You are on page 1of 135

[G.R. No. 122191. October 8, 1998.

]
1. SAUDI ARABIAN AIRLINES, petitioner, vs. COURT OF APPEALS, MILAGROS P. MORADA and HON. RODOLFO
A. ORTIZ, in his capacity as Presiding Judge of Branch 89, Regional Trial Court of Quezon City, respondents.
DECISION
QUISUMBING, J p:
This petition for certiorari pursuant to Rule 45 of the Rules of Court seeks to annul and set aside the Resolution 1 dated September 27,
1995 and the Decision 2 dated April 10, 1996 of the Court of Appeals 3 in CA-G.R. SP No. 36533, 4 and the Orders 5 dated August 29,
1994 6 and February 2, 1995 7 that were issued by the trial court in Civil Case No. Q-93-18394. 8
The pertinent antecedent facts which gave rise to the instant petition, as stated in the questioned Decision 9 , are as follows: dctai
"On January 21, 1988 defendant SAUDIA hired plaintiff as a Flight Attendant for its airlines based in Jeddah, Saudi
Arabia. . . .
On April 27, 1990, while on a lay-over in Jakarta, Indonesia, plaintiff went to a disco dance with fellow crew members
Thamer Al-Gazzawi and Allah Al-Gazzawi, both Saudi nationals. Because it was almost morning when they returned to
their hotels, they agreed to have breakfast together at the room of Thamer. When they were in te (sic) room, Allah left
on some pretext. Shortly after he did, Thamer attempted to rape plaintiff. Fortunately, a roomboy and several security
personnel heard her cries for help and rescued her. Later, the Indonesian police came and arrested Thamer and Allah AlGazzawi, the latter as an accomplice.
When plaintiff returned to Jeddah a few days later, several SAUDIA officials interrogated her about the Jakarta incident.
They then requested her to go back to Jakarta to help arrange the release of Thamer and Allah. In Jakarta, SAUDIA
Legal Officer Sirah Akkad and base manager Baharini negotiated with the police for the immediate release of the
detained crew members but did not succeed because plaintiff refused to cooperate. She was afraid that she might be
tricked into something she did not want because of her inability to understand the local dialect. She also declined to sign
a blank paper and a document written in the local dialect. Eventually, SAUDIA allowed plaintiff to return to Jeddah but
barred her from the Jakarta flights.
Plaintiff learned that, through the intercession of the Saudi Arabian government, the Indonesian authorities agreed to
deport Thamer and Allah after two weeks of detention. Eventually, they were again put in service by defendant SAUDI
(sic). In September 1990, defendant SAUDIA transferred plaintiff to Manila.
On January 14, 1992, just when plaintiff thought that the Jakarta incident was already behind her, her superiors
requested her to see Mr. Ali Miniewy, Chief Legal Officer of SAUDIA, in Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the police took her passport and questioned her about the Jakarta incident.
Miniewy simply stood by as the police put pressure on her to make a statement dropping the case against Thamer and
Allah. Not until she agreed to do so did the police return her passport and allowed her to catch the afternoon flight out
of Jeddah.
One year and a half later or on June 16, 1993, in Riyadh, Saudi Arabia, a few minutes before the departure of her flight
to Manila, plaintiff was not allowed to board the plane and instead ordered to take a later flight to Jeddah to see Mr.
Miniewy, the Chief Legal Officer of SAUDIA. When she did, a certain Khalid of the SAUDIA office brought her to a Saudi
court where she was asked to sign a document written in Arabic. They told her that this was necessary to close the case
against Thamer and Allah. As it turned out, plaintiff signed a notice to her to appear before the court on June 27, 1993.
Plaintiff then returned to Manila.
Shortly afterwards, defendant SAUDIA summoned plaintiff to report to Jeddah once again and see Miniewy on June 27,
1993 for further investigation. Plaintiff did so after receiving assurance from SAUDIA's Manila manager, Aslam Saleemi,
that the investigation was routinary and that it posed no danger to her.
In Jeddah, a SAUDIA legal officer brought plaintiff to the same Saudi court on June 27, 1993. Nothing happened then
but on June 28, 1993, a Saudi judge interrogated plaintiff through an interpreter about the Jakarta incident. After one
hour of interrogation, they let her go. At the airport, however, just as her plane was about to take off, a SAUDIA officer
told her that the airline had forbidden her to take flight. At the Inflight Service Office where she was told to go, the
secretary of Mr. Yahya Saddick took away her passport and told her to remain in Jeddah, at the crew quarters, until
further orders. LLpr
On July 3, 1993 a SAUDIA legal officer again escorted plaintiff to the same court where the judge, to her astonishment
and shock, rendered a decision, translated to her in English, sentencing her to five months imprisonment and to 286
lashes. Only then did she realize that the Saudi court had tried her, together with Thamer and Allah, for what happened
in Jakarta. The court found plaintiff guilty of (1) adultery; (2) going to a disco, dancing and listening to the music in
violation of Islamic laws; and (3) socializing with the male crew, in contravention of Islamic tradition."10
Facing conviction, private respondent sought the help of her employer, petitioner SAUDIA. Unfortunately, she was denied any assistance.
She then asked the Philippine Embassy in Jeddah to help her while her case is on appeal. Meanwhile, to pay for her upkeep, she worked on
the domestic flight of SAUDIA, while Thamer and Allah continued to serve in the international flights.

1

Because she was wrongfully convicted, the 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. LLpr
On November 23, 1993, Morada filed a Complaint for damages against SAUDIA, and Khaled Al-Balawi ("Al-Balawi"), its country manager.
On January 19, 1994, SAUDIA filed an Omnibus Motion To Dismiss 14 which raised the following grounds, to wit: (1) that the Complaint
states no cause of action against Saudia; (2) that defendant Al-Balawi is not a real party in interest; (3) that the claim or demand set forth
in the Complaint has been waived, abandoned or otherwise extinguished; and (4) that the trial court has no jurisdiction to try the case.
On February 10, 1994, Morada filed her Opposition (To Motion to Dismiss) 15 . Saudia filed a reply 16 thereto on March 3, 1994.
On June 23, 1994, Morada filed an Amended Complaint 17 wherein Al-Balawi was dropped as party defendant. On August 11, 1994, Saudia
filed its Manifestation and Motion to Dismiss Amended Complaint 18 .
The trial court issued an Order 19 dated August 29, 1994 denying the Motion to Dismiss Amended Complaint filed by Saudia.
From the Order of respondent Judge denying the Motion to Dismiss, SAUDIA filed on September 20, 1994, its Motion for Reconsideration of
the Order dated August 29, 1994. It alleged that the trial court has no jurisdiction to hear and try the case on the basis of Article 21 of the
Civil Code, since the proper law applicable is the law of the Kingdom of Saudi Arabia. On October 14, 1994, Morada filed her Opposition (To
Defendant's Motion for Reconsideration).
In the Reply 23 filed with the trial court on October 24, 1994, SAUDIA alleged that since its Motion for Reconsideration raised lack of
jurisdiction as its cause of action, the Omnibus Motion Rule does not apply, even if that ground is raised for the first time on appeal.
Additionally, SAUDIA alleged that the Philippines does not have any substantial interest in the prosecution of the instant case, and hence,
without jurisdiction to adjudicate the same.
Respondent Judge subsequently issued another Order 24 dated February 2, 1995, denying SAUDIA's Motion for Reconsideration. The
pertinent portion of the assailed Order reads as follows:
"Acting on the Motion for Reconsideration of defendant Saudi Arabian Airlines filed, thru counsel, on September 20,
1994, and the Opposition thereto of the plaintiff filed, thru counsel, on October 14, 1994, as well as the Reply therewith
of defendant Saudi Arabian Airlines filed, thru counsel, on October 24, 1994, considering that a perusal of the plaintiff's
Amended Complaint, which is one for the recovery of actual, moral and exemplary damages plus attorney's fees, upon
the basis of the applicable Philippine law, Article 21 of the New Civil Code of the Philippines, is, clearly, within the
jurisdiction of this Court as regards the subject matter, and there being nothing new of substance which might cause the
reversal or modification of the order sought to be reconsidered, the motion for reconsideration of the defendant, is
DENIED.
SO ORDERED." 25
Consequently, on February 20, 1995, SAUDIA filed its Petition for Certiorari and Prohibition with Prayer for Issuance of Writ of Preliminary
Injunction and/or Temporary Restraining Order 26 with the Court of Appeals.
Respondent Court of Appeals promulgated a Resolution with Temporary Restraining Order 27 dated February 23, 1995, prohibiting the
respondent Judge from further conducting any proceeding, unless otherwise directed, in the interim.
In another Resolution promulgated on September 27, 1995, now assailed, the appellate court denied SAUDIA's Petition for the Issuance of a
Writ of Preliminary Injunction dated February 18, 1995, to wit:
"The Petition for the Issuance of a Writ of Preliminary Injunction is hereby DENIED, after considering the Answer, with
Prayer to Deny Writ of Preliminary Injunction (Rollo, p. 135) the Reply and Rejoinder, it appearing that herein petitioner
is not clearly entitled thereto (Unciano Paramedical College, et. Al., v. Court of Appeals, et. Al., 100335, April 7, 1993,
Second Division).
SO ORDERED."
On October 20, 1995, SAUDIA filed with this Honorable Court the instant Petition 29 for Review with Prayer for Temporary Restraining Order
dated October 13, 1995.
However, during the pendency of the instant Petition, respondent Court of Appeals rendered the Decision dated April 10, 1996, now also
assailed. It ruled that the Philippines is an appropriate forum considering that the Amended Complaint's basis for recovery of damages is
Article 21 of the Civil Code, and thus, clearly within the jurisdiction of respondent Court. It further held that certiorari is not the proper
remedy in a denial of a Motion to Dismiss, inasmuch as the petitioner should have proceeded to trial, and in case of an adverse ruling, find
recourse in an appeal.
On May 7, 1996, SAUDIA filed its Supplemental Petition for Review with Prayer for Temporary Restraining Order 31 dated April 30, 1996,
given due course by this Court. After both parties submitted their Memoranda, 32 the instant case is now deemed submitted for decision.
Petitioner SAUDIA raised the following issues:
"I

2

The trial court has no jurisdiction to hear and try Civil Case No. Q-93-18394 based on Article 21 of the New Civil Code
since the proper law applicable is the law of the Kingdom of Saudi Arabia inasmuch as this case involves what is known
in private international law as a 'conflicts problem'. Otherwise, the Republic of the Philippines will sit in judgment of the
acts done by another sovereign state which is abhorred.
II
Leave of court before filing a supplemental pleading is not a jurisdictional requirement. Besides, the matter as to
absence of leave of court is now moot and academic when this Honorable Court required the respondents to comment
on petitioner's April 30, 1996 Supplemental Petition For Review With Prayer For A Temporary Restraining Order Within
Ten (10) Days From Notice Thereof. Further, the Revised Rules of Court should be construed with liberality pursuant to
Section 2, Rule 1 thereof.
III
Petitioner received on April 22, 1996 the April 10, 1996 decision in CA-G.R. SP NO. 36533 entitled 'Saudi Arabian
Airlines v. Hon. Rodolfo A. Ortiz, et al.' and filed its April 30, 1996 Supplemental Petition For Review With Prayer For A
Temporary Restraining Order on May 7, 1996 at 10:29 a.m. or within the 15-day reglementary period as provided for
under Section 1, Rule 45 of the Revised Rules of Court. Therefore, the decision in CA-G.R. SP No. 36533 has not yet
become final and executory and this Honorable Court can take cognizance of this case." 33
From the foregoing factual and procedural antecedents, the following issues emerge for our resolution:
I.
WHETHER RESPONDENT APPELLATE COURT ERRED IN HOLDING THAT THE REGIONAL TRIAL COURT OF QUEZON CITY
HAS JURISDICTION TO HEAR AND TRY CIVIL CASE NO. Q-93-18394 ENTITLED "MILAGROS P. MORADA V. SAUDI
ARABIAN AIRLINES". cdrep
II.
WHETHER RESPONDENT APPELLATE COURT ERRED IN RULING THAT IN THIS CASE PHILIPPINE LAW SHOULD GOVERN.
Petitioner SAUDIA claims that before us is a conflict of laws that must be settled at the outset. It maintains that 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. 34
On the other hand, private respondent contends that 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.
Under the factual antecedents obtaining in this case, there is no dispute that the interplay of events occurred in two states, the Philippines
and Saudi Arabia.
As stated by private respondent in her Amended Complaint 38 dated June 23, 1994:
"2.Defendant SAUDI ARABIAN AIRLINES or SAUDIA is a foreign airlines corporation doing business in the Philippines. It
may be served with summons and other court processes at Travel Wide Associated Sales (Phils.), Inc., 3rd Floor,
Cougar Building, 114 Valero St., Salcedo Village, Makati, Metro Manila.
xxx xxx xxx
6.Plaintiff learned that, through the intercession of the Saudi Arabian government, the Indonesian authorities agreed to
deport Thamer and Allah after two weeks of detention. Eventually, they were again put in service by defendant
SAUDIA. In September 1990, defendant SAUDIA transferred plaintiff to Manila.
7.On January 14, 1992, just when plaintiff thought that the Jakarta incident was already behind her, her superiors
requested her to see MR. Ali Meniewy, Chief Legal Officer of SAUDIA. in Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the police took her passport and questioned her about the Jakarta incident.
Miniewy simply stood by as the police put pressure on her to make a statement dropping the case against Thamer and
Allah. Not until she agreed to do so did the police return her passport and allowed her to catch the afternoon flight out
of Jeddah. Cdpr
8.One year and a half later or on June 16, 1993, in Riyadh, Saudi Arabia, a few minutes before the departure of her
flight to Manila, plaintiff was not allowed to board the plane and instead ordered to take a later flight to Jeddah to see
Mr. Meniewy, the Chief Legal Officer of SAUDIA. When she did, a certain Khalid of the SAUDIA office brought her to a
Saudi court where she was asked to sigh a document written in Arabic. They told her that this was necessary to close
the case against Thamer and Allah. As it turned out, plaintiff signed a notice to her to appear before the court on June
27, 1993. Plaintiff then returned to Manila.

3

129. in contravention of Islamic tradition. to her astonishment and shock. defendant SAUDIA summoned plaintiff to report to Jeddah once again and see Miniewy on June 27. a SAUDIA officer told her that the airline had forbidden her to take that flight. Court of Appeals. (2) going to a disco. a Saudi judge interrogated plaintiff through an interpreter about the Jakarta incident. Saudi Arabia. a SAUDIA legal officer brought plaintiff to the same Saudi court on June 27. Article 19 of the New Civil Code provides.9. act with justice give everyone his due and observe honesty and good faith. particularly from Manila. 40 The forms in which this foreign element may appear are many. the foreign element may assume a complex form." On the other hand. and the question of jurisdiction 43 confronts the court a quo. in the exercise of his rights and in the performance of his duties.Section 19 of Batas Pambansa Blg. The court found plaintiff guilty of (1) adultery. prLL 11. we note that she aptly predicated her cause of action on Articles 19 and 21 of the New Civil Code. 42 In the instant case. the secretary of Mr. 12. Also. the foreign element consisted in the fact that private respondent Morada is a resident Philippine national. 1993 for further investigation. and vice versa. otherwise known as the "Judiciary Reorganization Act of 1980". Cdpr 10. 45 this Court held that: "The aforecited provisions on human relations were intended to expand the concept of torts in this jurisdiction by granting adequate legal remedy for the untold number of moral wrongs which is impossible for human foresight to specifically provide in the statutes. 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. by virtue of the employment of Morada with the petitioner Saudia as a flight stewardess. we agree with private respondent's assertion that violations of Articles 19 and 21 are actionable. that caused a "conflicts" situation to arise. 7691. together with Thamer and Allah. just as her plane was about to take off. The latter helped her pursue an appeal from the decision of the court. she worked on the domestic flights of defendant SAUDIA while. On one hand. At the airport. we agree with petitioner that the problem herein could present a "conflicts" case. — Regional Trial Courts shall exercise exclusive jurisdiction: 4 .Any person who willfully causes loss or injury to another in a manner that is contrary to morals. and listening to the music in violation of Islamic laws. To pay for her upkeep. in Philippine National Bank (PNB) vs. Aslam Saleemi. 21.In Jeddah. Only then did she realize that the Saudi court had tried her. they let her go.Jurisdiction in Civil Cases. At the Inflight Service Office where she was told to go." 39 Where the factual antecedents satisfactorily establish the existence of a foreign element.On July 3. at the crew quarters. 1993." Thus. 19. A conflicts problem presents itself here. translated to her in English. plaintiff sought the help of the Philippine Embassy in Jeddah. imprecise. Based on the allegations in the Amended Complaint. "Art.Shortly afterwards. 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". events did transpire during her many occasions of travel across national borders. Philippines to Jeddah. 1993. 41 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. is hereby amended to read as follows: cda SEC. 19. (3) socializing with the male crew. ironically. Thus. and the Comment thereon. rendered a decision." Although Article 19 merely declares a principle of law. with judicially enforceable remedies in the municipal forum. After a careful study of the private respondent's Amended Complaint. that the investigation was routinary and that it posed no danger to her. Article 21 of the New Civil Code provides: "Art. 1993 a SAUDIA legal officer again escorted plaintiff to the same court where the judge. Thamer and Allah freely served the international flights.Because SAUDIA refused to lend her a hand in the case. Article 21 gives flesh to its provisions. for what happened in Jakarta. Nothing happened then but on June 28.Every person must. Yahya Saddick took away her passport and told her to remain in Jeddah. In other cases. until further orders. sentencing her to five months imprisonment and to 286 lashes. dancing. llcd We thus find private respondent's assertion that the case is purely domestic. and that petitioner SAUDIA is a resident foreign corporation. Its authority to try and hear the case is provided for under Section 1 of Republic Act No. After one hour of interrogation. or that a contract between nationals of one State involves properties situated in another State. read in the light of the Rules of Court on jurisdiction we find that the Regional Trial Court (RTC) of Quezon City possesses jurisdiction over the subject matter of the suit. good customs or public policy shall compensate the latter for damages. however. to wit: "Section 1. Plaintiff did so after receiving assurance from SAUDIA's Manila manager.

That would have caused a fundamental unfairness to her. Ker and Company. LLpr As held by this Court in Republic vs. 'vex'. Ltd. The choice of forum of the plaintiff (now private respondent) should be upheld. Undeniably. it would be forcing plaintiff (private respondent now) to seek remedial action elsewhere. ask for a dismissal of the action upon the further ground that the court had no jurisdiction over the subject matter. A special appearance by motion made for the purpose of objecting to the jurisdiction of the court over the person will be held to be a general appearance. LibLex As to the choice of applicable law. Although ideally. exclusive of interest. 54 5 . Cdpr Moreover. litigation expenses. For the court to validly decide the said plea of defendant Ker & Co. it must be for the sole and separate purpose of objecting to the jurisdiction of the court.Venue in Courts of First Instance. prayed for dismissal of the complaint on the ground that plaintiff's cause of action has prescribed. or where the plaintiff or any of the plaintiff resides. it necessarily had to acquire jurisdiction upon the latter's person. Quezon City. By filing her Complaint and Amended Complaint with the trial court. Relative advantages and obstacles to a fair trial are equally important.00). by choice of an inconvenient forum.g. If his motion is for any other purpose than to object to the jurisdiction of the court over his person. including the convenience of the parties. (b)Personal actions.xxx xxx xxx (8)In all other cases in which demand. is that SAUDIA prayed for other reliefs under the premises. all choice-oflaw theories should intrinsically advance both notions of justice and predictability. should be deemed to have abandoned its special appearance and voluntarily submitted itself to the jurisdiction of the court. 2. 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.000. we find that the trial court has jurisdiction over the case and that its exercise thereof. petitioner SAUDIA has effectively submitted to the trial court's jurisdiction by praying for the dismissal of the Amended Complaint on grounds other than lack of jurisdiction. (Emphasis ours) xxx xxx xxx And following Section 2 (b). 1962." llcd Pragmatic considerations. by inflicting upon him needless expense or disturbance." 52 Clearly. the plaintiff's choice of forum should rarely be disturbed. Rule 4 of the Revised Rules of Court — the venue. The records show that petitioner SAUDIA has filed several motions 50 praying for the dismissal of Morada's Amended Complaint. where the demand.. aside from disputing the lower court's jurisdiction over defendant's person. e. Similarly. petitioner had submitted to the jurisdiction of the Regional Trial Court of Quezon City. . attorney's fees. What is very patent and explicit from the motions filed.00) or. Paramount is the private interest of the litigant. Ker and Co. SAUDIA also filed an Answer In Ex Abundante Cautelam dated February 20. is appropriate: "SEC. But unless the balance is strongly in favor of the defendant. By interposing such second ground in its motion to dismiss.: 51 "We observe that the motion to dismiss filed on April 14. 'harass'. i. being the proponent of the affirmative defense. he thereby submits himself to the jurisdiction of the court. 53 Several theories have been propounded in order to identify the legal system that should ultimately control. and cost or the value of the property in controversy exceeds One hundred thousand pesos (P100.. Ltd. 1995. by hearing the case in the Philippines no unnecessary difficulties and inconvenience have been shown by either of the parties. held that: "When the appearance is by motion for the purpose of objecting to the jurisdiction of the court over the person. who." Similarly.. . — All other actions may be commenced and tried where the defendant or any of the defendants resides or may be found. also weigh heavily in favor of the RTC Quezon City assuming jurisdiction. The forum is then faced with the problem of deciding which of these two important values should be stressed. Enforceability of a judgment if one is obtained is quite obvious. Plaintiff may not. for example. or 'oppress' the defendant.e. in the Kingdom of Saudi Arabia where she no longer maintains substantial connections. the trial court also possesses jurisdiction over the persons of the parties herein. availed of an affirmative defense on the basis of which it prayed the court to resolve controversy in its favor. the case of De Midgely vs. they do not always do so. Had it refused to take cognizance of the case. exclusive of the above-mentioned items exceeds Two hundred Thousand pesos (P200. in such other cases in Metro Manila. and (2) to what extent should the chosen legal system regulate the situation. private respondent has voluntary submitted herself to the jurisdiction of the court. Ltd. Ferandos. damages of whatever kind. Thus. if the party in said motion should. justified. 49 Weighing the relative claims of the parties. the court a quo found it best to hear the case in the Philippines. at the election of the plaintiff.000. — [Now Regional Trial Court] (a).

as we have seen earlier. with the widespread criticism of the traditional rule of lex loci delicti commisi. or operative fact. the place of performance. if any. given the factual context of this case. e. 62 As already discussed. the place of performance of contractual duties. In keeping abreast with the modern theories on tort liability. (4)the place where an act has been done. Our starting point of analysis here is not a legal relation. This process is known as "characterization". In particular. 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. (2)the seat of a legal or juridical person. This is because it is in the Philippines where petitioner allegedly deceived private respondent. (7)the place where judicial or administrative proceedings are instituted or done. in the exercise of its rights and in the performance of its duties. 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. petitioner brought her to Jeddah on the pretense that she would merely testify in an investigation of the charges she made against the two SAUDIA crew members for the attack on her person while they were in Jakarta. she was the one made to face trial for very serious charges. 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. but a factual situation. misery and suffering of private respondent. we find that the Philippines could be said as a situs of the tort (the place where the alleged tortious conduct took place). taking advantage of the trust. or the place of wrongdoing. a resident foreign corporation engaged here in the business of 6 . "act with justice. the locus actus. In applying said principle to determine the State which has the most significant relationship. Note that one or more circumstances may be present to serve as the possible test for the determination of the applicable law. Petitioner thereby allegedly facilitated the arrest. we are convinced that there is reasonable basis for private respondent's assertion that although she was already working in Manila.Before a choice can be made. once duly proven. there is basis for the claim that over-all injury occurred and lodged in the Philippines. the lex situs is decisive when real rights are involved. Petitioner's purported act contributed to and amplified or even proximately caused additional humiliation. it is not without basis to identify the Philippines as the situs of the alleged tort. modem theories and rules on tort liability 61 have been advanced to offer fresh judicial approaches to arrive at just results. confidence and faith she reposed upon it. or the "doctrine of qualification". and (8)the flag of a ship. his place of sojourn.g. to provide compensation or redress for the wrongs done. There is likewise no question that private respondent is a resident Filipina national. the alleged conviction and imprisonment of private respondent was wrongful. his residence. his domicile. a Filipina residing and working here. petitioner failed to protect her. But these capped the injury or harm allegedly inflicted upon her person and reputation. between the parties is centered. for which petitioner could be liable as claimed. the "connecting factor" or "point of contact" could be the place or places where the tortious conduct or lex loci actus occurred.) After a careful study of the pleadings on record. social standing and human rights of complainant. reputation. including adultery and violation of Islamic laws and tradition. contract claim) and a connecting factor or point of contact. As purportedly found by the Prince of Makkah. it is necessary for us to determine under what category a certain set of facts or rules fall. (c) the domicile. There is likewise logical basis on record for the claim that the "handing over" or "turning over" of the person of private respondent to Jeddah officials. nationality. such as the situs of the res. The lex fori — the law of the forum — is particularly important because. detention and prosecution of private respondent under the guise of petitioner's authority as employer. or is deemed to be situated. (3)the situs of a thing. we find here an occasion to apply the "State of the most significant relationship" rule. which in our view should be appropriate to apply now." The purpose of "characterization" is to enable the forum to select the proper law. Considering that the complaint in the court a quo is one involving torts. event. (6)the intention of the contracting parties as to the law that should govern their agreement. the lex loci intentionis." Instead. according to the plaintiff below (herein private respondent). a will signed or a tort committed. she claimed. matters of 'procedure' not going to the substance of the claim involved are governed by it. (b) the place where the conduct causing the injury occurred. such as a corporation. It also covers contractual relationships particularly contracts of affreightment. which in many cases is decisive of practically all legal relationships of the ship and of its master or owner as such. As it turned out. That certain acts or parts of the injury allegedly occurred in another country is of no moment. An essential element of conflict rules is the indication of a "test" or "connecting factor" or "point of contact". such as the place where a contract has been made.. 59 These "test factors" or "points of contact" or "connecting factors" could be any of the following: "(1)The nationality of a person. give her her due and observe honesty and good faith. and (d) the place where the relationship. had lodged. residence. the place where a thing is. According to her. a marriage celebrated. working with petitioner. Choice-of-law rules invariably consist of a factual relationship (such as property right. All told. that is. It is the "process of deciding whether or not the facts relate to the kind of question specified in a conflicts rule. the place of celebration. or the place where a power of attorney is to be exercised. including allegations in the Amended Complaint deemed admitted for purposes of the motion to dismiss. petitioner may have acted beyond its duties as employer. she had honestly believed that petitioner would." (Emphasis ours. place of incorporation and place of business of the parties. LibLex Moreover. or his origin. And applying the torts principle in a conflicts case. The lex loci actus is particularly important in contracts and torts: (5)the place where an act is intended to come into effect.

and in case of death without issue. ADOLFO C. about eighteen years of age and who. who was born in the Philippines about twenty-eight years ago. From the record. that the Philippine law on tort liability should have paramount application to and control in the resolution of the legal issues arising out of this case. Not only was jurisdiction in order and venue properly laid. With these guidelines in mind. xxx xxx xxx "7. no error could be imputed to the respondent appellate court in upholding the trial court's denial of defendant's (herein petitioner's) motion to dismiss the case. Executor and LUCY CHRISTENSEN. Morada vs. Hon. from all information I have now resides in Egpit. although it should be stressed that this suit is not based on mere labor law violations. approving among other things the final accounts of the executor. and who. Further. and who is now residing at No. and expeditious trial itself indicated by the nature of the case at hand. AZNAR. "4. named Maria Lucy Christensen (now Mrs. is not in any way related to me. Executor and Heir-appellees.S. Philippines. Thus. in Special Proceeding No. the instant petition for certiorari is hereby DISMISSED. notwithstanding the fact that she was baptized Christensen. Abellera and Jovito Salonga for oppositor-appellant. .600. 66 Lastly. vs.. Digos. Los Angeles. Nothing said herein. J p: This is an appeal from a decision of the Court of First Instance of Davao. HELEN CHRISTENSEN GARCIA. oppositor-appellant. Carrie Louise C. Borton. WHEREFORE. Bernard Daney).international air carriage. 1949. the trial court must proceed to try and adjudge the case in the light of relevant Philippine law. we find. IN THE MATTER OF THE TESTATE ESTATE OF EDWARD E.R.A. which could properly apply Philippine law. L-16749. . SO ORDERED. of course. by way of recapitulation. Saudi Arabia Airlines" is hereby REMANDED to Regional Trial Court of Quezon City. in our view. not just for the benefit of all the litigants. devise and bequeath unto Maria Helen Christensen. we find untenable petitioner's insistence that "[s]ince private respondent instituted this suit. one-half of said residue to be payable to Mrs. but appeal after trial was obviously available. DECISION LABRADOR. Moreover.I give. Q-93-18394 entitled "Milagros P. 1963. The will was executed in Manila on March 5.] 2. 65 And as correctly held by the respondent appellate court. Sotelo for executor and heir-appellees. she has "no obligation to plead and prove the law of the Kingdom of Saudi Arabia since her cause of action is based on Articles 19 and 21" of the Civil Code of the Philippines. In her Amended Complaint and subsequent pleadings. Heir of the deceased. we hold that the respondent Regional Trial Court has jurisdiction over the parties and the subject matter of the complaint. nor has she been at any time adopted by me. Maria Lucy Christensen Daney. California. she never alleged that Saudi Law should govern this case. the "relationship" between the parties was centered here. that I have but one (1) child. etc. U. the claim that the Philippines has the most significant contact with the matter in this dispute.00). Christensen. DECEASED.. 63 raised by private respondent as plaintiff below against defendant (herein petitioner). No. Vicente N. she has the burden of pleading and proving the applicable Saudi law on the matter. January 31.I declare . "considering that it was the petitioner who was invoking the applicability of the law of Saudi Arabia. is exhausted." 64 As aptly said by private respondent. the sum of Three Thousand Six Hundred Pesos (P3. now married to Eduardo Garcia. CHRISTENSEN.I further declare that I now have no living ascendants. 622 of said court. Branch 89 for further proceedings. Davao. has been properly established. xxx xxx xxx 7 . but also for the vindication of the country's system of law and justice in a transnational setting. in accordance with the provisions of the will of the testator Edward E. Prescinding from this premise that the Philippines is the situs of the tort complained of and the place "having the most interest in the problem". EN BANC [G. Philippine Currency. the same to be deposited in trust for the said Maria Helen Christensen with the Davao Branch of the Philippine National Bank. R. directing the executor to reimburse Maria Lucy Christensen the amount of P3. Civil Case No. Jr. with due consideration of the foreign element or elements involved. Indubitably. then the burden was on it [petitioner] to plead and to establish what the law of Saudi Arabia is". 1951 and contains the following provisions: "3. presiding. should be construed as prejudging the results of the case in any manner whatsoever. the appropriate venue is in Quezon City. M. 665 Rodger Young Village. Leopoldo M. Cusi. and paid to her at the rate of One Hundred Pesos (P100.00). and no descendents except my above named daughter. the Philippines is the state intimately concerned with the ultimate outcome of the case below. Philippine Currency per month until the principal thereof as well as any interest which may have accrued thereon.600 paid by her to Helen Christensen Garcia as her legacy. dated September 14. and declaring Maria Lucy Christensen entitled to the residue of the property to be enjoyed during her lifetime.

California. 8 . Opposition to the approval of the project of partition was filed by Helen Christensen Garcia. which requires that the domicile of the decedent apply. she having been declared by Us in G. II THE LOWER COURT ERRED IN ENTIRELY IGNORING AND/OR FAILING TO RECOGNIZE THE EXISTENCE OF SEVERAL FACTORS.R. insofar as it deprives her (Helen) of her legitime as an acknowledged natural child. 2d 877. Christensen returned to the United States and stayed there for the following nine years until 1913. and wheresoever situated. but these were denied. Record on Appeal). Christensen was born on November 29."12. all the income from the rest.A. Maria Lucy Christensen." It is in accordance with the above-quoted provisions that the executor in his final account and project partition ratified the payment of only P3. 286.. The most important assignments of error are as follows: I THE LOWER COURT ERRED IN IGNORING THE DECISION OF THE HONORABLE SUPREME COURT THAT HELEN IS THE ACKNOWLEDGED NATURAL CHILD OF EDWARD E. and was teaching school in Sacramento.. 665 Rodger Young Village. Christensen was a citizen of the United States and of the State of California at the time of his death. cited in page 179. III THE LOWER COURT ERRED IN FAILING TO RECOGNIZE THAT UNDER INTERNATIONAL LAW. 176 P. 192.S. and In re Kaufman. in New York City. CHRISTENSEN AND. Appl. in the State of California.A. remainder. and residue of my property and estate. IN DEPRIVING HER OF HER JUST SHARE IN THE INHERITANCE. in accordance with which a testator has the right to dispose of his property in the way he desires. real. "In December.S..S. 1875. one of two acknowledged natural children.A. because the right of absolute dominion over his property is sacred and inviolable (In re McDaniel's Estate. Christensen was a citizen of the United States and of the State of California at the time of his death. CHRISTENSEN SHOULD BE GOVERNED BY THE LAWS OF THE PHILIPPINES. and (b) that said order of distribution is contrary thereto insofar as it denies to Helen Christensen. 2d 952. during her lifetime: . Hence this appeal. as witness the following facts admitted by the executor himself in appellee's brief: "In the proceedings for admission of the will to probate. N. of whatsoever kind or character. one-half of the estate in full ownership. that the forum is the Philippines and even if the case were decided in California. Section 946 of the California Civil Code. California.I hereby give devise and bequeath unto my well-beloved daughter. of which I may be possessed at my death and which may have come to me from any source whatsoever. through counsel. . Army Transport 'Sheridan' with Port of Embarkation as the City of San Francisco. Oppositor Maria Helen Christensen. should be applicable. Nos. It was also alleged that Maria Helen Christensen having been declared an acknowledged natural child of the decedent. The court below ruled that as Edward E. the successional rights and intrinsic validity of the provisions in his will are to be governed by the law of California. 77 Cal. his first arrival in the Philippines. Mr. but the entire law thereof because several foreign elements are involved. L-11483-84 an acknowledged natural child of the deceased Edward E. But there is also no question that at the time of his death he was domiciled in the Philippines.600 to Helen Christensen Garcia and proposed that the residue of the estate be transferred to his daughter. CONSEQUENTLY. U. The legal grounds of opposition are (a) that the distribution should be governed by the laws of the Philippines. THE INTRINSIC VALIDITY OF THE TESTAMENTARY DISPOSITION OR THE DISTRIBUTION OF THE ESTATE OF THE DECEASED EDWARD E. 117 Cal. 49 Pac. .S. on board the U. filed various motions for reconsideration. the said Maris Lucy Christensen Daney (Mrs. 1901. U. Bernard Daney). during which time he resided in. as an appointed school teacher. U. He stayed in the Philippines until 1904. Los Angeles. PARTICULARLY UNDER THE RENVOI DOCTRINE. was on July 1. ELEMENTS AND CIRCUMSTANCES CALLING FOR THE APPLICATION OF INTERNATIONAL LAW. In amplification of the above grounds it was alleged that the law that should govern the estate of the deceased Christensen should not be the internal law of California alone. There is no question that Edward E. IV THE LOWER COURT ERRED IN NOT DECLARING THAT THE SCHEDULE OF DISTRIBUTION SUBMITTED BY THE EXECUTOR IS CONTRARY TO THE PHILIPPINE LAWS. V THE LOWER COURT ERRED IN NOT DECLARING THAT UNDER THE PHILIPPINE LAWS HELEN CHRISTENSEN GARCIA IS ENTITLED TO ONE-HALF (1/2) OF THE ESTATE IN FULL OWNERSHIP. 1904. the facts of record show that the deceased Edward E. she is deemed for all purposes legitimate from the time of her birth. personal and/or mixed. now residing as aforesaid at No. Christensen. Y.

that. was never lost by his stay in the Philippines. Acquisition of a domicile of choice requires the exercise of intention as well as physical presence. and since he came to the Philippines in 1913 he returned to California very rarely and only for short visits (perhaps to relatives). and in accordance therewith and following the doctrine of renvoi. between which he divides his time. Christensen was interned by the Japanese Military Forces in the Philippines during World War II. however. There is no single American law governing the validity of testamentary provisions in the United States. has acquired a technical meaning. Thus one may be domiciled in a place where he has never been. however. Appellant. Exhs. it is used to denote something more than mere physical presence. Appellees' Collective Exhibits '6'. But domicile. He died at the St. Luke's Hospital in the City of Manila on April 30. while living in it. he left for the United States but returned to the Philippines in December. However. we are persuaded by the fact that he was born in New York. Appellee. which would indicate that he would ultimately abandon the Philippines and make home in the State of California. Proc." The application of this article in the case at bar requires the determination of the meaning of the term "national law" as used therein. 'MM'. "The terms 'residence' and 'domicile' might well be taken to mean the same thing. intestate and testamentary successions. and p. shall be regulated by the national law of the person whose succession is under consideration. 176 P.n. The "national law" indicated in Article 16 of the Civil Code above quoted can not. The man with two homes. and came back to the Philippines the following year. however. Sp. The next question is: What is the law in California governing the disposition of personal property? The decision of the court below. as Exhibits 'AA'. Appl. relies on the case cited in the decision and testified to by a witness. in April 1945. in the case at bar. 'BB' and 'CC-Daney'. which is as follows: "If there is no law to the contrary. 16. "Being an American citizen.s. Mr. while domicile requires bodily presence in that place and also an intention to make it one's domicile. 1945. if he treated his settlement as continuing only for the particular business in hand. therefore.' Residence. 1951. in 1928. Christensen returned once more to California shortly after the making of his last will and testament (now in question herein) which he executed at his lawyers' offices in Manila on March 5. CFI Davao. We have checked it in the California Civil Code and it is there. It is clear. he again departed the Philippines for the United States and came back here the following year. 9 . the private law of the State of California. "In April. and considering that he appears never to have owned or acquired a home or properties in that state. 'MM-2-Daney'. a place of permanent abode. for the latter was a territory of the United States (not a state) until 1946 and the deceased appears to have considered himself as a citizen of California by the fact that when he executed his will in 1951 he declared that he was a citizen of that State." (Goodrich. Upon liberation. And he may reside in a place where he has no domicile. California from 1904 to 1913. whatever may be the nature of the property and regardless of the country wherein said property may be found." (Goodrich on Conflict of Laws. 2-3) In arriving at the conclusion that the domicile of the deceased is the Philippines. 1951. insists that Article 946 should be applicable. on the other hand. Residence simply requires bodily presence as an inhabitant in a given place. 1939." he could not be a domiciled New Yorker. should govern the determination of the validity of the testamentary provisions of Christensen's will. 1953. and is governed by the law of his domicile. which is the Philippines." (Pp. 622. he again returned to his own country. 473. the question of the validity of the testamentary provision in question should be referred back to the law of the decedent's domicile. So it can refer to no other than the private law of the state of which the decedent is a citizen. 29) The law that governs the validity of his testamentary dispositions is defined in Article 16 of the Civil Code of the Philippines. This conclusion is in accordance with the following principle expounded by Goodrich in his Conflict of Laws. it is deemed to follow the person of its owner.. 2d 952. such law being in force in the State of California of which Christensen was a citizen. Some nine years later.Real property as well as personal property is subject to the law of the country where it is situated. not giving up his former "home. (Only the case Kaufman is correctly cited. in 1938. But if he went on business which would require his presence for several weeks or months."Mr. migrated to California and resided there for nine years. t. a testator may dispose of his property by will in the form and manner he desires. citing the case of Estate of McDaniel. so that he appears never to have intended to abandon his California citizenship by acquiring another. in the place where personal property is situated. July 21. 29) As to his citizenship. he might properly be said to have sufficient connection with the place to be called a resident. Edward E. the internal law thereof.) It is argued on executor's behalf that as the deceased Christensen was a citizen of the State of California. "However. we find that the citizenship that he acquired in California when he resided in Sacramento. Generally. both with respect to the order of succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions. and it is not safe to insist that any one use is the only proper one. But appellant invokes the provisions of Article 946 of the Civil Code of California. however. 16.Residence is a term used with many shades of meaning from mere temporary presence to the most permanent abode. possibly mean or apply to any general American law. sustains the contention of the executor-appellee that under the California Probate Code. which is that given in the above-cited case. 1929. 77 Cal. which is as follows: "ART. from the merest temporary presence to the most permanent abode. each state of the Union having its own private law applicable to its citizens only and in force only within the state. "Sec. Christensen's next arrival in the Philippines was in July of the year 1913. 1953. 'MM-1'. certainly resides in each one. p." The existence of this provision is alleged in appellant's opposition and is not denied. p. as has been shown. on the other hand. is a term used with many shades of meaning. 2d 877.

if the suit had been brought in the Illinois courts. 509-531. and every divorce. that is. 296.S. minus its Conflict of Laws rules? "On logic. The Michigan court chose to accept the renvoi.J. in determining the question before it. 7. the further question may arise: Are the rules as to the conflict of laws contained in such foreign law also to be resorted to? This is a question which. If it accepts the socalled renvoi doctrine. Conflict of Laws. both the advocates for and the objectors to the renvoi plead that greater uniformity will result from adoption of their respective views.'" (Harvard Law Review. had the Michigan court rejected the renvoi. So on the surface of things the Massachusetts court has open to it alternative course of action: (a) either to apply the French laws as to intestate succession. and France. has been the subject of frequent discussion by textwriters and essayists.e. or both accept the doctrine. Vol. The same result would happen. has been advanced. But once having determined that the Conflict of Laws principle is the rule looked to. "This is one type of renvoi. England. but any further reference goes only to the internal law. According to this theory 'the law of a country' means the whole of its law.) The scope of the theory of renvoi has also been defined and the reasons for its application in a country explained by Prof. in turn refers the matter back again to the law of the forum. "The Restatement accepts the renvoi theory in two instances: where the title to land is in question. recognized by the situs. 27. In the case stated above. the Conflict of Laws rule of the situs of the land.) "After a decision has been arrived at that a foreign law is to be resorted to as governing a particular case. domiciled in France. judgment would have been against the woman. the natural thing for the Massachusetts court to do would be to turn to French statute of distributions. it will follow the latter course. Since by hypothesis X's last domicile was France. There the rule of the conflict of laws as to intestate succession to movables calls for an application of the law of the deceased's last domicile. the result of the litigation will vary with the choice of the forum. must take into account the whole law of the other jurisdiction. It is true that such a solution avoids going on a merry-go-round. The pertinent parts of the article are quoted herein below: "The recognition of the renvoi theory implies that the rules of the conflict of laws are to be understood as incorporating not only the ordinary or internal law of the foreign state or country. The theory of the doctrine of renvoi is that the court of the forum. 523571. Perhaps the opponents of the renvoi are a bit more consistent for they look always to internal law as the rule of reference.) "Another theory. "Strangely enough. Yet there seems no compelling logical reason why the original reference should be to the internal law rather than to the Conflict of Laws rule. 1917-1918. but also its rules as to conflict of laws. . . known as the 'doctrine of renvoi'. the solution is not an easy one. Sec. This is renvoi in the narrower sense. and the doctrine involved has been descriptively designated by them as the 'Renvoyer' to send back. Jur. A jural matter is presented which the conflict-of-laws rule of the forum refers to a foreign law. or whatever corresponds thereto in French law. The doctrine of therenvoi has generally been repudiated by the American authorities. applied the Conflict of Laws rule of Illinois which referred the matter back to Michigan law. or (b) to resolve itself into a French court and apply the Massachusetts statute of distributions. or is the reference to the purely internal rules of law of the foreign system. though the courts would switch with respect to which would hold liability. The German term for this judicial process is 'Ruckverweisung. Thus. however." (Goodrich. Lorenzen in an article in the Yale Law Journal. 872. since an affirmative answer to the question postulated and the operation of the adoption of the foreign law in toto would in many cases result in returning the main controversy to be decided according to the law of the forum . or the 'Weiterverweisung'. The question arises as to how this property is to be distributed among X's next of kin. This may be the law of the forum. 10 . would show that if a French court were called upon to determine how this property should be distributed. i. is the reference to the corresponding rule of the Conflict of Law of that foreign law. leaving movable property in Massachusetts. An examination of French law. a citizen of Massachusetts. The opponents of the renvoi would have looked merely to the internal law of Illinois. and decree a distribution accordingly. pp. while it has been considered by the courts in but a few instances. is applied by the forum. pp. valid by the domicile of the parties. a person's title to land. pp. In these cases. if both courts accepted the renvoi.) "X. "Assume (1) that this question arises in a Massachusetts court. it would refer the distribution to the national law of the deceased. it is difficult to see why the reference back should not have been to Michigan Conflict of Laws.The theory or doctrine of renvoi has been defined by various authors. This would have resulted in the 'endless chain of references' which has so often been criticized by legal writers. on the assumption that this is what a French court would do. thus rejecting therenvoi or the reference back. thus: "The problem has been stated in this way: 'When the Conflict of Laws rule of the forum refers a jural matter to a foreign law for decision. but its rules of the conflict of laws as well. the conflict-of-laws rule of which. will be recognized by every court. and they too rejected the renvoi. If both reject. and where the validity of a decree of divorce is challenged. 31. Vol. 13-14." (2 Am. or the Ruchversweisung'.. and then apply the law to the actual question which the rules of the other jurisdiction prescribe. thus applying its own law. or the domicile of the parties in the divorce case. but those who have accepted the renvoi theory avoid this inextricabilis circulas by getting off at the second reference and at that point applying internal law. (15 C. dies intestate. judgment would be for the woman. And still more strange is the fact that the only way to achieve uniformity in this choice-of-law problem is if in the dispute the two states whose laws form the legal basis of the litigation disagree as to whether the renvoi should be accepted. thus applying the Massachusetts state of distributions. will be valid everywhere. to the totality of the foreign law.

105. for example. the practical wisdom and justice of the rule is more apparent than ever. It is logical that. which agree in attributing the determination of a question to the same system of law. such action would leave the issue incapable of determination because the case will then be like a football. Brimo. which authorizes the reference or return of the question to the law of the testator's domicile. the law of the state where he was domiciled at the time of his death will be looked to in deciding legal questions about the will. "(2)Provided that no express provision to the contrary exists. Article 946. Here. almost as completely as the law of the situs is consulted in questions about the devise of land. But as above explained the laws of California have prescribed two sets of laws for its citizens. 59 Phil. then we must enforce the law of California in accordance with the express mandate thereof and as above explained. a law similar to or identical with Art. Sec. Government.. The conflict of law rule in California.. The court of the domicile can not and should not refer the case back to California. and if he finds that the Belgian law would make the distribution in accordance with the law of nationality — that is the English law. The Philippine cases (In Re Estate of Johnson.. 887 (4) and 894. Reason demands that We should enforce the California internal law prescribed for its citizens residing therein. 946 of the California Civil Code. 39 Phil. Miciano vs. i. Riera vs. and desires that said personal statute shall be determined by law of the domicile. the English Law directs its judge to distribute the personal estate of an Englishman who has died domiciled in Belgium in accordance with the law of his domicile. provided it be certain that one of them is necessarily competent. supra. Palmaroli. especially as the application of the internal law of California provides no legitime for children while the Philippine law. i. 'The general principle that a disposition of personal property valid at the domicile of the owner. since the domiciliary rules control devolution of the personal estate in case of intestate succession. 40 Phil. — he must accept this reference back to his own law. As explained in the various authorities cited above the national law mentioned in Article 16 of our Civil Code is the law on conflict of laws in the California Civil Code. 52 Phil.. 442-443. Arts. 293. makes natural children legally acknowledged forced heirs of the parent recognizing them.e. 946 of the California Civil Code refers to Article 16 of the Civil Code of the Philippines and that the law to the contrary in the Philippines is the provision in said Article 16 thatthe national of the deceased should govern. and its conflict of laws rule for those domiciled abroad.e. This contention can not be sustained. the court shall respect: "(a)The provisions of a foreign law which disclaims the right to bind its nationals abroad as regards their personal statute. it is not that the domiciliary has effect beyond the borders of the domiciliary state. 11 . between the country of which the decedent was a citizen and the country of his domicile. in the form of the following theses: "(1)Every court shall observe the law of its country as regards the application of foreign laws. to the law of his domicile. the Philippines in the case at bar.. and leaves a will directing the manner of distribution of the property. if the question has to be decided. is the general convenience of the doctrine. while the rule applied in In re Kaufman. the same rules should determine the validity of an attempted testamentary disposition of the property. precisely refers back the case." We note that Article 946 of the California Civil Code as its conflict of laws rule. i. the subject in each case does not appear to be a citizen of a state in the United States but with domicile in the Philippines.e. The Philippine court must apply its own law as directed in the conflict of law rule of the state of the decedent. as so declared in Article 16 of our Civil Code. 156. at Neuchatel.'" (Goodrich. The New York court has said on the point.xxx xxx xxx "Von Bar presented his views at the meeting of the institute of International Law. when business intercourse and the process of accumulating property take but little notice of boundary lines. is one of universal application.. in 1900. apply the internal law for residents therein. tossed back and forth between the two states. and it does not appear in each case that there exists in the state of which the subject is a citizen. and the reason for the recognition as in the case of intestate succession. Babcock Templeton vs. and enforce the conflict of law rules law for the citizens domiciled abroad. It is argued on appellees behalf that the clause "if there is no law to the contrary in the place where the property is situated" in Sec. but Article 946 should apply to such of its citizens as are not domiciled in California but in other jurisdictions. its internal law. 867. Civil Code of the Philippines.. each in its own intended and appropriate sphere. and Gibbs vs. 50 Phil. pp. Rider Babcock.) cited by appellees to support the decision can not possibly apply in the case at bar. when a decedent is not domiciled in California. If the law on succession and the conflict of law rules of California are to be enforced jointly. and in this age. If we must enforce the law of California as in comity we are bound to do. The rule laid down of resorting to the law of the domicile in the determination of matters with foreign element involved is in accord with the general principle of American law that the domiciliary law should govern in most matters or rights which follow the person of the owner. It had its origin in that international comity which was one of the first fruits of civilization. the principle cited In re Kaufman should apply to citizens living in the State.) Appellees argue that what Article 16 of the Civil Code of the Philippines pointed out as the national law is the internal law of California. "(b)The decision of two or more foreign systems of law. Civil Code. is valid everywhere. one for residents therein and another for those domiciled in other jurisdictions. or even by the law of the place where the act in question occurred. he must first inquire whether the law of Belgium would distribute personal property upon death in accordance with the law of domicile. also. "When a man dies leaving personal property in one or more estates. Article 946. 130. Conflict of Laws. The rules of the domicile are recognized as controlling by the Conflict of Laws rules at the situs of the property. 164.. xxx xxx xxx "If. for two important reasons.

oppositorappellant. the register of deeds of the City of Manila. No. upon the death of the wife previous to that of the husband. Allison D. EN BANC [G. WHEREFORE. not by the internal law of California. 1931. Gibbs filed in the said court a petition for an order requiring the said register of deeds "to issue the corresponding titles" to the petitioner without requiring previous payment of any inheritance tax. has no obligations or debts and no one will be prejudiced by adjudicating said parcels of land (and seventeen others not here involved) to be the absolute property of the said Allison D. entitled "In the Matter of the Intestate Estate of Eva Johnson Gibbs. C. with costs against appellees. and refused to register the transfer of title of the said conjugal property to Allison D. Bautista Angelo. describing in detail the three tracts here involved. a citizen and resident of California. Barrera. recites that the parcels of land covered by said certificates of title formerly belonged to the conjugal partnership of Allison D.We therefore find that as the domicile of the deceased Christensen. Gibbs presented this decree to the register of deeds of Manila and demanded that the latter issue to him a "transfer certificate of title". Allison D. ALLISON D.. J. filed an ex parte petition in which he alleged "that the parcels of land hereunder described belong to the conjugal partnership of your petitioner and his wife. Regala and Makalintal. 12 . December 23. Eva Johnson Gibbs". legacy or inheritance. and issue in lieu thereof new certificates of transfer of title in favor of Allison D. should be governed by the Philippine law.J. Gibbs in his own behalf. that the conjugal partnership of Allison D. And they shall immediately notify the Collector of Internal Revenue or the corresponding provincial treasurer of the nonpayment of the tax discovered by them. Gibbs without requiring him to present any document showing that the succession tax due under Article XI of Chapter 40 of the Administrative Code has been paid. which is under review on this appeal. Philippine Islands. Gibbs and Eva Johnson Gibbs.. covering lands located in the City of Manila. the decision appealed from is hereby reversed and the case returned to the lower court with instructions that the partition be made as the Philippine law on succession provides.] 3. On January 3. and entered the order of March 10." Acting upon the authority of said section. 1929. the appellant. It appears further from said order that Allison D. Gibbs as sole owner. 1930. deceased. declined to accept as binding said decree of court of September 22. The court granted said petition and on September 22. is the Philippines. that the latter died intestate in Palo Alto. Gibbs and Eva Johnson Gibbs.R. JJ. 36795 in the same court. GIBBS. 1929. respondent-appellant. by way of gifts mortis causa. and further alleging that his said wife. 20880. that at the time of her death she and her husband were citizens of the State of California and domiciled therein. . Reyes. this court remanded the case to the court of origin for new trial upon additional evidence in regard to the pertinent law of California in force at the time of the death of Mrs. Judgment reversed. Gibbs to be the sole and absolute owner of said lands. 28336 and 28331. the domicile. The case is now before us with the supplementary evidence. Concepcion. 946 of the Civil Code of California. unless the payment of the tax fixed in this article and actually due thereon shall be shown. describing in detail the three tracts here involved. applying section 1401 of the Civil Code of California. on September 22. Gibbs. DECISION BUTTE. 1933. requiring the register of deeds of the City of Manila to cancel certificates of title Nos. Section 1547 of Article XI of Chapter 40 of the Administrative Code provides in part that: "Registers of deeds shall not register in the registry of property any document transferring real property or real rights therein or any chattel mortgage. the community property of spouses who are citizens of California. 1931. Gibbs was appointed administrator of the estate of his said deceased wife in case No. Gibbs. pursuant to Art. THE GOVERNMENT OF THE PHILIPPINE ISLANDS. Paredes. . Thereupon. that in said intestate proceedings. on the ground that the corresponding inheritance tax had not been paid. After due hearing of the parties. THE REGISTER OF DEEDS OF THE CITY OF MANILA. Deceased". Eva Johnson Gibbs". a citizen of California. 1930. also authorizing the introduction of evidence with reference to the dates of the acquisition of the property involved in this suit and with reference to the California law in force at the time of such acquisition. that in accordance with the law of California. 35694. The said order of court of March 10. J p: This is an appeal from a final order of the Court of First Instance of Manila. the court reaffirmed said order of September 22. 1930. the said Allison D. Padilla. petitioner-appellee. Solicitor-General Hilado for appellants. Gibbs. died on November 28. vs.. the validity of the provisions of his will depriving his acknowledged natural child. Dizon. 1930. under date of December 26. and further alleging that his said wife. took no part. concur. 1933.L. 1930. belongs absolutely to the surviving husband without administration. .B. entered a decree adjudicating the said Allison D. on November 28. California. Bengzon.

the rules relating to property. and other acquisitions mortis causa" provides in section 1536 that "Every transmission by virtue of inheritance . But the appellant's chief argument and the sole basis of the lower court's decision rests upon the second paragraph of article 10 of the Civil Code which is as follows: "Nevertheless. 419). (Miciano vs. legacies. 1927. to citizens of the Philippine Islands). by reason of the rather anomalous political status of the Philippine Islands.. as her sole heirs at law. 1929. being governed by article 10 of the Civil Code. Rider Babcock. the nationality and domicile of Mrs. Quoting the case of Estate of Klumpke (167 Cal. and registered in the name of "Allison D. leaving surviving her husband. by its very terms. the appellee. even if the nature and extent of her title under said certificates be governed by the law of the Philippine Islands. 20880. 415. but because she never had more than an inchoate interest or expectancy which is extinguished upon her death. Article 9 of the Civil Code treats of purely personal relations and status and capacity for juristic acts. Allison D. not as an heir or as the beneficiary of his deceased wife.) Having regard to the practical autonomy of the Philippine Islands. that he is the absolute owner of all the community property from the moment of the death of his wife. Gibbs. Codigo Civil. There is not the slightest doubt that a California married woman can acquire title to land in a common law jurisdiction like the State of Illinois or the District of Columbia. in the Philippine Islands. we have concluded that if article 10 is applicable and the estate in question is that of a deceased American citizen. whatever may be the nature of the property or the country in which it may be situated. Article 9 of the Civil Code is as follows: "The laws relating to family rights and duties. be settled by the law governing her personal status. legal and testamentary successions. is applicable only to "Spaniards" (now. . citing article 9 of the Civil Code. known as the "Jones Law") as regards the determination of private rights.A parcel of land in the City of Manila. a citizen of the State of California and domiciled therein. 28331. now aged 22. in which it is certified "that the spouses Allison D. the prerequisite conditions obtaining. by construction. the court said: "The decisions under this section (1401 Civil Code of California) are uniform to the 13 . 52 Phil." In construing the above language we are met at the outset with some difficulty by the expression "the national law of the person whose succession is in question"." It is argued that the conjugal right of the California wife in community real estate in the Philippine Islands is a personal right and must. that said Eva Johnson Gibbs died intestate on November 28. represented by transfer certificate of title No. upon the death of the wife. The Organic Act of the Philippine Islands (Act of Congress. and legal capacity of persons. But that. that there was no antenuptial marriage contract between the parties. 156. the entire community property without administration belongs to the surviving husband. therefore. Brimo. Gibbs casado con Eva Johnson Gibbs". or to the status. 166. and two sons. 867. dated April 6. the law of California. that is. Gibbs has been continuously. therefore.. represented by transfer certificate of title No.. vol.A parcel of land in the City of Manila. Ohio. if any. not by virtue of succession or by virtue of her death. pp. 20880. grants practical autonomy to the Government of the Philippine Islands. 1916. . that vested in Eva Johnson Gibbs under the three certificates of title Nos. But our attention has not been called to any law of California that incapacitates a married woman from acquiring or holding land in a foreign jurisdiction in accordance with the lex rei sitæ. Gibbs. may apply the principles and rules of private international law (conflict of laws) on the same footing as an organized territory or state of the United States.) We encountered no difficulty in applying article 10 in the case of a citizen of Turkey. citing the second paragraph of article 10 of the Civil Code. both personal and real. 3. 39 Phil. August 29. Furthermore. Gibbs. to ascertain the norm which would be applied here as law were there any question as to her status. that he and Eva Johnson Gibbs were married at Columbus. In re Estate of Johnson.. Manresa. 137. therefore. 28336 and 28331 above referred to. represented by transfer certificate of title No. 1927. Gibbs married to Eva Johnson Gibbs" is the owner of the land described therein. 1906. in respect to the order of succession as well as to the amount of the successional rights and the intrinsic validity of their provisions. dated May 14." It results that the question for determination in this case is as follows: Was Eva Johnson Gibbs at the time of her death the owner of a descendible interest in the Philippine lands above-mentioned? The appellee contends that the law of California should determine the nature and extend of the title. 1920. 2. we shall consider the following facts as established by the evidence or the admissions of the parties: Allison D. 103. . 130. of real property . . subject to the common-law estate by the courtesy which would vest in her husband. are binding upon Spaniards even though they reside in a foreign country.For the purposes of this case.A parcel of land in the City of Manila. article 9. and Finley J.) The trial court found that under the law of California. the succession shall be regulated in accordance with the norms of the State of his domicile in the United States. as above stated. This Government. among others. Gibbs and Eva Johnson Gibbs are the owners in fee simple" of the land therein described. which states "that Allison D. the spouses acquired the following lands. 1. (Cf. 104. the laws of California govern the succession to such title. Babcock Templeton vs. since the year 1902. (Cf. resort to the law of California. but by virtue of the fact that when the death of the wife precedes that of the husband he acquires the community property. We should. now aged 25. 50 Phil. that during the existence of said marriage. shall be subject to the following tax. as conjugal property: 1. in July. dated March 16. Article XI of Chapter 40 of the Administrative Code entitled "Tax on inheritances. shall be regulated by the national law of the person whose succession is in question. Nor is there any doubt that if a California husband acquired land in such a jurisdiction his wife would be vested with the common law right of dower. condition. 28336.

but that he holds it all from the moment of her death as though acquired by himself. 96 U. Under the law of the Philippine Islands. 545. Scales. 5 Martin [N.) It is unnecessary in this proceeding to determine the "order of succession" or the "extent of the successional rights" (article 10. the nature and extent of the title which vested in Mrs. Ona. in the absence of an antenuptial contract. S. It never belonged to the estate of the deceased wife. upon the acquisition of any conjugal property. 99 [Texas]. the second paragraph of article 10 can be invoked only when the deceased was vested with a descendible interest in property within the jurisdiction of the Philippine Islands. 705. No. in other words. 569. the wife. . and transfer. Dec. W. Heidenheimer vs. 115. and the foreign law is consulted only in regard to the order of succession or the extent of the successional rights. 577.) Under this broad principle. 5 L. Jur." Article 1426 provides that upon dissolution of the conjugal partnership and after inventory and liquidation. 191. ed.. from the date of their acquisition to the date of her death. ed. Gibbs. or their respective heirs.. in which it is certified that "the spouses Allison D. Civil Code. 661. That appellee himself believed that his wife was vested of such a title and interest is manifest from the second of said certificates. 186.].. McGoon vs. 1028. becomes immediately vested with an interest and title therein equal to that of her husband. . ed. 199 N. 478: "In accord with the rule that real property is subject to the lex rei sitæ.. 334. real property to the laws of the country in which it is situated.. Clark vs. subject to the power of management and disposition which the law vests in the husband. 858. 44 Law." Article 1414 provides that "the husband may dispose by will of his half only of the property of the conjugal partnership." The argument of the appellee apparently leads to this dilemma: If he takes nothing by succession from his deceased wife. are determined by the law of the place where the property is situated. 16 Am.effect that the husband does not take the community property upon the death of the wife by succession. 402.. Y. S. Immediately upon her death. It is admitted that the Philippine lands here in question were acquired as community property of the conjugal partnership of the appellee and his wife.. R. 20880. 469. if there are no obligations of the decedent. as is true in the present case.]. in the Philippine lands covered by certificates of title Nos. 33 Phil. Gibbs at the time of the acquisition of the community lands here in question must be determined in accordance with the lex rei sitæ. 24 L. vested of a descendible interest. dated May 14. S. 780. 23.. 26 S. 9 Wall. 1031).) It results that the wife of the appellee was." Article 1395 provides: "The conjugal partnership shall be governed by the rules of law applicable to the contract of partnership in all matters in which such rules do not conflict with the express provisions of this chapter. her share in the conjugal property is transmitted to her heirs by succession.. (United States vs. "the net remainder of the partnership property shall be divided share and share alike between the husband and wife. 28336." The descendible interest of Eva Johnson Gibbs in the lands aforesaid was transmitted to her heirs by virtue of inheritance and this transmission plainly falls within the inheritance and this transmission plainly falls within the language of section 1536 of Article XI of Chapter 40 of the Administrative Code which levies a tax on inheritances.. Co. ed. 287." It is stated in 5 Cal.]. 7 Cranch. 3 L... 14 . 456.)" (See also Estate of Lloyd. 29 L. and for the effect and construction of wills and other conveyances. (Articles 657. Ins. E. 175 Cal. In the case of Clarke vs. 19 L.." Under the provisions of the Civil Code and the jurisprudence prevailing here. also Coronel vs. supra) which would be regulated by section 1386 of the Civil Code of California which was in effect at the time of the death of Mrs. 627. S. cf. the court said: "It is a principle firmly established that to the law of the state in which the land is situated we must look for the rules which govern its descent. Loring. equal to that of her husband. 6 Wheat.." (See also Saul vs. 92 N. His Creditors. by the law of the Philippine Islands. 1927. [N. alienation. 212 [La. how can the second paragraph of article 10 be invoked? Can the appellee be heard to say that there is a legal succession under the law of California? It seems clear that the second paragraph of article 10 applies only when a legal or testamentary succession has taken place in the Philippines in accordance with the law of the Philippine Islands and no legal succession under the law of California? It seems clear that the second paragraph of article 10 applies only when a legal or testamentary succession has taken place in the Philippines in accordance with the law of the Philippine Islands. she was vested of a title equal to that of her husband. Hartford F. Article 1407 of the Civil Code provides: "All the property of the spouses shall be deemed partnership property in the absence of proof that it belongs exclusively to the husband or to the wife. introduced by him in evidence. The record does not show what the proper amount of the inheritance tax in this case would be nor that the appellee (petitioner below) in any way challenged the power of the Government to levy an inheritance tax or the validity of the statute under which the register of deeds refused to issue a certificate of transfer reciting that the appellee is the exclusive owner of the Philippine lands included in the three certificates of title here involved. ed.. 704. Clarke (178 U. irrespective of the domicile of the parties or of the place where the marriage was celebrated. Gibbs and Eva Johnson Gibbs are the owners in fee simple of the conjugal lands therein described. 28336 and 28331. A. (Cf. 29. Re Estate of Majot.) This fundamental principle is stated in the first paragraph of article 10 of our Civil Code as follows: "Personal property is subject to the laws of the nation of the owner thereof.. Crosby. the respective rights of husband and wife in such property. Graham. Brine vs. . 659. Civil Code..

and the rest of 1. December 5. pp. et. L-85-10-799 and L-86-05-460 insofar as it: (i) applied the three-year prescriptive period under the Labor Code of the Philippines instead of the tenyear prescriptive period under the Civil Code of the Philippines. 1994. AMUL. GERARDO A. The petition in G. BROWN & ROOT INTERNATIONAL. 26-220). al. al. C. L-85-10-777. EVANGELISTA. 8-25. Street. 767 NAMEDCOMPLAINANTS. entitled "Asia International Builders Corporation. (ii) declaring the said labor cases as a class suit. ANTONIO T. et. INC. National Labor Relations Commission. EMIGDIO N." was filed under Rule 65 of the Revised Rules of Court: (1)to modify the Resolution dated September 2. VICENTE ARLITA. et. al. v. is reversed with directions to dismiss the petition. ET AL. L-85-10-779 and L-86-05-460. 104776. vs. HON. and (2)to reverse the Resolution dated March 21. al. J p: The petition in G. denying the motion for reconsideration of its Resolution dated September 2. 1991 (Rollo. Malcolm. 1994. DEL MUNDO. and (2)to reverse the Resolution dated March 24.R. NATIONAL LABOR RELATIONS COMMISSION. NATIONAL LABOR RELATIONS COMMISSION. 1991 of NLRC in POEA Cases Nos. Cadalin. entitled "Bienvenido M. and Vickers. JOSE M. 1991 of the National Labor Relations Commission (NLRC) in POEA Cases Nos. 105029-32. ROLANDO B. Florante M. v. CADALIN. Nos. pp. respondents. SOLOMON B. petitioners.. L-84-06-555. ABARQUEZ.] ASIA INTERNATIONAL BUILDER CORPORATION and BROWN & ROOT INTERNATIONAL. DONATO B. 1991 (Rollo. (2)to render a new decision: (i) declaring private respondents as in default. ABAN. ROMEO PATAG. ROLANDO M. MARTIN AMISTAD. 61-230). and (3)to reverse the Resolution dated March 24. vs. RIZALINO REYES. entitled "Bienvenido M. 104911-14. L-84-06-555. Cadalin.R. IGNACIO DE VERA. v. al.. L-85-10-777. J. ROLANDO M. BIENVENIDO M. 1992 of NLRC insofar as it denied the motions for reconsideration of AIBC and BRII (Rollo.. Villa-Real. 8-288). Avanceña. 104911-14. Abad Santos.. dissents. (BRII) to pay the claims of the 1. INC. insofar as it granted the claims of 149 claimants. JJ. vs. INC. de Castro guilty of forum-shopping. 1994. AL DECISION QUIASON. 1991 of NLRC in POEA Cases Nos. Hon. denying the motion for reconsideration of its Resolution dated September 2. AMORSOLO ANADING.R. EVANGELISTA. ANGLO. without special pronouncement as to the costs. L86-05-460. Nos. 104776.R.767 claimants in said labor cases.. CADALIN. HERBERT AYO. SILVERIO BALATAZO. REYES. [G. CADALIN. Hull. NATIONAL LABOR RELATIONS COMMISSION. pp. WILFREDO D. No. BIENVENIDO M. 1992 of NLRC. al. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION'S ADMINISTRATOR. 2-59. et. L-84-06-555. 1992 of the NLRC." was filed under Rule 65 of the Revised Rules of Court: (1)to reverse the Resolution dated September 2. (iv) declaring Atty.J. thru and by their Attorney-in-fact. Atty. and/or ASIA INTERNATIONAL BUILDERS CORPORATION. 15 . No. respondents. L-85-10-779 and L-86-05-460.. AND/OR ASIA INTERNATIONAL BUILDERS CORPORATION. concur." was filed under Rule 65 of the Revised Rules of Court: (1)to reverse the Resolution dated September 2. ROMEO ACUPAN. Nos. ANTONIO ACUPAN. Philippine Overseas Employment Administration's Administrator. ALIGADO. [G.The judgment of the court below of March 10. et. (iii) ordering Asia International Builders Corporation (AIBC) and Brown and Root International Inc. petitioners.. and (v) dismissing POEA Case No. and (ii) denied the "three-hour daily average" formula in the computation of petitioners' overtime pay. Nos. 105029-32. JR. DONATO B. National Labor Relations Commission. December 5.] BIENVENIDO M.R. et. 1931. petitioners..R. The petition in G. AMUL. L-85-10-777. December 5. BENJAMIN ALEJANDRE. BROWN & ROOT INTERNATIONAL..] 4.. AMUL. FIRST DIVISION [G.

the claimants filed their "Rejoinder and Comments. upon motion of AIBC and BRII. claimants filed their "Compliance" with the Order dated October 2. In the Resolution dated July 26. the payment of the interest of the earnings of the Travel and Reserved Fund.R. mobilize and deploy Filipino workers for overseas employment on behalf of its foreign principals. On December 27. Rollo. 1991 of NLRC. up to July 5.R. On November 20. 1984.R. Florante de Castro filed another complaint for the same money claims and benefits in behalf of several claimants. interest on all the unpaid benefits. Nos. 1984. 104911-14. 1984. Atty. 13-14). Nos. In the Resolution dated October 27. On October 2." praying that the POEA Administrator direct the parties to submit simultaneously their position papers. 104911-14. G. 1984. On November 14.The Resolution dated September 2. The amended complaint principally sought the payment of the unexpired portion of the employment contracts.R.R. the "Complaint" and the "Compliance and Manifestation. 1984.107. Cadalin. 1984. the POEA Administrator issued an order directing AIBC and BRII to file their answers within ten days from receipt of the order. the Third Division granted the motion filed in G. 16 . Rollo. 104911-14 to the Third Division (G. The claimants alleged that AIBC and BRII had waived their right to present evidence and had defaulted by failing to file their answers and attend the pre-trial conference. I On June 6. In the Resolution dated September 29.R. Nos. 85-10-779).R. 1984. 104911-14. after which the case should be deemed submitted for decision. refund of withholding tax not remitted to the BIR. that claimants should be ordered to amend their complaint. 104911-14 were raffled to the Second Division. claimants asked for time within which to comply with the Order of October 2.R. Bienvenido M. 1984. 426-432). AIBC was furnished a copy of the complaint and was given. the Second Division referred G. refund of SSS and premium not remitted to the SSS. Amul and Donato B. Nos. 1984.R. pp. 104776. On November 8. 1984 and filed an "Urgent Manifestation. Rollo. BRII is a foreign corporation with headquarters in Houston. Nos. Consolidation of Cases G. 369-377. Nos." On July 23. 1984. some of whom were also claimants in POEA Case No. together with BRII. Rolando M. On July 13. No. 104776 and 105029-32 were originally raffled to the Third Division while G. 104911-14 for the consolidation of said cases with G. area wage and salary differential pay. At the hearing on June 25.R. 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 in the order. as well as the suspension of the license of AIBC and the accreditation of BRII (G. pp. fringe benefits.R. claimants filed an opposition to the motions for extension of time and asked that AIBC and BRII be declared in default for failure to file their answers. 10502932. 1984. Rollo. 986-1. which were assigned to the First Division (G. On July 3. 1984. POEA Administrator. No. On October 10. which was terminated prematurely. 1984.. 104911-14 with G. while AIBC is a domestic corporation licensed as a service contractor to recruit. the claimants submitted their "Compliance and Manifestation. Evangelista. 105029-30. and is engaged in construction. pp. 1993." averring. among other reliefs. ordered the claimants to file a bill of particulars within ten days from receipt of the order and the movants to file their answers within ten days from receipt of the bill of particulars. and secondarily. Gerardo del Mundo. L-84-06-555). Nos. 1984 to file its answer. The claimants were represented by Atty. Texas. which modified the decision of POEA in four labor cases: (1) awarded monetary benefits only to 149 claimants and (2) directed Labor Arbiter Fatima J. Franco to conduct hearings and to receive evidence on the claims dismissed by the POEA for lack of substantial evidence or proof of employment. 1993. p. On November 6. G. On the same day. 1984.R. 104776 (G. 1984." praying that the POEA direct the parties to submit simultaneously their position papers after which the case would be deemed submitted for decision. p. 1993. 895). Rollo. 104776 and 105029-32." On July 25. 1984 and an "Urgent Manifestation. No. among other matters. the First Division granted the motion to consolidate G. the POEA Administrator informed AIBC that its motion for extension of time was granted.R. p. the failure of AIBC and BRII to file their answers and to attend the pre-trial conference on July 25. 1984. On October 19. The POEA Administrator also scheduled a pre-trial conference on July 25. Nos. it filed a second motion for extension of time to file the comment. Rollo. Nos. L-84-06-555 (POEA Case No. On the same day. No. penalties for committing prohibited practices. 1562). 1109. AIBC and BRII filed a "Comment" praying. in their own behalf and on behalf of 728 other overseas contract workers (OCWs) instituted a class suit by filing an "Amended Complaint" with the Philippine Overseas Employment Administration (POEA) for money claims arising from their recruitment by AIBC and employment by BRII (POEA Case NO. AIBC asked for time to file its comment on the "Compliance" and "Urgent Manifestation" of claimants. AIBC filed a "Motion to Strike Out of the Records".

Rollo. On September 18. together with a petition for the issuance of a writ of injunction. Bruce denouncing AIBC and BRII of violations of labor laws. 1985 by AIBC and BRII. NLRC enjoined the POEA Administrator from hearing the labor cases and suspended the period for the filing of the answers of AIBC and BRII. On June 24. 104776. L-84-06-555. 1987. L-85-10-779) against AIBC and BRII. 1987. Atty. 1987. Said order required BRII and AIBC to answer the amended complaint in POEA Case No. the NLRC dismissed the two appeals filed on February 27. On February 24. No. 1985 and Administrative Case No. At the same hearing. 104776. claimants filed an "Urgent Motion for Summary Judgment. questioning the Order dated September 4. claimants asked the POEA Administrator to include additional claimants in the case and to investigate alleged wrongdoings of BRII. 1985. On May 29. 1987. L-84-06-555. On April 15. 1985. At the hearing on June 19. Atty. On April 28. 1986. In narrating the proceedings of the labor cases before the POEA Administrator.R. the original claimants filed an "Amended Complaint and/or Position Paper" dated March 24. L-84-06-555. 1985.R. No. Maximino N." On the same day. 78489). De Castro filed a complaint for money claims (POEA Case No. it is not amiss to mention that two cases were filed in the Supreme Court by the claimants.R." Claimants opposed the motions. Romeo Patag and two co-claimants filed a complaint (POEA Case No. namely — G. Rollo. 1986. 1985. de Castro & Associates asked for the substitution of the original counsel of record and the cancellation of the special powers of attorney given the original counsel. The second was filed on April 28. On January 14. NLRC en banc denied the motion for reconsideration. we dismissed the petition by informing AIBC that all its technical objections may properly be resolved in the hearings before the POEA. 1985. On December 12. AIBC and BRII submitted their 17 . L-84-06-555. On June 29. On September 19.On February 27. annual leave differential pay. On September 19. pp. retirement and savings benefits and their share of forfeitures (G. 1985 and September 18. In a resolution dated November 9. No. AIBC countered with a "Motion to Dismiss as Improper Class Suit and Motion for Bill of Particulars Re: Amended Complaint dated March 24. claiming that it was dilatory and praying that AIBC and BRII be declared in default. 86-05-460) in behalf of 11 claimants including Bienvenido Cadalin. The third was filed by Jose R. AIBC submitted its answer to the complaint. 1987. On October 10. On December 12. a claimant in POEA Case No. extra night work pay. On October 17. adding new demands: namely. L-84-06-555 and L-86-05-460 and to decide the labor cases with deliberate dispatch. Del Mundo filed in NLRC a notice of the claim to enforce attorney's lien. Claimants opposed the appeal. 1985. Solomon Reyes also filed his own complaint (POEA Case No." alleging that the answer was filed out of time. Talibsao and Amado B. AIBC reiterated before the POEA Administrator its motion for suspension of the period for filing an answer or motion for extension of time to file the same until the resolution of its motion for reconsideration of the order of the NLRC dismissing the two appeals. 1985. they would be deemed to have waived their right to present evidence and the case would be resolved on the basis of complainants' evidence. 1985. 1986. the Supreme Court issued a resolution in Administrative Case No. p. AIBC filed a motion for reconsideration of the NLRC Resolution dated December 12. Santos. 1985. 20). 1987 claimants filed their "Urgent Motion to Strike Out Answer. the law firm of Florante M. AIBC and BRII appealed to NLRC seeking the reversal of the said order of the POEA Administrator. claimants filed their "Supplement to Urgent Manifestational Motion" to comply with the POEA Order of June 19. 14-16). 1985. 84-06-555. The first was filed on September 22. the payment of overtime pay. 1987. The Ombudsman merely referred the complaint to the Secretary of Labor and Employment with a request for the early disposition of POEA Case No. demanding monetary claims similar to those subject of POEA Case No. AIBC also filed a petition in the Supreme Court (G. Bautista and Rolando R. 1988. 1985. 1985. 1985. On June 5. On September 4. No. leave indemnity pay. the POEA Administrator directed AIBC to file its answer to the amended complaint (G. AIBC filed its second appeal to the NLRC. 1985. the POEA Administrator reiterated his directive to AIBC and BRII to file their answers in POEA Case No. Complaints were also filed before the Ombudsman. 1988 by claimant Hermie Arguelles and 18 co-claimants against the POEA Administrator and several NLRC Commissioners. On April 2. the parties were given a period of 15 days from said date within which to submit their respective position papers. 1987.R. L-85-10-777) against AIBC and BRII with the POEA. On January 13. 1985 of the POEA Administrator. 1989 by claimants Emigdio P. 1986. AIBC and their respective lawyers. the POEA issued an order directing AIBC and BRII to file their answers to the "Amended Complaint. In the same month. 1987." otherwise. On May 13. On May 28. 2858 on March 18. Lobeta charging AIBC and BRII for violation of labor and social legislations. 72132 on September 26. 2858 directing the POEA Administrator to resolve the issues raised in the motions and oppositions filed in POEA Cases Nos.

claimants filed their "Answer to Appeal. the claimants represented by Atty. 2.44 in favor of only 324 complainants. On March 4. by the claimants represented by Atty. Del Mundo. On the same day. including those for overtime work and favorably granted by the POEA. No. Three motions for reconsideration of the September 2. L-84-06-555 and the other consolidated cases. hereby directs Labor Arbiter Fatima J. 4. 1991. whose claims were dismissed by the POEA for lack of proof of employment in Bahrain (these complainants numbering 683. are hereby dismissed for lack of substantial evidence in support thereof or are beyond the competence of this Commission to pass upon. The first. by the claimants represented by Atty. L-86-05-460. as amended by R. pp. claimants filed their "Ex-parte Motion to Expunge from the Records" the position paper of AIBC and BRII. 1992. 1989 on the grounds that BRII had failed to appeal on time and AIBC had not posted the supersedeas bond in the amount of $824.652. which awarded the amount of $824. claimants filed their "Manifestational Motion. who were former clients of Atty. 1989.652. 120741-44). whose awards decreed by the POEA." together with 446 individual contracts of employments and service records. the claimants filed their "Counter-Manifestation." together with their "newly discovered evidence" consisting of payroll records. On September 2.A." On October 26. the second. disposing as follows: "WHEREFORE.position paper. 104911-14. AIBC and BRII submitted to NLRC their "Manifestation. 1990. AIBC and BRII submitted their Supplemental Memorandum. G. this Commission. 1988. are listed in pages 13 to 23 of the decision of POEA. pp. 1989. Rollo. the POEA Administrator rendered his decision in POEA Case No. On April 20. On February 17. 1989. Nos. Nos. at the time of payment. AIBC also filed its motion for reconsideration and/or appeal in addition to the "Notice of Appeal" filed earlier on February 6. On September 12." praying that all the 1. 85-87. 105029-31. (b)complainants identified and listed in Annex "E" attached and made an integral part of this Resolution.R. claimants filed their "Urgent Motion for Execution" of the Decision dated January 30. 120-122).44." On January 30. NLRC promulgated its Resolution. in the exercise of its powers and authority under Article 218 (c) of the Labor Code. premises considered." praying for the dismissal of the appeal of AIBC and BRII. 1989. On September 6. claimant Amado S. 1988. Franco of this Commission to summon parties. jointly and severally. On April 5. 1988. Tolentino and 12 co-claimants. of the total amount in US dollars indicated opposite their respective names. 104776. 18 . regarding the claims of the following: (a)complainants identified and listed in Annex "D" attached and made an integral part of this Resolution. conduct hearings and receive evidence.The awards given by the POEA to the 19 complaints classified and listed in Annex "C" hereof. De Castro filed their memorandum in POEA Case No. as expeditiously as possible.R. 3. G. 1988.All claims other than those indicated in Annex "B".767 of them. pp. Del Mundo. 1989. In addition. 1988. who appear to have worked elsewhere than in Bahrain are hereby set aside. and the third. On December 23. by AIBC and BRII. On February 10. to pay the 149 complainants. filed a petition forcertiorari with the Supreme Court (G. the peso equivalent.The claims of the 94 complainants identified and listed in Annex "A" hereof are dismissed for having prescribed. 1991." stating among other matters that there were only 728 named claimants. BRII filed its "Reply to Complainant's Memorandum. On July 27. 1989.R. to Our mind. The petition was dismissed in a resolution dated January 27. and thereafter submit a written report to this Commission (First Division) of the proceedings taken. De Castro. 6715. subject of the appeals) and. On August 21.R. the Decision of the POEA in these consolidated cases is modified to the extent and in accordance with the following dispositions: 1. On September 1. claimants submitted their "Ex-parte Manifestational Motion and CounterSupplemental Motion. 1989. 1989 by another counsel for AIBC. claimants filed another motion to resolve the labor cases. claimants filed their "Supplement to Complainants' Appeal Memorandum. On November 27. claiming that it was filed out of time.Respondents AIBC and Brown & Root are hereby ordered. Nos.767 claimants be awarded their monetary claims for failure of private respondents to file their answers within the reglementary period required by law. 1989. claimants submitted their "Appeal Memorandum for Partial Appeal" from the decision of the POEA. 1991 Resolution of the NLRC were filed. On October 27. 113-115. AIBC and BRII filed a "Consolidated Reply. 1988." alleging that there were 1. On March 15. are not supported by substantial evidence" (G. identified and listed in Annex "B" hereof.

R. Nos. Nos. No. Nos. 896-959). pp. G. 987-1105. 813-836. 679-729. pp. Nos.R. 731-746. it appears that the complainants-appellants allege that they were recruited by respondent-appellant AIBC for its accredited foreign principal. pp. Rollo. Rollo. 104776. G. 906-956. 104911-14) and by AIBC and BRII (G. 1992 (G. 104911-14. pp.R. 104776. G. Rollo. Nos.R. Anglo and 17 co-claimants dated October 14.R. Solano and six co-claimants dated August 25. 1993 (G. Rollo.R. pp.R.R.R.R. Nos. 104911-14. G. 1993 (G. Rollo. III The facts as found by the NLRC are as follows: "We have taken painstaking efforts to sift over the more than fifty volumes now comprising the records of these cases. G. No. II). Rollo. Rollo. Nos. Rollo. Rollo. Rollo. pp. from time to time. 263-406. 105029-32. 104776. No. No. pp.R. 104776. Nos. 104911-14). 1993 (G. Nos. 105029-32).R.R. 974-1190. 105029-32.R. Rollo. Rollo. Rollo. Evangelista and 4 co-claimants dated March 10.R. 1243-1254. pp. Nos. 1994 (G. G. the claimants represented by Atty. 104776. 1773-1814). 8)Joint Manifestation and Motion involving claimant Benjamin Ambrosio and 15 other co-claimants dated May 4. Rollo. 1257-1375. Rollo. 1657-1703.R. pp.R.In its Resolution dated March 24. 748-864. Brown & Root. 4)Joint Manifestation and Motion involving claimant Antonio T. 105029-32. 14)Joint Manifestation and Motion involving Vivencio V. Rollo. G.R. Rollo. 613-722. No. Rollo. 1993 (G. Rollo. 1815-1829). 104776. 104911-14. 407-516). No. 104911-14. G. 10)Joint Manifestation and Motion involving petitioner Quiterio R. 5)Joint Manifestation and Motion involving claimant Dionisio Bobongo and 6 co-claimants dated January 15. pp. G. Rollo. pp. 104911-14. 10502932. No. De Castro and AIBC and BRII have submitted. pp. From the records. 1992 (G. 650-713. 105029-32. Dayrit and 2 co-claimants dated September 7. Nos. pp. G. 105029-3.R. 470-615). 104776). Abella and 27 co-claimants dated January 10. Nos. pp. 104911-14. 1992 (G. Nos.R. 1992. 972-984). on various dates from 1975 to 1983. G. No. 1993 (G.R. De Castro (G. No. compromise agreements for our approval and jointly moved for the dismissal of their respective petitions insofar as the claimantsparties to the compromise agreements were concerned (See Annex A for list of claimants who signed quitclaims). the claimants represented by Atty. 13)Joint Manifestation and Motion involving claimant Dante C.R. 629-652). Hence. 15)Joint Manifestation and Motion involving Domingo B. pp.R. 104776. 655-675). 104776. pp.R. 105029-32. Rollo. G.R. No. Rollo. Aban and 36 co-claimants dated September 17. 530-590).R. Alonzo and 19 co-claimants dated July 22. Nos.R. No. 104776.R. 7)Joint Manifestation and Motion involving claimants Palconeri Banaag and 5 co-claimants dated March 17. 1993 (G. pp.R. pp. G. Rollo. 1173-1235.Rollo. G.R. these petitions filed by the claimants represented by Atty.R. 104776. 1066-1183). G. pp. pp. pp. Rollo. 104911-14. Nos. 105029-32. 1992 (G. Rollo. Del Mundo (G. Nos.R. 1993 (G. pp. Rollo. G. Nos. Rollo.R. G. Nos. Aceres and 37 co-claimants dated September 8. pp. 105029-32. NLRC denied all the motions for reconsideration. Vol. G. They 19 .R. 6)Joint Manifestation and Motion involving claimant Valerio A. Nos. pp. 104911-14.R. pp. 518-626. Rollo. No. Rollo. 105029-32. 9)Joint Manifestation and Motion involving Valerio Evangelista and 3 co-claimants dated May 10. 104911-14. 3)Joint Manifestation and Motion involving claimant Jose M. 364-507). 2)Joint Manifestation and Motion involving petitioner Bienvenido Cadalin and 82 co-petitioners dated September 3. pp. pp. 104911-14. 1993 (G. pp. 12)Joint Manifestation and Motion involving claimant Ricardo C. No. No. G. 1266-1278.R. G. Rollo. 1994 (G. Thus the following manifestations that the parties had arrived at a compromise agreement and the corresponding motions for the approval of the agreements were filed by the parties and approved by the Court: 1)Joint Manifestation and Motion involving claimant Emigdio Abarquez and 47 co-claimants dated September 2. Agudo and 36 co-claimants dated June 14. 1993 (G. 1280-1397). No. Nos. Nos. 11)Joint Manifestation and Motion involving claimant Arnaldo J. 104776. 1815-1829). Nos. II Compromise Agreements Before this Court. No. 104776. pp. 1193-1256. Rollo.R. 104776. 104911-14. 778-843.R. pp. pp.

at his sole option. This shall be computed at the basic wage rate. under this agreement at any time.HOURS OF WORK AND COMPENSATION a)The Employee is employed at the hourly rate and overtime rate as set out in Part B of this Document. The Employer will be responsible for his return transportation to his country of origin. or by change in the type of construction of such work. economy class accommodation. as well as in Southeast Asia. such as Saudi Arabia. or suspension of the work on which the Employee's services were being utilized. employee shall be entitled to 12-days vacation leave with pay. xxx xxx xxx 10. Vols. United Arab Emirates and Bahrain. b)The hours of work shall be those set forth by the Employer.TERMINATION a)Notwithstanding any other terms and conditions of this agreement. all the individual complainants signed standard overseas employment contracts (Records. b)Sick leave of 15 days shall be granted to the employee for every year of service for non-work connected injuries or illness. 25-32. These overseas employment contracts invariably contained the following relevant terms and conditions. at his sole discretion. Hereafter. Libya. 4. 11. terminate employee's service with cause. or because of a reduction in force due to a decrease in scope of such work. If the employee failed to avail of such leave benefits.VACATION/SICK LEAVE BENEFITS a)After one (1) year of continuous service and/or satisfactory completion of contract. the same shall be forfeited at the end of the year in which said sick leave is granted.BONUS 20 . and Employer may.were all deployed at various projects undertaken by Brown & Root in several countries in the Middle East. If the Employer terminates the services of the Employee under this Agreement because of the completion or termination. considering their chaotic arrangement) with AIBC before their departure from the Philippines. PART B — (1)Employment Position Classification:————————— (Code):————————— (2)Company Employment Status:————————— (3)Date of Employment to Commence on:————————— (4)Basic Working Hours Per Week:————————— (5)Basic Working Hours per Month:————————— (6)Basic Hourly Rate:————————— (7)Overtime Rate Per Hour:————————— (8)Projected Period of Service (Subject to C (1) of this [sic]):————————— Months and/or Job Completion xxx xxx xxx 3. reference to the records would be sparingly made. change or adjust such hours as may be deemed necessary from time to time. in Indonesia and Malaysia. Normally on the most expeditious air route. the Employer may. Having been officially processed as overseas contract workers by the Philippine Government. Fractions of a year's service will be computed on a pro-rata basis.

where some of the individual complainants were deployed." Art. 80: Friday shall be deemed to be a weekly day of rest on full pay. 12." A worker shall be entitled to such leave upon a quantum meruit in respect of the proportion of his service in that year. he shall be paid an additional sum equivalent to 150% of his normal wage. When conditions of work require the worker to work on any official holiday. Art. No. Third: — Whether or not the instant cases qualify as a class suit. . (a)Whether or not the complainants who have worked in Bahrain are entitled to the above-mentioned benefits. 23 that are relevant to the claims of the complainants-appellants are as follows (emphasis supplied): Art. in writing. in respect of monthly paid workers and fifteen days' notice in respect of other workers. 107: A contract of employment made for a period of indefinite duration may be terminated by either party thereto after giving the other party thirty days' prior notice before such termination. all hours work shall be paid at the premium rate. . 79: . The party terminating a contract without giving 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. 18). an employer may require a worker. ." Art. 81: . 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. ." All the individual complainants-appellants have already been repatriated to the Philippines at the time of the filing of these cases (R. pp. otherwise known as the Labour Law for the Private Sector (Records. this offday pay provision is applicable only when the laws of the Host Country require payments for rest day. . Vol. This decree took effect on August 16. . . Rollo. 104776. 111: . to work on his weekly day of rest if circumstances so require and in respect of which an additional sum equivalent to 150% of his normal wage shall be paid to him . the employer concerned shall pay to such worker. Some of the provisions of Amiri Decree No.R.A bonus of 20% (for offshore work) of gross income will be accrued and payable only upon satisfactory completion of this contract. However. A worker shall receive payment for each extra hour equivalent to his wage entitlement increased by a minimum of twenty-five per centum thereof for hours worked during the day. 1976. . 23 on June 16. 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. . Amir of Bahrain. with his consent. 23 of Bahrain. 1976. Art. 44 of the same Decree (allegedly prescribing a more favorable treatment of alien employees) bars complainants from enjoying its benefits. whether or not complainants' claim for the benefits provided therein have prescribed. Second: — Assuming that Amiri Decree No. and by a minimum of fifty per centum 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 . . . . 59-65). His Majesty Isa Bin Salman Al Kaifa. (b)Whether or not Art. In the State of Bahrain. 84: Every worker who has completed one year's continuous service with his employer shall be entitled to leave 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. as well as the decision that is the subject of these appeals. (a)Whether or not the respondent-appellant was denied its right to due process. 21 . . Fourth: — Whether or not the proceedings conducted by the POEA. upon termination of employment. conformed with the requirements of due process. issued his Amiri Decree No." Art. IV The issues raised before and resolved by the NLRC were: First: — Whether or not complainants are entitled to the benefits provided by Amiri Decree No.OFFDAY PAY The seventh day of the week shall be observed as a day of rest with 8 hours regular pay. If work is performed on this day. . 23 of Bahrain is applicable in these cases. .

23 of 1976 (Labour Law for the Private Sector). b. Nos. Fifth: — Whether or not the POEA erred in holding respondents AIBC and Brown & Root jointly are severally liable for the judgment awards despite the alleged finding that the former was the employer of the complainants.Fringe benefits under B & R's "A Summary of Employee Benefits" (Annex "Q" of Amended Complaint).Area Differential Pay. g. if so. 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.Unexpired portion of contract.Salary differential pay. e.Refund of withholding tax not remitted to BIR.Refund of SSS premiums not remitted to SSS. 23. 104911-14.War Zone bonus or premium pay of at least 100% of basic pay.Other reliefs.R. 25-29. Interest earnings of Travel and Reserve Fund. should form part of the overseas employment contract of the complainants. o. f. not excluding reportorial requirements thereof.Accrued interests on all the unpaid benefits. and. (c)Whether or not the POEA acquired jurisdiction over Brown & Root International. (b)Whether or not the undisputed fact that AIBC was a licensed construction contractor precludes a finding that Brown & Root is liable for complainants claims. NLRC invoked Article 221 of the Labor Code of the Philippines. l. m. (d)Whether or not the judgment awards are supported by substantial evidence. (f)Whether or not the POEA awarded sums beyond what the complainants-appellants prayed for. NLRC set aside Section 1. Eight: — Whether or not the POEA Administrator erred in not dismissing POEA Case No. Inc.Moral and exemplary damages. i. Seventh: — Whether or not the POEA Administrator erred in dismissing the following claims: a.Wage differential pay. pp. j. n. vesting on the Commission ample discretion to use every and all reasonable means to ascertain the facts in each case without regard to the technicalities of law or procedure. whether or not these awards are valid.Penalty for violations of Article 34 (prohibited practices). k. Rollo. d. like suspending and/or cancelling the license to recruit of AIBC and the accreditation of B & R issued by POEA. 51-55). h. (a)Whether or not the POEA has acquired jurisdiction over Brown & Root.Retirement and Savings Plan benefits. being more favorable and beneficial to the workers. 22 . Sixth: — Whether or not the POEA Administrator's failure to hold respondents in default constitutes a reversible error. NLRC agreed with the POEA Administrator that the Amiri Decree No. (e)Whether or not the awards based on the averages and formula presented by the complainants-appellants are supported by substantial evidence.Attorney's fees of at least ten percent of the judgment award.(b)Whether or not the admission of evidence by the POEA after these cases were submitted for decision was valid. c.. (L) 86-65-460 on the ground of multiplicity of suits (G. Anent the first issue.

No. is not of common or general interest to all the complainants. 23 of 1976. NLRC also held that jurisdiction over BRII was acquired by the POEA Administrator through the summons served on AIBC. who worked in Bahrain. 23 applied only to the claimants. NLRC sustained the ruling of the POEA Administrator that BRII and AIBC are solidarily liable for the claims of the complainants and held that BRII was the actual employer of the complainants. which involved other money claims not based on the Amiri Decree No. (L) 84-06-555. and (3) some of the evidence upon which the decision was based were not disclosed to AIBC and BRII during the hearing. the basis for granting said damages was not established. the claim that POEA Case No.R. (4)that the claims for salaries corresponding to the unexpired portion of their contract may be allowed if filed within the threeyear prescriptive period. No. On the sixth issue. NLRC passed sub silencio the last issue. and set aside awards of the POEA Administrator in favor of the claimants.NLRC. (4)that the prescriptive period for the filing of the claims is ten years. in total disregard of its own rules. NLRC ruled that the prescriptive period for the filing of the claims of the complainants was three years. however. (3)that the POEA Administrator has no jurisdiction over claims for moral and exemplary damages and nonetheless. The POEA Administrator allowed private respondents to file their answers in two years (on June 19. the indirect employer. Instead of dismissing POEA Case No. (L) 86-65-460 should have been dismissed on the ground that the claimants in said case were also claimants in POEA Case No. 1987) after the filing of the original complaint (on April 2. On the fifth issue. held that the Amiri Decree No. its local agent. 1985) and NLRC. NLRC found at least three infractions of the cardinal rules of administrative due process: namely. V G. (2) some findings of fact were not supported by substantial evidence. (2)the claimants failed to establish that they are entitled to the claims which are not based on the overseas employment contracts nor the Amiri Decree No. who worked elsewhere. In other words. NLRC ruled: (1)that the POEA Administrator has no jurisdiction over the claims for refund of the SSS premiums and refund of withholding taxes and the claimants should file their claims for said refund with the appropriate government agencies. and 23 . NLRC agreed with the POEA Administrator that the labor cases cannot be treated as a class suit for the simple reason that not all the complainants worked in Bahrain and therefore. the POEA just resolved the corresponding claims in POEA Case No. (L) 84-06-555. 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. (3)the NLRC and POEA Administrator erred in not holding that the labor cases filed by AIBC and BRII cannot be considered a class suit. the claims arising from the Bahrain law. or at the very least. and (6)that the POEA Administrator has no jurisdiction over the complaint for the suspension or cancellation of the AIBC's recruitment license and the cancellation of the accreditation of BRII. On the seventh issue. On the third issue. On the second issue. NLRC held that the POEA Administrator was correct in denying the Motion to Declare AIBC in default. (1) the failure of the POEA Administrator to consider the evidence presented by AIBC and BRII. the POEA did not pass upon the same claims twice. as provided in Article 291 of the Labor Code of the Philippines.R. Article III of the 1987 Constitution. 23. On the fourth issue. (2)that NLRC and the POEA Administrator should have declared AIBC and BRII in default and should have rendered summary judgment on the basis of the pleadings and evidence submitted by claimants. 104776 based their petition for certiorari on the following grounds: (1)that they were deprived by NLRC and the POEA of their right to a speedy disposition of their cases as guaranteed by Section 16. affirmed the action of the POEA Administrator. (L) 86-65-460. with AIBC as the labor contractor. 104776 Claimants in G. 23 of 1976. (5)that the allegation that complainants were prematurely repatriated prior to the expiration of their overseas contract was not established. the subject matter of the action.

pp. Each claimant demanded separate claims peculiar only to himself and depending upon the particular circumstances obtaining in his case. 1992. Del Mundo to cite Atty. because such memorandum was proposed by a subordinate Bahrain official and there was no showing that it was approved by the Bahrain Minister of Labor. De Castro collected additional attorney's fees on top of the 25% which he was entitled to receive. pp. 1992.R. 292-305). 1560-1614). the nature of the claims varied. de Castro had no right to represent them in said agreements. De Castro and Atty. 18-22). said party had already filed its answer. He also claimed that the claimants were paid less than the award given them by NLRC. 1983 of the Ministry of Labor of Bahrain (Rollo. Atty. pp. prevails over that provided in the Civil Code of the Philippines. BRII and AIBC. The said lawyers allegedly misled this Court.R. Atty. 1994. considering the great difficulty of getting all the records of the more than 1.R. Attorney's Lien On November 12. 104911-14. 15 and 16 of the Code of Professional Responsibility. Katz Tierra for contempt of court and for violation of Canons 1. pp.500 claimants. 1992 (G.R. No. Contempt of Court On February 18. No. Likewise. a special law. that Atty. 1993. pp. argued: (1)that they were not responsible for the delay in the disposition of the labor cases. it was impossible to prepare the answers within the ten-day period provided in the NLRC Rules. Del Mundo filed a "Notice and Claim to Enforce Attorney's Lien. that when the motion to declare AIBC in default was filed on July 19.R. when in fact they were represented by Atty. AIBC and BRII. 104776. Florante de Castro (Rollo. Del Mundo (G. the case filed by Atty. (4)that the prescriptive period for filing the claims is that prescribed by Article 291 of the Labor Code of the Philippines (three years) and not the one prescribed by Article 1144 of the Civil Code of the Philippines (ten years).R. reiterated their contention in G. In the Resolution dated November 23. 23. No. Rollo. pp. 104776. (3)that the claimants failed to refute NLRC's finding that there was no common or general interest in the subject matter of the controversy — which was the applicability of the Amiri Decree No. No. 31-40). Gerardo A. BRII and AIBC claimed that they were not bound by what appeared therein.000. 105029-32 24 . Rollo. 104911-14 based their petition for certiorari on the grounds that NLRC gravely abused its discretion when it: (1) applied the three-year prescriptive period under the Labor Code of the Philippines. Rollo. an omnibus motion was filed by Atty. commenting on the petition in G. the ten-day rule to answer was not fair and reasonable. this being a private quarrel between the two labor lawyers (Rollo. a general law. No." alleging that the claimants who entered into compromise agreements with AIBI and BRII with the assistance of Atty. del Mundo moved to strike out the joint manifestations and motions of AIBC and BRII dated September 2 and 11. 1987.R. De Castro for unethical practices and moved for the voiding of the quitclaims submitted by some of the claimants. No. 21-22). Nos. G. 608-609). L-86-05-460. Atty. On December 14. Likewise.00) and the complicated issues raised by the parties. the Court denied the motion to strike out the Joint Manifestations and Motions dated September 2 and 11. Rollo. On September 23. De Castro. pp. and that considering the staggering amount of the claims (more than US$50.R. 104911-14 The claimants in G. pp. had all signed a retainer agreement with his law firm (G. (2)that considering the number of complaints and claimants.R. 228-236). Nos.(5)that NLRC and the POEA Administrator should have dismissed POEA Case No. As to the memorandum of the Ministry of Labor of Bahrain on the method of computing the overtime pay. they claimed that the averaging method was discussed in the course of the negotiation for the amicable settlement of the dispute and any offer made by a party therein could not be used as an admission by him (Rollo. and that the consent of the claimants to the compromise agreements and quitclaims were procured by fraud (G. L-86-05-460 should be dismissed. by making it appear that the claimants who entered into the compromise agreements were represented by Atty. Del Mundo reiterated his charges against Atty. 1992. 623-624. and (5)that they are not concerned with the issue of whether POEA Case No. in their Comment. De Castro. 1992.000. 838-1535). The claimants argue that said method was proposed by BRII itself during the negotiation for an amicable settlement of their money claims in Bahrain as shown in the Memorandum dated April 16. and (2) it denied the claimant's formula based on an average overtime pay of three hours a day (Rollo. Nos. Florante M. 838-810). 104776. G. pp. some being based on salaries pertaining to the unexpired portion of the contracts while others being for pure money claims. 104776. claiming that all the claimants who entered into the compromise agreements subject of said manifestations and motions were his clients and that Atty. 104776 that the prescriptive period in the Labor Code of the Philippines. the piece-meal filing of the complaints and the addition of hundreds of new claimants by petitioners.

There was no violation. the applicable law of prescription to this instant case is Article 1144 of the Civil Code of the Philippines.R. fixing the prescriptive period at three years as provided in Article 291 of the Labor Code of the Philippines.. Labor Code. [1955]. they allege that assuming that the Amiri Decree No. 104911-14. NLRC opined that the applicability of said law was one of characterization. but the provisions of the Amiri Decree No. . 23 of 1976 was applicable. 104776 and G. Respondents consciously failed to conform to these provisions which specifically provide for the increase of the worker's rate. whether to characterize the foreign law on prescription or statute of limitation as "substantive" or "procedural. (2) granted claims for holiday.R. pp. herein money claims of the complainants against the respondents shall prescribe in ten years from August 16. . The Court observed: 25 . 89-90). when respondent AIBC's contracts have undergone amendments in Bahrain for the new hires/renewals (Respondent's Exhibit 7).R. (G. Atlantic Maritime Company (220 F. instead of ten years. This three-year prescriptive period shall be the one applied here and which should be reckoned from the date of repatriation of each individual complainant. as found by the POEA Administrator.S. We can not consider complainants' cause/s of action to have accrued from a violation of their employment contracts." NLRC cited the decision in Bournias v. 104776. invoking different grounds. 2d Cir. In said case. which ipso facto amended the worker's contracts of employment. i. Hence. considering the fact that the case is having (sic) filed in this country. overtime and leave indemnity pay and other benefits. applying Article 1144 of the Civil Code of the Philippines. 291. which provides: 'Art. the NLRC argued as follows: "The Labor Code provides that 'all money claims arising from employer-employee relations . otherwise they shall be forever barred' (Art. 1144. Article 291 gives no such indication. four months after the brown builders brought a suit against B & R in Bahrain for this same claim. the prescriptive period provided in the law of the forum should apply. what the respondents violated are not the rights of the workers as provided by the Labor Code. The claimants in G. The Solicitor General expressed his personal view that the prescriptive period was one year as prescribed by the Amiri Decree No. NLRC believed otherwise. The U. pp. 23 of 1976. no claim suffered the infirmity of being prescribed" (G. It was only after June 30. No. Nos." hence. In overruling the POEA Administrator. Rollo. 105029-32.R. 152. Likewise. 2d. No. Anent the applicability of the one-year prescriptive period as provided by the Amiri Decree No. 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. Circuit Court of Appeals held that the Panamanian Law was procedural as it was not "specifically intended to be substantive.' Thus. as amended). Nos. To the POEA Administrator. 90-91).In G.R. No. premises considered. Lastly. No.R. VI G. 104911-14 G. (2)Upon an obligation created by law. the claims would have prescribed under the Panamanian Law but not under the Statute of Limitations of New York. Inasmuch as all claims were filed within the ten-year prescriptive period.R. 29-30). Rollo.The following actions may be brought within ten years from the time the cause of action accrues: (1)Upon a written contract. 1983. the prescriptive period was ten years. the claims arise from the benefits of the law of the country where they worked. 105029-32 All the petitions raise the common issue of prescription although they disagreed as to the time that should be embraced within the prescriptive period. shall be filed within three years from the time the cause of action accrued. The POEA Administrator held the view that: "These money claims (under Article 291 of the Labor Code) refer to those arising from the employer's violation of the employee's right as provided by the Labor Code. insisted that NLRC erred in ruling that the prescriptive period applicable to the claims was three years. 1976. BRII and AIBC claim that NLRC gravely abused its discretion when it: (1) enforced the provisions of the Amiri Decree No. In the instant case. We do not agree with the POEA Administrator that this three-year prescriptive period applies only to money claims specifically recoverable under the Philippine Labor Code. 104776 G. 23 of 1976 and not the terms of the employment contracts. 23 issued in Bahrain. and (3) ordered the POEA Administrator to hold new hearings for the 683 claimants whose claims had been dismissed for lack of proof by the POEA Administrator or NLRC itself. NLRC erred when it did not apply the one-year prescription provided in said law (Rollo.e. Nos. on evidence admitted in contravention of petitioner's constitutional right to due process. Nos. 23 of 1976 but he deferred to the ruling of NLRC that Article 291 of the Labor Code of the Philippines was the operative law.R. 104776. and holding that the prescriptive period is three years as provided in Article 291 of the Labor Code of the Philippines.

". . . And where, as here, 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. It does not lead American courts into the necessity of
examining into the unfamiliar peculiarities and refinements of different foreign legal systems. . ."
The court further noted:
xxx xxx xxx
"Applying that test here it appears to us that the libelant 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 libelant seeks to enforce. The Panama Labor Code is a statute having broad objectives, viz: 'The present Code
regulates the relations between capital and labor, placing them on a basis of social justice, so that, without injuring any
of the parties, there may be guaranteed for labor the necessary conditions for a normal life and to capital an equitable
return to its investment.' In pursuance of these objectives the Code gives laborers various rights against their
employers. Article 623 establishes the period of limitation for all such rights, except certain ones which are enumerated
in Article 621. And there is nothing in the record to indicate that the Panamanian legislature gave special consideration
to the impact of Article 623 upon the particular rights sought to be enforced here, as distinguished from the other rights
to which that Article is also applicable. Were we confronted with the question of whether the limitation period of Article
621 (which carves out particular rights to be governed by a shorter limitation period) is to be regarded as 'substantive'
or 'procedural' under the rule of 'specificity' we might have a different case; but here on the surface of things we appear
to be dealing with a 'broad,' and not a 'specific,' statute of limitations" (G.R. No. 104776, Rollo, pp. 92-94).
Claimants in G.R. Nos. 104911-14 are of the view that Article 291 of the Labor Code of the Philippines, which was applied by
NLRC, refers only to claims "arising from the employer's violation of the employee's right as provided by the Labor Code." They assert
that their claims are based on the violation of their employment contracts, as amended by the Amiri Decree No. 23 of 1976 and
therefore the claims may be brought within ten years as provided by Article 1144 of the Civil Code of the Philippines (Rollo, G.R. Nos.
104911-14, pp. 18-21). To bolster their contention, they cite PALEA v. Philippine Airlines, Inc., 70 SCRA 244 (1976).
AIBC and BRII, insisting that the actions on the claims have prescribed under the Amiri Decree No. 23 of 1976, argue that
there is in force in the Philippines a "borrowing law," which is Section 48 of the Code of Civil Procedure and that where such kind of law
exists, it takes precedence over the common-law conflicts rule (G.R. No. 104776, Rollo, pp. 45-46).

First to be determined is whether it is the Bahrain law on prescription of action based on the Amiri Decree No. 23 of 1976 or a
Philippine law on prescription that shall be the governing law.
Article 156 of the Amiri Decree No. 23 of 1976 provides:
"A claim arising out of a contract of employment shall not be actionable after the lapse of one year from the
date of the expiry of the contract" (G.R. Nos. 105029-31, Rollo, p. 226).
As a general rule, a foreign procedural law will not be applied in the forum. 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 (Restatement of the Conflict of Laws, Sec. 685; Salonga, Private International Law 131 [1979]).
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.
Thus in Bournias v. Atlantic Maritime Company, supra, 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 on prescription of
actions.
However, the characterization of a statute into a procedural or substantive law becomes irrelevant when the country of the
forum has a "borrowing statute." Said statute has the practical effect of treating the foreign statute of limitation as one of substance
(Goodrich, Conflict of Laws 152-153 [1938]). A "borrowing statute" directs the state of the forum to apply the foreign statute of
limitations to the pending claims based on a foreign law (Siegel, Conflicts 183 [1975]). While there are several kinds of "borrowing
statutes," one from 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 has not run against it (Goodrich and Scoles, Conflict of Laws 152-153 [1938]). Section 48 of our Code of Civil
Procedure is of this kind. Said Section 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
Philippines Islands."
Section 48 has not been repealed or amended by the Civil Code of the Philippines. Article 2270 of said Code repealed only
those provisions of the Code of Civil Procedures as to which were inconsistent with it. There is no provision in the Civil Code of the
Philippines, which is inconsistent with or contradictory to Section 48 of the Code of Civil Procedure (Paras, Philippine Conflict of Laws
104 [7th ed.]).

26

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 will not enforce any foreign claim obnoxious to the forum's public policy (Canadian Northern Railway
Co. v. Eggen, 252 U.S. 553, 40 S. Ct. 402, 64 L. ed. 713 [1920]). 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."
Having determined that the applicable law on prescription is the Philippine law, the next question is whether the prescriptive
period governing the filing of the claims is three years, as provided by the Labor Code or ten years, as provided by the Civil Code of the
Philippines.
The claimants are of the view that the applicable provision is Article 1144 of the Civil Code of the Philippines, which provides:
"The following actions must be brought within ten years from the right of action accrues:
(1)Upon a written contract;
(2)Upon an obligation created by law;
(3)Upon a judgment."
NLRC, on the other hand, believes that the applicable provision is Article 291 of the Labor Code of the Philippines, which in
pertinent part provides:
"Money claims-all money claims arising from employer-employee relations accruing during the effectivity of this
Code shall be filed within three (3) years from the time the cause of action accrued, otherwise they shall be forever
barred.
xxx xxx xxx"
The case of Philippine Air Lines Employees Association v. Philippine Air Lines, Inc., 70 SCRA (1976) invoked by the claimants in
G.R. Nos. 104911-14 is inapplicable to the cases at bench (Rollo, p. 21). The said case involved the correct computation of overtime
pay as provided in the collective bargaining agreements and not the Eight-Hour Labor Law.
As noted by the Court: "That is precisely why petitioners did not
under the Eight-Hour Labor Law (Secs. 3 and 4, CA No. 494) and instead
bargaining agreements between the parties be observed. Since the claim
contracts between the litigants, the ten-year prescriptive period provided

make any reference as to the computation for overtime work
insisted that work computation provided in the collective
for pay differentials is primarily anchored on the written
by Art. 1144(1) of the New Civil Code should govern."

Section 7-a of the Eight-Hour Labor Law (CA No. 444 as amended by R.A. No. 1993) provides:
"Any action to enforce any cause of action under this Act shall be commenced within three years after the
cause of action accrued otherwise such action shall be forever barred, . . . "
The court further explained:
"The three-year prescriptive period fixed in the Eight-Hour Labor Law (CA No. 444 as amended) will apply, if the claim
for differentials for overtime work is solely based on said law, and not on a collective bargaining agreement or any other
contract. In the instant case, the claim for overtime compensation is not so much because of Commonwealth Act No.
444, as amended but because the claim is demandable right of the employees, by reason of the above-mentioned
collective bargaining agreement."
Section 7-a of the Eight-Hour Labor Law provides the prescriptive period for filing "actions to enforce any cause of action under
said law." On the other hand, Article 291 of the Labor Code of the Philippines provides the prescriptive period for filing "money claims
arising from employer-employee relations." The claim is the cases at bench all arose from the employer-employee relations, which is
broader in scope than claims arising from a specific law or from the collective bargaining agreement.

27

The contention of the POEA Administrator, that the three-year prescriptive period under Article 291 of the Labor Code of the
Philippines applies only to money claims specifically recoverable under said Code does not find support in the plain language of the
provision. Neither is the contention of the claimants in G.R. No. 104911-14 that said Article refers only to claims "arising from the
employer's violation of the employee's right," as provided by the Labor Code supported by the facial reading of the provision.
VII
G.R. No. 104776
A.As the first two grounds for the petition in G.R. No. 104776, claimants aver: (1) that while their complaints were filed on
June 6, 1984 with POEA, the case was decided only on January 30, 1989, a clear denial of their right to a speedy disposition of the
case; and (2) that NLRC and the POEA Administrator should have declared AIBC and BRII in default (Rollo, pp. 31-35).
Claimants invoke a new provision incorporated in the 1987 Constitution, which provides:
"Sec. 16.All persons shall have the right to a speedy disposition of their cases before all judicial, quasi-judicial, or
administrative bodies."
It is true that the constitutional right to "a speedy disposition of cases" is not limited to the accused in criminal proceedings but
extends to all parties in all cases, including civil and administrative cases, and in all proceedings, including judicial and quasi-judicial
hearings. Hence, under the Constitution, any party to a case may demand expeditious action on all officials who are tasked with the
administration of justice.
However, as held in Caballero v. Alfonso, Jr., 153 SCRA 153 (1987), "speedy disposition of cases" is a relative term. Just like
the constitutional guarantee of "speedy trial" accorded to the accused in all criminal proceedings, "speedy disposition of cases" is a
flexible concept. It is consistent with delays and depends upon the circumstances of each case. What the Constitution prohibits are
unreasonable, arbitrary and oppressive delays which render rights nugatory.
Caballero laid down the factors that may be taken into consideration in determining whether or not the right to a "speedy
disposition of cases" has been violated, thus:
"In the determination of whether or not the right to a "speedy trial" has been violated, certain factors may be
considered and balanced against each other. These are length of delay, reason for the delay, assertion of the right or
failure to assert it, and prejudice caused by the delay. The same factors may also be considered in answering judicial
inquiry whether or not a person officially charged with the administration of justice has violated the speedy disposition
of cases."
Likewise, in Gonzales v. Sandiganbayan, 199 SCRA 298, (1991), we held:
"It must be here emphasized that the right to a speedy disposition of a case, like the right to speedy trial, is deemed
violated only when the proceeding is attended by vexatious, capricious, and oppressive delays; or when unjustified
postponements of the trial are asked for and secured, or when without cause or justified motive a long period of time is
allowed to elapse without the party having his case tried."

Since July 25, 1984 or a month after AIBC and BRII were served with a copy of the amended complaint, claimants had been
asking that AIBC and BRII be declared in default for failure to file their answers within the ten-day period provided in Section 1, Rule III
of Book VI of the Rules and Regulations of the POEA. At that time, there was a pending motion of AIBC and BRII to strike out of the
records the amended complaint and the "Compliance" of claimants to the order of the POEA, requiring them to submit a bill of
particulars.
The cases at bench are not of the run-of-the-mill variety, such that their final disposition in the administrative level after seven
years from their inception, cannot be said to be attended by unreasonable, arbitrary and oppressive delays as to violate the
constitutional rights to a speedy disposition of the cases of complainants.
The amended complaint filed on June 6, 1984 involved a total of 1,767 claimants. Said complaint had undergone several
amendments, the first being on April 3, 1985.
The claimants were hired on various dates from 1975 to 1983. They were deployed in different areas, one group in and the
other groups outside of, Bahrain. The monetary claims totalling more than US$65 million according to Atty. Del Mundo, included:
"1.Unexpired portion of contract;
2.Interest earnings of Travel and Fund;
3.Retirement and Savings Plan benefit;
4.War Zone bonus or premium pay of at least 100% of basic pay;
5.Area Differential pay;

28

L-84-06-555. 1986 (POEA Case No.Accrued Interest of all the unpaid benefits. 12. have yet to settle the right of representation.Attorney's fees of at least ten percent of amounts. G. to the lament of NLRC.6.Other reliefs. "the problem created by this situation is that if one of the two petitions is dismissed. Atty.R. and in the disbarment proceedings by one against the other. When claimants filed their "Compliance and Manifestation. then the parties and the public respondents would not know which claim of which petitioner was dismissed and which was not. Rollo. In the charges and countercharges of falsification of documents and signatures.Wage Differential pay. Some of the records dated as far back as 1975. The two lawyers for the complainants. 7. As late as last month.700 claimants had to be retrieved from various countries in the Middle East. 104776. 10. Another complaint was filed on May 29. Attempts by this Commission to resolve counsels' conflicting claims of their respective authority to represent the complainants prove futile. 73-74). not improbable that their misplaced zeal and exuberance caused them to throw all caution to the wind in the matter of elementary rules of procedure and evidence" (Rollo. September 2. which complained: "It is very evident from the records that the protagonists in these consolidated cases appear to be not only the individual complainants.Claimants insist that all their claims could properly be consolidated in a "class suit" because "all the name complainants have similar money claims and similar rights sought irrespective of whether they worked in Bahrain.Penalty for violation of Article 34 (Prohibited practices) not excluding reportorial requirements thereof" (NLRC Resolution. unwittingly. L-85-10-777 and L-85-10-779). Inasmuch as the complaint did not allege with sufficient definiteness and clarity of some facts." B. The hearings on the merits of the claims before the POEA Administrator were interrupted several times by the various appeals.). 104776. NLRC. like suspending and/or cancelling the license to recruit of AIBC and issued by the POEA. Sept. While the POEA Administrator denied the motion to strike out the complaint. As a result. 14. United Arab Emirates or in Abu Dhabi. painted a rainbow for the complainants. with the proverbial pot of gold at its end containing more than US$100 million. 11.460). and even derailed the prospects of an amicable settlement. 9.R. 18-19. G. 13. and AIBC and Brown & Root. L-86-05. Libya or in any part of the Middle East" (Rollo. Florante De Castro. Parties and counsel have made these cases a litigation of emotion. perhaps.Moral and Exemplary Damages. the aggregate of the claims in these cases. this Commission made a last and final attempt to bring the counsel of all the parties (this Commission issued a special order directing respondent Brown & Root's resident agent/s to appear) to come to a more conciliatory stance. on the one hand. Aside from the inclusion of additional claimants. Even this failed" (Rollo. thus: "These cases could have been spared the long and arduous route towards resolution had the parties and their counsel been more interested in pursuing the truth and the merits of the claims rather than exhibiting a fanatical reliance on technicalities. Adding to the confusion in the proceedings before NLRC. to a large extent. 1985 (POEA Cases No. The bickerings by these two counsels are reflected in their pleadings. Gerardo Del Mundo and Atty. All these have. pp. It would not be far-fetched to imagine that both counsel. and 15.Salary differential pay. is the listing of some of the complainants in both petitions filed by the two lawyers. the claimants were ordered to comply with the motion of AIBC for a bill of particulars. 2.Refund of SSS premiums not remitted to Social Security System. in exasperation. 57). pp. No. p. 8. first to NLRC and then to the Supreme Court. pp. The squabble between the lawyers of claimants added to the delay in the disposition of the cases. likewise. Rollo. The intransigence of parties and counsel is remarkable.Refund of Withholding Tax not remitted to Bureau of Internal Revenue (B." AIBC moved to strike out the complaint from the records for failure of claimants to submit a proper bill of particulars. No. the records of employment of the more than 1.Fringe Benefits under Brown & Root's "A Summary of Employees Benefits consisting of 43 pages (Annex "Q" of Amended Complaint). p. 58). on the other hand. It is. jumble the presentation of evidence. Before an intelligent answer could be filed in response to the complaint. 29 . there are two appeals by the complainants. two new cases were filed against AIBC and BRII on October 10. abetted in confounding the issues raised in these cases.R. he ordered the claimants "to correct the deficiencies" pointed out by AIBC. 58-59). pp. 1991. As noted by NLRC. 35-38). noted that the exact number of claimants had never been completely established (Resolution. All the three new cases were consolidated with POEA Case No. 1991.I. NLRC blamed the parties and their lawyers for the delay in terminating the proceedings. each one persistently claiming to appear in behalf of most of the complainants.

The problem arises when the decision is adverse to them. Court of Industrial Relations. many of the claimants never worked in that country. Gerardo A. De Castro because NLRC and POEA have no jurisdiction to investigate charges of unethical conduct of lawyers. C.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 (Revised Rules of Court. 1525). It appears that each claimant is only interested in collecting his own claims. each claimant is interested only in his own demand and not in the claims of the other employees of defendants.R. duplicity and other unprofessional activities" and his appearances as counsel for some of the claimants as illegal (Rollo. Rule 138.The claimants in G. 104911-14 Claimants charge NLRC with grave abuse of discretion in not accepting their formula of "Three Hours Average Daily Overtime" in computing the overtime payments. They claim that it was BRII itself which proposed the formula during the negotiations for the settlement of their claims in Bahrain and therefore it is in estoppel to disclaim said offer (Rollo. Florante De Castro and Atty. No. Del Mundo to protect his claim for attorney's fees for legal services rendered in favor of the claimants (G. said circular took effect only on April 1. No. it is only logical that only those who worked in Bahrain shall be entitled to file their claims in a class suit. 101 Phil. G. In an improperly instituted class suit. many of the claimants worked outside Bahrain. Some of the claimants were deployed in Indonesia and Malaysia under different terms and conditions of employment.R. The named claimants have a special or particular interest in specific benefits completely different from the benefits in which the other named claimants and those included as members of a "class" are claiming (Berses v. It is entitled "Additional Requirements For Petitions Filed with the Supreme Court and the Court of Appeals To Prevent Forum Shopping or Multiple Filing of Petitioners and Complainants. The lawyer shall cause written notice thereof to be delivered to his clients and to the adverse party (Revised Rules of Court. Del Mundo to cite Atty. No. 38-40). 12). pp. Said Rule however. that hundreds of them have abandoned their co-claimants and have entered into separate compromise settlements of their respective claims. 1994. For this matter. falsification. 21-22). While some claims are based on the Amiri Law of Bahrain. 1983. The Court is extra-cautious in allowing class suits because they are the exceptions to the condition sine qua non. with the result that the courts or agencies have to resolve the same issues. applies only to petitions filed with the Supreme Court and the Court of Appeals. Attorney's Lien The "Notice and Claim to Enforce Attorney's Lien" dated December 14. ambulance chasing activities. 6). 838-810." The first sentence of the circular expressly states that said circular applies to an governs the filing of petitions in the Supreme Court and the Court of Appeals. While all the claims are for benefits granted under the Bahrain Law. Sec. 473 [1913]). 04-94 extended the application of the anti-forum shopping rule to the lower courts and administrative agencies. pp. While Administrative Circular No. While there are common defendants (AIBC and BRII) and the nature of the claims is the same (for employee's benefits). Contempt of Court The complaint of Atty. Rule 3. Villanueva. The most that can be accorded to them under the Rules of Court is to be allowed to join as plaintiffs in one complaint (Revised Rules of Court. would surely claim denial of due process. Florante De Castro guilty of "forum shopping. 104776 also urged that the POEA Administrator and NLRC should have declared Atty. Gerardo A. POEA and NLRC could not have entertained the complaint for unethical conduct against Atty. in which case the others who were impleaded by their self-appointed representatives. 25 Phil. pp. 104776. Rollo. there would be no problem if the decision secured is favorable to the plaintiffs. requiring the joinder of all indispensable parties. A claimants has no concern in protecting the interests of the other claimants as shown by the fact. Del Mundo should have been filed with the administrative agency that rendered and executed the judgment. Sec. A statement of a claim for a charging lien shall be filed with the court or administrative agency which renders and executes the money judgment secured by the lawyer for his clients. which in pertinent part states: 30 . The statement of the claim for the charging lien of Atty. Claimants presented a Memorandum of the Ministry of Labor of Bahrain dated April 16.R. NLRC and the POEA Administrator are correct in their stance that 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). 28-91) is intended to put a stop to the practice of some parties of filing multiple petitions and complaints involving the same issues. 1992 was filed by Atty. 37). but were deployed elsewhere. The Anti-Forum shopping Rule (Revised Circular No. the claimants who worked in Bahrain can not be allowed to sue in a class suit in a judicial proceeding. Rule 3. there is no common question of law or fact. 590 [1957]). A principle basic to the concept of "class suit" is that plaintiffs brought on the record must fairly represent and protect the interests of the others (Dimayuga v. Sec. Thus. Katz Tierra for violation of the Code of Professional Responsibility should be filed in a separate and appropriate proceeding.

It was stipulated in said contracts that: "The Employee agrees that while in the employ of the Employer. While said document was presented to the POEA without observing the rule on presenting official documents of a foreign government as provided in Section 24. an offer to settle a claim is not an admission that anything is due. sample of the Service Contract executed between one of the employees and the company through its agent in (sic) Philippines. BRII and AIBC countered: (1) that the Memorandum was not prepared by them but by a subordinate official in the Bahrain Department of Labor. and (3) that the offer was made in the course of the negotiation for an amicable settlement of the claims and therefore it was not admissible in evidence to prove that anything is due to the claimants. provided that the laws of the host country became applicable to said contracts if they offer terms and conditions more favorable that those stipulated therein. But to bind a party to his offers. 352-353). 23 of 1976."After the perusal of the memorandum of the Vice President and the Area Manager. plus the non-waivable benefits shall be equivalent to the compensation herein agreed" (Rollo.The average hours for the overtime is 3 hours plus in all public holidays and weekends. xxx xxx xxx The Company in its computation reached the following averages: A.The average duration of the actual service of the employee is 35 months for the Philippino (sic) employees . it can be admitted in evidence in proceedings before an administrative body. .22). The opposing parties have a copy of the said memorandum. then the laws of the host country shall form part of the overseas employment contract.Payment of US$8. — In civil cases. The submission of offers and counter-offers in the negotiation table is a step in the right direction. Middle East. . Nos." This Rule is not only a rule of procedure to avoid the cluttering of the record with unwanted evidence but a statement of public policy. 4. . he will not engage in any other business or occupation. . Asia International Builders Corporation where it has been provided for 48 hours of work per week and annual leave of 12 days and an overtime wage of 1 & 1/4 of the normal hourly wage. (Rollo. nor seek employment with anyone other than the Employer.72 per months (sic) of service as compensation for the difference of the wages of the overtime done for each Philippino (sic) employee . in labor proceedings.1. pp. an offer of compromise is not an admission of any liability. . They contend that the principle that a law is deemed to be a part of a contract applies only to provisions of Philippine law in relation to contracts executed in the Philippines. . ." It quoted with approval the observation of the POEA Administrator that ". Rule 132 of the 1989 Revised Rules on Evidence. all doubts in the implementation of the provisions of the Labor Code and its implementing regulations shall be resolved in favor of labor" (Rollo.e. and is not admissible in evidence against the offeror. 31 . G. It was of the belief that "where the laws of the host country are more favorable and beneficial to the workers. pp. Every effort must be taken to encourage them to arrive at a settlement. Said Rule provides: "Offer of compromise not admissible. 90-94). . that he shall devote his entire time and attention and his best energies. AIBC and BRII claim that NLRC acted capriciously and whimsically when it refused to enforce the overseas-employment contracts. There is great public interest in having the protagonists settle their differences amicable before those ripen into litigation. and abilities to the performance of such duties as may be assigned to him by the Employer. which were prepared by AIBC and BRII themselves. it being understood that should applicable laws establish that fringe benefits. of Brown & Root Co. 105029-32 A. the complaint filed by the employees on 14/2/83 where they have claimed as hereinabove stated.69 .NLRC applied the Amiri Decree No. and they could easily verify its authenticity and accuracy..The average wage per hour for the Philippino (sic) employee is US$2. Under Section 27. . . would defeat the salutary purpose of the Rule. and that the benefits provided to Employee hereunder are substituted for and in lieu of all other benefits provided by any applicable law. or other such benefits additional to the compensation herein agreed cannot be waived. The admissibility of the offer of compromise made by BRII as contained in the memorandum is another matter. 3. that total remuneration and benefits do not fall below that of the host country regulation or custom. (2) that there was no showing that the Bahrain Minister of Labor had approved said memorandum.R. The overseas-employment contracts. which provides for greater benefits than those stipulated in the overseasemployment contracts of the claimants. Employee agrees that such compensation will be adjusted downward so that the total compensation hereunder. that he shall at all times be subject to the direction and control of the employer.. provided of course. 2. which became the law of the parties. and the Summary of the compensation offered by the Company to the employees in respect of the difference of pay of the wages of the overtime and the difference of vacation leave and the perusal of the documents attached thereto e. minutes of the meetings between the Representative of the employees and the management of the Company. Rule 130 of the 1989 Revised Rules on Evidence. as what claimants would make this Court do. p.

Inc.]). Songco. the place of registry of the vessel in which the late husband of private respondent served at the time of his death.. 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. Such party expectation is protected by giving effect to the parties' own choice of the applicable law (Fricke v. and the late husband of the private respondent. however. (PTE) v. Inc. we read the overseas-employment contracts in question as adopting the provisions of the Amiri Decree No. v. annual-leave differential and leave indemnity pay to the claimants listed in Annex B of the Resolution. 135 SCRA 278 (1985). Private International Law." They pointed out that NLRC took into consideration evidence submitted on appeal. 23 of 1976 as part and parcel thereof. NLRC decided to pass upon the validity of the claims itself. Supp. pp. the foreign law is adopted as a "system" to regulate the relations of the parties. the "Employment Agreement. AIBC and BRII themselves were able to present before NLRC additional evidence which they failed to present before the POEA Administrator.The overseas-employment contracts could have been drafted more felicitously. Inc. B. pp. we applied said foreign law in preference to the terms of the contract. "compensation shall be paid to employee in accordance with and subject to the limitation of the Workmen's Compensation Act of the Republic of the Philippines or the Worker's Insurance Act of registry of the vessel. Margarine-Verkaufs-Union.. The issue in that case was whether the amount of the death compensation of a Filipino seaman should be determined under the shipboard employment contract executed in the Philippines or the Hongkong law." By such reference to the provisions of the foreign law. Choice of Law in Torts and Contracts. As a matter of fact. the contract does not become a foreign contract to be governed by the foreign law." 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. matters of performance. Isbrandtsen Co. holiday-pay differential. Dicey and Morris. 37-39). Private International Law 197 [1967]. bear some relationship to the parties or their transaction (Scoles and Hayes. The said law does not operate as a statute but as a set of contractual terms deemed written in the contract (Anton. Applying the said legal precepts. 32 . whichever is greater. National Labor Relations Commission. It is this procedure that AIBC and BRII complain of as being irregular and a "reversible error. The Conflict of Laws 702-703. 21 [1977]). At first. relied upon by AIBC and BRII is inapposite to the facts of the cases at bench. While a part thereof provides that the compensation to the employee may be "adjusted downward so that the total computation (thereunder) plus the non-waivable benefits shall be equivalent to the compensation" therein agreed. 150-161). which means further delay in the termination of the case." between Norse Management co. the court differentiated said case from Norse Management Co. v. the parties may just agree that specific provisions of a foreign statute shall be deemed incorporated into their contract "as a set of terms. 93 SCRA 257 [1979]). 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. 187 [7th ed]). The choice of law must. In such a case. NLRC noted that so many pieces of evidentiary matters were submitted to the POEA administrator by the claimants after the cases were deemed submitted for resolution and which were taken cognizance of by the POEA Administrator in resolving the cases. 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. A basic policy of contract is to protect the expectation of the parties (Reese. [8th ed. NLRC reversed the resolution of the POEA Administrator granting these benefits on a finding that the POEA Administrator failed to consider the evidence presented by AIBC and BRII. While AIBC and BRII had no opportunity to refute said evidence of the claimants before the POEA Administrator. 117 SCRA 486 (1982). expressly provided that in the event of illness or injury to the employee arising out of and in the course of his employment and not due to his own misconduct. in that in the latter case there was an express stipulation in the employment contract that the foreign law would be applicable if it afforded greater compensation. The case of Bagong Filipinas Overseas Corporation v. conflict of Law 644-647 [1982]). including questions of their capacity to enter into the contract. Instead of adopting the entire mass of the foreign law. that some findings of fact of the POEA Administrator were not supported by the evidence. 151 F. But instead of remanding the case to the POEA Administrator for a new hearing. 467 [1957]). 35-36. In Norse Management Co." 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 (Fieldmen's Insurance Co. and that some of the evidence were not disclosed to AIBC and BRII (Rollo. 106-107). granted a better compensation package." Any ambiguity in the overseas-employment contracts should be interpreted against AIBC and BRII. they had all the opportunity to rebut said evidence and to present their counter-evidence before NLRC.AIBC and BRII claim that they were denied by NLRC of their right to due process when said administrative agency granted Friday-pay differential. Holding that the shipboard employment contract was controlling. and so forth (16 Am Jur 2d. 465. 25 SCRA 70 [1968]). the formalities to be observed by them. National Seamen Board." Since the laws of Singapore. 16 Columbia Journal of Transnational Law 1. the parties that drafted it (Eastern Shipping Lines. The parties to a contract may select the law by which it is to be governed (Cheshire. the same evidence which NLRC found to have been "unilaterally submitted by the claimants and not disclosed to the adverse parties" (Rollo.

after the marriage. Cdpr A principle well embedded in Administrative Law is that the technical rules of procedure and evidence do not apply to the proceedings conducted by administrative agencies (First Asian Transport & Shipping Agency Inc v. We find no such abuse of discretion. MANUEL V. DECISION MELENCIO-HERRERA. Inc. that they were married in Hongkong in 1972. 1983. HON. United States. that. WHEREFORE. Asiaworld Publishing House. These cardinal rules are collated inAng Tibay v." In deciding to resolve the validity of certain claims on the basis of the evidence of both parties submitted before the POEA Administrator and NLRC. Manila. 1984. . that they begot two children born on April 4. The three petitions were filed under Rule 65 of the Revised Rules of Court on the grounds that NLRC had committed grave abuse of discretion amounting to lack of jurisdiction in issuing the questioned orders. National Labor Relations Commission. ALICE REYES VAN DORN. Regional Trial Court of the National Capital Region Pasay City. as Presiding Judge of Branch CX. (the Galleon Shop. stating that petitioner's business in Ermita. ROMILLO. Branch CXV. 41-42). L-68470. 1983 and August 3. Ople. Pagdonsalan v. which denied her Motion to Dismiss said case. Padilla. Jr. 127 SCRA 463 [1984]). Dated June 8. and RICHARD UPTON. is conjugal property of the parties. 1973 and December 18. there are cardinal rules which must be observed by the hearing officers in order to comply with the due process requirements of the Constitution. 1975. . 1985. JR.] 5. J p: In this Petition for Certiorari and Prohibition.. matter or controversy. C. No. 142 SCRA 542 [1986]. which empowers it "[to] conduct investigation for the determination of a question. petitioner Alice Reyes Van Dorn seeks to set aside the Orders. 41-45). that the parties were divorced in Nevada.AIBC and BRII charge NLRC with grave abuse of discretion when it ordered the POEA Administrator to hold new hearings for 683 claimants listed in Annex D of the Resolution dated September 2. This principle is enshrined in Article 221 of the Labor Code of the Philippines and is now the bedrock of proceedings before NLRC. this time to Theodore Van Dorn. Ople.Under Article 221 of the Labor Code of the Philippines. . private respondent filed suit against petitioner in Civil Case No. petitioner. the latter considered that it was not expedient to remand the cases to the POEA Administrator for that would only prolong the already protracted legal controversies. respectively. 69 Phil. all the three petitions are DISMISSED. all in the interest of due process. in 1982.. 190 SCRA 653 [1990]. NLRC based its ruling on Article 218 (c) of the Labor Code of the Philippines. within its jurisdiction. issued by respondent Judge. Davide. concur. Notwithstanding the non-applicability of technical rules of procedure and evidence in administrative proceedings." It is the posture of AIBC and BRII that NLRC has no authority under Article 218(c) to remand a case involving claims which had already been dismissed because such provision contemplates only situations where there is still a question or controversy to be resolved (Rollo. JJ. Petitioner moved to dismiss the case on the ground that the cause of action is barred by previous judgment in the divorce proceedings before the Nevada Court wherein respondent had acknowledged that he and petitioner had "no community property" as of June 33 . pp. October 8. and that private respondent be declared with right to manage the conjugal property. vs. and that petitioner has re-married also in Nevada. and asking that petitioner be ordered to render an accounting of that business. respectively. v. and her Motion for Reconsideration of the Dismissal Order. they established their residence in the Philippines. in Civil Case No. respondents. Even the Supreme Court has decided appealed cases on the merits instead of remanding them to the trial court for the reception of evidence. where the same can be readily determined from the uncontroverted facts on record (Development Bank of the Philippines v. 152 SCRA 219 [1987]). 1075-P of the Regional Trial Court. SO ORDERED. for short). NLRC is enjoined to "use every and all reasonable means to ascertain the facts in each case speedily and objectively and without regard to technicalities of law or procedure. 1075-P. 635 (1940).. The basic background facts are that petitioner is a citizen of the Philippines while private respondent is a citizen of the United States. whose claims had been found by NLRC itself as not "supported by evidence" (Rollo. 1991 whose claims had been denied by the POEA Administrator "for lack of proof" and for 69 claimants listed in Annex E of the same Resolution. Intermediate Appellate Court. dated September 15. FIRST DIVISION [G. pp. in Pasay City.R. Bellosillo and Kapunan. . Court of Industrial Relations.

to file an Answer. The decree is binding on private respondent as an American citizen. 799: "The purpose and effect of a decree of divorce from the bond of matrimony by a court of competent jurisdiction are to change the existing status or domestic relation of husband and wife. that the Galleon Shop was not established through conjugal funds. or upon any other regime. and to free them both from the bond. For the resolution of this case. "2. upon complete separation of property. Atherton. when a grave abuse of discretion was patently committed. as private respondent does. For his part. divest Philippine Courts of jurisdiction to entertain matters within its jurisdiction. 5 only Philippine nationals are covered by the policy against absolute divorces the same being considered contrary to our concept of public policy and morality. to agree to the divorce on the ground of incompatibility in the understanding that there were neither community property nor community obligations. were upon absolute or relative community property. is unknown to the law. he is estopped by his own representation before said Court from asserting his right over the alleged conjugal property. observe respect and fidelity. then it devolves upon this Court in a certiorari proceeding to exercise its supervisory authority and to correct the error committed which. ceases to bind either. that the acts and declaration of a foreign Court cannot. xxx xxx xxx" 4 There can be no question as to the validity of that Nevada divorce in any of the States of the United States. the same being contrary to local law and public policy. 45 L. The Nevada District Court.That there is no community of property to be adjudicated by the Court. For instance. under which divorce dissolves the marriage. The Court below denied the Motion to Dismiss in the mentioned case on the ground that the property involved is located in the Philippines so that the Divorce Decree has no bearing in the case. aliens may obtain divorces abroad. However. to represent him in the divorce proceedings: xxx xxx xxx "You are hereby authorized to accept service of Summons.. 336 W. California. San Francisco. et. respondent avers that the Divorce Decree issued by the Nevada Court cannot prevail over the prohibitive laws of the Philippines and its declared national policy. When the law provides. of the Civil Code cannot be just. petitioner has to be considered still married to private respondent and still subject to a wife's obligations under Article 109. that the guilty party shall not marry again. 1 Prohibition would then lie since it would be useless and a waste of time to go ahead with the proceedings.11. Reno. A husband without a wife. subject to the following: "1. Petitioner should not be obliged to live together with. which may be recognized in the Philippines. "3. However. authorized his attorneys in the divorce case. is still absolutely freed from the bond of the former marriage. as well as the other. had obtained jurisdiction over petitioner who appeared in person before the Court during the trial of the case.. giving his address as No. What he is contending in this case is that the divorce is not valid and binding in this jurisdiction. in such a case. is equivalent to lack of jurisdiction. in any State of the Union. and render support to private respondent. and whose decision he does not repudiate. Karp & Gradt. especially if the same is contrary to public policy. which validly exercised jurisdiction over him. the divorce in Nevada released private respondent from the marriage from the standards of American law. provided they are valid according to their national law. The pivotal fact in this case is the Nevada divorce of the parties. The latter should not continue to be one of her heirs with possible rights to conjugal property. 381 Bush Street. in the nature of a penalty. pursuant to his national law." Thus. appear on my behalf and do all things necessary and proper to represent me. 1982. 3 As explicitly stated in the Power of Attorney he executed in favor of the law firm of KARP & GRAD LTD. or a wife without a husband. under our laws. or the lower Court acted capriciously and whimsically. She should not be discriminated against in her own country if the ends of justice are to be served. It also obtained jurisdiction over private respondent who. after their marriage. Ltd.That my spouse seeks a divorce on the ground of incompatibility. seq. Nevada. To maintain. As stated by the Federal Supreme Court of the United States in Atherton vs. and that respondent's claim is barred by prior judgment. without further contesting. which decreed the divorce. and we have given it due course. 794. it is not necessary to determine whether the property relations between petitioner and private respondent. as her husband. Ed. private respondent cannot sue petitioner. Certiorari and Prohibition are neither the remedies to question the propriety of an interlocutory order of the trial Court. 34 . Liberty. Generally. We consider the petition filed in this case within the exception. that. The marriage tie. the denial of a Motion to Dismiss in a civil case is interlocutory and is not subject to appeal. He would have no standing to sue in the case below as petitioner's husband entitled to exercise control over conjugal assets. 6 In this case. private respondent is no longer the husband of petitioner.That there are no community obligations to be adjudicated by the court. that party. For resolution is the effect of the foreign divorce on the parties and their alleged conjugal property in the Philippines. It is true that owing to the nationality principle embodied in Article 15 of the Civil Code. As he is bound by the Decision of his own country's Court. The denial is now the subject of this Certiorari proceeding. when thus severed as to one party. Petitioner contends that respondent is estopped from laying claim on the alleged conjugal property because of the representation he made in the divorce proceedings before the American Court that they had no community of property.

promulgated a decree of divorce on the ground of failure of marriage of the spouses. that is. her co-accused in Criminal Case No. 6 The complaints were accordingly filed and were eventually raffled to two branches of the Regional Trial Court of Manila. concur. 1980. the respondent city fiscal approved a resolution. The marriage started auspiciously enough. de los Reyes. No. 1075-P of his Court. Imelda Pilapil and William Chia". June 30. Relova Gutierrez. gave due course to both petitions and directed the respondent city fiscal to inform the Department of Justice "if the accused have already been arraigned and if not yet arraigned. The Secretary of Justice. Imelda Pilapil and James Chua". on the other hand. in his capacity as the City Fiscal of Manila. The case entitled "People of the Philippines vs. to move to defer further proceedings" and to elevate the entire records of both cases to his office for review. Isabella Pilapil Geiling. He claimed that there was failure of their marriage and that they had been living apart since April. 11 A motion to quash was also filed in the same case on the ground of lack of jurisdiction. were married before the Registrar of Births. 1 Thereafter. Marriages and Deaths at Friedensweiler in the Federal Republic of Germany. petitioner. JJ. 1979. 12 which motion was denied by the respondent judge in an order dated September 8. upon review. 10 As a consequence. petitioner and William Chia. was assigned to Branch XXVI presided by the respondent judge. After about three and a half years of marriage. HON. while still married to said respondent.. and respondent Judge is hereby ordered to dismiss the Complaint filed in Civil Case No. followed by a separation de facto between them. Judge Leonardo Cruz suspended proceedings in Criminal Case No. after the corresponding investigation. Division 20 of the Schoneberg Local Court. was born on April 20. respondents. 9 Petitioner thereafter filed a motion in both criminal cases to defer her arraignment and to suspend further proceedings thereon. recommended the dismissal of the cases on the ground of insufficiency of evidence. 1983. Assistant Fiscal Jacinto A. support and separation of property before the Regional Trial Court of Manila. provides Us the opportunity to lay down a decisional rule on what hitherto appears to be an unresolved jurisdictional question. 1987. Branch XXV.] 6. petitioner filed a petition with the Secretary of Justice asking that the aforesaid resolution of respondent fiscal be set aside and the cases against her be dismissed. and the couple lived together for some time in Malate. only to be followed by a criminal infidelity suit of the latter against the former. 87-52434. 8 A similar petition was filed by James Chua. and private respondent Erich Ekkehard Geiling. Without costs. of the same court. Jr. SO ORDERED. 87-52435 to April 6. petitioner Imelda Manalaysay Pilapil. On September 7. through the Chief State Prosecutor. 87-52434. private respondent filed two complaints for adultery before the City Fiscal of Manila alleging that. VICTOR. Teehankee (Chairman). The same order also directed the arraignment of both accused therein. such connubial disharmony eventuated in private respondent initiating a divorce proceeding against petitioner in Germany before the Schoneberg Local Court in January. 2 Petitioner. 1982. 1986. the Petition is granted. 3 On January 15. IMELDA MANALAYSAY PILAPIL. 1986. 87-52435.. Plana. marital discord set in. 1989. The latter entered a plea of not guilty while the petitioner refused to be arraigned. filed an action for legal separation. J p: An ill-starred marriage of a Filipina and a foreigner which ended in a foreign absolute divorce. Such refusal of the petitioner being considered by respondent judge as direct contempt. in her capacity as Presiding Judge of the Regional Trial Court of Manila. a Filipino citizen. On the other hand. docketed as Criminal Case No. LUIS C. HON. or more than five months after the issuance of the divorce decree. petitioner moved for the cancellation of the arraignment and for the suspension of proceedings in said Criminal Case No. 1987. dated January 8. she and her counsel were 35 . with mutual recriminations between the spouses. 87-52434 went to the sala of Judge Leonardo Cruz. docketed as Criminal Case No. The records show that under German law said court was locally and internationally competent for the divorce proceeding and that the dissolution of said marriage was legally founded on and authorized by the applicable law of that foreign jurisdiction. petitioner "had an affair with a certain William Chia as early as 1982 and with yet another man named Jesus Chua sometime in 1983". DECISION REGALADO.WHEREFORE. 7 On March 14. 80116. Branch XXVI. SECOND DIVISION [G. CORONA IBAY-SOMERA. directing the filing of two complaints for adultery against the petitioner. On June 27. vs.. respondent judge merely reset the date of the arraignment in Criminal Case No.R. De la Fuente and Patajo. Jr. Manila where their only child. while the other case. 1983 where the same is still pending as Civil Case No. The custody of the child was granted to petitioner. 5 However. 83-15866. 87-52435 until after the resolution of the petition for review then pending before the Secretary of Justice. on January 23. 1986. a German national. Branch XXXII. Before such scheduled date. Federal Republic of Germany. "People of the Philippines vs. 1987. and ERICH EKKEHARD GEILING.

Unlike the offenses of seduction. seeking the annulment of the order of the lower court denying her motion to quash. capacity or legal representation to do so at the time of the filing of the criminal action. on cases involving statutes in that jurisdiction which are in pari materia with ours. grandparents or guardian. rape and acts of lasciviousness." 15 On October 21. 1987. through the People of the Philippines. the law specifically provides that in prosecutions for adultery and concubinage the person who can legally file the complaint should be the offended spouse. a foreigner. 16 We find this petition meritorious. which is a private offense that cannot be prosecuted de officio (sic). upholding petitioner's ratiocinations. It is significant that while the State. However. in the so-called "private crimes". Now. is a matter exclusively within his power and option.was added and vested by the 1985 Rules of Criminal Procedure with the power to initiate the criminal action for a deceased or incapacitated victim in the aforesaid offenses of seduction. or to refrain therefrom. 14 On October 27. Article 344 of the Revised Penal Code thus presupposes that the marital relationship is still subsisting at the time of the institution of the criminal action for adultery. as well as four other crimes against chastity. or those which cannot be prosecuted de oficio. it necessarily follows that such initiator must have the status. The writs prayed for shall accordingly issue. In other words. 13 Later. the offended spouse assumes a more predominant role since the right to commence the action. Corollary to such exclusive grant of power to the offended spouse to institute the action. 87-52435. the requirement for a sworn written complaint is just as jurisdictional a mandate since it is that complaint which starts the prosecutory proceeding 19 and without which the court cannot exercise its jurisdiction to try the case. 1988 Secretary of Justice Sedfrey A. however. he had ceased to be such when the prosecution was begun. or was acquired subsequent to but did not exist at the time of. This is a familiar and express rule in civil actions. a divorce subsequently granted can have no legal effect on the prosecution of the criminal proceedings to a conclusion. 1987. issued a resolution directing the respondent city fiscal to move for the dismissal of the complaints against the petitioner. the institution of the case. Code. 21 In these cases. requirement. It has long since been established. abduction. 20 Hence. only the offended spouse. Subsequently. 1987 and from further proceeding with Criminal Case No. it may not have been found necessary since criminal actions are generally and fundamentally commenced by the State.fined and the former was ordered detained until she submitted herself for arraignment. there does not appear to be any local precedential jurisprudence on the specific issue as to when precisely the status of a complainant as an offended spouse must exist where a criminal prosecution can be commenced only by one who in law can be categorized as possessed of such status. cannot be prosecuted except upon a sworn written complaint filed by the offended spouse. the innocent spouse no longer has the right to institute proceedings against the offenders where the statute provides that the innocent spouse shall have the exclusive right to institute a prosecution for adultery. abduction. and nobody else. rape and acts of lasciviousness. with unwavering consistency. petitioner filed this special civil action for certiorari and prohibition. private respondent entered a plea of not guilty. in default of her parents. such amendment did not include the crimes of adultery and concubinage. where such capacity or status existed prior to but ceased before. is authorized by law to initiate the action therefor. To repeat. is determined as of the filing of the complaint or petition. Ordoñez acted on the aforesaid petitions for review and. proceedings have been properly commenced. Though Loftus was husband of defendant when the offense is said to have been committed. it is indispensable that the status and capacity of the complainant to commence the action be definitely established and. that compliance with this rule is a jurisdictional. yields the rule that after a divorce has been decreed. It would be absurd if his capacity to bring the action would be determined by his status before or subsequent to the commencement thereof. the offended party being merely the complaining witness therein. such status or capacity must indubitably exist as of the time he initiates the action. and no other. We would thereby have the anomalous spectacle of a party bringing suit at the very time when he is without the legal capacity to do so. LexLib Under Article 344 of the Revised Penal Code. lack of legal capacity to sue. on March 23. therefore. grandparents or guardian of the offended party. this Court issued a temporary restraining order enjoining the respondents from implementing the aforesaid order of September 8. The absence of an equivalent explicit rule in the prosecution of criminal cases does not mean that the same requirement and rationale would not apply. in fact. as already demonstrated. 17 the crime of adultery. The so-called exclusive and successive rule in the prosecution of the first four offenses above mentioned do not apply to adultery and concubinage. American jurisprudence. 18 While in point of strict law the jurisdiction of the court over the offense is vested in it by the Judiciary Law. the inquiry would be whether it is necessary in the commencement of a criminal action for adultery that the marital bonds between the complainant and the accused be unsevered and existing at the time of the institution of the action by the former against the latter. This is a logical consequence since the raison d'etre of said provision of law would be absent where the supposed offended party had ceased to be the spouse of the alleged offender at the time of the filing of the criminal case. with a prayer for a temporary restraining order. since the purported complainant. and not merely a formal. as a ground for a motion to dismiss in civil cases. Where.' Section 4932. 22 In the cited Loftus case. as parens partriae. and the present prosecution for adultery is of such genre. This policy was adopted out of consideration for the aggrieved party who might prefer to suffer the outrage in silence rather than go through the scandal of a public trial. and appellant insists that his status was not such as to entitle him to make the 36 . does not qualify as an offended spouse having obtained a final divorce decree under his national law prior to his filing the criminal complaint. Understandably. The petition is anchored on the main ground that the court is without jurisdiction "to try and decide the charge of adultery. as cogently argued by petitioner. Stated differently and with reference to the present case. no provision is made for the prosecution of the crimes of adultery and concubinage by the parents. the Supreme Court of Iowa held that — " 'No prosecution for adultery can be commenced except on the complaint of the husband or wife.

Private respondent's invocation of Donio-Teves. . the person who initiates the adultery case must be an offended spouse. Padilla and Sarmiento. When said respondent initiated the divorce proceeding. For instance. it cannot be logically inferred therefrom that the complaint can still be filed after the declaration of nullity because such declaration that the marriage is void ab initio is equivalent to stating that it never existed. 37 . . Mata cannot be successfully relied upon by private respondent. provided they are valid according to their national law . although an issue was raised as to its sufficiency but which was resolved in favor of the complainant. 124371. the latter filed a civil case in a trial court here alleging that her business concern was conjugal property and praying that she be ordered to render an accounting and that the plaintiff be granted the right to manage the business. . any complaint for adultery filed after said declaration of nullity would no longer have a leg to stand on. LLORENTE. even though it should be made to appear that she is entitled to have her marriage contract declared null and void. this Court perspicuously demonstrated the error of such stance. vs. "Thus. Definitely. pursuant to his national law. Thus. petitioner. However. Melencio-Herrera. The same rule and requisite would necessarily apply where the termination of the marriage was effected. 26 since there would thenceforth be no spousal relationship to speak of. is admitted.) We see no reason why the same doctrinal rule should not apply in this case and in our jurisdiction. in any State of the Union . and we are of the opinion that the unoffending spouse must be such when the prosecution is commenced. the questioned order denying petitioner's motion to quash is SET ASIDE and another one entered DISMISSING the complaint in Criminal Case No. LLORENTE. hence the actuations of one would not affect or cast obloquy on the other. JJ . Thus. as well as the state. The severance of the marital bond had the effect of dissociating the former spouses from each other. as in this case. A cursory reading of said case reveals that the offended spouse therein had duly and seasonably filed a complaint for adultery. Jr. Rejecting his pretensions. et al. 24 after a divorce was granted by a United States court between Alice Van Dorn. 1987 is hereby made permanent. which punished adultery "although the marriage be afterwards declared void". the Federal Republic of Germany. SO ORDERED. which may be recognized in the Philippines.A. WHEREFORE. Neither would there be a danger of introducing spurious heirs into the family. E. 87-52435 for lack of jurisdiction. in the recent case of Van Dorn vs. as her husband. In applying Article 433 of the old Penal Code. the fact that private respondent obtained a valid divorce in his country. He would have no standing to sue in the case below as petitioner's husband entitled to exercise control over conjugal assets . . No. and her American husband. COURT OF APPEALS and ALICIA F. Romillo. and by this is meant that he is still married to the accused spouse. November 23." (Emphasis supplied. had no legal standing to commence the adultery case under the imposture that he was the offended spouse at the time he filed suit. substantially the same as Article 333 of the Revised Penal Code. at the time of the filing of the complaint. The aforecited case of United States vs. only Philippine nationals are covered by the policy against absolute divorces the same being considered contrary to our concept of public policy and morality. even if true.R. We are convinced that in cases of such nature.. private respondent.. We have repeatedly said that the offense is against the unoffending spouse. . in explaining the reason for this provision in the statute." 25 Under the same considerations and rationale. considering our statutory law and jural policy on the matter. what was consequently contemplated and within the purview of the decision in said case is the situation where the criminal action for adultery was filed before the termination of the marriage by a judicial declaration of its nullity ab initio. concur. the status of the complainant vis-a-vis the accused must be determined as of the time the complaint was filed.. Moreover. There being no marriage from the beginning. The decree is binding on private respondent as an American citizen. private respondent is no longer the husband of petitioner. et al. Said divorce and its legal effects may be recognized in the Philippines insofar as private respondent is concerned 23 in view of the nationality principle in our civil law on the matter of status of persons. 2000. In the present case. is of no legal significance or consequence in this case. herein before cited. The temporary restraining order issued in this case on October 21. respondents. Said case did not involve a factual situation akin to the one at bar or any issue determinative of the controversy herein.complaint. the Court merely stated that "the lawmakers intended to declare adulterous the infidelity of a married woman to her marital vows. PAULA T. by a valid foreign divorce. 27 must suffer the same fate of inapplicability. he obviously knew that there would no longer be a family nor marriage vows to protect once a dissolution of the marriage is decreed. which is said to be one of the reasons for the particular formulation of our law on adultery. Vamenta.] 7. thus: "There can be no question as to the validity of that Nevada divorce in any of the States of the United States. aliens may obtain divorces abroad. The allegation of private respondent that he could not have brought this case before the decree of divorce for lack of knowledge. until and unless she actually secures a formal judicial declaration to that effect". a Filipina. "It is true that owing to the nationality principle embodied in Article 15 of the Civil Code. vs. Dacanay for petitioner. . being no longer the husband of petitioner. private respondent cannot sue petitioner. FIRST DIVISION [G.

Llorente was an enlisted serviceman of the United States Navy from 1927 to 1957 and a naturalized American citizen. 3 On February 22. all surnamed Llorente. 1943. who did not oppose the marriage or cohabitation. The divorce decree became final in 1952. The trial court appointed Paula Llorente as legal administrator of the estate of the deceased. Before the outbreak of the Pacific War." with the certificate stating that the child was not legitimate and the line for the father's name was left blank.S. 1985. therefore. What is before us is an appeal from the decision of the Court of Appeals 1 modifying that of the Regional Trial Court. since he was a foreigner. Llorente was an enlisted serviceman of the United States Navy from March 10. Llorente by the Superior Court of the State of California in and for the County of San Diego. therefore. The Supreme Court reversed and set aside the ruling of the trial court and recognized as valid and as a matter of comity the decree of divorce granted in favor of the deceased Lorenzo N. The trial court declared Alicia as co-owner of whatever properties she and the deceased Lorenzo may have acquired during the twenty-five (25) years of cohabitation. 1957. Paula gave birth to a boy registered in the Office of the Registrar of Nabua as "Crisologo Llorente. Llorente (hereinafter referred to as "Alicia"). Nabua. On February 22. Camarines Sur. and actively participated in the proceedings. The Court remanded the cases to the court of origin for determination of the intrinsic validity of Lorenzo N. Iriga City2 declaring respondent Alicia F. The Superior Court of the State of California. not covered by Philippine laws on family rights and duties. In the will. Hence. Nabua. affirming with modification the decision of the trial court. Lorenzo married petitioner Paula Llorente. Paula filed with the same court a petition for letters of administration over Lorenzo's estate in her favor. Respondent Alicia filed with the trial court a motion for reconsideration. Llorente (hereinafter referred to as "Lorenzo") may have acquired during the twenty-five (25) years that they lived together as husband and wife. but was denied. Navarro & Sales for private respondents. Lorenzo filed with the Regional Trial Court. Lorenzo bequeathed all his property to Alicia and their three children. Lorenzo returned to the United States and filed for divorce with the Superior Court of the State of California in and for the County of San Diego. Paula was represented by counsel. refer to no other than the law of the State of which the decedent was a resident and there was also no showing that the application of the renvoi doctrine was called for or required by New York State law. DECISION PARDO. Alicia had no knowledge of the first marriage even if they resided in the same town as Paula. Ceferino Llorente. On March 13. The Facts The deceased Lorenzo N. 1958. Camarines Sur. Llorente in Manila. Lorenzo and petitioner Paula Llorente (hereinafter referred to as "Paula") were married before a parish priest. Lorenzo was admitted to United States citizenship and Certificate of Naturalization No. Alicia also filed in the testate proceeding a petition for the issuance of letters testamentary. John Riley. Iriga. as co-owners of whatever property she and the deceased Lorenzo N. According to the Court. before the proceedings could be terminated. Lorenzo died. There is no such law governing the validity of testamentary provisions in the United States. Raul. 1945. 1937. Lorenzo married Alicia F. 5 On November 30. On January 16. he discovered that his wife Paula was pregnant and was "living in" and having an adulterous relationship with his brother. 8 On December 4. 5579816 was issued in his favor by the United States District Court. Ceferino Llorente. but was denied for lack of merit. Roman Catholic Church. a petition for the probate and allowance of his last will and testament wherein Lorenzo moved that Alicia be appointed Special Administratrix of his estate. Lorenzo departed for the United States and Paula stayed in the conjugal home in barrio Antipolo. condition and legal capacity. On June 11. 9 38 . Camarines Sur. Lorenzo executed a Last Will and Testament. Apparently. J p: The Case The case raises a conflict of laws issue. Each State of the union has its own law applicable to its citizens and in force only within the State. her marriage to Lorenzo was likewise void. status. Camarines Sur. Camarines Sur. 1952. Navy. Branch 35. The Court also said that the clear intent of Lorenzo to bequeath his property to his second wife and children by her was glaringly shown in the will he executed and the Court did not wish to frustrate Lorenzo's wishes.Pardalis. On December 14. The appellate court promulgated its decision. Lorenzo was granted an accrued leave by the U. 1937. The trial court denied Alicia's petition and ruled that the divorce decree granted to the late Lorenzo Llorente was void and inapplicable in the Philippines. 6 Upon the liberation of the Philippines by the American Forces in 1945. 1927 to September 30. From 1958 to 1985. in Nabua. made final on December 4. Lorenzo departed for the United States and Paula stayed in the conjugal home in barrio Antipolo. SYNOPSIS The deceased Lorenzo N. The trial court admitted the will to probate. Lorenzo Llorente. Lorenzo refused to forgive Paula and live with her. 4 Before the outbreak of the Pacific War. Alicia appealed to the Court of Appeals. to visit his wife and he visited the Philippines. Southern District of New York. It can. 7 He discovered that his wife Paula was pregnant and was "living in" and having an adulterous relationship with his brother. Lorenzo and Alicia lived together as husband and wife and produced three children. When Lorenzo returned to the Philippines to visit his wife in 1945. Llorente's will and determination of the parties' successional rights allowing proof of foreign law. Luz and Beverly. 1983. 1981. the "national law" indicated in Article 16 of the Civil Code cannot possibly apply to the general American law. the present petition. for the County of San Diego found all factual allegations to be true and issued an interlocutory judgment of divorce. Petitioner Paula moved for reconsideration.

188652. Nabua. 1981. if of age. 21 On September 4. who did not oppose the marriage or cohabitation. to wit: "(1)I give and bequeath to my wife ALICIA R. conveyed and disposed of by and among themselves. Sitio Puga. the divorce decree became final. 1984. (3) they would make a separate agreement regarding their conjugal property acquired during their marital life. Philippines. and covered by Transfer Certificate of Title No. Lorenzo married Alicia F. for the County of San Diego found all factual allegations to be true and issued an interlocutory judgment of divorce. the trial court denied the motion for the reason that the testator Lorenzo was still alive. but could only be sold. 11 On December 4. sold and conveyed to any other persons. Philippines. 13 Apparently. ceded. located at San Francisco. Nabua. Raul. my real properties located in Quezon City Philippines. The agreement was notarized by Notary Public Pedro Osabel. "(3)I likewise give and bequeath exclusively unto my wife Alicia R. by me. In the will. the couple drew a written agreement to the effect that (1) all the family allowances allotted by the United States Navy as part of Lorenzo's salary and all other obligations for Paula's daily maintenance and support would be suspended. on February 2. and (4) Lorenzo would not prosecute Paula for her adulterous act since she voluntarily admitted her fault and agreed to separate from Lorenzo peacefully." 17 On December 14. Llorente. Raul F. specifically my real properties located at Barangay Aro-Aldao. Fortunato and my children with respect to any real or personal properties I gave and bequeathed respectively to each one of them by virtue of this Last Will and Testament. finding that the will was duly executed. (2) that the various property were acquired during their marriage. Camarines Sur. FORTUNO to be the sole executor of this my Last Will and Testament. Llorente and Beverly F. The will was notarized by Notary Public Salvador M. John Riley. the trial court admitted the will to probate. 1985. Camarines Sur. covered by Transfer Certificate of Title Nos. Paula contended (1) that she was Lorenzo's surviving spouse. 15 Their twenty-five (25) year union produced three children. 12 In the meantime. 1951 filed for divorce with the Superior Court of the State of California in and for the County of San Diego. Iriga. Lorenzo executed a Last Will and Testament. encroaching on her legitime and 1/2 share in the conjugal property. both of the Registry of Deeds of the province of Rizal. signed. Barangay Baras. "(4)That their respective shares in the above-mentioned properties. in equal shares. and Barangay Paloyon. 124196 and 165188. 10 Lorenzo returned to the United States and on November 16. 14 From 1958 to 1985. Lorenzo returned to the Philippines. before the proceedings could be terminated. 1983. including ALL the personal properties and other movables or belongings that may be found or existing therein. 1984. whether real or personal properties. Luz and Beverly. any of my children in the order of age. a petition for the probate and allowance of his last will and testament wherein Lorenzo moved that Alicia be appointed Special Administratrix of his estate. The agreement was signed by both Lorenzo and Paula and was witnessed by Paula's father and stepmother. Llorente in Manila. shall not be disposed of. Nabua. Luz F. Occiano. or testamentary dispositions heretofore executed. Camarines Sur. and in her default or incapacity of the latter to act. 1985. Rizal. (3) that Lorenzo's will disposed of all his property in favor of Alicia and her children. Llorente. Luz F. "(5)I designate my wife ALICIA R. Alicia had no knowledge of the first marriage even if they resided in the same town as Paula. Sitio Nalilidong. 1958. 1952. "(6)I hereby direct that the executor named herein or her lawful substitute should served (sic) without bond. Paula filed with the same court a petition 22 for letters of administration over Lorenzo's estate in her favor. Francisco Neibres and Tito Trajano. 1946. Barangay Paloyon. no relatives of mine in any degree in the Llorente's Side should ever bother and disturb in any manner whatsoever my wife Alicia R. 23 39 . Llorente and Beverly F. Lorenzo and Alicia lived together as husband and wife.Lorenzo refused to forgive Paula and live with her. Lorenzo filed with the Regional Trial Court. 19 On January 24. Philippines. (2) they would dissolve their marital union in accordance with judicial proceedings. Llorente. 20 On June 11. Raul F. Camarines Sur. 18 On January 18. Camarines Sur. Lorenzo bequeathed all his property to Alicia and their three children. or published. Nabua. all my real properties whatsoever and wheresoever located. Paula was represented by counsel. all surnamed Llorente. "(2)I give and bequeath exclusively to my wife Alicia R. Nabua. the Superior Court of the State of California. CADHcI On January 16. Lorenzo died. 1951. and actively participated in the proceedings. On November 27. Llorente. ceded. duly signed by Lorenzo with attesting witnesses Francisco Hugo. "(8)It is my final wish and desire that if I die. in equal shares. Fortuno and to my children. In fact. Fortuno and unto my children. 16 On March 13. and my lands in Antipolo. Camarines Sur. FORTUNO exclusively my residential house and lot. codicils. "(7)I hereby revoke any and all my other wills.

1981 as void and declares her entitled as conjugal partner and entitled to one-half of their conjugal properties. she is not entitled to receive any share from the estate even if the will especially said so her relationship with Lorenzo having gained the status of paramour which is under Art.00 conditioned for her to make a return to the court within three (3) months a true and complete inventory of all goods. 1996. and so declares the intrinsic disposition of the will of Lorenzo Llorente dated March 13. This being so the petition of Alicia F. and as primary compulsory heir. and from the proceeds to pay and discharge all debts. "On the other hand. As such let the corresponding letters of administration issue in her favor upon her filing a bond in the amount (sic) of P100. 26 On May 18. and estate which shall at any time come to her possession or to the possession of any other person for her. We remand the case to the trial court for ruling on the intrinsic validity of the will of the deceased. the Court of Appeals. considering that this court has so found that the divorce decree granted to the late Lorenzo Llorente is void and inapplicable in the Philippines. Llorente? We do not agree with the decision of the Court of Appeals. 1995. 30 On September 28." 32 On August 25. "SO ORDERED. No. 1987. 28 On September 14. IR888. and (4) death. Proc. 1987. 1985. "SO ORDERED. is duly established. Lorenzo Llorente. rights. the trial court declared Beverly Llorente as the only illegitimate child of Lorenzo. the order was published in the newspaper "Bicol Star". 33 On March 21. the decision appealed from is hereby AFFIRMED with the MODIFICATION that Alicia is declared as coowner of whatever properties she and the deceased may have acquired during the twenty-five (25) years of cohabitation. the court finds the petition of Paula Titular Llorente. 31 On July 31. 13 and 20. Who are entitled to inherit from the late Lorenzo N. Llorente is also entitled to one-third of the estate and then one-third should go to the illegitimate children. 739 (1). without terminating the testate proceedings. 1985. 40 . No. entitling her to one-third (1/3) of the estate and one-third (1/3) of the free portion of the estate. chattels. Paula T. a petition for the issuance of letters testamentary.On December 13. and credits. 24 On October 14. 35 The Issue Stripping the petition of its legalese and sorting through the various arguments raised. 29 Amending its decision of May 18. (3) execution of his will. admitted and undisputed." 27 In time. Luz and Beverly. 1958 at Manila is likewise void. 1995. the trial court denied Alicia's motion for reconsideration but modified its earlier decision. all surname (sic) Llorente.000. Alicia filed with the trial court a motion for reconsideration of the aforequoted decision. meritorious. (2) marriage to Alicia. Proc. affirming with modification the decision of the trial court in this wise: "WHEREFORE. Llorente became an American citizen long before and at the time of: (1) his divorce from Paula. Raul. 1985. "On the other matters prayed for in respective petitions for want of evidence could not be granted. stating that Raul and Luz Llorente are not children "legitimate or otherwise" of Lorenzo since they were not legally adopted by him. Llorente for the issuance of letters testamentary is denied. this petition. therefore the marriage he contracted with Alicia Fortunato on January 16. the trial court gave due course to Paula's petition in Sp. the Court of Appeals promulgated its decision. "Petitioner. thus: ISaCTE "Wherefore. 1987. petitioner filed with the Court of Appeals a motion for reconsideration of the decision. The Applicable Law The fact that the late Lorenzo N. respondent appealed to the Court of Appeals. Likewise. for them to partition in equal shares and also entitled to the remaining free portion in equal shares. the Regional Trial Court issued a joint decision. 36 the issue is simple. 25 On November 6. or such dividends thereon as shall be decreed or required by this court. Alicia filed in the testate proceeding (Sp. to render a true and just account of her administration to the court within one (1) year. 34 denied the motion for lack of merit. legacies and charges on the same. Paula Llorente is appointed legal administrator of the estate of the deceased. and at any other time when required by the court and to perform all orders of this court by her to be performed. Hence. IR-755). 1987.

with nothing. The "national law" indicated in Article 16 of the Civil Code cannot possibly apply to general American law. and her two children. The Court of Appeals and the trial court called to the fore the renvoi doctrine. there is no such thing as one American law. provided they are valid according to their national law. already probated as duly executed in accordance with the formalities of Philippine law. 41 that once proven that respondent was no longer a Filipino citizen when he obtained the divorce from petitioner.Thus.The forms and solemnities of contracts." (italics ours) True. The trial court held that the will was intrinsically invalid since it contained dispositions in favor of Alice. We hold that the divorce obtained by Lorenzo H. status. applying Article 144 of the Civil Code of the Philippines. Philippine law.Laws relating to family rights and duties. who in the trial court's opinion was a mereparamour. not covered by our laws on "family rights and duties. in this case. Romillo." (italics ours) The clear intent of Lorenzo to bequeath his property to his second wife and children by her is glaringly shown in the will he executed. Jr. there is no showing that the application of the renvoi doctrine is called for or required by New York State law. For failing to apply these doctrines. both with respect to the order of succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions. "However. issues arising from these incidents are necessarily governed by foreign law. foreign laws do not prove themselves in our jurisdiction and our courts are not authorized to take judicial notice of them. Each State of the union has its own law applicable to its citizens and in force only within the State. We note that while the trial court stated that the law of New York was not sufficiently proven. Philippine law applies when determining the validity of Lorenzo's will. Validity of the Foreign Divorce In Van Dorn v. "When the acts referred to are executed before the diplomatic or consular officials of the Republic of the Philippines in a foreign country. The Court of Appeals also disregarded the will. the Federal Republic of Germany. wills. is fatal. where the case was "referred back" to the law of the decedent's domicile. the decision of the Court of Appeals must be reversed. albeit equally unproven statement that "American law" follows the 'domiciliary theory' hence. Citing this landmark case." 44 41 . Validity of the Will The Civil Code provides: "ARTICLE 17. the Court ruled that aliens may obtain divorces abroad. Ibay-Somera. shall be regulated by the national law of the person whose succession is under consideration. the same being considered contrary to our concept of public policy and morality. Now. We do not wish to frustrate his wishes. The trial court threw the will out. since he was a foreigner. the Court held in Quita v. It declared Alice entitled to one half (1/2) of whatever property she and Lorenzo acquired during their cohabitation. condition and legal capacity. In the same case. in the same breath it made the categorical. It can therefore refer to no other than the law of the State of which the decedent was a resident. the effects of this divorce (as to the succession to the estate of the decedent) are matters best left to the determination of the trial court. especially in light of the factual and legal circumstances here obtaining. the solemnities established by Philippine laws shall be observed in their execution. 38 First. intestate and testamentary succession. and other public instruments shall be governed by the laws of the country in which they are executed. even though living abroad. The Civil Code clearly provides: "ARTICLE 15. There. Raul and Luz. only Philippine nationals are covered by the policy against absolute divorces. we held that owing to the nationality principle embodied in Article 15 of the Civil Code.Real property as well as personal property is subject to the law of the country where it is situated. 37 While the substance of the foreign law was pleaded. Court of Appeals. In Pilapil v. condition and legal capacity of persons are binding upon citizens of the Philippines. Like any other fact. The hasty application of Philippine law and the complete disregard of the will. SCcHIE "ARTICLE 16. the ruling in Van Dorn would become applicable and petitioner could "very well lose her right to inherit" from him. we recognized the divorce obtained by the respondent in his country. Llorente from his first wife Paula was valid and recognized in this jurisdiction as a matter of comity.whatever may be the nature of the property and regardless of the country wherein said property may be found. or to the status. as a rule. leaving Alice. they must be alleged and proved. the Court of Appeals did not admit the foreign law. we stated that divorce and its legal effects may be recognized in the Philippines insofar as respondent is concerned in view of the nationality principle in our civil law on the status of persons. There is no such law governing the validity of testamentary provisions in the United States. Second.

REPUBLIC OF THE PHILIPPINES. the trial court should note that whatever public policy or good customs may be involved in our system of legitimes. The court a quo had declared that herein respondent Cipriano Orbecido III is capacitated to remarry. by virtue of the provision of the second paragraph of Art. DECISION QUISUMBING. 3 The factual antecedents. concur. Llorente's will and determination of the parties' successional rights allowing proof of foreign law with instructions that the trial court shall proceed with all deliberate dispatch to settle the estate of the deceased within the framework of the Rules of Court. the Court REVERSES the decision of the Regional Trial Court and RECOGNIZES as VALID the decree of divorce granted in favor of the deceased Lorenzo N. Whether the will was executed in accordance with the formalities required is answered by referring to Philippine law.. 2002. the court granted the same. Congress specifically left the amount of successional rights to the decedent's national law. FIRST DIVISION [G. as narrated by the trial court. On May 24. of the Regional Trial Court of Molave. The decision of the Court of Appeals in CA-G. through the Office of the Solicitor General (OSG).J. and Ynares-Santiago. SP No. 26 of the Family Code and by reason of the divorce decree obtained against him by his American wife. The Fallo WHEREFORE.. 154380. Cipriano thereafter filed with the trial court a petition for authority to remarry invoking Paragraph 2 of Article 26 of the Family Code. In 1986. Walnut Grove Avenue. can the Filipino spouse likewise remarry under Philippine law? Before us is a case of first impression that behooves the Court to make a definite ruling on this apparently novel question. No opposition was filed. October 5.Whether the will is intrinsically valid and who shall inherit from Lorenzo are issues best proved by foreign law which must be pleaded and proved. C. Finding merit in the petition. In this petition for review. the petitioner is given the capacity to remarry under the Philippine Law. Further. The Republic. IT IS SO ORDERED. respondent. Cipriano Orbecido III married Lady Myros M. Cipriano's wife left for the United States bringing along their son Kristoffer.R. 17446 promulgated on July 31. Orbecido. Their marriage was blessed with a son and a daughter. 45 Having thus ruled. No. A few years later. made final on December 4. where one party is later naturalized as a foreign citizen and obtains a valid divorce decree capacitating him or her to remarry. petitioner. 42 . J p: Given a valid marriage between two Filipino citizens. Congress did not intend to extend the same to the succession of foreign nationals. JJ. San Gabriel. Orbecido and Lady Kimberly V. presented as a pure question of law.] 8. Branch 23 and its Resolution 2 dated July 4. Cipriano discovered that his wife had been naturalized as an American citizen. Stanley and her child by him currently live at 5566 A. SO ORDERED. we find it unnecessary to pass upon the other issues raised. the Court REMANDS the cases to the court of origin for determination of the intrinsic validity of Lorenzo N. Sometime in 2000. No costs. the Solicitor General assails the Decision 1 dated May 15. Ozamis City. Llorente by the Superior Court of the State of California in and for the County of San Diego.. Villanueva at the United Church of Christ in the Philippines in Lam-an. She. Davide. Zamboanga del Sur. herein petitioner. R. 1952. the petition is GRANTED. the will was duly probated. The fallo of the impugned Decision reads: WHEREFORE. Jr. Kapunan. California. 2002 denying the motion for reconsideration. 2005. vs. Cipriano learned from his son that his wife had obtained a divorce decree and then married a certain Innocent Stanley. In lieu thereof. Puno. Kristoffer Simbortriz V. are as follows. In fact.HAICcD As a guide however. 1995 is SET ASIDE. sought reconsideration but it was denied. 1981. CIPRIANO ORBECIDO III.

The interests of the parties are also adverse.S.All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized. On July 17. the parties were two Filipino citizens. Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry. he is likewise capacitated by operation of law pursuant to Section 12. The instant case is one where at the time the marriage was solemnized. ordinance. as petitioner representing the State asserts its duty to protect the institution of marriage while respondent.A. it now provides: ART. (4). and valid there as such. that is. the foregoing provision does not appear to govern the situation presented by the case at hand. 209. bring an action in the appropriate Regional Trial Court to determine any question of construction or validity arising. then President Corazon Aquino signed into law Executive Order No. and remarried while in the U. respondent admits that Article 26 is not directly applicable to his case but insists that when his naturalized alien wife obtained a divorce decree which capacitated her to remarry. obtained a divorce decree. a private citizen. 36. is to file a petition for annulment or for legal separation. or other governmental regulation may. and for a declaration of his rights or duties. except those prohibited under Articles 35(1). litigation ensues and puts into question the validity of his second marriage. thereunder. the OSG raises a pure question of law: WHETHER OR NOT RESPONDENT CAN REMARRY UNDER ARTICLE 26 OF THE FAMILY CODE 4 The OSG contends that Paragraph 2 of Article 26 of the Family Code is not applicable to the instant case because it only applies to a valid mixed marriage. 26. and valid there as such. It discriminates against those whose spouses are Filipinos who divorce them abroad. 7 At the outset. does Paragraph 2 of Article 26 of the Family Code apply to the case of respondent? Necessarily. contract or other written instrument. These spouses who are divorced will not be able to re-marry. Rule 63 of the Rules of Court provides: RULE 63 DECLARATORY RELIEF AND SIMILAR REMEDIES Section 1.In this petition. praying for relief. 5 Furthermore. and 38. Section 1. amending Articles 26. otherwise known as the "Family Code. (Emphasis supplied) On its face. 37 and 38. shall also be valid in this country. executive order or regulation. It seems to apply only to cases where at the time of the celebration of the marriage. The OSG posits that this is a matter of legislation and not of judicial determination. Executive Order No.A. 227 was likewise signed into law. and 39 of the Family Code. the wife was naturalized as an American citizen and subsequently obtained a divorce granting her capacity to remarry. and indeed she remarried an American citizen while residing in the U. we must dwell on how this provision had come about in the first place. we note that the petition for authority to remarry filed before the trial court actually constituted a petition for declaratory relief. Article II of the Constitution. Article 26 thereof states: All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized. (5) and (6). according to the OSG. shortly after the signing of the original Family Code. 1987. 37. (3) that the party seeking the relief has a legal interest in the controversy. shall also be valid in this country. (2) the controversy must be between persons whose interests are adverse." which took effect on August 3.Who may file petition — Any person interested under a deed. Noteworthy. Coming now to the substantive issue. except those prohibited under Articles 35. the OSG argues there is no law that governs respondent's situation.The rule is discriminatory. As so amended. In this connection. This case concerns the applicability of Paragraph 2 of Article 26 to a marriage between two Filipino citizens where one later acquired alien citizenship. 6 For his part. insists on a declaration of his capacity to remarry. before breach or violation thereof. 36. a marriage celebrated between a Filipino citizen and an alien. but later on. and what was the intent of the legislators in its enactment? Brief Historical Background On July 6. will. has legal interest in the controversy. A second paragraph was added to Article 26. in the Report of the Public Hearings 9 on the Family Code. and (4) that the issue is ripe for judicial determination. the Catholic Bishops' Conference of the Philippines (CBCP) registered the following objections to Paragraph 2 of Article 26: 1. 43 . The proper remedy. The issue raised is also ripe for judicial determination inasmuch as when respondent remarries.S. the parties are a Filipino citizen and a foreigner. xxx xxx xxx The requisites of a petition for declaratory relief are: (1) there must be a justiciable controversy. the Filipino spouse shall have capacity to remarry under Philippine law. 1987. Respondent. or whose rights are affected by a statute. 1988. while the spouses of foreigners who validly divorce them abroad can.

there would be no evidence sufficient to declare that he is capacitated to enter into another marriage. there was still a valid marriage that has been celebrated between her and Cipriano. 209. However. The reckoning point is not the citizenship of the parties at the time of the celebration of the marriage. we are unanimous in our holding that Paragraph 2 of Article 26 of the Family Code (E. The Court therein hinted. Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn v. is to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. hence. taking into consideration the legislative intent and applying the rule of reason. the Filipino spouse is capacitated to remarry under Philippine law. we hold that Paragraph 2 of Article 26 should be interpreted to include cases involving parties who. To rule otherwise would be to sanction absurdity and injustice.There is a valid marriage that has been celebrated between a Filipino citizen and a foreigner. the party pleading it must prove the divorce as a fact and demonstrate its conformity to the foreign law allowing it. The Filipino spouse should likewise be allowed to remarry as if the other party were a foreigner at the time of the solemnization of the marriage. We are also unable to sustain the OSG's theory that the proper remedy of the Filipino spouse is to file either a petition for annulment or a petition for legal separation. Jr. Likewise. who has been divorced by a spouse who had acquired foreign citizenship and remarried. On the other hand. 15 Furthermore. legal separation would not be a sufficient remedy for it would not sever the marriage tie. Court of Appeals. after obtaining a divorce. such laws must be alleged and proved. 13 Accordingly. 11 In Quita. but later on. but later on. who was naturalized as an American citizen. The Court held therein that a divorce decree validly obtained by the alien spouse is valid in the Philippines. we are unable to declare. In this case. as in this case. a member of the Civil Code Revision Committee. Romillo. is no longer married to the Filipino spouse. Does the same principle apply to a case where at the time of the celebration of the marriage. then the instant case must be deemed as coming within the contemplation of Paragraph 2 of Article 26. Annulment would be a long and tedious process. according to Judge Alicia Sempio-Diy. so long as they come within its spirit or intent. Like any other fact. the "divorced" Filipino spouse. had obtained a divorce 44 . Filipino citizens when they got married.This is the beginning of the recognition of the validity of divorce even for Filipino citizens. No. for his plea to prosper. we state the twin elements for the application of Paragraph 2 of Article 26 as follows: 1. and in this particular case. AHDTIE In view of the foregoing.O. As fate would have it. before a foreign divorce decree can be recognized by our own courts. It is settled rule that one who alleges a fact has the burden of proving it and mere allegation is not evidence. 12 If we are to give meaning to the legislative intent to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. also to remarry. and 2. based on respondent's bare allegations that his wife. the naturalized alien wife subsequently obtained a valid divorce capacitating her to remarry. No. Thus. A statute may therefore be extended to cases not within the literal meaning of its terms. 14 Such foreign law must also be proved as our courts cannot take judicial notice of foreign laws. considering that in the present petition there is no sufficient evidence submitted and on record. considering that the marriage of the parties appears to have all the badges of validity. Thus Cipriano.A valid divorce is obtained abroad by the alien spouse capacitating him or her to remarry. respondent herein must prove his allegation that his wife was naturalized as an American citizen. should be allowed to remarry. Clearly. (Emphasis supplied. 10 The Van Dorn case involved a marriage between a Filipino citizen and a foreigner. at the time of the celebration of the marriage were Filipino citizens. For those whose foreign spouses validly divorce them abroad will also be considered to be validly divorced here and can re-marry. However. Nevertheless. Where the interpretation of a statute according to its exact and literal import would lead to mischievous results or contravene the clear purpose of the legislature. when Cipriano's wife was naturalized as an American citizen. the parties were. we note that the records are bereft of competent evidence duly submitted by respondent concerning the divorce decree and the naturalization of respondent's wife. the twin requisites for the application of Paragraph 2 of Article 26 are both present in this case. after obtaining a divorce is no longer married to the Filipino spouse.O. one of them becomes naturalized as a foreign citizen and obtains a divorce decree. respondent must also show that the divorce decree allows his former wife to remarry as specifically required in Article 26. but their citizenship at the time a valid divorce is obtained abroad by the alien spouse capacitating the latter to remarry. and consequently. by way ofobiter dictum. that a Filipino divorced by his naturalized foreign spouse is no longer married under Philippine law and can thus remarry. AETcSa Interestingly. should be interpreted to allow a Filipino citizen. Otherwise. The wife became a naturalized American citizen in 1954 and obtained a divorce in the same year. not even feasible. as amended by E. disregarding as far as necessary the letter of the law. it should be construed according to its spirit and reason. the legally separated Filipino spouse would still remain married to the naturalized alien spouse.) Legislative Intent Records of the proceedings of the Family Code deliberations showed that the intent of Paragraph 2 of Article 26. the parties were Filipino citizens. We propose that this be deleted and made into law only after more widespread consultation.2. one of them obtains a foreign citizenship by naturalization? The jurisprudential answer lies latent in the 1998 case of Quita v. 227).

Engelhard filed his answer to the amended complaint. The assailed Decision dated May 15. "There are many expressions in the American reports from which it might be inferred that the court acquires personal jurisdiction over the person of the defendant by publication and notice. Eugene Arthur Perkins. Neff (95 U. the proposition that jurisdiction over the person of a non-resident cannot be acquired by publication and notice was never clearly understood even in the American courts until after the decision had been rendered by the Supreme Court of the United States in the leading case of Pennoyer v.. 1939. it must have jurisdiction over the subject-matter and over the persons of the parties. and Resolution dated July 4. No tribunal established by one State can extend its process beyond its territory so as to subject to its decisions either persons or property located in another State. but such is not the case. Jr. JJ. but the principles governing the question are well settled in this jurisdiction. whether or not said court may validly try the case. This doctrine applies to all kinds of constructive or substituted process. ed. Branch 23. The answer prays that the adverse claimants be made parties to the action and served with notice thereof by publication. Idonah Slade Perkins. The parties have filed lengthy memorandums relying on numerous authorities. or. Engelhard be adjudged without interest in the shares of stock in question and excluded from any claim they assert thereon. Palanca. that the action relates to real or personal property within the Philippines in which said defendant has or claims a lien or interest. DIZON. EUCENE ARTHUR PERKINS. EN BANC [G. vs. and George H.J. 1938. Davide. Idonah Slade Perkins. ARSENIO P.379. Engelhard. Ynares-Santiago. summons by publication were served upon the non-resident defendants. she now brought the present petition for certiorari. praying that the summons by publication issued against her be declared null and void.R. 2002. and demurrer to jurisdiction" wherein she challenged the jurisdiction of the lower court over her person. Engelhard. the petition by the Republic of the Philippines is GRANTED. To the complaint. Idonah Slade Perkins and George H. to the exclusion of all others. the court cannot acquire jurisdiction over his person even if the summons be served by publication. Zamboanga del Sur. Section 398 of our Code of Civil Procedure provides that when a non-resident defendant is sued in the Philippine courts and it appears. No. and that thereafter all such parties be required to interplead and settle the rights among themselves. No pronouncement as to costs. concur. SO ORDERED. and that. notwithstanding the want of such jurisdiction. of the Regional Trial Court of Molave.. Jurisdiction over the subject-matter is acquired by concession of the sovereign authority which organizes a court and determines the nature and extent of its powers in general and thus fixes its jurisdiction with reference to actions which it may entertain and the relief it may grant. 714. or by the coercive power of legal process exerted over their persons. and on December 10.. service of summons may be made by publication. Judge of First Instance of Manila. wholly or in part. 46631. respondent judge be permanently prohibited from taking any action on the case. payment of which was being withheld by the company. The controlling issue here involved is whether or not the Court of First Instance of Manila has acquired jurisdiction over the person of the present petitioner as a non-resident defendant. actual or contingent.] 9.. Such declaration could only be made properly upon respondent's submission of the aforecited evidence in his favor. motion and demurrer having been overruled as well as her motion for reconsideration of the order of denial. On December 9. 921. C. 1938. On September 5. 37 Phil. and by one George H. We have fully explained the meaning of this provision in El Banco Español Filipino vs. (2)When the defendant is a non-resident and refuses to appear voluntarily. The complaint was accordingly amended and in addition to the relief prayed for in the original complaint. In the light of that decision. motion to quash. respondent. the proposition that jurisdiction over the person cannot be thus acquired by publication and notice is no longer open to question. 1938. In truth. pursuant to the order of the trial court. are hereby SET ASIDE. wherein we laid down the following rules: (1)In order that the court may validly try a case. 2002. Engelhard. instituted an action in the Court of First Instance of Manila against the Benguet Consolidated Mining Company for dividends amounting to P71. petitioner Idonah Slade Perkins. and it is now fully established that a personal judgment upon constructive or substituted service against a non-resident who does not appear is wholly invalid. and of other decisions which have subsequently been rendered in that and other courts. filed her pleading entitled "objection to venue. in excluding such person from any interest therein. by the complaint or by affidavits. or in which the relief demanded consists. November 16. DECISION MORAN. IDONAH SLADE PERKINS. S. for he is beyond the reach of judicial process. and BENGUET CONSOLIDATED MINING COMPANY. respondents. the trial court ordered respondent Eugene Arthur Perkins to include in his complaint as parties defendant petitioner. that the withholding of such dividends and the non-recognition of plaintiff's right to the disposal and control of the shares were due to certain demands made with respect to said shares by the petitioner herein..decree and had remarried an American. the company filed its answer alleging. petitioner. with respect to her. Jurisdiction over the persons of the parties is acquired by their voluntary appearance in court and their submission to its authority.-respondent Perkins prayed that petitioner Idonah Slade Perkins and George H.. for the recognition of his right to the control and disposal of said shares. including service by publication and personal 45 .90 on 52. and.874 shares of stock registered in his name. 24 Law. that respondent is now capacitated to remarry. Petitioner's objection. J p: On July 6. Thereafter. Carpio and Azcuna. CcAHEI ACCORDINGLY. through counsel. 565). 1938. by way of defense.

" (Pennoyer v. and has for its object the disposition of the property. Where. supra. organized in the Philippines under the provisions of the Spanish Code of Commerce. a sociedad anonima. or of some interest therein. pt. [N. Confl. If any be said.' says Story.]. R. supra. 312. It is in virtue of the State's jurisdiction over the property of the non-resident situated within its limits that its tribunals can inquire into the non-resident's obligations to its own citizens. Under these circumstances." (4)As before stated. as an elementary principle. (Fletcher Cyclopedia Corporations. The situs of the shares is in the jurisdiction where the corporation is created.service outside of the jurisdiction in which the judgment is rendered. 2. ed. it is merely to satisfy the constitutional requirement of due process. 585. there is nothing upon which the tribunals can adjudicate. assumes. the action relates to property located in the Philippines. as has already been suggested. without taking actual physical control over the property. p. the relief that may be granted by the Philippine court must be confined to the res.) When. This phraseology was undoubtedly originally adopted by the court because of the analogy between service by publication and personal service of process upon the defendant. Section 120 of our Code of Civil Procedure provides that whenever conflicting claims are or may he made upon a person for or relating 46 . the Philippine courts may validly try the case. 2. Every State owes protection to its own citizens. 35 L. to exercise a jurisdiction in rem over the property and to adjudicate the title in favor of the petitioner against all the world. Petitioner contends that the proceeding instituted against her is one of interpleading and is therefore an action in personam. Neff (supra). 565. In order to satisfy the constitutional requirement of due process. Neff (supra): "It is true that. S. and its jurisdiction over the person of the non-resident is non-essential. and the only exception seems to be found in the case where the non-resident defendant has expressly or impliedly consented to the mode of service. Here the court. Vol. in a strict sense. the difference between the legal effects of the two forms of service was obscure. The several States are of equal dignity and authority. But it is clear that the legal principle here involved is not affected by the peculiar language in which the courts have expounded their ideas. Neff. There is potential custody when. the action is in rem or quasi in rem in connection with property located in the Philippines. as laid down by the Supreme Court of the United States in Pennoyer v. prior to the decision of Pennoyer v. and. in this connection. however. the court acquires jurisdiction over the res.. it is a legitimate and just exercise of authority to hold and appropriate any property owned by such non-residents to satisfy the claims of its citizens. S." (Pennoyer v. S.' Story. Idonah Slade Perkins." The action being quasi in rem.) In the instant case. And so it is laid down by jurists. But. 2. p. Wheat. and if the law requires in such case that the summons upon the defendant be served by publication." (50 C. and the inquiry can then be carried only to the extent necessary to control the disposition of the property. A.. Raher.. therefore. however. that "many reported cases can be cited in which it is assumed that the question of the sufficiency of publication or notice in a case of this kind is a question affecting the jurisdiction of the court. L.. when non-residents deal with them. A. 11. whether the certificates evidencing the ownership of those shares are within or without that jurisdiction. As held by the Supreme Court of the United States in Pennoyer v. and that no tribunal established by it can extend its process beyond that territory so as to subject either persons or property to its decisions. Int. for. at the instance of some person claiming to be owner. potential custody thereof being sufficient. There is no question as to the adequacy of the publication made nor as to the mailing of the order of publication to the petitioner's last known place of residence in the United States. (Note to Raher vs. 'is a mere nullity. may subject property situated within its limits owned by non-residents to the payment of the demand of its own citizens against them. through its tribunals. Story. there can be no question that the action brought by Eugene Arthur Ferkins in his amended complaint against the petitioner. 539. 95). that the laws of one State have no operation outside of its territory. we hold that the action thus brought is quasi in rem. 503). in an action in rem or quasi in rem against a non-resident defendant. may be found in a recognized principle of public law to the effect that "no State can exercise direct jurisdiction and authority over persons or property without its territory. seeks to exclude her from any interest in a property located in the Philippines. sec. but. R. and. 292. L. upon the principle that a "State. it having no jurisdiction to render a personal judgment against the non-resident. In order that the court may exercise power over the res. "it fixes and settles the title to the property in controversy and to that extent partakes of the nature of the judgment in rem. where the direct object is to reach and dispose of property owned by them. of course.. L. In the amended complaint filed by Eugene Arthur Perkins. 568-569. the action being quasi in rem and notice having been made by publication. without reference to the title of individual claimants. no money judgment or other relief in personam is prayed for against the petitioner. R. and incapable of binding such persons or property in any other tribunals. it is not necessary that the court should take actual custody of the property. The only relief sought therein is that she be declared to be without any interest in the shares in controversy and that she be excluded from any claim thereto. jurisdiction over his person is nonessential. in a larger and more general senses the terms are applied to actions between parties. ch. "An illustration of what we term potential jurisdiction over the res. If the non-resident has no property in the State.) (3)The general rule. with its principal office in the City of Manila and which conducts its mining activities therein. 35 L.]. Confl." The reason for the rule that Philippine courts cannot acquire jurisdiction over the person of a non-resident. except so far as is allowed by comity. is that a suit against a non-resident cannot be entertained by a Philippine court.. It is accordingly not surprising that the modes of expression which had already been mounded into legal tradition before that case was decided have been brought down to the present day. 714. ch. the power of the court over the property is impliedly recognized by law. is found in the proceeding to register the title of land under our system for the registration of land. A. and the exercise of this jurisdiction in no respect infringes upon the sovereignty of the State where the owners are domiciled. and the court is sometimes said to acquire jurisdiction by virtue of the publication. Neff. Any exertion of authority of this sort beyond this limit. 95 U. see also 5 L. and the independence of one implies the exclusion of power from all others. the Court of First Instance of Manila has jurisdiction to try the same even if it can acquire no jurisdiction over the person of the non-resident. That property consists in certain shares of stock of the Benguet Consolidated Mining Company. a proceeding in rem is one taken directly against property. Permanent ed. L. summons has been served upon her by publication. 24 Law.. J. while the judgment that may be rendered therein is not strictly a judgment in rem. Neff. from the nature of the action brought. R.

so that he may be made subject to several actions by different persons. while PHILSEC and AYALA extended a loan to ATHONA in the amount of US$2. so that the three claimants may litigate their conflicting claims and settle their rights among themselves. On appeal. as neither jurisdiction over the subject-matter nor res adjudicata nor lis pendenshas anything to do with the question of jurisdiction over her person.807. that these pleas have been made not as independent grounds for relief. For all of the foregoing. private respondent Ventura O. after the claimants have appeared in court. therefore. however. lis pendens and lack of jurisdiction over the subject-matter. 1983. private respondent Drago Daic. Voluntary appearance cannot be implied from either a mistaken or superfluous reasoning but from the nature of the relief prayed for. clear that the publication of the summons was ordered not in virtue of an interpleading. Engelhard. praying that the new defendants thus joined be excluded from any interest in the shares in question. 1997. and one named George H. (hereafter called ATHONA) a parcel of land in Harris County. and no specific relief is prayed for against them. upon the non-resident Idonah Slade Perkins. DRAGO DAIC. The balance of US$307. for it merely seeks to call conflicting claimants into court so that they may interplead and litigate their several claims among themselves. the Benguet Consolidated Mining Company. such person may bring an action against the conflicting claimants. PERLAS and WILLIAM H.V. dated January 27. In order to facilitate the payment of the loans.00 as initial payment of the purchase price.500. and the court may order them to interplead with one another and litigate their several claims among themselves.to personal property. his wife Idonah Slade Perkins. calling the conflicting claimants into court and compelling them to interplead with one another. in its answer to the complaint filed by Eugene Arthur Perkins. 1983. we believe and so hold that the petitioner has not. and prayed that these last two be made parties to the action and served with summons by publication. upon the filing of the answer of the Benguet Consolidated Mining Company. dismissed Civil Case No. N..500. Ducat obtained separate loans from petitioners Ayala International Finance Limited (hereafter called AYALA) 1 and Philsec Investment Corporation (hereafter called PHILSEC) in the sum of US$2. Inc. but upon the filing of the amended complaint wherein an action quasi in remis alleged.00.00 secured by shares of stock owned by Ducat with a market value of P14. submitted herself to the jurisdiction of the court. Suffice it to say that here the service of the summons by publication was ordered by the lower court by virtue of an action quasi in rem against the non-resident defendant. Respondents contend that. 103493. SECOND DIVISION [G. What would be the situation if. conflicting claims were being made upon it by said plaintiff. assumed Ducat's obligation under an Agreement. which. private respondent 1488. averred that in connection with the shares of stock in question. U. Inc. or the performance of an obligation or any portion thereof. such order could not perhaps have validly been served by publication or otherwise. The plaintiff did so. The facts are as follows: On January 15. in addition to forum non conveniens. Eugene Arthur Perkins. respondents.02 was to be paid by 47 . 1488. she claimed that the lower court had no jurisdiction over her person not only because she is a non-resident. one of them pleads ownership of the personal property located in the Philippines and seeks to exclude a non-resident claimant from any interest therein. Oreta. whereby 1488. executed a Warranty Deed with Vendor's Lien by which it sold to petitioner Athona Holdings. Suarez & Narvasa Law Firm for private respondents. Petitioners brought this case in the Regional Trial Court of Makati. BPI-INTERNATIONAL FINANCE LIMITED. through its president.209. but merely as additional arguments in support of her contention that the lower court had no jurisdiction over her person. VENTURA O.S.995.000. but also because the court had no jurisdiction over the subject-matter of the action and that the issues therein involved have already been decided by the New York court and are being relitigated in the California court. CRAIG. Padilla Law Office for petitioners. PHILSEC INVESTMENT CORPORATION. Had not the complaint been amended.R. and ATHONA HOLDINGS. including the herein petitioner as an additional defendant. J p: This case presents for determination the conclusiveness of a foreign judgment upon the rights of the parties under the same cause of action asserted in a case in our local court.vs. DUCAT. and it is upon this amended complaint that the court ordered the service of the summons by publication. Texas. for US$2. and had the court. petition is hereby denied.A. the Court of Appeals affirmed. Hence this petition for review on certiorari. 16563 on the ground of litis pendentia.. and thereupon proceed to determine their several claims. is a question which we do not decide now. petitioners. The court has not issued an order compelling the conflicting claimants to interplead with one another and litigate their several claims among themselves. PRECIOSO R. It is. as the interpleader simply disclaims any personal interest in the controversy. Here. issued an order under section 120 of the Code of Civil Procedure. We have noticed. N. disclaiming personal interest in the controversy.209. Such proceeding is a personal action. she has submitted herself to its jurisdiction. THE HONORABLE COURT OF APPEALS.. but instead ordered the plaintiff to amend his complaint including the other two claimants as parties defendant. as the petitioner in the lower court has pleaded res adjudicata. Salonga Hernandez & Mendoza for Guevarra. June 19. DECISION MENDOZA.000. In other words.088. Branch 56. No. for then the proceeding would be purely one of interpleading.V. in view of the pendency at the time of the foreign action. INC. with costs against petitioner.] 10. by such erroneous argument.02. Although this argument is obviously erroneous.

1985. for the rescission of the sale on the ground that the property had been over-valued. In the U. A separate hearing was held with regard to 1488. Inc.000. under the doctrine offorum non conveniens. Private respondent Perlas. but. upon their receipt of the US$2. 1987. reiterating its allegations in the original complaint. all the shares of stock in their possession belonging to Ducat. the Ayala International Finance Ltd. (2) forum non conveniens.. The transaction sued upon by the parties. H-86-440 of the United States District Court of Southern Texas that private respondents committed fraud by selling the property at a price 400 percent more than its true value of US$800. Inc. where it was docketed as Case No. arguing that the trial court erred in applying the principle of litis pendentia and forum non conveniens and in ruling that it had no jurisdiction over the defendants. on October 17. Inc. Ducat contended that the alleged overpricing of the property prejudiced only petitioner ATHONA. PHILSEC and AYALA filed a motion to dismiss on the ground of lack of jurisdiction over their person. where it was docketed as Civil Case No. ATHONA sought the recovery of damages and excess payment allegedly made to 1488. for allegedly conspiring in selling the property at a price over its market value. .000. The recovery of a sum of money and damages. Inc. PHILSEC's own former president.A. filed an amended complaint. the United States District Court for the Southern District of Texas dismissed the counterclaim against Edgardo V.S. and Daic's motion to dismiss. On March 9. Originally instituted in the United States District Court of Texas. Inc. PHILSEC and AYALA released Ducat from his indebtedness and delivered to 1488. For their part. On the other hand. stating that "the evidentiary requirements of the controversy may be more suitably tried before the forum of the litis pendentia in the U. is the better (if not exclusive) forum to litigate matters needed to determine the assessment and/or fluctuations of the fair market value of real estate situated in Houston. PHILSEC and AYALA were induced to enter into the Agreement and to purchase the Houston property.S. (emphasis by trial court) The trial court also held itself without jurisdiction over 1488. 1488.. Accordingly. the trial court 3 granted the motion to dismiss filed by 1488. 16563 on the grounds of (1) litis pendentia. under the principle in private international law of forum non conveniens. as buyer. . and Daic because they were non-residents and the action was not an action in rem or quasi in rem. Guevarra on the ground that it was "frivolous and [was] brought against him simply to humiliate and embarrass him.S. Petitioners claimed that. On January 6. Inc. and Daic. but not PHILSEC and BPI-IFL which were not parties to the sale and whose only participation was to extend financial accommodation to ATHONA under a separate loan agreement. and. impleading private respondents herein as counterdefendants. the entire amount covered by the note became due and demandable. 85-57746. The complaint reiterated the allegation of petitioners in their respective counterclaims in Civil Action No. Petitioners prayed that private respondents be ordered to return to ATHONA the excess payment of US$1." even as it noted that Ducat was not a party in the U. extraterritorial service of summons by publication was ineffectual and did not vest the court with jurisdiction over 1488. where 1488. Guevarra.. in both cases is the Warranty Deed executed by and between Athona Holdings and 1488 Inc.S. sued petitioners PHILSEC.209. and Daic on the ground of litis pendentia considering that the "main factual element" of the cause of action in this case which is the validity of the sale of real property in the United States between defendant 1488 and plaintiff ATHONA is the subject matter of the pending case in the United States District Court which. Inc. As ATHONA failed to pay the interest on the balance of US$307. ATHONA. NV. court are 1488 Inc. and (3) failure of petitioners PHILSEC and BPI-IFL to state a cause of action. the venue of the action was later transferred to the United States District Court for the Southern District of Texas. the U." For this reason. case.S. the rescission of sale of the property. the Court of Appeals 4 affirmed the dismissal of Civil Case No. and Daic. on the marketability of Ducat's securities given in exchange for the Texas property. the trial court granted Ducat's motion to dismiss.means of a promissory note executed by ATHONA in favor of 1488." contending that the action being in personam.00 and to pay damages. H-86-440 was pending in the United States. Subsequently. . Inc. as their motion was denied. Inc. under the Agreement. and Daic on the ground of litis pendentia. which is a non-resident foreign corporation. Inc. case. in 48 . thus: The plaintiffs in the U. private respondents 1488. U.S. they later filed a joint answer with counterclaim against private respondents and Edgardo V.700. which likewise alleges fraud employed by herein appellants. petitioners filed a complaint "For Sum of Money with Damages and Writ of Preliminary Attachment" against private respondents in the Regional Trial Court of Makati.500. and Daic in the U. who is a non-resident alien. Inc.02 and for damages for breach of contract and for fraud allegedly perpetrated by petitioners in misrepresenting the marketability of the shares of stock delivered to 1488. and Daic. Inc. H-86440 filed by 1488. as a result of private respondents' fraudulent misrepresentations. The trial court subsequently lifted the writ of attachment it had earlier issued against the shares of stocks of 1488. On January 26. Inc.. while Civil Case No.00 from 1488.209. 1988. from the date of the transaction in 1983 up to the present and verily. despite the previous attachment of shares of stocks belonging to 1488..S. On April 20. the trial court issued a writ of preliminary attachment against the real and personal properties of private respondents. Texas. private respondent 1488. and/or Drago Daic. was later dropped as counterdefendant. 1990. Petitioners appealed to the Court of Appeals. while the defendants are Philsec. 1987. breach of contract and the promissory notes are sued upon by 1488 Inc. 1988. for fraud purportedly committed by appellees. so that extraterritorial service of summons was ineffective. (BPI-IFL's former name) and the Athona Holdings. The case at bar involves the same parties. Inc. court imposed so-called Rule 11 sanctions on PHILSEC and AYALA and ordered them to pay damages to Guevarra. Inc. 165th Judicial District. 16563 against Ducat. AYALA and ATHONA in the United States for payment of the balance of US$307.000. vis-a-vis Civil Action No. ATHONA filed an answer with counterclaim. Inc.02. and its president Daic filed a joint "Special Appearance and Qualified Motion to Dismiss.00. in the alternative. who had allegedly appraised the property. On April 10.. 1992. 16563. 2 Private respondent Ducat moved to dismiss Civil Case No. On March 13.

in Philippine International Shipping Corp.S. 2) the seller.S.S. it cannot be said that petitioners were given the opportunity to challenge the judgment of the U. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT PHILIPPINE PUBLIC POLICY REQUIRED THE ASSUMPTION. Athona Holdings.AS A COROLLARY TO THE FIRST TWO GROUNDS. in order for the court to properly determine its efficacy. Trial had been previously held in the lower court and only afterward was a decision rendered. the United States District Court for the Southern District of Texas rendered judgment 5 in the case before it. Private respondents contend that for a foreign judgment to be pleaded as res judicata. BY THE TRIAL COURT OF ITS RIGHTFUL JURISDICTION IN THE CIVIL ACTION FOR THERE IS EVERY REASON TO PROTECT AND VINDICATE PETITIONERS' RIGHTS FOR TORTIOUS OR WRONGFUL ACTS OR CONDUCT PRIVATE RESPONDENTS (WHO ARE MOSTLY NONRESIDENT ALIENS) INFLICTED UPON THEM HERE IN THE PHILIPPINES. which was in favor of private respondents. or clear mistake of law or fact. 50. collusion.S. The proceedings in the trial court were summary. The dismissal of Civil Case No. having jurisdiction to pronounce the judgment is as follows: (a)In case of a judgment upon a specific thing. a foreign corporation which does not claim to be doing business in the Philippines. court as basis for declaring it res judicata or conclusive of the rights of private respondents. 1988. 3) although the buyer.S.S. court: The U. We will deal with these contentions in the order in which they are made. Inc. a domestic corporation. collusion. 10 which private respondents invoke for claiming conclusive effect for the foreign judgment in their favor. §50 provides: SEC. Ltd. 7 it was after the parties opposed to the judgment had been given ample opportunity to repel them on grounds allowed under the law. court or apprised of the evidence presented thereat.THE DOCTRINE OF PENDENCY OF ANOTHER ACTION BETWEEN THE SAME PARTIES FOR THE SAME CAUSE (LITIS PENDENTIA) RELIED UPON BY THE COURT OF APPEALS IN AFFIRMING THE TRIAL COURT'S DISMISSAL OF THE CIVIL ACTION IS NOT APPLICABLE. U. 4) the Warranty Deed was executed in Texas. constitute the action before the Philippine court. 2. fraud. want of notice to the party. As the trial court stated in its disputed order dated March 9. The judgment.THE PRINCIPLE OF FORUM NON CONVENIENS ALSO RELIED UPON BY THE COURT OF APPEALS IN AFFIRMING THE DISMISSAL BY THE TRIAL COURT OF THE CIVIL ACTION IS LIKEWISE NOT APPLICABLE. so that service of summons by publication did not vest the trial court with jurisdiction over 1488. as distinguished from actions in rem. was affirmed on appeal by the Circuit Court of Appeals. case and the case at bar arose from only one main transaction. declaring the judgment of the Supreme Court of the State of Washington to have the effect of res judicata in the case before the lower court. 12 this court held that the foreign judgment was valid and enforceable in the Philippines there being no showing that it was vitiated by want of notice to the party.A. petitioners argue that the foreign judgment cannot be given the effect of res judicata without giving them an opportunity to impeach it on grounds stated in Rule 39. with respect to actions in personam. (b)In case of a judgment against a person. the judgment is presumptive evidence of a right as between the parties and their successors in interest by a subsequent title. to wit: "want of jurisdiction. a foreign judgment merely constitutes prima facie evidence of the justness of the claim of a party and. which likewise stems from the same Warranty Deed." Petitioners' contention is meritorious. to assure a proper determination of whether the issues then being litigated in the U. It is important to note in connection with the first point that while the present case was pending in the Court of Appeals.S.S. and involve foreign elements. in the case of General Corporation of the Philippines v. fraud. The Court of Appeals also held that Civil Case No. This is because in THIS jurisdiction.A. court were exactly the issues raised in this case such that the judgment that might be rendered would constitute res judicata. 16563 on the ground of forum non conveniens was likewise affirmed by the Court of Appeals on the ground that the case can be better tried and decided by the U. 9 Rule 39. the principal issue to be resolved in this case is whether Civil Case No. — The effect of a judgment of a tribunal of a foreign country. collusion. the judgment is conclusive upon the title to the thing. Court of Appeals. is wholly owned by Philsec. What is essential is that there is opportunity to challenge the foreign judgment. While this court has given the effect of res judicata to foreign judgments in several cases. v. Union Insurance Society of Canton.. Athona Holdings is also owned by BPI-IFL. The prima facie presumption under the Rule had not been rebutted. is a non-resident foreign corporation. a judgment admitting the foreign decision is not necessary. 16536 is barred by the judgment of the U. In the same vein. also a foreign corporation. the foreign judgment was considered res judicata because this Court found "from the evidence as well as from appellant's own pleadings" 11 that the foreign court did not make a "clear mistake of law or fact" or that its judgment was void for want of jurisdiction or because of fraud or collusion by the defendants.Effect of foreign judgments. but the judgment may be repelled by evidence of a want of jurisdiction. to wit: 1) the property subject matter of the sale is situated in Texas. NOT THE RELINQUISHMENT. In their present appeal. U. On the other hand. 49 . In the case at bar. 16563 was an action in personam for the recovery of a sum of money for alleged tortious acts. 1488 Inc. 8 It is not necessary for this purpose to initiate a separate action or proceeding for enforcement of the foreign judgment. Neither the trial court nor the appellate court was even furnished copies of the pleadings in the U. or clear mistake of law or fact. First. §50 of the Rules of Court. petitioners contend that: 1.overpricing the Texas land. 3. 6 Thus. is subject to proof to the contrary. as such. fraud or clear mistake of law or fact. court. want of notice to the party. and Drago Daic.. Thus.

No. ROUZIE. 92-1070 is pending in Branch 134 of Judge Ignacio Capulong. Guevarra to enforce so-called Rule 11 sanctions imposed on the petitioners by the U. February 26. It has been held therefore that: [A] foreign judgment may not be enforced if it is not recognized in the jurisdiction where affirmative relief is being sought. among others. Nor is the trial court's refusal to take cognizance of the case justifiable under the principle of forum non conveniens. 17 In this case. JR. 162894. 1994 is hereby LIFTED. J p: 50 . 16563 is REMANDED to the Regional Trial Court of Makati for consolidation with Civil Case No. albeit in different salas. 16563. but their claim was brushed aside by both the trial court and the Court of Appeals. Inc. 2008. vs.] 11. court. It was error we think for the Court of Appeals and the trial court to hold that jurisdiction over 1488. while Civil Case No. STOCKTON W. 20 it appears from the pleadings that petitioners only belatedly impleaded Guevarra as defendant in Civil Case No. case. 16 The propriety of dismissing a case based on this principle requires a factual determination. Rule 39 of the Rules of Court in order that the defendant..S. notice. collusion. 1987. 1992. "the property of the defendant has been attached within the Philippines. in the interest of justice. The temporary restraining order issued on June 29. An absurdity could then arise: a foreign judgment is not subject to challenge by the plaintiff against whom it is invoked. Gorospe)." 1 8 It is not disputed that the properties. fraud or clear mistake of fact and law. 92-1070 and assigned to Branch 134. the Court finds that the judgment sought to be enforced is severable from the main judgment under consideration in Civil Case No. to determine whether special circumstances" require the court's desistance. were identical. 92-1070 should be consolidated. court over their persons. 1988 never found that the causes of action of this case and the case pending before the USA Court. (emphasis added) It was error therefore for the Court of Appeals to summarily rule that petitioners' action is barred by the principle of res judicata. Second. 92-1070 and for further proceedings in accordance with this decision. but it may be opposed by the defendant if the foreign judgment is sought to be enforced against him in a separate proceeding. the trial court abstained from taking jurisdiction solely on the basis of the pleadings filed by private respondents in connection with the motion to dismiss. 92-1445 filed by Edgardo V. cdasia WHEREFORE. respondent. First. RAYTHEON INTERNATIONAL. petitioner. The separability of Guevarra's claim is not only admitted by petitioners. 15 After all. petitioners should have the burden of impeaching the foreign judgment and only in the event they succeed in doing so may they proceed with their action against private respondents. 1488. Inc. The trial court arbitrarily dismissed the case even after finding that Ducat was not a party in the U. Petitioners in fact questioned the jurisdiction of the U. and Daic filed a petition for the enforcement of judgment in the Regional Trial Court of Makati. precisely the Order of January 26. 13 Moreover. it should do so only after "vital facts are established. this case and Civil Case No. may present evidence of lack of jurisdiction.. while it is within the discretion of the trial court to abstain from assuming jurisdiction on this ground. to insure the orderly administration of justice. the TRO should be lifted and Civil Case No. SO ORDERED. 16563. Second. if applicable. the Court notes that on April 22. although the proceedings were suspended because of the pendency of this case.On the plaintiff's claim in its Opposition that the causes of action of this case and the pending case in the United States are not identical. 14 Accordingly. Third. §1. In such proceedings. Rule 14. this case being assigned to Branch 56 (Judge Fernando V. if it is pleaded to resist a claim as in this case. to suspend the proceedings in Civil Case No. hence. the complaint should be considered as a petition for the recognition of the Hongkong judgment under Section 50 (b). and Daic could not be obtained because this is an action in personam and summons were served by extraterritorial service. where it was docketed as Civil Case No.S. As for the temporary restraining order issued by the Court on June 29. DECISION TINGA. INC. 21 Hence. real and personal. It failed to consider that one of the plaintiffs (PHILSEC) is a domestic corporation and one of the defendants (Ventura Ducat) is a Filipino.R. of the private respondents had been attached prior to service of summons under the Order of the trial court dated April 20. This is plainly untenable. a motion to dismiss is limited to the grounds under Rule 16. 1994. §17 on extraterritorial service provides that service of summons on a non-resident defendant may be effected out of the Philippines by leave of Court where. private respondent herein. To sustain the appellate court's ruling that the foreign judgment constitutes res judicata and is a bar to the claim of petitioners would effectively preclude petitioners from repelling the judgment in the case for enforcement. 19 Fourth. the two have been filed in the Regional Trial Court of Makati. the decision of the Court of Appeals is REVERSED and Civil Case No. SECOND DIVISION [G.S. it is more properly considered a matter of defense. Hence. 92-1445 allowed to proceed. which does not include forum non conveniens. and that it was the extinguishment of the latter's debt which was the object of the transaction under litigation.

Karagdag or of respondent despite diligent efforts. had severed relations with the law firm even before the filing of the instant petition and that it could no longer find the whereabouts of Atty. the deposition of Walter Browning was taken before the Philippine Consulate General in Chicago. Browning for alleged nonpayment of commissions. Jr. entered into a contract whereby BMSI hired respondent as its representative to negotiate the sale of services in several government projects in the Philippines for an agreed remuneration of 10% of the gross receipts. The appellate court also stated that it could not rule one way or the other on the issue of whether the corporations. instituted an action for damages before the Regional Trial Court (RTC) of Bauang. The complaint also averred that BMSI and RUST as well as petitioner itself had combined and functioned as one company. illegal termination and breach of employment contract. Pinatubo eruption and mudflows.. petitioner filed an Omnibus Motion for Preliminary Hearing Based on Affirmative Defenses and for Summary Judgment 12 seeking the dismissal of the complaint on grounds of forum non conveniens and failure to state a cause of action. The trial court held that the factual allegations in the complaint. the RTC denied petitioner's omnibus motion. 5 Upon appeal by BMSI. were sufficient for the trial court to render a valid judgment thereon. the Court resolved to dispense with the filing of a comment. Petitioner also denied combining with BMSI and RUST for the purpose of assuming the alleged obligation of the said companies. Respondent opposed the same. Pending the resolution of the omnibus motion. as well as BMSI and RUST. an American citizen. 20 On 28 August 2003. 7 docketed as Civil Case No. 11 On 18 May 1999. 3 On 16 July 1994. the deposition of Walter Browning. On 11 March 1992. 18 the trial court denied petitioner's motion. 15 Petitioner filed a Motion for Reconsideration 16 of the order. assuming the same to be admitted. The Resolution became final and executory on 09 November 1998. insufficient for purposes of determining whether the complaint failed to state a cause of action. On 8 January 1999. Hence. Thus." the rights and obligations of the parties shall be governed by the laws of the State of Connecticut. the NLRC reversed the decision of the Labor Arbiter and dismissed respondent's complaint on the ground of lack of jurisdiction. then a resident of La Union. 8 petitioner alleged that contrary to respondent's claim. it being a foreign corporation licensed to do business in the Philippines.Before this Court is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure which seeks the reversal of the Decision 1 and Resolution 2 of the Court of Appeals in CA-G. La Union. the following antecedents appear: Sometime in 1990. it held that the issue should be threshed out during trial. Labor Arbiter Pablo C. Atty. it found the evidence presented by petitioner. rendered judgment ordering BMSI and RUST to pay respondent's money claims. SP No. the two corporations impleaded in the earlier labor case. Rodney C. 10 Petitioner sought the dismissal of the complaint on grounds of failure to state a cause of action and forum non conveniens and prayed for damages by way of compulsory counterclaim. 17 In an Order dated 31 July 2001. respondent secured a service contract with the Republic of the Philippines on behalf of BMSI for the dredging of rivers affected by the Mt. respondent failed to file a comment despite repeated notices. named as defendants in the case had indeed merged together based solely on the evidence presented by respondent. 23 Moreover. The complaint essentially reiterated the allegations in the labor case that BMSI verbally employed respondent to negotiate the sale of services in government projects and that respondent was not paid the commissions due him from the Pinatubo dredging project which he secured on behalf of BMSI. It also denied petitioner's motion for reconsideration in the assailed Resolution issued on 10 March 2004. it was a foreign corporation duly licensed to do business in the Philippines and denied entering into any arrangement with respondent or paying the latter any sum of money. the appellate court deferred to the discretion of the trial court when the latter decided not to desist from assuming jurisdiction on the ground of the inapplicability of the principle offorum non conveniens. denominated as "Special Sales Representative Agreement. Brand Marine Services. a corporation duly organized and existing under the laws of the State of Connecticut. it filed a Rule 65 Petition 19 with the Court of Appeals praying for the issuance of a writ of certiorari and a writ of injunction to set aside the twin orders of the trial court dated 13 September 2000 and 31 July 2001 and to enjoin the trial court from conducting further proceedings. named as defendants herein petitioner Raytheon International. Rouzie. Jr. Inc. 13 In an Order 14 dated 13 September 2000. In its Answer. It also ruled that the principle of forum non conveniens was inapplicable because the trial court could enforce judgment on petitioner. 9 Petitioner also referred to the NLRC decision which disclosed that per the written agreement between respondent and BMSI and RUST. 24 Incidentally. 1192-BG. 6 Respondent elevated the case to this Court but was dismissed in a Resolution dated 26 November 1997. United States of America. including petitioner. Thus. 67001 and the dismissal of the civil case filed by respondent against petitioner with the trial court. Inc. respondent filed before the Arbitration Branch of the National Labor Relations Commission (NLRC) a suit against BMSI and Rust International. Espiritu. manifested that the lawyer handling the case. The Ceferino Padua Law Office. and respondent Stockton W. Rogelio Karagdag. respondent. As culled from the records of the case. which motion was opposed by respondent. 4 On 28 September 1995. The Complaint. WHETHER OR NOT THE COURT OF APPEALS ERRED IN REFUSING TO DISMISS THE COMPLAINT ON THE GROUND OF FORUM NON CONVENIENS. the Court of Appeals rendered the assailed Decision 21 denying the petition for certiorari for lack of merit. counsel on record for respondent. (RUST). (BMSI).R. this petition raising the following issues: WHETHER OR NOT THE COURT OF APPEALS ERRED IN REFUSING TO DISMISS THE COMPLAINT FOR FAILURE TO STATE A CAUSE OF ACTION AGAINST RAYTHEON INTERNATIONAL. 22 The appellate court held that although the trial court should not have confined itself to the allegations in the complaint and should have also considered evidence aliunde in resolving petitioner's omnibus motion. 51 . INC. Gilbert and Walter G. Inc. that is. In a Resolution 25 dated 20 November 2006.

On the other hand. it is more properly considered as a matter of defense. As regards jurisdiction over the parties. Our examination of the deposition of Mr. . 37 The complaint alleged that petitioner had combined with BMSI and RUST to function as one company. (2) that the Philippine Court is in a position to make an intelligent decision as to the law and the facts. Petitioner theorizes that the foreign elements of the dispute necessitate the immediate application of the doctrine of forum non conveniens. the surviving company (if at all) may be held liable for the obligation of BMSI to respondent Rouzie for unpaid commissions. and Brand Marine Service. after Rust International ceased to exist after being absorbed by REC. . 35 Finding no grave abuse of discretion on the trial court. to determine whether special circumstances require the court's desistance. Neither these documents clearly speak otherwise. thus: . the elementary test for failure to state a cause of action is whether the complaint alleges facts which if true would justify the relief demanded. 26 the Court outlined three consecutive phases involved in judicial resolution of conflicts-of-laws problems. the following requisites had to be proved: (1) that the Philippine Court is one to which the parties may conveniently resort. Petitioner also contends that the complaint in Civil Case No. 33 The choice of law stipulation will become relevant only when the substantive issues of the instant case develop. so much so that Raytheon International. the resolution of the Court of Appeals is instructive. in the instances 27 where the Court held that the local judicial machinery was adequate to resolve controversies with a foreign element. the trial court acquired jurisdiction over herein respondent (as party plaintiff) upon the filing of the complaint. convincing and conclusive proofs that Raytheon Engineers and Constructors. Failure to state a cause of action refers to the insufficiency of allegation in the pleading. 1192-BG is an action for damages arising from an alleged breach of contract. This is an exercise of sovereign prerogative of the country where the case is filed.] Inc. the nature of the action and the amount of damages prayed are within the jurisdiction of the RTC. 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. that is. While it is within the discretion of the trial court to abstain from assuming jurisdiction on this ground. It also mentions the presence of foreign elements in the dispute — namely. Kitamura. 28 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. Annexes "A" to "E" by themselves are not substantial. Inc. and (3) that the Philippine Court has or is likely to have the power to enforce its decision. Rust International[. Jurisdiction considers whether it is fair to cause a defendant to travel to this state. (REC) assumed the warranty obligations of defendant Rust International in the Makar Port Project in General Santos City. in conflicts-of-laws cases. a court. Thus. Petitioner contends that the deposition of Walter Browning rebutted this allegation. are precluded from hearing the civil action. No. 29 Jurisdiction over the nature and subject matter of an action is conferred by the Constitution and the law 30 and by the material allegations in the complaint. jurisdiction over the person of petitioner (as party defendant) was acquired by its voluntary appearance in court. 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. Walter Browning as well as other documents produced in the hearing shows that these evidencealiunde are not quite sufficient for us to mete a ruling that the complaint fails to state a cause of action. Recently in Hasegawa v. or any other foreign tribunal for that matter. the propriety of dismissing a case based on the principle of forum non conveniens requires a factual determination. it should do so only after vital facts are established. the parties and the res. 52 . Under the doctrine of forum non conveniens. irrespective of whether or not the plaintiff is entitled to recover all or some of the claims or reliefs sought therein.The instant petition lacks merit. JURISDICTION AND CHOICE OF LAW ARE TWO DISTINCT CONCEPTS. Petitioner mainly asserts that the written contract between respondent and BMSI included a valid choice of law clause. 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. Other documents already submitted in evidence are likewise meager to preponderantly conclude that Raytheon International. which only a full-blown trial on the merits can afford. AFTER HEARING on the merits proceeds before the trial court. the question of whether petitioner. 1192-BG and the parties involved. 31 Civil Case No. Undoubtedly. In the same manner. choice of law. namely: jurisdiction. that the contract shall be governed by the laws of the State of Connecticut. 34 Petitioner's averments of the foreign elements in the instant case are not sufficient to oust the trial court of its jurisdiction over Civil Case No. Inc. the Court defers to the sound discretion of the lower courts because their findings are binding on this Court. 36 As a general rule. Moreover. 1192-BG failed to state a cause of action against petitioner.. hence. have combined into one company. Inc. that is. and recognition and enforcement of judgments.. BMSI and RUST merged together requires the presentation of further evidence. Inc. the parties and witnesses involved are American corporations and citizens and the evidence to be presented is located outside the Philippines — that renders our local courts inconvenient forums. 32 That the subject contract included a stipulation that the same shall be governed by the laws of the State of Connecticut does not suggest that the Philippine courts. On this score. the Court of Appeals respected its conclusion that it can assume jurisdiction over the dispute notwithstanding its foreign elements. 38 As correctly pointed out by the Court of Appeals.

would protect him. Not all cases involving Filipino citizens can be tried here. FIRST DIVISION [G. Beijing. J p: The case before the Court is a petition for certiorari 1 to annul the following orders of the National Labor Relations Commission (hereinafter referred to as "NLRC") for having been issued without or with excess jurisdiction and with grave abuse of discretion: 2 (1)Order of May 31. JJ.600. If Santos were an "overseas contract worker. Shmidt as the representative of Palace Hotel. Sandoval-Gutierrez. specifically the POEA. he received a letter from Mr. ARBITER CEFERINA J. on May 2. he was directly hired by the Palace Hotel. However. While in Oman. 1998. Jr.WHEREFORE. Sultanate of Oman. 1995. the Labor Arbiter had no jurisdiction over respondent's claim. Shmidt before the Arbitration Branch. (2)Decision of December 15.00) as "14th month pay" or a total of nineteen thousand and eight hundred dollars (US$19. 1992. Shmidt were not served with summons and neither participated in the proceedings before the Labor Arbiter. vs. SYNOPSIS Private respondent Marcelo Santos was an overseas worker employed as printer at the Mazoon Printing Press. Hence. MHICL. 1988. 1998 was perfected. Shmidt.800. without exercising a judicious deliberation or rendering a decision on the matter. The Palace Hotel and Mr. Shmidt that his employment at the Palace Hotel print shop will be terminated due to business reverses brought about by the political upheaval in China. NATIONAL LABOR RELATIONS COMMISSION. a foreign employer.00) as extra four months salary for the two (2) year period of his contract. Further. 1993.R. DIOSANA AND MARCELO G. in June 1988. Santos signified his acceptance. 120077. three thousand six hundred dollars (US$3. the Palace Hotel informed respondent Santos by letter signed by Mr. MHC and MHICL appealed to the NLRC which decided in favor of Santos. Palace Hotel is a member of the Manila Hotel Group. concur. Moreover. People's Republic of China and later terminated due to retrenchment. it is basic that a corporation has a personality separate and distinct from those composing it as well as from that of any other legal entity to which it may be related. the Labor Arbiter decided against MHC and MHICL. respondents. National Capital Region. SP No. 2000.] 12. Subsequently. China." a fact which he admits with conviction. General Manager of Palace Hotel. not the NLRC.600. one is not expressing his agreement or approval. He was hired without the intervention of the POEA or any authorized recruitment agency of the government. three thousand six hundred dollars (US$3. InSichangco v. 4 The questioned order declared that the NLRC. Board of Commissioners of Immigration. 1994.. The only link that the Philippines has with the case is that respondent Santos is a Filipino citizen. However. the instant petition for review on certiorari is DENIED. SO ORDERED. Sultanate of Oman. Clear and convincing evidence is needed to pierce the veil of corporate fiction. The amended employment contract was signed by Mr. 1990. respondent Santos filed a complaint for illegal dismissal against MHC. On February 20. He was hired directly by the Palace Hotel. Subsequently.00) representing salaries for the unexpired portion of his contract. 67001 are hereby AFFIRMED. when one "notes" a contract. National Labor Relations Commission. MHC and respondent Santos." a Philippine forum. On August 10. Subsequently. and (3)Order of March 30. offering him the same position as printer with a higher monthly salary and increased benefits as he was recommended by his friend Nestor Buenio. as a party would. the Palace Hotel and Mr. petitioners. the employment contract was amended.R. 1989. this appeal. Carpio. and was noted by the Vice President for Operations and Development of MHICL.. since it was only on November 5. and the case involves purely foreign elements. The Court ANNULLED the orders and resolutions of the National Labor Relations Commission.00) or its peso equivalent and attorney's fees amounting to ten percent (10%) of the total award. the Court recognized that the term "noted" means that the person so noting has merely taken cognizance of the existence of an act or declaration.. SANTOS. DECISION PARDO. Beijing. private respondent Marcelo Santos (hereinafter referred to as "Santos") was an overseas worker employed as a printer at the Mazoon Printing Press. This is not to say that Philippine courts and agencies have no power to solve controversies involving foreign employers. Cergueda. through correspondence sent to the Sultanate of Oman where he was then employed. LTD. Miguel O. 6 Denying the motion for reconsideration of the petitioners. THE MANILA HOTEL CORP. * Carpio-Morales and Velasco. Costs against petitioner. AND MANILA HOTEL INTL. Considering that no employer-employee relationship existed between MHICL. China. The Palace Hotel and MHICL are foreign corporations. 1988 that Santos left for Beijing.600. The main aspects of the case transpired in two foreign jurisdictions. an employment contract for a period of two years beginning September 1. had jurisdiction over private respondent's complaint. Gerald R. 5 Directing petitioners to jointly and severally pay private respondent twelve thousand and six hundred dollars (US$12. he is not an "overseas contract worker. EHSITc In May. October 13. not the Philippine Overseas Employment Administration (hereinafter referred to as "POEA"). The Decision and Resolution of the Court of Appeals in CA-G. 3 Reversing and setting aside its earlier resolution of August 28. The Court found no evidence to show that MHICL and MHC are one and the same entity. No. 53 .

Respondent Santos enclosed four (4) signed copies of the employment contract (dated June 4. The position was slated to open on October 1. 1988. the Palace Hotel terminated the employment of respondent Santos and paid all benefits due him. 1989. 54 . General Manager. China. Schmidt informed respondent Santos that he was recommended by one Nestor Buenio. respondent Santos was deemed resigned from the Mazoon Printing Press. On August 10. owning 50% of its capital stock. Shmidt's Executive Secretary. 1988. "We sincerely regret that a decision like this has to be made. respondent Santos was in the Philippines on vacation leave. respondent Santos was repatriated to the Philippines. including his plane fare back to the Philippines. Henk's letter. 1988. Gerhard R. Mr. 1988. On July 1.00) net of taxes.Petitioners are the Manila Hotel Corporation (hereinafter referred to as "MHC") and the Manila Hotel International Company. we will not open/operate printshop for the time being. Mr. the Palace Hotel Manager. a friend of his. We quote the letter: "After the unfortunate happenings in China and especially Beijing (referring to Tiannamen Square incidents). 7 MHC is an "incorporator" of MHICL. The Vice President (Operations and Development) of petitioner MHICL Miguel D. 12 It provided for a monthly salary of nine hundred dollars (US$900. Cergueda signed the employment agreement under the word "NOTED." From June 8 to 29. 13 On June 30. together with his passport and two additional pictures for his visa to China. To reduce expenses. 11 On May 8. MHICL 10 trained the personnel and staff of the Palace Hotel at Beijing. 1989. Mr. we will contact you directly and give you priority on future assignment. On October 3. Shmidt that his employment at the Palace Hotel print shop would be terminated due to business reverses brought about by the political upheaval in China. respondent Santos arrived in Manila. respondent Santos wrote to Mr. payable fourteen (14) times a year. a certain Joanna suggested in a handwritten note that respondent Santos be given one (1) month notice of his release from employment. Shmidt and signified his acceptance of the offer. Limited (hereinafter referred to as "MHICL"). MHICL is a corporation duly organized and existing under the laws of Hong Kong. On November 5. the Palace Hotel informed respondent Santos by letter signed by Mr. 8 By virtue of a "management agreement" 9 with the Palace Hotel (Wang Fu Company Limited). effective June 30. Henk in Manila. MHC was still a government-owned and controlled corporation duly organized and existing under the laws of the Philippines. Hans J. respondent Santos resigned from the Mazoon Printing Press. 14 Subsequently. 1988 for a period of two years. He started to work at the Palace Hotel. respondent Santos wrote the Palace Hotel and acknowledged Mr. Shmidt." "Should a turnaround in the business happen. 1989. 1988. our business has been severely affected. Henk advised respondent Santos that if the contract was acceptable. Mr. Palace Hotel. effective November 5. respondent Santos received a letter dated May 2. The employment contract of June 4. TAIEcS On May 30. 1988. Shmidt represented the Palace Hotel. 1989. respondent Santos left for Beijing. Shmidt offered respondent Santos the same position as printer. to return the same to Mr. 1988 stated that his employment would commence September 1. under the pretext that he was needed at home to help with the family's piggery and poultry business. China. When the case was filed in 1990. Mr. During his employment with the Mazoon Printing Press in the Sultanate of Oman. 1989. Henk mailed a ready to sign employment contract to respondent Santos. 1989. 1988. Now the facts. but with a higher monthly salary and increased benefits. 1988. Beijing. Mr. 1988 from Mr. On June 4. In the contract. 1988. 1988) and notified them that he was going to arrive in Manila during the first week of July 1988. On May 19. respondent Santos signed an amended "employment agreement" with the Palace Hotel. He returned to China and reassumed his post on July 17. AaEcDS On July 22. 1988. China. but rest assured this does in no way reflect your past performance which we found up to our expectations." On September 5.

(2) US$3. Labor Arbiter Ceferina J. through his lawyer. 24 On November 25. Shmidt were not served with summons and neither participated in the proceedings before the Labor Arbiter. and the case was transferred to Labor Arbiter Jose G. Mr. directing the respondents to jointly and severally pay complainant the following computed contractual benefits: (1) US$12.00 55 . de Vera. when Mr. He argued that the case was not cognizable by the POEA as he was not an "overseas contract worker. the NLRC ruled in favor of private respondent.On October 24.600. to wit: 17 "His service with the Palace Hotel. National Labor Relations Commission (NLRC).00 as salaries for the unexpired portion of the parties' contract. 1994. "SO ORDERED. 1993. Atty. National Capital Region.00 as exemplary damages.000. 1994. the NLRC granted the motion and reversed itself. Labor Arbiter Tumanon was re-assigned as trial Arbiter of the National Capital Region. please also be advised that his performance was below average and a Chinese National who is doing his job now shows a better approach. 1990. as it is hereby. Shmidt. On November 11. finding that the report and recommendations of Arbiter de Vera are supported by substantial evidence. stating: 20 "WHEREFORE. Diosana. 1992. "In closing. not the NLRC had jurisdiction over the case. Ednave wrote Mr. 1994. Labor Arbiter Tumanon completed the proceedings based on the testimonial and documentary evidence presented to and heard by him. he hardly showed up for work but still enjoyed free accommodation/laundry/meals up to the day of his departure." On July 23.000. 22 On January 13. 1992. Santos received all benefits due him. 25 He found that respondent Santos was illegally dismissed from employment and recommended that he be paid actual damages equivalent to his salaries for the unexpired portion of his contract.00 as moral damages. 18 On June 27. 1989. MHICL. "When going through the latest performance ratings. demanding full compensation pursuant to the employment agreement.00) as exemplary damages and attorney's fees equivalent to 20% of the damages prayed for. Arbitration Branch. "b)P50. 26 On December 15. let the appealed Decision be. judgment is hereby rendered. DCSETa The Palace Hotel and Mr. "For your information the Print Shop at the Palace Hotel is still not operational and with a low business outlook. retrenchment in various departments of the hotel is going on which is a normal management practice to control costs. 23 Subsequently. the NLRC promulgated a resolution. declared null and void for want of jurisdiction.820 US dollars or its equivalent in Philippine currency as unearned salaries. Labor Arbiter de Vera submitted his report. petitioners appealed to the NLRC. decided the case against petitioners. judgment is hereby rendered: "1. Santos received the letter of notice. He prayed for an award of nineteen thousand nine hundred and twenty-three dollars (US$19. "c)P40.923. On August 28. Shmidt replied.000. "a)$20. Complainant is hereby enjoined to file his complaint with the POEA. 1989. "SO ORDERED. to wit: 27 "WHEREFORE. respondent Santos. and "d)Ten (10) percent of the total award as attorney's fees. 1991. thus: 19 "WHEREFORE. The complaint named MHC. the Palace Hotel and Mr.600. respondent Santos moved for reconsideration of the afore-quoted resolution. arguing that the POEA." 21 On May 31.directing all the respondents to pay complainant jointly and severally. respondent Santos filed a complaint for illegal dismissal with the Arbitration Branch. forty thousand pesos (P40. 1991." On February 20." On September 18. Beijing was not abruptly terminated but we followed the one-month notice clause and Mr. The NLRC directed Labor Arbiter Emerson Tumanon to hear the case on the question of whether private respondent was retrenched or dismissed.00) as actual damages. Shmidt as respondents.

00 as "14th month pay" for the aforesaid two (2) years contract stipulated by the parties or a total of US$19. Forum Non-Conveniens The NLRC was a seriously inconvenient forum. Henk are non-residents of the Philippines. the Court denied petitioner's urgent motion. the Solicitor General filed a manifestation stating that after going over the petition and its annexes. — We fail to see how the NLRC is a convenient forum given that all the incidents of the case — from the time of recruitment. The inconvenience is compounded by the fact that the proper defendants. People's Republic of China. Principle of effectiveness.1996. He was hired without the intervention of the POEA or any authorized recruitment agency of the government. 1995. petitioners filed a motion for reconsideration arguing that Labor Arbiter de Vera's recommendation had no basis in law and in fact. — Neither can an intelligent decision be made as to the law governing the employment contract as such was perfected in foreign soil. (3) US$3. Not all cases involving our citizens can be tried here. 32 On March 8. a Philippine court or agency may assume jurisdiction over the case if it chooses to do so provided: (1) that the Philippine court is one to which the parties may conveniently resort to. This letter was sent to the Palace Hotel in the People's Republic of China. without giving due course to the petition. 38 The employment contract was not perfected in the Philippines. such would not have any binding effect against the employer. they can not defend and sustain the position taken by the NLRC in its assailed decision and orders. where respondent Santos was then employed. No power to determine the facts. plus (4) attorney's fees of 10% of complainant's total award. 1995. The Palace Hotel is a corporation incorporated under the laws of China and was not even served with summons. This calls to fore the application of the principle of lex loci contractus (the law of the place where the contract was made). 34 On June 26. Not Convenient. the Court granted the manifestation of the Solicitor General and required the NLRC to file its own comment to the petition. The NLRC was not in a position to determine whether the Tiannamen Square incident truly adversely affected operations of the Palace Hotel as to justify respondent Santos' retrenchment. 1996. the Palace Hotel and MHICL are not nationals of the Philippines.600. The Solicitor General prayed that he be excused from filing a comment on behalf of the NLRC. The only link that the Philippines has with the case is that respondent Santos is a Filipino citizen. and (3) that the Philippine court has or is likely to have power to enforce its decision. Neither are they "doing business in the Philippines. ICTaEH The employment contract. the main witnesses. Respondent Santos signified his acceptance by writing a letter while he was in the Republic of Oman. — Even assuming that a proper decision could be reached by the NLRC. to employment to dismissal occurred outside the Philippines.28 On March 30. I. 30 On October 9. 1995. no power to execute decision.00 or its peso equivalent. The petition is meritorious. We note that the main aspects of the case transpired in two foreign jurisdictions and the case involves purely foreign elements. Mr. through correspondence sent to the Sultanate of Oman. — Neither can the NLRC determine the facts surrounding the alleged illegal dismissal as all acts complained of took place in Beijing. The Palace Hotel and MHICL are foreign corporations. 36 Under the rule of forum non conveniens. Jurisdiction over its person was not acquired." On February 2. No power to determine applicable law. private respondent Santos filed his comment." Likewise. a foreign employer. The Court required respondents to file their respective comments. Shmidt and Mr. 33 On April 30. this petition.as extra four (4) months salary for the two (2) years period (sic) of the parties' contract. 1995. — Respondent Santos was hired directly by the Palace Hotel. (2) that the Philippine court is in a position to make an intelligent decision as to the law and the facts. 31 On November 20. "SO ORDERED. 1995. 37 The conditions are unavailing in the case at bar. 29 Hence. petitioners filed with this Court an urgent motion for the issuance of a temporary restraining order and/or writ of preliminary injunction and a motion for the annulment of the entry of judgment of the NLRC dated July 31. 1997. 35 On January 7.800. the NLRC filed its comment. 56 . 1996. the NLRC denied the motion for reconsideration. the Palace Hotel.

The "witnessing part" of the document is that which. and "(4)the power to control employee's conduct. without exercising a judicious deliberation or rendering a decision on the matter. through Mr. Henk. If Santos were an "overseas contract worker. The absence of any of the elements prevents the piercing of the corporate veil." 49 One who "notes" something just makes a "brief written statement" 50 a memorandum or observation. we note that the Vice President (Operations and Development) of MHICL. control must be used by the defendant to commit fraud or wrong. 39 He is not an "overseas contract worker" a fact which he admits with conviction. Mr. Schmidt and not MHICL that terminated respondent Santos' services. 40 Even assuming that the NLRC was the proper forum. Second. It did not select respondent Santos as an employee for the Palace Hotel. Court of Appeals." a Philippine forum. Neither did respondent Santos adduce any proof that MHICL had the power to control his conduct. 57 . True. Neither is there evidence to suggest that MHICL was a "labor-only contractor. Cergueda merely signed the "witnessing part" of the document. and (2) that MHICL was liable for Santos' retrenchment.This is not to say that Philippine courts and agencies have no power to solve controversies involving foreign employers. specifically the POEA. 41 It is done only when a corporation is a mere alter ego or business conduit of a person or another corporation. 45 In this case. the aforesaid control or breach of duty must be the proximate cause of the injury or loss complained of. Third. MHC Not Liable Even if we assume two things: (1) that the NLRC had jurisdiction over the case. as a party would. we find no evidence to show that MHICL and MHC are one and the same entity. MHICL not Liable Respondent Santos predicates MHICL's liability on the fact that MHICL "signed" his employment contract with the Palace Hotel. Neither are we saying that we do not have power over an employment contract executed in a foreign country. it was the Palace Hotel. This fact fails to persuade us. 42 we held that "the mere ownership by a single stockholder or by another corporation of all or nearly all of the capital stock of a corporation is not of itself a sufficient reason for disregarding the fiction of separate corporate personalities. who were officers and representatives of the Palace Hotel and not MHICL. and more importantly. will or existence with respect the act complained of." 48 As opposed to a party to a contract. He was referred to the Palace Hotel by his friend. a beholder. The terms of employment were negotiated and finalized through correspondence between respondent Santos. protect fraud or defend a crime. would protect him. personally sees or perceives a thing. Second. There must be proof that the other corporation had no separate mind. 44 Clear and convincing evidence is needed to pierce the veil of corporate fiction. "in a deed or other formal instrument is that part which comes after the recitals. not the NLRC. 47 the Court recognized that the term "noted" means that the person so noting has merely taken cognizance of the existence of an act or declaration. II. He merely signed under the word "noted. Cergueda signed the employment contract as a mere witness. "(2)the payment of wages. even on the merits. one is not expressing his agreement or approval. In determining the existence of an employer-employee relationship. 43 It is basic that a corporation has a personality separate and distinct from those composing it as well as from that of any other legal entity to which it may be related. Nestor Buenio." 52 There is no proof that MHICL "supplied" respondent Santos or even referred him for employment to the Palace Hotel. or eyewitness. the following elements are considered: 51 "(1)the selection and engagement of the employee. However. Piercing the veil of corporate entity is an equitable remedy. the NLRC's decision cannot be sustained. justify wrong. First. DSHTaC III. "(3)the power to dismiss. Board of Commissioners of Immigration. still MHC. Miguel D. this is not enough to pierce the veil of corporate fiction between MHICL and MHC. MHICL did not engage respondent Santos to work. 46 In Sichangco v. as a separate and distinct juridical entity cannot be held liable. Schmidt and Mr. a witness is simply one who. after the parties (italics ours)." When one "notes" a contract. It is resorted to when the corporate fiction is used to defeat public convenience. "being present. Mr. In Traders Royal Bank v. or where there are no recitals. MHC is an incorporator of MHICL and owns fifty percent (50%) of its capital stock. there was no existing employer-employee relationship between Santos and MHICL. policy and business practices with regard to the transaction attacked. Finally. the defendant must have control or complete domination of the other corporation's finances." MHICL did not have and did not exercise any of the aforementioned powers. a spectator." The tests in determining whether the corporate veil may be pierced are: First.

Bank of America filed collection suits before foreign courts. SYNOPSIS As security for restructured loans. Consequently. including questions involving legality of strikes and lockouts." In all these cases. executed two (2) real estate mortgages in favor of Bank of America. involving an amount exceeding five thousand pesos (P5. Labor Arbiter Ceferina J. December 15. 133876. those cases that workers may file involving wages. the corporate borrowers defaulted in the payment of the restructured loans. Grave Abuse of Discretion Considering that the NLRC was forum non-conveniens and considering further that no employer-employee relationship existed between MHICL. rates of pay. respondents. Agcaoili & Associates for petitioner. BANK OF AMERICA. SO ORDERED. The trial court rendered judgment in favor of American Realty Corporation. moral. or their collective bargaining agreements. NT and SA. December 29. 00-02-01058-90. a third party mortgagor. petitioner resorted to this action. Medicare and maternity benefits. SECOND DIVISION [G. Veto for private respondent. arising from employer-employee relations.Claims for actual. 54 "To determine which body has jurisdiction over the present controversy. The jurisdiction of labor arbiters and the NLRC under Article 217 of the Labor Code is limited to disputes arising from an employer-employee relationship which can be resolved by reference to the Labor Code. The Fallo WHEREFORE. William R. and "6. The fact that the Palace Hotel is a member of the "Manila Hotel Group" is not enough to pierce the corporate veil between MHICL and the Palace Hotel.Except claims for Employees Compensation. Later Bank of America likewise filed an application for extra-judicial foreclosure of real estate mortgage. the filing by Bank of America of collections suits operated as a waiver of the security of the mortgages. an employer-employee relationship is an indispensable jurisdictional requirement.00) regardless of whether accompanied with a claim for reinstatement. 1993.R.000. His failure to dismiss the case amounts to grave abuse of discretion. exemplary and other forms of damages arising from employer-employee relations.Cases arising from any violation of Article 264 of this Code. or other labor statutes. The Court of Appeals affirmed the assailed decision of the lower court. Diosana clearly had no jurisdiction over respondent's claim in NLRC NCR Case No. vs. 00-0201058-90). all other claims. AaCcST Labor Arbiters have exclusive and original jurisdiction only over the following: 53 "1.] 13." 55 The lack of jurisdiction of the Labor Arbiter was obvious from the allegations of the complaint. No. 1994 and March 30. "5. MHC and respondent Santos. hours of work and other terms and conditions of employment. including those of persons in domestic or household service. This prompted American Realty Corporation to file an action for damages against Bank of America. "2. "4. 1999.Termination disputes. IV. aSDCIE 58 . According to the trial court.Unfair labor practice cases. 56 V. we rely on the sound judicial principle that jurisdiction over the subject matter is conferred by law and is determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of the claims asserted therein. Eventually. there is no evidence to show that the Palace Hotel and MHICL are one and the same entity. "3. AMERICAN REALTY CORPORATION and COURT OF APPEALS.If accompanied with a claim for reinstatement.Likewise. Its motion for reconsideration having been denied. No costs. 1995 in NLRC NCR CA No. the Court hereby GRANTS the petition for certiorari and ANNULS the orders and resolutions of the National Labor Relations Commission dated May 31. petitioner. American Realty Corporation. 002101-91 (NLRC NCR Case No. Social Security.

Aurelio Katipunan Litonjua. Espriona Shipping Company S. an application for extrajudicial foreclosure 6 of real estate mortgage. promulgated on 30 September 1997 and its resolution. El Challenger S. Queen's Bench Division. denying petitioner's motion for reconsideration. Philippines..A.A. in its High Court of Justice. T-78759. BANTSA and the corporate borrowers signed and entered into restructuring agreements. This would best serve the interest of justice and fair play and further discourage the noxious practice of splitting up a lone cause of action. in the Supreme Court of Hongkong High Court (Action No. 1992. Espriona Shipping Company. over its parcels of land including improvements thereon. 3 Due to the default in the payment of the loan amortizations. Cdpr Eventually. and Eduardo Katipunan Litonjua on November 19. S.A. cdrep c)In Hongkong.A. 2 dated 22 May 1998.. Eddie Navigation Corporation S. b)In England. Inc.A mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage. T-78761. the corporate borrowers defaulted in the payment of the restructured loans prompting petitioner BANTSA to file civil actions 5 before foreign courts for the collection of the principal loan.. Eduardo Katipunan Litonjua and Aurelio Katipunan Litonjua on June 17..A. El Challenger S. in the Supreme Court of Hongkong High Court (Action No. An election of one remedy operates as a waiver of the other. United States of America while private respondent American Realty Corporation (ARC) is a domestic corporation. Litonjua Chartering (Edyship) Co.A. 2098) against Liberian Transport Navigation S. As borne by the records.A. Petitioner Bank of America NT & SA (BANTSA) is an international banking and financing institution duly licensed to do business in the Philippines.A. Despite the fact that the award of actual and compensatory damages by the lower court exceeded that prayed for in the complaint.. the rudiments of fair play were deemed satisfied. Inasmuch as the petitioner was afforded the opportunity to refute the evidence formally offered by private respondent.A. Jr.A. 1992. 51094. located at Barrio Sto....A.A. The remedies available to the mortgage creditor are deemed alternative and not cumulative. Bulacan. S. (2) El Challenger S. organized and existing under and by virtue of the laws of the State of California. J p: Does a mortgage-creditor waive its remedy to foreclose the real estate mortgage constituted over a third party mortgagor's property situated in the Philippines by filing an action for the collection of the principal loan before foreign courts? cdrep Sought to be reversed in the instant petition for review on certiorari under Rule 45 of the Rules of Court are the decision 1 of public respondent Court of Appeals in CA G. T-78762 and T78763. to wit: "a)In England. in its High Court of Justice.. being a third party mortgagor.A. is a limited liability company organized and existing under the laws of England.R.A. As additional security for the restructured loans. 4039 of 1992) against Eshley Compania Naviera S.. private respondent ARC. private respondent ARC as third party mortgagor executed two real estate mortgages. Eshley Compania Naviera S... 2245) against El Challenger S.. Eddie Navigation Corporation S. Queen's Bench Division. DECISION BUENA. Eduardo Katipuan Litonjua & Aurelio Katipunan Litonjua on July 2. petitioner BANTSA filed before the Office of the Provincial Sheriff of Bulacan. 1992.. all of which are existing under and by virtue of the laws of the Republic of Panama and are foreign affiliates of private respondent. San Jose Del Monte. Cristo.. El Challenger S. CV No. S..A.. Espriona Shipping Company S. and d)In Hongkong. On 16 December 1992. Eddie Navigation Corp. (hereinafter collectively referred to as "borrowers").. Bank of America International Limited (BAIL). Pacific Navigators Corporation. was not impleaded as partydefendant. Litonjua Chartering (Edyship) Co. T-78760. the same was nonetheless valid. Commercial Court (1992-Folio No.A. and Eduardo Katipunan Litonjua on November 21..A. and which are covered by Transfer Certificate of Title Nos. Jr. 4 dated 17 February 1983 and 20 July 1984. on the other hand." In the civil suits instituted before the foreign courts. and (3) Eshley Compania Naviera S. BANTSA and BAIL on several occasions granted three major multi-million United States (US) Dollar loans to the following corporate borrowers: (1) Liberian Transport Navigation. Pacific Navigators Corporation. 1992. Commercial Court (1992-Folio No. cdasia 59 . 4040 of 1992) against Eshley Compania Naviera S. Espriona Shipping Company S.A. A suit brought before a foreign court having competence and jurisdiction to entertain the action is deemed to be within the contemplation of the remedy available to the mortgagee-creditor.

R. Bulacan. the purchaser of the mortgaged properties at the foreclosure sale.00). In its answer 9 petitioner alleged that the rule prohibiting the mortgagee from foreclosing the mortgage after an ordinary suit for collection has been filed. private respondent filed before the Pasig Regional Trial Court. the mortgagee does not lose its security interest by filing civil actions for sums of money. T-187782(m). consolidated its ownership over the real properties. private respondent filed a motion for suspension 10 of the redemption period on the ground that "it cannot exercise said right of redemption without at the same time waiving or contradicting its contentions in the case that the foreclosure of the mortgage on its properties is legally improper and therefore invalid. prLL After trial.The Hon. the mortgaged real properties were sold at public auction in an extrajudicial foreclosure sale. as of July 12. Cdpr 2. after the consolidation of ownership in its favor. Transfer Certificate of Title Nos. (ICCS) as the highest bidder for the sum of Twenty Four Million Pesos (P24. T-186273.000. T187783(m). ICCS sold the real properties to Stateland Investment Corporation for the amount of Thirty Nine Million Pesos (P39. "SO ORDERED. "2)Exemplary damages in the amount of Five Million Pesos (P5. T-78763. is not applicable in the present case." In an order 11 dated 28 January 1994. T-187781(m). prLL "c)Under English Law. 7 On 12 February 1993. 1998 although such huge amount was not asked 60 . 1989 and Philippine Commercial International Bank vs." On appeal. Supreme Court in the cases of Caltex Philippines. vs.00). On 07 February 1994. as one of the issues in the assignment of errors found on page 5 of the decision dated September 30.000. Philippines.000. Court of Appeals acted with grave abuse of discretion when it awarded the private respondent actual and exemplary damages totalling P171.00. 196 SCRA 29 (1991 case). judgment is hereby rendered declaring that the filing in foreign courts by the defendant of collection suits against the principal debtors operated as a waiver of the security of the mortgages.000.000. Inc. As such. with Integrated Credit and Corporation Services Co. all with legal interest thereon from the date of the filing of the complaint up to the date of actual payment: "1)Actual or compensatory damages in the amount of Ninety Nine Million Pesos (P99. T-16653P(m) and T-16652P(m) were issued in the latter's name. the instant petition for review 14 on certiorari where herein petitioner BANTSA ascribes to the Court of Appeals the following assignment of errors: 1. T-78760 and T-78761. Hence. claiming that: "a)The plaintiff. IAC.The Honorable Court of Appeals disregarded the doctrines laid down by this Hon. Branch 159. Bulacan. for the latter's act of foreclosing extrajudicially the real estate mortgages despite the pendency of civil suits before foreign courts for the collection of the principal loan. the lower court rendered a decision 13 in favor of private respondent ARC dated 12 May 1993. after due publication and notice.Intermediate Appellate Court docketed as G. T-186272.000. resulting to the issuance of Transfer Certificate of Title Nos. 12 Accordingly. 74730 promulgated on August 25. any decisions (sic) which may be rendered in the abovementioned courts are not (sic) enforceable in the Philippines unless a separate action to enforce the foreign judgments is first filed in the Philippines. Section 50 of the Revised Rules of Court.00).000.600. "Accordingly. T-78762. 1997. On 18 March 1994. ICCS. was never made a party defendant in the civil cases filed in Hongkong and England. were violated when the defendant caused the extrajudicial foreclosure of the mortgages constituted thereon. No. the defendant is hereby ordered to pay the plaintiff the following sums. the plaintiff's rights as owner and possessor of the properties then covered by Transfer Certificates of Title Nos. extensively discussed and specifically mentioned. although said cases were duly cited.000.00). T-16471 and T-16472 in its name. the trial court granted the private respondent's motion for suspension after which a copy of said order was duly received by the Register of Deeds of Meycauayan. an action for damages 8 against the petitioner. T-78759. "b)There is actually no civil suit for sum of money filed in the Philippines since the civil actions were filed in Hongkong and England. all of the Register of Deeds of Meycauayan." On 14 December 1993. the Court of Appeals affirmed the assailed decision of the lower court prompting petitioner to file a motion for reconsideration which the appellate court denied. which is the governing law under the principal agreements. being a mere third party mortgagor and not a party to the principal restructuring agreements.000. the decretal portion of which reads: "WHEREFORE. pursuant to Rule 39. T-18627. Consequently. and "3)Costs of suit.On 22 January 1993.

is contrary to law and is totally unsupported by evidence (sic). In the case at bench. The rule is now settled that a mortgage creditor may elect to waive his security and bring. other than the mortgaged property. a remedy is deemed chosen upon the filing of the suit for collection or upon the filing of the complaint in an action for foreclosure of mortgage. a final judgment must be secured and obtained in the personal action so that waiver of the remedy of foreclosure may be appreciated. as third-party mortgagor. would result not only in multiplicity of suits so offensive to justice (Soriano vs. In fine. private respondent subjected itself to the liabilities of a third party mortgagor. but also in subjecting the defendant to the vexation of being sued in the place of his residence or of the residence of the plaintiff. vs. 21 In the instant case. 61 . Notably.subject to the qualification that if he fails in the remedy by him elected." LexLib In Danao vs. 584) and obnoxious to law and equity (Osorio vs. For this purpose. his cause of action undiminished. an election of one remedy operates as a waiver of the other. The signatory to the principal contract — loan — remains to be primarily bound. . To put it differently. Thus. an unsatisfied judgment thereon would still give him the right to sue for a deficiency judgment. this Court is called upon to resolve two main issues: 1. he may pursue either of the two remedies. an election to bring a personal action will leave open to him all the properties of the debtor for attachment and execution. an ordinary action to recover the indebtedness with the right to execute a judgment thereon on all the properties of the debtor. We do not agree.. such remedy is deemed elected by the mortgage creditor upon filing of the petition not with any court of justice but with the Office of the Sheriff of the province where the sale is to be made. San Agustin. the mere filing of a personal action to collect the principal loan does not suffice. On the other hand. but not both. thus: "In the absence of express statutory provisions. in which case. and any advantages attendant to the pursuit of one or the other remedy are purely accidental and are all under his right of election. as to the issue of availability of remedies. there is no legal provision nor jurisprudence in our jurisdiction which makes a third person who secures the fulfillment of another's obligation by mortgaging his own property. absent any of the two requisites. including the subject matter of the mortgage . 18invariably held: ". if he waives such personal action and pursues his remedy against the mortgaged property. 24 Phil. petitioner submits that a waiver of the remedy of foreclosure requires the concurrence of two requisites: an ordinary civil action for collection should be filed and subsequently a final judgment be correspondingly rendered therein. 4118. the Court has laid down the rule that a mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage. First. And. and then again in the place where the property lies. the mortgagee-creditor is deemed not to have waived the remedy of foreclosure. his remedy is complete. third persons who are not parties to a loan may secure the latter by pledging or mortgaging their own property. . 3135. 25 Phil. It is only upon default of the latter that the creditor may have recourse on the mortgagors by foreclosing the mortgaged properties in lieu of an action for the recovery of the amount of the loan. his cause of action can by no means be impaired. to be solidarily bound with the principal obligor. Co Kim 17 and Movido vs.Whether or not the petitioner's act of filing a collection suit against the principal debtors for the recovery of the loan before foreign courts constituted a waiver of the remedy of foreclosure. 19 In our jurisdiction. private respondent ARC constituted real estate mortgages over its properties as security for the debt of the principal debtors. is proper. Court of Appeals. as amended by Act No. . a rule that would authorize the plaintiff to bring a personal action against the debtor and simultaneously or successively another action against the mortgaged property. 16 this Court. is untenable. reiterating jurisprudence enunciated in Manila Trading and Supply Co. the remedies available to the mortgage creditor are deemed alternative and not cumulative. According to petitioner. even including the mortgaged property itself. In other words. he cannot pursue further the remedy he has waived. By such election. Under the law.. for each of the two remedies is complete in itself. all the properties of the defendant. RFC. (Underscoring Ours) Anent real properties in particular. The petition is bereft of merit. in accordance with the provisions of Act No. 2.Whether or not the award by the lower court of actual and exemplary damages in favor of private respondent ARC. 404).nor prayed for in private respondent's complaint. pursuant to the provision of Rule 68 of the 1997 Rules of Civil Procedure. are again open to him for the satisfaction of the deficiency. Certainly. petitioner's contention that the requisites of filing the action for collection and rendition of final judgment therein should concur. this Court finds petitioner's arguments untenable and upholds the jurisprudence laid down in Bachrach 15 and similar cases adjudicated thereafter. 20 Notwithstanding. Enriques. instead. . By doing so. As to extrajudicial foreclosure. In either case. a mortgage creditor may institute against the mortgage debtor either a personal action for debt or a real action to foreclose the mortgage.

in Cerna vs. 10-11) 62 ." Petitioner further faults the Court of Appeals for allegedly disregarding the doctrine enunciated in Caltex." (RTC Decision pp. alternative remedies are available for its enjoyment and exercise. for clarity and emphasis. supposedly to buttress its contention. Consequently. . vs. Hence. By allowing the creditor to file two separate complaints simultaneously or successively. . . however." Notably. thus: "The aforequoted ruling in Caltex is the exception rather than the rule. This ruling is more in harmony with the principles underlying our judicial system. the creditor has a single cause of action against the debtor. by nullifying the collection suits. Inc. that the filing of a collection suit barred the foreclosure of the mortgage: "A mortgagee who files a suit for collection abandons the remedy of foreclosure of the chattel mortgage constituted over the personal property as security for the debt or value of the promissory note when he seeks to recover in the said collection suit. There is no occasion. . we therefore reiterate the rule. which to our mind still finds applicability in cases of this sort. this Court had occasion to rule that the mere act of filing a collection suit for the recovery of a debt secured by a mortgage constitutes waiver of the other remedy of foreclosure. as a result of which a waiver of the other necessarily must arise. what is determinative is the fact that the foreclosure proceedings ended even before the decision in the collection suit was rendered. the non-payment of the debt. during the pendency thereof. 23 a case relied upon by petitioner. for this court to apply the exception laid down by the Supreme Court in Caltex. 24 "For non-payment of a note secured by mortgage.. foreclosed extrajudicially the mortgaged property which secured the indebtedness. T-78762. wherein this High Court relaxed the application of the general rules to wit: "In the present case. vs. Though the debt and the mortgage constitute separate agreements. T-78760 and T-78761. This single cause of action consists in the recovery of the credit with execution of the security. as the Court hereby holds. . and both refer to one and the same obligation. the creditor in his action may make two demands. T78759. Intermediate Appellate Court. . In other words. But both demands arise from the same cause." ". thereby abandoning the chattel mortgage as basis for relief." Contrary to petitioner's arguments. petitioner BANTSA only has one cause of action which is non-payment of the debt. that the defendant has waived the right to foreclose the mortgages constituted by the plaintiff on its properties originally covered by Transfer Certificates of Title Nos. be authorizing him plural redress for a single breach of contract at so much cost to the courts and with so much vexation and oppression to the debtor. it has not been shown whether the defendant pursued to the end or are still pursuing the collection suits filed in foreign courts. By the mere filing of the ordinary action for collection against the principal debtors. though. the petitioner in the present case is deemed to have elected a remedy. . If he does so. Quite obviously. in effect. to prevent a mockery of our judicial system". the aforesaid collection suits are beyond the reach of this Court. not foreclosure. Corollarily. We must stress that the Caltex case was never intended to overrule the well-entrenched doctrine enunciated in Bachrach. too. petitioner took the Caltex ruling out of context. cannot split up his single cause of action by filing a complaint for payment of the debt. in the present case. by applying the rules above stated. Nevertheless. In the case at bar. xxx xxx xxx "In the case at bar. . the collection suit had to be nullified because the foreclosure proceedings have already been pursued to their end and can no longer be undone. Plaintiff. dictated by the peculiar circumstances obtaining therein. we shall not follow this rule to the letter but declare that it is the collection suit which was waived and/or abandoned. one to recover his credit and another to foreclose his mortgage. they constitute a single cause of action. the latter is subsidiary to the former. then. therefore. and for that reason. Inc. It is of no moment that the collection suit was filed ahead.. Icarangal. We then quote the decision 25 of the trial court." Thus. the Supreme Court chastised Caltex for making ". Thus the only way the court may prevent the specter of a creditor having "plural redress for a single breach of contract" is by holding. . we will. the filing of the first complaint will bar the subsequent complaint. in Caltex Philippines. Bachrach is still good law. and thereafter another complaint for foreclosure of the mortgage. a mockery of our judicial system when it initially filed a collection suit then. Court of Appeals. the payment of the debt and the foreclosure of his mortgage. Petitioner then may opt to exercise only one of two remedies so as not to violate the rule against splitting a cause of action. 22 we agreed with the petitioner in said case. In the said case. When the mortgagee elects to file a suit for collection.Thus. and still pursued the collection suit to the end. no final judgment in the collection suit is required for the rule on waiver to apply. To reiterate. he clearly manifests his lack of desire and interest to go after the mortgaged property as security for the promissory note . As elucidated by this Court in the landmark case of Bachrach Motor Co. that the mere act of filing of an ordinary action for collection operates as a waiver of the mortgage-creditor's remedy to foreclose the mortgage. there exists only one cause of action for a single breach of that obligation. .

judgment or order shall not be applied. which according to petitioner is the governing law with regard to the principal agreements. this Court adopted the well-imbedded principle in our jurisdiction that there is no judicial notice of any foreign law. if the foreign law involved is not properly pleaded and proved." LibLex xxx xxx xxx "Thus. the mortgagee does not lose its security interest by simply filing civil actions for sums of money. to be within the contemplation of the remedy available to the mortgagee-creditor. Incidentally. public policy and good customs shall not be rendered ineffective by laws or judgments promulgated. et al. as third-party mortgagor. by the expediency of filing four civil suits before foreign courts. In the case at bench. their acts or property. vs. To give justice is the most important function of law. for this purpose. necessarily abandoned the remedy to foreclose the real estate mortgages constituted over the properties of third-party mortgagor and herein private respondent ARC. English Law is not applicable. 34 The public policy sought to be protected in the instant case is the principle imbedded in our jurisdiction proscribing the splitting up of a single cause of action. 28 Notably. BANTSA alleges that under English Law. 63 . when the PCIB filed Civil Case No. 31 This is what we refer to as the doctrine of processual presumption. 26 Moreover. 30 Thus.3 million promissory note secured by real estate mortgages and subsequently filed a petition for extrajudicial foreclosure. prohibitive laws concerning persons. petitioner in effect transgressed the rules against splitting a cause of action well-enshrined in jurisprudence and our statute books. the said foreign law. 27 Again. or by determinations or conventions agreed upon in a foreign country. or judgment or contract that is obviously unjust negates the fundamental principles of Conflict of Laws. Thus. hence. the actuations of Caltex are deserving of severe criticism. IAC. we hold that petitioner. considering that the creditor should not be afforded "plural redress for a single breach of contract. Hence. 29392 to enforce payment of the 1. 32 said foreign law would still not find applicability. this Court in PCIB buttressed its firm stand on this issue by declaring: "While the law allows a mortgage creditor to either institute a personal action for the debt or a real action to foreclosure the mortgage. 33 Additionally.In this light. Philippine law shall apply notwithstanding the evidence presented by petitioner to prove the English law on the matter. by filing the four civil actions and by eventually foreclosing extrajudicially the mortgages. Rule 132 of the Rules of Court and the jurisprudence laid down in Yao Kee. we hold that the private respondent is entitled to the award of actual or compensatory damages inasmuch as the act of petitioner BANTSA in extrajudicially foreclosing the real estate mortgages constituted a clear violation of the rights of herein private respondent ARC. a law. applying the foregoing rules. it is not the nature of the redress which is crucial but the efficacy of the remedy chosen in addressing the creditor's cause. This pronouncement would best serve the interest of justice and fair play and further discourage the noxious practice of splitting up a lone cause of action. It must be stressed that far from overturning the doctrine laid down in Bachrach. Moreover. Rule 2 of the 1997 Rules of Civil Procedure is pertinent — "If two or more suits are instituted on the basis of the same cause of action. LLphil This argument shows desperation on the part of petitioner to rivet its crumbling cause. Sy-Gonzales. LibLex Section 4. In the instant case. A foreign law must be properly pleaded and proved as a fact." Accordingly. it violates the rule against splitting a cause of action. and those which have for their object public order. In a long line of decisions." Moreover." For cause of action should not be confused with the remedy created for its enforcement. Cdpr As to the second pivotal issue. petitioner tried to fit a square peg in a round hole. foreign law should not be applied when its application would work undeniable injustice to the citizens or residents of the forum. assuming arguendo that the English Law on the matter were properly pleaded and proved in accordance with Section 24. a suit brought before a foreign court having competence and jurisdiction to entertain the action is deemed. the filing of one or a judgment upon the merits in any one is available as a ground for the dismissal of the others. our courts will presume that the foreign law is the same as our local or domestic or internal law. when the foreign law. 35 Clearly then. he cannot pursue both remedies simultaneously or successively as was done by PCIB in this case. 29 We rule in the negative. LibLex In Bachrach. judgment or contract is contrary to a sound and established public policy of the forum. petitioner attempts to mislead this Court by citing the case of PCIB vs. to say the least. this Court resolved to deny the creditor the remedy of foreclosure after the collection suit was filed.

witness for private respondent. 27). the question of the value of property is always a difficult one to settle as valuation of real property is an imprecise process since real estate has no inherent value readily ascertainable by an appraiser or by the court. and the vicinity is a growing community. 64 . Flores. Flores had been with the company for 26 years at the time of his testimony. Of equal importance is the fact that the trial court did not confine itself to the appraisal report dated 29 March 1993. In arriving at the amount of actual damages. as indubitably shown by the fact that on March 18. In effect. 5). p. arrive at a conclusion which is just and equitable. p. Sto. petitioner assails the Court of Appeals for relying heavily on the valuation made by Philippine Appraisal Company. together with the corroborative testimony of one Mr. 2. 3). 46 Applying the foregoing principle. ICCS (the buyer during the foreclosure sale) sold the consolidated real estate properties to Stateland Investment Corporation. the trial courts justified the award by presenting the following ratiocination in its assailed decision 45 .Actual or compensatory damages are those recoverable because of pecuniary loss in business. 37 The opinions of men vary so much concerning the real value of property that the best the courts can do is hear all of the witnesses which the respective parties desire to present. since 1990. in the amount of P99. May 30. the appreciation of evidence and the assessment of the credibility of witnesses rest primarily with the trial court.. and the only remaining piggery (named Cherry Farm) in the vicinity is about 2 kilometers away from the western boundary of the property in question (TSN. 47 As the records show. in whose favor new titles were issued.. otherwise if the proof is flimsy and non-substantial. conducted an ocular inspection where the opposing parties appeared and were duly represented. The appraisal report. consisting of twenty three (23) pages which set out in detail the valuation of the property to determine its fair market value (TSN. Reynaldo Flores.The properties are suitable for development into a subdivision for low cost housing. 1994.The properties consist of about 39 hectares in Bo. April 22. 6-22). 41 This Court will not alter the findings of the trial court on the credibility of witnesses. Records. to wit: "Indeed. principally because they are in a better position to assess the same than the appellate court. The latter's testimony was subjected to extensive cross-examination by counsel for defendant-appellant (TSN.986. is a licensed real estate broker. 2) clearly shows that the Court cannot rely on defendant's aforesaid estimate (Decision. 603). trade." It is a fundamental legal aphorism that the conclusions of the trial judge on the credibility of witnesses command great respect and consideration especially when the conclusions are supported by the evidence on record. no damages will be given. which is (sic) not distant from Metro Manila — the biggest urban center in the Philippines — and are easily accessible through well-paved roads. 3). profession. Records. 44 In the case at bar. ibid. Cristo. which is more than triple defendant's appraisal (Exh. and the Court itself has seen the character and nature of said properties during the ocular inspection it conducted.The fact that ICCS was able to sell the subject properties to Stateland Investment Corporation for Thirty Nine Million (P39. 42 Besides. 1994. with regard to the award of actual damages. p. "3. p. San Jose del Monte. was corroborated by the testimony of Mr. April 22. Reynaldo F. trial courts are in a better position to examine real evidence as well as observe the demeanor of witnesses. Above all these. 40 The time-tested jurisprudence is that the findings and conclusions of the trial court on the credibility of witnesses enjoy a badge of respect for the reason that trial courts have the advantage of observing the demeanor of witnesses as they testify. "2.e. T-187783(m). and then. Houses of strong materials are found in the vicinity of the property (Exhs. as affirmed by the Court of Appeals. 38 In the instant case. Reynaldo Flores. we therefore hold that the trial court committed no palpable error in giving credence to the testimony of Reynaldo Flores. T-187781(m). Bulacan. Inc. 43 Similarly. p. an appraiser and director of Philippine Appraisal Company.00 (TSN. 31). On this matter. 1994. in determining the fair market value of the real property. the trial court observed: "The record herein reveals that plaintiff-appellee formally offered as evidence the appraisal report dated March 29. i. job or occupation and the same must be proved.000. BANTSA questions the act of the appellate court in giving due weight to the appraisal report composed of twenty three pages. p. Lauro Marquez and submitted as evidence by private respondent. the Court reiterates the familiar and well-entrenched rule that the factual findings of the trial court should be respected. the record would likewise show that the trial judge in order to appraise himself of the characteristics and condition of the property. 1994. p. we see no reason that would justify this Court to disturb the factual findings of the trial court. and the testimony given by Mr. 409).000.00) Pesos.It will not be hard to find interested buyers of the property. as the records would readily show. "5. the Court has its own mind in the matter of valuation.592. Inc. appraiser and director of Philippine Appraisal Company. T16653P(m) and T-166521(m) by the Register of Deeds of Meycauayan (sic). It has even been shown that the house of the Barangay Chairman is located adjacent to the property in question (Exh. TCT Nos. 1993 (Exhibit J. T-187782(m). signed by Mr. ibid. The size of the subject real properties are (sic) set forth in their individual titles. who according to the records. 2-1 to 2-7). property.." 39 In the matter of credibility of witnesses. pp. as admitted by defendant's own appraiser (TSN. (TSN. 36 Indeed.The pigpens which used to exist in the property have already been demolished. 4). "4. by carefully weighing that testimony. the Court makes the following observations: "1. Based principally on the foregoing. Bulacan. November 19.

cda On this issue. The court may grant a continuance to enable the amendment to be made. . This appears to be. judgment may be rendered validly as regards those issues. they shall be treated in all respects as if they had been raised in the pleadings. so long as no surprise or prejudice is thereby caused to the adverse party. even after judgment.000. Put a little differently. Intermediate Appellate Court 50 is enlightening: "There have been instances where the Court has held that even without the necessary amendment. Under these circumstances. The appellate court could treat the pleading as amended to conform to the evidence although the pleadings were actually not amended. as to issues not alleged in the pleadings. although it had not been actually so amended. the lower court's actuations are sanctioned by the Rules and supported by jurisprudence. In fact. a better approximation of the fair market value of the subject properties. by way of example or correction for the public good. we affirm the ruling of the trial court as regards the valuation of the property — ". 5). Exemplary or corrective damages are imposed. There is implied consent to the evidence thus presented when the adverse party fails to object thereto. "The failure of a party to amend a pleading to conform to the evidence adduced during trial does not preclude an adjudication by the court on the basis of such evidence which may embody new issues not raised in the pleadings. both documentary and testimonial. Similarly.00) per square meter. 672). The court may treat the pleading as if it had been amended to conform to the evidence.Based on these considerations and the evidence submitted. the court acted within the bounds of its jurisdiction and committed no reversible error in awarding actual damages the amount of which is higher than that prayed for. so long as the basis requirements of fair play had been met. petitioner ascribes error to the lower court for awarding an amount allegedly not asked nor prayed for in private respondent's complaint. formally offered by private respondent.Amendment to conform to or authorize presentation of evidence. the trial court should not be precluded from awarding an amount higher than that claimed in the pleading notwithstanding the absence of the required amendment. Asociacion de Agricultures de Talisay-Silay. or serve as a basis for a higher award of damages. subject to certain qualifications. 106). Diaz (75 Phil. Inc. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time. In Co Tiamco vs. we held that where there is a variance in the defendant's pleadings and the evidence adduced by it at the trial. as the court so holds. which shall be considered as if they have been raised in the pleadings. in as much as the petitioner was afforded the opportunity to refute and object to the evidence. with the expressed or implied consent of the adverse party. — When issues not raised by the pleadings are tried with the express or implied consent of the parties. in addition to 65 . Section 5 of the Rules of Court is pertinent: "SECTION 5.00) awarded. .00) for the 39-hectare properties (sic) translates to just about Two Hundred Fifty Four Pesos (P254. with full opportunity on the part of the opposing parties to support their respective contentions and to refute each other's evidence. Notwithstanding the fact that the award of actual and compensatory damages by the lower court exceeded that prayed for in the complaint.000. vs. the Court may treat the pleading as amended to conform with the evidence. the amount proved at the trial may be validly awarded. the testimony of Reynaldo Flores was put under scrutiny during the course of the cross-examination. is subject to reduction. Laguna (48 Phil. the court may validly treat the pleadings as if they had been amended to conform to the evidence and proceed to adjudicate on the basis of all the evidence before it. as in Tuazon v.' "Clearly." The jurisprudence enunciated in Talisay-Silay Milling Co. where we said that if the facts shown entitled plaintiff to relief other than that asked for. being excessive. particularly where no surprise or prejudice is caused the objecting party. This is the amount which should be restituted by the defendant to the plaintiff by way of actual or compensatory damages . a valuation of Ninety Nine Million Pesos (P99. Former Chief Justice Moran put the matter in this way: 'When evidence is presented by one party. If evidence is objected to at the trial on the ground that it is not within the issues made by the pleadings. we affirm the grant of exemplary damages although the amount of Five Million Pesos (P5. Although the pleading may not have been amended to conform to the evidence submitted during trial. . Rule 10. And in the recent case of National Power Corporation vs. as we held in Bank of the Philippine Islands vs. not simply on the basis of the issues alleged but also on the basis of issues discussed and the assertions of fact proved in the course of trial. we stressed that the rule on amendment need not be applied rigidly. Bolanos (95 Phil. 49 citing Northern Cement Corporation vs. Verily.000. Amendment is also unnecessary when only clerical error or non substantial matters are involved. as where litigants were given full opportunity to support their respective contentions and to object to or refute each other's evidence. But it is upon the condition that the evidence of such higher amount has been presented properly. no amendment to the complaint was necessary." 48 Further. Inc. a court may rule and render judgment on the basis of the evidence before it even though the relevant pleading had not been previously amended. the rudiments of fair play are deemed satisfied.000.. the same is nonetheless valid. . the court may allow the pleadings to be amended and shall do so with liberality if the presentation of the merits of the action and the ends of substantial justice will be subserved thereby. Court of Appeals (113 SCRA 556). but failure to amend does not affect the result of the trial of these issues. especially where defendant had himself raised the point on which recovery was based." In the instant case. judgment may nonetheless be rendered. prLL "It is the view of the Court that pursuant to the above-mentioned rule and in light of the decisions cited.

the moral, temperate, liquidated or compensatory damages. 51 Considering its purpose, it must be fair and reasonable in every case and
should not be awarded to unjustly enrich a prevailing party. 52 In our view, an award of P50,000.00 as exemplary damages in the present
case qualifies the test of reasonableness.
WHEREFORE, premises considered, the instant petition is DENIED for lack of merit. The decision of the Court of Appeals is hereby AFFIRMED
with MODIFICATION of the amount awarded as exemplary damages. Accordingly, petitioner is hereby ordered to pay private respondent the
sum of P99,000,000.00 as actual or compensatory damages; P50,000.00 as exemplary damage and the costs of suit. LexLib
SO ORDERED.

THIRD DIVISION
[G.R. No. 55960. November 24, 1988.]
14. YAO KEE, SZE SOOK WAH, SZE LAI CHO, and SY CHUN YEN, petitioners, vs. AIDA SY-GONZALES, MANUEL
SY, TERESITA SY-BERNABE, RODOLFO SY, and HONORABLE COURT OF APPEALS, respondents.
Montesa, Albon & Associates for petitioner.
De Lapa, Salonga, Fulgencio & De Lunas for respondents.
DECISION
CORTES, J p:
Sy Kiat, a Chinese national, died on January 17, 1977 in Caloocan City where he was then residing, leaving behind real and personal
properties here in the Philippines worth P300,000.00 more or less.
Thereafter, Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe and Rodolfo Sy filed a petition for the grant of letters of administration
docketed as Special Proceedings Case No. C-699 of the then Court of First Instance of Rizal Branch XXXIII, Caloocan City. In said petition
they alleged among others that (a) they are the children of the deceased with Asuncion Gillego; (b) to their knowledge Sy Kiat died
intestate; (c) they do not recognize Sy Kiat's marriage to Yao Kee nor the filiation of her children to him; and, (d) they nominate Aida SyGonzales for appointment as administratrix of the intestate estate of the deceased [Record on Appeal, pp. 4-9; Rollo, p. 107.]
The petition was opposed by Yao Kee, Sze Sook Wah, Sze Lai Cho and Sy Yun Chen who alleged that: (a) Yao Kee is the lawful wife of Sy
Kiat whom he married on January 19, 1931 in China; (b) the other oppositors are the legitimate children of the deceased with Yao Kee; and,
(c) Sze Sook Wah is the eldest among them and is competent, willing and desirous to become the administratrix of the estate of Sy Kiat
[Record on Appeal, pp. 12-13; Rollo, p. 107.]
After hearing, the probate court, finding among others that:
(1)Sy Kiat was legally married to Yao Kee [CFI decision, pp. 12-27; Rollo, pp. 49-64;]
(2)Sze Sook Wah, Sze Lai Cho and Sze Chum Yen are the legitimate children of Yao Kee with Sy Kiat [CFI decision, pp.
28-31; Rollo. pp. 65-68;] and,
(3)Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe and Rodolfo Sy are the acknowledged illegitimate offsprings of Sy
Kiat with Asuncion Gillego [CFI decision, pp. 27-28; Rollo, pp. 64-65.]
held in favor of the oppositors (petitioners herein) and appointed Sze Sook Wah as the administratrix of the intestate estate of the
deceased [CFI decision, pp. 68-69; Rollo, pp. 106.]
On appeal the Court of Appeals rendered a decision modifying that of the probate court, the dispositive portion of which reads:
IN VIEW OF THE FOREGOING, the decision of the lower Court is hereby MODIFIED and SET ASIDE and a new judgment
rendered as follows:
(1)Declaring petitioners Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe and Rodolfo Sy acknowledged natural
children of the deceased Sy Kiat with Asuncion Gillego, an unmarried woman with whom he lived as husband and wife
without benefit of marriage for many years:
(2)Declaring oppositors Sze Sook Wah, Sze Lai Chu and Sze Chun Yen, the acknowledged natural children of the
deceased Sy Kiat with his Chinese wife Yao Kee, also known as Yui Yip, since the legality of the alleged marriage of Sy
Kiat to Yao Kee in China had not been proven to be valid to the laws of the Chinese People's Republic of China (sic);
(3)Declaring the deed of sale executed by Sy Kiat on December 7, 1976 in favor of Tomas Sy (Exhibit "G-1", English
translation of Exhibit "G") of the Avenue Tractor and Diesel Parts Supply to be valid and accordingly, said property
should be excluded from the estate of the deceased Sy Kiat; and

66

(4)Affirming the appointment by the lower court of Sze Sook Wah as judicial administratrix of the estate of the
deceased. [CA decision, pp. 11-12; Rollo, pp. 36-37.]
From said decision both parties moved for partial reconsideration, which was however denied by respondent court. They thus interposed
their respective appeals to this Court.
Private respondents filed a petition with this Court docketed as G.R. No. 56045 entitled "Aida Sy-Gonzales, Manuel Sy, Teresita Sy-Bernabe
and Rodolfo Sy v. Court of Appeals, Yao Kee, Sze Sook Wah, Sze Lai Cho and Sy Chun Yen" questioning paragraphs (3) and (4) of the
dispositive portion of the Court of Appeals' decision. The Supreme Court however resolved to deny the petition and the motion for
reconsideration. Thus on March 8, 1982 entry of judgment was made in G.R. No. 56045. *

The instant petition, on the other hand, questions paragraphs (1) and (2) of the dispositive portion of the decision of the Court of Appeals.
This petition was initially denied by the Supreme Court on June 22, 1981. Upon motion of the petitioners the Court in a resolution dated
September 16, 1981 reconsidered the denial and decided to give due course to this petition.
Herein petitioners assign the following as errors:
I.RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN DECLARING THE MARRIAGE OF SY KIAT TO YAO YEE AS NOT
HAVE (sic) BEEN PROVEN VALID IN ACCORDANCE WITH LAWS OF THE PEOPLE'S REPUBLIC OF CHINA.
II.RESPONDENT COURT OF APPEALS GRAVELY ERRED IN DECLARING AIDA SY-GONZALES, MANUEL SY, TERESITA SYBERNABE AND RODOLFO SY AS NATURAL CHILDREN OF SY KIAT WITH ASUNCION GILLEGO. [Petition, p. 2; Rollo, p. 6.]
I.Petitioners argue that the marriage of Sy Kiat to Yao Kee in accordance with Chinese law and custom was conclusively proven. To buttress
this argument they rely on the following testimonial and documentary evidence.
First, the testimony of Yao Kee summarized by the trial court as follows:
Yao Kee testified that she was married to Sy Kiat on January 19, 1931 in Fookien, China; that she does not have a
marriage certificate because the practice during that time was for elders to agree upon the betrothal of their children,
and in her case, her elder brother was the one who contracted or entered into [an] agreement with the parents of her
husband; that the agreement was that she and Sy Kiat would be married, the wedding date was set, and invitations
were sent out; that the said agreement was complied with; that she has five children with Sy Kiat, but two of them
died; that those who are alive are Sze Sook Wah, Sze Lai Cho, and Sze Chun Yen, the eldest being Sze Sook Wah who is
already 38 years old; that Sze Sook Wah was born on November 7, 1939; that she and her husband, Sy Kiat, have been
living in Fookien, China before he went to the Philippines on several occasions; that the practice during the time of her
marriage was a written document [is exchanged] just between the parents of the bride and the parents of the groom, or
any elder for that matter; that in China, the custom is that there is a go-between, a sort of marriage broker who is
known to both parties who would talk to the parents of the bride-to-be; that if the parents of the bride-to-be agree to
have the groom-to-be their son-in-law, then they agree on a date as an engagement day; that on engagement day, the
parents of the groom would bring some pieces of jewelry to the parents of the bride-to-be, and then one month after
that, a date would be set for the wedding, which in her case, the wedding date to Sy Kiat was set on January 19, 1931;
that during the wedding the bridegroom brings with him a couch (sic) where the bride would ride and on that same day,
the parents of the bride would give the dowry for her daughter and then the document would be signed by the parties
but there is no solemnizing officer as is known in the Philippines; that during the wedding day, the document is signed
only by the parents of the bridegroom as well as by the parents of the bride; that the parties themselves do not sign the
document; that the bride would then be placed in a carriage where she would be brought to the town of the bridegroom
and before departure the bride would be covered with a sort of a veil; that upon reaching the town of the bridegroom,
the bridegroom takes away the veil; that during her wedding to Sy Kiat (according to said Chinese custom), there were
many persons present; that after Sy Kiat opened the door of the carriage, two old ladies helped her go down the
carriage and brought her inside the house of Sy Kiat; that during her wedding, Sy Chiok, the eldest brother of Sy Kiat,
signed the document with her mother; that as to the whereabouts of that document, she and Sy Kiat were married
for 46 years already and the document was left in China and she doubt if that document can still be found now; that it
was left in the possession of Sy Kiat's family; that right now, she does not know the whereabouts of that document
because of the lapse of many years and because they left it in a certain place and it was already eaten by the termites;
that after her wedding with Sy Kiat, they lived immediately together as husband and wife, and from then on, they lived
together; that Sy Kiat went to the Philippines sometime in March or April in the same year they were married; that she
went to the Philippines in 1970, and then came back to China; that again she went back to the Philippines and lived with
Sy Kiat as husband and wife; that she begot her children with Sy Kiat during the several trips by Sy Kiat made back to
China. [CFI decision, pp. 13-15; Rollo, pp. 50-52.]
Second, the testimony of Gan Ching, a younger brother of Yao Kee who stated that he was among the many people who attended the
wedding of his sister with Sy Kiat and that no marriage certificate is issued by the Chinese government, a document signed by the parents
or elders of the parties being sufficient [CFI decision, pp. 15-16; Rollo, pp. 52-53.]
Third, the statements made by Asuncion Gillego when she testified before the trial court to the effect that (a) Sy Kiat was married to Yao
Kee according to Chinese custom; and, (b) Sy Kiat's admission to her that he has a Chinese wife whom he married according to Chinese
custom [CFI decision, p. 17; Rollo, p. 54.]

67

Fourth, Sy Kiat's Master Card of Registered Alien issued in Caloocan City on October 3, 1972 where the following entries are found: "Marital
status — Married"; "If married give name of spouse — Yao Kee"; "Address — China"; "Date of marriage — 1931"; and "Place of marriage —
China" [Exhibit "SS-1".]
Fifth, Sy Kiat's Alien Certificate of Registration issued in Manila on January 12, 1968 where the following entries are likewise found: "Civil
status — Married"; and, "If married, state name and address of spouse — Yao Kee Chingkang, China" [Exhibit "4".]
And lastly, the certification issued in Manila on October 28, 1977 by the Embassy of the People's Republic of China to the effect that
"according to the information available at the Embassy Mr. Sy Kiat a Chinese national and Mrs. Yao Kee alias Yui Yip also Chinese were
married on January 19, 1931 in Fukien, the People's Republic of China" [Exhibit "5".]
These evidence may very well prove the fact of marriage between Yao Kee and Sy Kiat. However, the same do not suffice to establish the
validity of said marriage in accordance with Chinese law or custom.
Custom is defined as "a rule of conduct formed by repetition of acts, uniformly observed (practiced) as a social rule, legally binding and
obligatory" [In the Matter of the Petition for Authority to Continue Use of the Firm Name "Ozaeta, Romulo, de Leon, Mabanta and Reyes",
July 30, 1979, SCRA 3, 12 citing JBL Reyes & RC Puno, Outline of Phil. Civil Law, Fourth Ed. Vol. 1, p. 7.] The law requires that "a custom
must be proved as a fact, according to the rules of evidence" [Article 12, Civil Code.] On this score the Court had occasion to state that "a
local custom as a source of right can not be considered by a court of justice unless such custom is properly established by competent
evidence like any other fact" [Patriarca v. Orate, 7 Phil. 390, 395 (1907).] The same evidence, if not one of a higher degree, should be
required of a foreign custom.
The law on foreign marriages is provided by Article 71 of the Civil Code which states that:
Art. 71.All marriages performed outside the Philippines in accordance with the laws in force in the country where they
were performed, and valid there as such, shall also be valid in this country, except bigamous, polygamous, or
incestuous marriages, as determined by Philippine law. (Emphasis supplied.) **
Construing this provision of law the Court has held that to establish a valid foreign marriage two things must be proven, namely: (1) the
existence of the foreign law as a question of fact; and (2) the alleged foreign marriage by convincing evidence [Adong v. Cheong Seng Gee,
43 Phil. 43, 49 (1922).]
In proving a foreign law the procedure is provided in the Rules of Court. With respect to an unwritten foreign law, Rule 130 section 45 states
that:
SEC. 45.Unwritten law. — The oral testimony of witnesses, skilled therein, is admissible as evidence of the unwritten law
of a foreign country, as are also printed and published books of reports of decisions of the courts of the foreign country,
if proved to be commonly admitted in such courts.
Proof of a written foreign law, on the other hand, is provided for under Rule 132 section 25, thus:
SEC. 25.Proof of public or official record. — An official record or an entry therein, when admissible for any purpose, 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, if the record is not kept in the Philippines, with a certificate that such officer
has the custody. If the office in which the record is kept is in a foreign country, the certificate may be made by a
secretary of 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.
The Court has interpreted section 25 to include competent evidence like the testimony of a witness to prove the existence of a written
foreign law [Collector of Internal Revenue v. Fisher, 110 Phil. 686, 700-701 (1961) citing Willamette Iron and Steel Works v. Muzzal, 61
Phil. 471 (1935).]
In the case at bar petitioners did not present any competent evidence relative to the law and custom of China on marriage. The testimonies
of Yao and Gan Ching cannot be considered as proof of China's law or custom on marriage not only because they are self-serving evidence,
but more importantly, there is no showing that they are competent to testify on the subject matter. For failure to prove the foreign law or
custom, and consequently, the validity of the marriage in accordance with said law or custom, the marriage between Yao Kee and Sy Kiat
cannot be recognized in this jurisdiction.
Petitioners contend that contrary to the Court of Appeals' ruling they are not duty bound to prove the Chinese law on marriage as judicial
notice thereof had been taken by this Court in the case of Sy Joc Lieng v. Sy Quia [16 Phil. 137 (1910).]
This contention is erroneous. Well-established in this jurisdiction is the principle that Philippine courts cannot take judicial notice of foreign
laws. They must be alleged and proved as any other fact [Yam Ka Lim v. Collector of Customs, 30 Phil. 46, 48 (1915); Fluemer v. Hix, 54
Phil. 610 (1930).]
Moreover a reading of said case would show that the party alleging the foreign marriage presented a witness, one Li Ung Bieng, to prove
that matrimonial letters mutually exchanged by the contracting parties constitute the essential requisite for a marriage to be considered
duly solemnized in China. Based on his testimony, which as found by the Court is uniformly corroborated by authors on the subject of
Chinese marriage, what was left to be decided was the issue of whether or not the fact of marriage in accordance with Chinese law was duly
proven [Sy Joc Lieng v. Sy Quia, supra., at p. 160.]

68

they cannot be accorded the status of legitimate children but only that of acknowledged natural children. 269. Aida Sy. Teresita Sy. Petitioners are natural children. 1958. They aver that the judicial pronouncement in the Memoracion case. No.000. L-21076. Sy Kiat who shall own one-half of the total and the other half to Asuncion Gillego who shall transfer the same to their children. 1965. 87-88. G. 1955. .] And they are acknowledged children of the deceased because of Sy Kiat's recognition of Sze Sook Wah [Exhibit "3"] and its extension to Sze Lai Cho and Sy Chun Yen who are her sisters of the full blood [See Art. during the existence of the common-law husband-and-wife relationship between the parties. and. it therefore follows that her marriage to Sy Kiat.] Likewise on the record is the testimony of Asuncion Gillego that Sy Kiat told her he has three daughters with his Chinese wife. 1953. born on December 14. Sze Sook Wah Sze Lai Chu and Sze Chin Yan [TSN.] (2)the testimony of their mother Yao Kee who stated that she had five children with Sy Kiat. born on May 30.] and. 1977. . Respondent court found the following evidence of petitioners' filiation: (1)Sy Kiat's Master Card of Registered Alien where the following are entered: "Children if any: give number of children — Four". holds true in this case.. which they have likewise decided to definitely and finally terminate effective immediately. and one adopted son [TSN. Teresita Sy. namely: Aida Sy.] II. December 6. The Memoracion case however is not applicable to the case at bar as said case did not concern a foreign marriage and the issue posed was whether or not the oral testimony of a spouse is competent evidence to prove the fact of marriage in a complaint for adultery. the parties mutually agree and covenant that the said real estates and properties shall be transferred in equal shares to their 69 .] Since Yao Kee admitted in her testimony that there was no solemnizing officer as is known here in the Philippines [See Article 56.With respect to the AVENUE TRACTOR AND DIESEL PARTS SUPPLY . 1950. Petitioners moreover cite the case of U. (b)the business name and premises . a Filipina with whom he lived for twenty-five (25) years without the benefit of marriage. 3.] Private respondents on the other hand are also the deceased's acknowledged natural children with Asuncion Gillego. p.00) monthly out of the rental of the two doors of the same building now occupied by Everett Construction. pp. Manuel Sy. 1977. December 12.The second issue raised by petitioners concerns the status of private respondents. 1974 wherein Sy Kiat not only acknowledged them as his children by Asuncion Gillego but likewise made provisions for their support and future inheritance.. Civil Code. of the real estates and properties registered and/or appearing in the name of Asuncion Gillego . 271. they begot five children. Civil Code] when her alleged marriage to Sy Kiat was celebrated [CFI decision. wherein Sy Kiat expressly stated that she is his daughter [Exhibit "3". and distributed to. xxx xxx xxx (5)With respect to the acquisition. . thus: xxx xxx xxx 2. even if true.S. 555-556. v. shall be retained by Sy Kiat. Ricardo Sy now deceased. 1956. supra. Rollo. 1961 by Sy Kiat for presentation to the Local Civil Registrar of Manila to support Sze Sook Wah's application for a marriage license. March 31.R. Civil Code. as petitioners failed to establish the marriage of Yao Kee with Sy Kiat according to the laws of China. However. evidenced by a compromise agreement entered into by and between their parents and approved by the Court of First Instance on February 12. namely. it appearing that at the time of their conception Yao Kee and Sy Kiat were not disqualified by any impediment to marry one another [See Art. only three of whom are alive namely. . .. born on January 28..The parties also acknowledge that they are common-law husband and wife and that out of such relationship. . 9-11. in the absence of proof of the Chinese law on marriage. Vivo. born on July 1. pp. Accordingly. cannot be recognized in this jurisdiction [Wong Woo Yiu v. that the testimony of one of the contracting parties is competent evidence to show the fact of marriage.Further. even assuming for the sake of argument that the Court has indeed taken judicial notice of the law of China on marriage in the aforecited case. 51]. and Rodolfo Sy. Memoracion [34 Phil. petitioners however have not shown any proof that the Chinese law or custom obtaining at the time the Sy Joc Lieng marriage was celebrated in 1847 was still the law when the alleged marriage of Sy Kiat to Yao Kee took place in 1931 or eighty-four (84) years later. born on May 7. it shall be his obligation to give to the aforenamed children an amount of One Thousand Pesos (P1. Manuel Sy. p. (3)an affidavit executed on March 22. They have in their favor their father's acknowledgment. the parties mutually agree and covenant that — (a)The stocks and merchandise and the furniture and equipments . .] However. it should be presumed that it is the same as ours *** [Wong Woo Yiu v. Vivo. "Name — All living in China" [Exhibit "SS-1". pp. 555. . shall be divided into two equal shares between. 13 SCRA 552. 633 (1916)] as being applicable to the instant case. 14. two of whom — Sook Wah and Sze Kai Cho — she knows. and Rodolfo Sy.

(3)Annulment of marriages. Rovira [G. Their functions and jurisdiction are now vested with the Regional Trial Courts [See Section 19 (7). No. No. de Baluyut v. G.R. . the decision of the Court of Appeals is hereby AFFIRMED. and actions for support. [at pp. otherwise known as the Judiciary Reorganization Act of 1980. L-42215.R. 1976. Act No. No. B. Rovira [G. relief from marital obligations legal separation of spouses. (4)Proceedings brought under the provisions of title six and title seven. WHEREFORE. 129 and Divinagracia v. — xxx xxx xxx The provisions of the Judiciary Act to the contrary notwithstanding. No. 1986. xxx xxx xxx As held in the case of Divinagracia v. Blg. 91-A. Teresita Sy. Accordingly. August 12. 143 SCRA 356. Bartolome [G. adoption. the Juvenile and Domestic Relations Courts were abolished. petitioners rely on the following provision of Republic Act No. 5502 sec. No. Luciano. guardianship. L42615. 3278. 313-314.) xxx xxx xxx This compromise agreement constitutes a statement before a court of record by which a child may be voluntarily acknowledged [See Art.R. 70 .Creation and Jurisdiction of the Court. Act No. 5502. L-23661. G. even without the enactment of Batas Pambansa Blg. 72 SCRA 307]: xxx xxx xxx It is true that under the aforequoted section 1 of Republic Act No. xxx xxx xxx (2)Cases involving custody.P. 129 we find in Rep. 1976. July 13. L-42215. [Exhibit "D". with regard to the Juvenile and Domestic Relations Court: SEC. the court shall have exclusive original jurisdiction to hear and decide the following cases.R. otherwise known as the Charter of the City of Caloocan". said incident shall be determined in the main case. 1976). namely. . 278.] (Emphasis supplied. Aida Sy. this Court finds no reversible error committed by respondent court. August 10. and Rodolfo Sy. 129. But that legal provision presupposes that such an administration proceeding is pending or existing and has not been terminated.] (Emphasis supplied. chapters one to three of the civil code. 4834 **** a case involving paternity and acknowledgment may be ventilated as an incident in the intestate or testate proceeding (See Baluyot vs. 91-A last paragraph that: xxx xxx xxx If any question involving any of the above matters should arise as an incident in any case pending in the ordinary court. 72 SCRA 52. L-42615. L-47407. but to be administered by Asuncion Gillego during her lifetime. xxx xxx xxx and the ruling in the case of Bartolome v.] Petitioners further argue that the questions on the validity of Sy Kiat's marriage to Yao Kee and the paternity and filiation of the parties should have been ventilated in the Juvenile and Domestic Relations Court.) xxx xxx xxx The reason for this rule is not only "to obviate the rendition of conflicting rulings on the same issue by the Court of First Instance and the Juvenile and Domestic Relations Court" [Vda. 360] hence it is no longer necessary to pass upon the issue of jurisdiction raised by petitioners. revocation of adoption. Civil Code. Ines Luciano. 21 SCRA 1324] reiterated in Divinagracia v. 63] but more importantly to prevent multiplicity of suits. entitled "An Act Revising Rep. paternity and acknowledgment. Moreover.R.] With the enactment of Batas Pambansa Blg. Specifically. Manuel Sy.children. Bellosillo. 72 SCRA 307. July 13. .

"4. Harden.. married to Fred M. Harden.. and said case being for the purposes aforestated. "3. November 29.500. and temporarily residing in the Philippines.J . I hereby agree to pay said Attorney Claro M. twenty-five (25%) per cent of the total increase in allowance or pension which may be awarded to me by the court over and above the amount of P1.97). Fernan. that should the case be terminated or an amicable settlement thereof be arrived at by the parties before the expiration of two years from the date of the filing of the complaint. and appellee.It is hereby understood that this contract includes the services of Attorney Claro M. I hereby agree to pay Attorney Claro M. this contract of services to be under the following conditions: "1. HARDEN.SO ORDERED. Fred M. Harden. to secure an increase in the amount of support I now receive as well as to protect and preserve my rights and interest in the properties of the conjugal partnership. Recto twenty (20%) per cent of the value of the share and participation which I may receive in the funds and properties of the said conjugal partnership of myself and defendant Fred M. for the purpose of securing an increase in the amount of support being received by me from the conjugal partnership of myself and said Fred M.97.That in lieu of retainer fee. such payment to be made monthly. I shall continue to pay the said twenty-five (25%) per cent up to the end of said period. DECISION CONCEPCION. Jr. Recto to appear and act as my counsel in the action which I will file against my husband.85 or the sum of P384. Harden or against the conjugal partnership by way of litis expense.554. Exhibit JJJ or 20. and the said Esperanza P. in contemplation of the divorce suit which I intent to file against him in the competent Court of California and of the liquidation of the conjugal partnership between us. de Harden is hereby ordered to pay the said amount above-stated. executed the following: "CONTRACT OF PROFESSIONAL SERVICES KNOW ALL MEN BY THESE PRESENTS: "That I. Harden. Harden. Recto. EN BANC [G.That as full and complete satisfaction of the fees of Attorney Claro M. ESPERANZA P. claimant-appellee. Manila. and for the purpose likewise of protecting and preserving my rights in the properties of the said conjugal partnership.00 which I now receive monthly from defendant Fred M. which under the circumstances I am not in a position to pay. Fred M. vs. this Court hereby approves the recommendation of the Commissioner with the above-stated modification.That the aforesaid monthly payments shall be in addition to whatever amount may be adjudged by the court against the defendant Fred M. Claro M. have engaged the services of Attorney Claro M. of age. Exhibit JJJ or 20. JJ . concur. de Harden and Fred M. Harden out of the funds of the conjugal partnership. during the pendency of the litigation and until the termination of the same. 1956. but the same may be advanced by Attorney Claro M. No. RECTO. C . upon dissolution of said partnership or for any other cause mentioned in Paragraph (3) hereof. CLARO M. L-6897." It appears that sometime in July.] 15. with address at 534 Sales Street. Recto in connection with the securing of the liquidation of the properties and assets of the conjugal partnership of myself and Fred M. ESPERANZA PEREZ DE HARDEN. Harden.110..920. the pertinent part of which is of the following tenor:. judicial separation. is 20% of P1. In the Matter of the Claim for Attorney's Fees. Mrs. Recto in connection with the case above referred to. Harden from a decision of the Court of First Instance of Manila. representing 20% of Esperanza P. Recto. defendants-appellants. Harden. attorney's fees chargeable as expenses of litigation. Provided.R. appellant.110. that is. 1941. that is. Gutierrez. DE HARDEN and FRED M. and finds that Attorney Claro M. in contemplation of divorce and of the liquidation of said partnership. Recto is entitled to the sum of THREE HUNDRED EIGHTY-FOUR THOUSAND ONE HUNDRED AND TEN PESOS AND NINETY-SEVEN CENTAVOS (P384. compromise or by any means or method by virtue of which said partnership is or may be liquidated. Feliciano and Bidin. "2. de Harden's share in the conjugal properties owned by her and her husband. as contingent fee stipulated in paragraph 3 of the Contract of Professional Services.All expenses in connection with the litigation are to be for my account. divorce. Recto. "5. 71 . "The contingent fee to which the claimant is entitled under paragraph 3 of the contract. as a result of the liquidation thereof either by death. J p: This is an appeal taken by Esperanza P. to be reimbursed to him either from the money which I receive by way of support or from the funds of the conjugal partnership. "WHEREFORE.

the proceedings were resumed and. Australia and China. made by Mr. from which has already been deducted the sum of P160. (c) that Mr. Fred M. Recto t/ CLARO M. and (i) that a writ of preliminary injunction be issued restraining the defendants from disposing of the assets of the conjugal partnership in fraud of Mrs. said records were reconstituted at the instance of appellee herein. belonging to the business and assets of said conjugal partnership and deposited by him in a safety box. from January 23 to December 23. the defendants be ordered to inform her "of everything pertaining to the administration of said business and properties". Harden.00 representing Fred M. 1941. be rescinded and said defendant ordered to transfer said shares of stock in the name of Mrs. and with a view to avoiding unnecessary embarrassment. of Manila. (d) that defendant Salumbides be ordered to account for all moneys. a decision the dispositive part of which we quote: "In view of the foregoing considerations. Thereafter. on or about October 31. Harden. Harden be given the exclusive administration of the business and all properties of the conjugal partnership of Mr. the same was amended by an order dated July 19. "The order of injunction of July 12. "(b)The matrimonial domicile of Fred M. real or personal. ( f ) that the transfer. are hereby declared conjugal properties. Harden. Harden. Philippines this _______ day of July. (g) that the monthly allowance of Mrs. Harden abandoned his domicile of origin in New Jersey and established a domicile of choice in Manila. is modified only to the above extent. merchandise. up to the present. since 1901. the selling price of the house in Los Angeles. 1946. . and Mrs. and to return to this jurisdiction.IN WITNESS WHEREOF.000 shares of stock of the Angelo Mining Company. Harden's capital. who at present is Mr. Harden be utilized for the purpose of starting said special bank account in the Chartered Bank of India. that all income from the aforesaid businesses be deposited in this special bank account and no checks be drawn upon the same. the Philippines was invaded by the Japanese and placed under military occupation. Harden or his duly authorized representative covering all business transactions passed through said special bank account and the same be opened for inspection by the plaintiff's duly authorized representative. It appears that. without the necessity of securing a particular order from this Court on each occasion. in due course. 1941. Harden be allowed to continue as administrator of said partnership. except to pay the necessary overhead and running expenses including purchases of tobacco. 1941. 1917. it was prayed. Harden or in that of Mr. in the event of denial of this prayer. among other things: (a) that Mrs. Harden be ordered to account to Mrs. either in his name." In the complaint therein filed. "(d)The total amount of P1.00 covering payments for deficiency 72 . I have signed these presents in the City _____ of Manila. Mr. and in all other respects is maintained. in the name of Salumbides. this court finds and so holds that — "(a)Fred M. 1949. DE HARDEN ACCEPTED: s/ Claro M. 1941.37 representing deposits in safety deposit boxes in the name of Jose Salumbides. that the present funds in the Philippine National Bank in the name of Plaza Lunch and Fred M. de Harden was established in Manila. Harden be increased from P1. and all transactions in connection with the aforesaid businesses passed through that account by Mr. of 36. the sum of P449. "(c)Since they did not execute any antenuptial contract before their marriage. pursuant to an agreement submitted by both parties." Subsequently. and Mrs. the court authorized the issuance of said writ. required for the proper operation of said businesses. RECTO" In compliance therewith.500 to P15.944. in the course of which the records of this case were destroyed.000. on July 12. 59634 of the Court of First Instance of Manila. 1941. Harden and Jose Salumbides. and Mrs. Harden or his duly authorized representative. from the date of their marriage on December 14. pending final decision. 1917. Philippines. Harden be ordered to increase the allowance or pension of Mrs. Harden and their daughter Sarah Elizabeth to P10. ". of certain shares of stock. to some residents of Hongkong. Harden. a separate bank account be established in the Chartered Bank of India. entitled "Esperanza P.44 allegedly withdrawn by him from the Philippines or sent by him to Hongkong on April 1. . as his attorney-in-fact.00. Philippines. the appellee. over and above the sum of P20. Harden. and the pre-war and post-war remittances abroad of Fred M. (h) that. de Harden t/ ESPERANZA P.. amounting to P285. California. upon the filing of the corresponding bond.000. (e) that the transfer. Harden. By an order dated July 12. Salumbides. or in that of Antonio Wilson. On October 23. 1941. allegedly belonging to the conjugal partnership. should Mr. de Harden vs.794. the Court of First Instance of Manila rendered. as counsel for Mrs.000. that a new set of books be opened by Mr. Harden and/or by defendant Salumbides. be rescinded and said shares returned to the assets of the conjugal partnership and placed in the name of Mr. 1940. as well as to render accounts thereof and to permit her to examine the books and records pertinent thereto.000. in the sense that. etc. all the properties.015. s/ Esperanza P.000 a month. commenced Civil Case No. Harden and Esperanza P. without prejudicing in any way the rights of the parties in this case. acquired by either or both of them on and after December 14. (b) that. Then came the liberation. restraint or inconvenience in the financial operations of the business enterprises affected by said writ of preliminary injunction. Australia and China.

Fred M. Recto agrees to the lifting of the writ of preliminary injunction. both in the tax case and the present one. moved for the dismissal of the case. 24393. In said "manifestation". de Harden." The defendants appealed from said decision to this Court. demands and claims to the conjugal partnership. "(e)A conjugal lien be annotated in the original and owner's duplicate of Transfer Certificates of Title Nos. since receivership is merely an auxiliary 73 . that the purpose of the said instruments. in accordance with several instruments dated January 29. and Mrs. and render a true and complete accounting of the earnings and profits thereof." Counsel for the defendants-appellants. "IT IS SO ORDERED. both dated February 20. Harden had instructed him. de Harden are hereby ordered to execute a document to be approved by this court creating and express active trust upon the remaining cash assets and income of the conjugal partnership in the Philippines. he prayed. by letter. subject to the right of Fred M. Harden. but said auxiliary remedies will be automatically lifted upon the conclusion of the annotation of the conjugal lien and the execution of the deed of trust above mentioned. in appellee's "manifestation". duties. and on all the certificates of shares belonging to said conjugal partnership. accounts. upon his failure to return and deposit them in the name of the Plaza Lunch with the Manila branch of the Chartered Bank of India. 1952. Harden. "d)And the receiver be ordered to pay to the undersigned the full amount of the fees to which the latter is found to be entitled. and executed without the knowledge. Harden alone or his representative without the consent of his wife will be deemed fraudulent and subject to revocation or cancellation for being in fraud and prejudicial to the right of Esperanza P. 1941. with offices in Manila. debts. and abandon and nullify all her claims to the conjugal partnership existing between her and Mr. and to that end a charging lien therefore be established upon the properties above-mentioned. but objects to the dismissal of the case on the ground that. which Fred M. On the other hand. Recto on the property under receivership. Australia and China up to the time this decision shall become final. this Court issued on July 22. is hereby maintained. 1946. under paragraph 3 of the contract. Annex 'A'. executed by Mr. whereby the Philippine Trust Company. will act as trustee. Harden had purportedly agreed to settle their differences in consideration of the sum of $5. Harden to Mrs. the orders of contempt and commitment. L-3687. is hereby declared chargeable to the share of defendant Harden and deductible from whatever participation he may still have in the said conjugal partnership upon the liquidation thereof. and all other interlocutory orders which were issued in the course of this case. to "discontinue all proceedings relative to" said case. Harden to receive therefrom the sum of P2. and (3) Mr.00 for services rendered by her counsel up to the rendition of this judgment. "b)A day set aside to receive the evidence of the undersigned and those of the plaintiff and the defendant Fred M. It was further asserted. as counsel for Mrs.553 shares of the Balatoc Mining Company which belong to Fred M. for which reason. is hereby declared permanent and the order of receivership of November 20. in his aforementioned motion. While the appeal was thus pending before us. appellee stated that Mrs. "vacate all orders and judgments rendered therein. Fred M. "(g)Within thirty (30) days after this decision shall have become final. as well as in the corresponding books of the companies or corporations issuing them. with the exception of the receivership. by the appointment of a referee or commissioner for the reception of such "c)After due hearing.00 a month by way of allowance and an equal amount for the plaintiff as separate support and maintenance. Without costs.000 paid by Mr. Harden had created a trust fund of $20. (2) Mr. a resolution the pertinent part of which reads: "It will be seen from the above that the defendants-appellants pray for the complete dismissal of the above entitled case without prejudice to the annotation of the contingent claim of Attorney Claro M. Harden.00 as his fees for services rendered in behalf of the plaintiff in this case. Acting upon the issues raised in such motion for dismissal and in appellee's motion to establish and enforce his charging lien. in order to determine the amount of fees due to the undersigned. and a monthly pension of P500 to be paid by him to her.000 from which said monthly pension of $500 would be taken. the receiver appointed herein be authorized to continue holding the properties above mentioned in his custody in order not to defeat the undersigned's inchoate lien on them. Harden. that "a)Pending the resolution of this motion. and "(i)The writ of preliminary injunction of July 12.500. Harden shall inform the plaintiff of all the properties and businesses of the conjugal partnership. and Mrs. was to defeat the claim of the former for attorney's fees. the undersigned be declared entitled to the sum of P400. Harden or the herein receiver is ordered to pay within a period of fifteen (15) days after this decision has become final. Harden.000. Harden and Esperanza P. "(h)The plaintiff is entitled to litis expensae in the amount of P175. 1952. 52436 and 54911 of the Register of Deeds of Manila and in Original Certificate of Title No. "( f )Within a period of fifteen (15) days after this decision shall have become final. and Mrs. other than the 368. to which appellee objected.Federal income taxes and attorney's fees. advise and consent of said appellee. where the case was docketed as case No. whereby it will be made to appear that any subsequent alienation or encumbrance of said properties by Fred M. Harden". Harden. as counsel for Mrs. 1952. whereby: (1) Mr. herein appellee filed a manifestation and a motion. be they in the Philippines or abroad. in turn.000. Harden had mutually released and forever discharged each other from all actions. Attorney Claro M. in consideration of the sum of $1. 2292 of Quezon Province.

" After appropriate proceedings. Ballentine. 540. 1953. and all interlocutory orders which were issued in the course of this case. . adopting substantially said report of the commissioner. Harden cannot bind the conjugal partnership without her husband's consent. Harden. However." (See 5 Am. the difficulties encountered by him while handling the same in which he had to work hard every inch of the way because of the stiff oppositions filed by adverse counsel. to the appellee any right whatsoever. 1952. . this appeal taken by Mr. 1953. the volume and quality of the work performed. "Pending the determination of the amount of fees claimed by Attorney Claro M.410. the writ of preliminary injunction.. 276. Recto prays that a commissioner or referee be immediately appointed by this Court to receive evidence in support of his allegations as to his attorney's lien and its enforcement. provided such contracts are not in contravention of public policy. his reputation in the bar. untenable.553 shares of the Balatoc Mining Company. on September 2. p. For the same reason.04 as his contingent fee for services rendered in her behalf. the rule in the United States (Legal Ethics by Henry S. 1352 and 1409 of the Civil Code of the Philippines. 20% of her share in said partnership. Recto. and his findings of fact. the sum recommended in the report. 359 et seq. in behalf of Esperanza P. likewise. "Attorney Claro M. also. 74 . his successful handling of said case and those cases growing out of it which reached the Supreme Court.) Needless to say. the second objection is. in and to her aforesaid share. allegedly in violation of Articles 1305.410. ". Manila Railroad Co. Exhibit JJJ. "It is understood that. The first question for determination therein is the validity of the above-quoted contract of services. personal or real. to P384. upon the ground: (1) that Mrs. the orders of contempt and commitment. Ferrier. the length of time in which claimant had handled the same for Esperanza Harden. the receivership shall be maintained. in detail. and with regard to the receivership. Recto in his motion dated February 20. the undersigned Commissioner concludes that claimant is entitled to the full amount of 20% of Esperanza Harden's share of the conjugal properties. the same is hereby dissolved.) Such is. "WHEREFORE. the diligence he employed not only in the preservation of the records in his possession during the days of enemy occupation but also in the protection of the interests of Esperanza Harden. de Harden's share of the conjugal properties or the sum of P369. Mrs. as provided in paragraph 3 of the Contract of Professional Services.. in the United States. this case will be completely dismissed as prayed for by the defendants-appellants. (2) that Article 1491 of the Civil Code of the Philippines in effect prohibits contingent fees.. the undersigned Commissioner respectfully recommends that Atty. 1952. in any manner. taken an unfair or unreasonable advantage of his client Mrs." In compliance with said resolution. Recto filed by Attorney J. Sr. the records of this case were remanded to the lower court. 554. the great weight of authority recognizes the validity of contracts for contingent fees. with the following conclusion and recommendation: "Taking into consideration the value of the properties involved in this litigation. are hereby lifted and vacated. by way of contingent fees. (3) that the contract in question has for its purpose to secure a decree of divorce. and it is deemed advisable that this matter be determined by the Court of First Instance. Counsel for the defendantsappellants does not object to this proceeding provided that the restrictions set forth by him be observed. 1952. Recto be paid the equivalent amount of 20% of Esperanza P. 2nd ed. there is absolutely nothing in the records before us to show that appellee herein had. nor purports to give. Jur. Claro M. the above entitled case is hereby remanded to the court of origin in order to determine the amount of fees claimed by Attorney Claro M. The amount thereof is simply a basis for the computation of said fees. which.110. for the contract in dispute does not seek to bind the conjugal partnership. it has already been held that contingent fees are not prohibited in the Philippines and are impliedly sanctioned by our Cannons (No. and the extra services he rendered in her behalf in the tax and other court cases. Harden merely bound herself — or assumed the personal obligation — to pay. this Court does not have the proper facilities for receiving evidence in order to determine the amount of the fees claimed by Attorney Claro M. a report of about one hundred (100) pages of the printed record on appeal. After due hearing. without prejudice to considering the claim of the receiver for compensation as stated in his urgent motion dated July 2. "In view of the foregoing. said commissioner submitted. Recto. p. By virtue of said contract. on February 6. the present case should be allowed to remain pending for the purpose of maintaining the receivership to safeguard his right to collect the fees that may be due him. The contract neither gives. the evidence introduced by both parties. This is specially so considering the opposition to the claim of Attorney Claro M.remedy..97. W. 13) of Professional Ethics. mainly. the complicated legal questions involved. and (4) that the terms of said contract are harsh. and it is only when the attorney has taken an unfair or unreasonable advantage of his client that such a claim is condemned. Harden. As to the rest of the properties. Drinker. the lower court rendered a decision dated April 30. designated a commissioner to receive evidence on the amount of the fees collectible by herein appellee and to report thereon. inequitable and oppressive. after said fees had been finally determined and paid. 176). but increasing the contingent fee of appellee herein from P369. Hence. only with respect to the 368. setting forth. Moreover. 45 Phil. which the appellants assail as void. likewise. and Mrs. the responsibility assumed by the claimant as counsel. The first objection has no foundation in fact. Law Dictionary.04. de Harden. (see. Ulanday vs.

in consideration of the paltry sum of $5. 2. Mr. R. 1941. Subsequently or on March 5. On October 7. and like counsel for the petitioners therein. 1947. et al. or with the Chartered Bank of India.000. in his name to the Philippines for deposit with the Clerk of Court. Harden applied for a writ of certiorari annulling said orders of Judge Peña of October 7 and November 13. at the rate of $500 a month. By an order dated March 21. when Mrs. by an order dated April 5. directed the appointment of Abelardo Perez as receiver of said properties.He succeeded in defeating defendants' motion for the dissolution of the writ of preliminary injunction. the lower court deferred action on the aforementioned motion of November 27. the contract of services. 1947. on May 13. 1947. Appellee filed a rejoinder to the rejoinder. In the petition therein filed. filed several lengthy. to be charged against her litis expensae. having secured a judgment in her favor. 1950. the Court. Harden in the conjugal partnership. 1947. 5. One can not even consider the possibility of a reconciliation between the spouses. 1941. as evidence by an action for divorce filed by Mr. Harden. the aforementioned orders of the lower court dated July 12. inasmuch as Mr. at Manila .66. 1946.000. Harden. or to facilitate or promote the procurement of a divorce. under the same conditions.. 1947. despite said writ of preliminary injunction. under the contract in question. 195. and prayed that. acknowledging her rights to the assets of the conjugal partnership. a writ of preliminary injunction be issued restraining the respondents therein from enforcing said orders. upon the ground of repeated acts of infidelity allegedly committed by Mrs. as well as the benefits of all orders and judgments in her favor. and Mrs. even. Emilio Peña. Abelardo Perez and Esperanza P. the same being inconsistent with the monetary consideration for said alleged settlement. No. entitled "Fred M. the enforcement thereof. No.On motion of the appellee dated March 4. 1941. 1946. After appropriate proceedings. Harden in 1940 and 1941. which sanction divorce. L-1816 of this Court against Hon.000. J. said sum to be deposited with the account of the Plaza Lunch at the Manila Branch of the Chartered Bank of India. particularly through contempt proceedings. denying the writ of certiorari prayed for. the Court granted appellee's motion. Mr. Harden objected to said motion. in July 1948. Harden "should bring back all the 368. remitted abroad several sums of money aggregating P1. 1947. Subsequently. by an order dated November 20. Harden had instituted case G. that their aforementioned agreements. Mr. 1947. this Court. good customs. Harden and the additional sum of $20. Harden and Jose Salumbidesvs. Its purpose was not to secure a divorce. in a resolution dated February 12. it appears that appellee had rendered. Australia and China. the Court authorized said discharged upon the filing.On November 12. to our satisfaction. and appellants have not done so. but. R. What is more. issued by the Court on July 12. 1941. 1947. In fact. Harden. 1947. were made for the purpose of circumventing or defeating the rights of herein appellee.. . It merely sought to protect the interest of Mrs. 6. G. for Mr. 1950. . for the suspension of this order. decision was rendered on November 21. and denied by an order dated November 13. or else. Dy Buncio & Co. Again. Harden are admittedly citizens of the United States. not only in July. After due hearing. 1947. Indeed. 1947. Harden replied. Harden the sum of $5. decision was rendered denying the petition for a writ of certiorari. 1946. in the meantime. S.000. appellee filed on November 27. Harden moved. provided that Mr. Mr. 1947. within a stated period. refused to issue the writ of preliminary injunction prayed for. during the pendency of a divorce suit she intended to file in the United States. on November 18. the defendants instituted Civil Case No.000 bond. 1947. filed by appellee on or about April 26. Harden to remit to Mrs. Harden" for the purpose of annulling and setting aside. and Mrs. Defendants asked. and April 5 and May 13. and to restrain. for the circumstances surrounding the case show. detailed pleadings and memoranda. In short. to furnish Mrs. between Mrs. the records show that the relations between said spouses — which were bad indeed. Harden. the defendants had been disposing of the properties of the conjugal partnership for the purpose of defrauding Mrs. 75 . morals.500.Inasmuch as said order of November 13. or by the intent of the parties thereto. 1947. but.The third objection is not borne out. fraudulently and without judicial consent. Harden engaged the services of the appellee. 4. it is inconceivable that Mrs. appellee moved for the appointment of a receiver. 1947. as Judge of the Court of First Instance of Manila. which was opposed by the appellee on October 27. Upon similar motion. Appellee filed a rejoinder. to which Mr. appellee filed a motion alleging that despite the writ of preliminary injunction above mentioned. Harden in New Jersey. directed Mr. 1947. "3. After due hearing. and praying that Mr.vs. before.. Meanwhile. 1947 had not been complied with. and amended on July 19.. 30 C. one who seeks equity must come with clean hands (Bastida. Harden: 1. which turned out to be worth almost P4. November 20. Harden sought a reconsideration. the court. 1948.000 allegedly paid to her by Mr.000. pending disposition of the case.On or about September 9.On June 21. 1946. Mr. The last objection is based upon principles of equity. Harden. that the receivership be suspended. or on November 21. or on November 24. under his above-quoted contract of services with Mrs. Harden were separated since 1938 — had worsened considerably thereafter. Hence. public order or public policy. a motion praying that Mr. ostensibly for the settlement of the differences between husband and wife. and Mrs. for the benefit of Mrs. their status and the dissolution thereof are governed — pursuant to Article 9 of the Civil Code of Spain (which was in force in the Philippines at the time of the execution of the contract in question) and Article 15 of the Civil Code of the Philippines — by the laws of the United States. Harden and herein appellee. pursuant thereto. that they be allowed to file a bond for the discharge of the receivership. either by the language of the contract between them. the defendants had. on February 13.000. 1947. the following services. and Mrs. the defendants sought a reconsideration of the order of November 20. which was immediately objected to by the appellee and then denied by the Court. Harden. Harden be declared in contempt of court and punished accordingly. upon the filing of a P10.000 to be paid by him in installments. 475).000 bond. What is more.553 shares of the Balatoc Mining Co. no explanation has been given for this most unusual avowed settlement between Mr. Harden the sum of $2. Emilio Peña. 93 Phil. is not contrary to law.608. 1947. Harden would have waived such rights. and the discharge of the receiver. Appellee replied objecting thereto. by writ of certiorari. L-1499 of this Court. Australia and China. of a bond in the sum of P500. in the course of which appellee appeared as counsel for Mrs.000 in addition to litis expensae in the sum of P175. upon the ground that. the Court ordered Mr. by the defendants. Harden be ordered to return this sum to the Philippines. unless the defendants posted a P4.

oppositions. and ordering the payment of said sum to Attorney Recto in pursuance of the provisions of paragraph 3 of the Contract of Professional Services. found guilty as charged and ordered confined "until he complies with the aforementioned orders" of October 7.000. The Director of Prisons"). 11. the risks assumed and the results obtained. from P200 to P250 a month. For instance.Appellee instituted civil case No. Harden" for the recovery of P113. that the conjugal assets would bear the payment of P22.767. the record on appeal in one of those cases. through appellee's intervention. the nature and importance of the issues in said litigations.He (appellee) represented Mrs. No. Esperanza P. Harden". the appellee made representations with the Japanese Government to prevent the commandeering of a business establishment belonging to Mr. we are of the opinion. 6222 of the Court of First Instance of Manila. Then too. He. entitled "Abelardo Perez vs. that the contract of services in question is neither harsh nor oppressive or inequitable. 1948.43 only. the receiver.000 represents litis expensae.Appellee successfully blocked Mr. Among other things.R. devoid of merit.000.The lower court erred in holding that the inchoate share of the wife. Harden was. 1948.00 for all such legal services.000 and forward the same to the Collector of Internal Revenue of Los Angeles.3687). 1947 and March 27. On motion of Mr. (2) $50. represented the receiver in seeking war damage payments.7.. CFI-R-59634 (SC-G. Harden. considering the character of the services rendered by the appellee. including orders for the delivery of certificates of stock. lent her money to meet her needs and spent the sum of P55. Harden's share of the conjugal partnership. in due course was denied in a decision promulgated on October 22. 4. Rizal. L. the professional character and standing of the appellee. within five (5) days from notice. likewise.97. entitled "Francisco Dalupan vs. G. 9. Harden and her daughter and to allow her to withdraw. No. and the evidence introduced. Moreover. 8. for which is sought by him in this case. Harden's share in such conjugal properties without proper evidence. 13. de Harden. extensive and exhaustive. After due hearing. 1948. R. Harden and his attorney's fees of 20% of her share in the conjugal partnership.000. have already been paid by his immediate execution pending appeal of the decision in Civil Case No. R. that: 3. with the order of October 7. entitled "Fred M. 1948.17.Appellee assisted. as his counsel and. dated February 12. 1816. Harden. de Harden.000 in the preservation of the records and papers pertaining to the business and other properties of the conjugal partnership of Mr. the receiver. in the undissolved and unliquidated conjugal partnership properties of the Harden spouses. 1948. appellee sought and obtained judicial authority for some important acts of administration of. or to be exact on March 27. the value of the property affected by the controversy. 10. and so hold." Said decision. appellants maintain that: "The lower court erred in failing to find as a fact borne out by the evidence that the legal services of Attorney Claro M. is capable of certain valuation before such dissolution and liquidation. 1948. L-2349.66 and the return of stock certificates of the Balatoc Mining Co. 1948 was suspended until May 4. Harden's attempts to withdraw: (1) $53. in Muntinglupa. therefore. and the contract between the appellee and Mrs. the skill displayed in connection with said cases. wherein he collected the sum of P176. and memoranda filed.During the military occupation of the Philippines by the Japanese. Harden vs. Harden in connection with a million-peso federal tax case against Mr. in the aforementioned cases — in which appellee was pitted against one of the most experienced and able members of the Philippine Bar — were numerous. he succeeded in persuading the Japanese to refrain from interning Mrs. Harden. the conjugal partnership had varried and extensive business interests and its assets were worth almost P4.000. took all steps essential for the proper discharge of the duties of the former. and Mrs. summarily assessing such 20% inchoate share as of a value of P384. rejoinders. Harden for contempt of court. In short. however. and (3) P65. which. The second assignment of error is. 1948. and summarily assessing the value of Mrs. 1947. The pleadings. Harden's interests in the Harden conjugal properties."The lower court erred in awarding 20% of such inchoate share to Attorney Claro M. He (appellee) secured judicial intervention for the protection and preservation of the assets of the conjugal partnership. and disposition by. He. On April 6. 6940 of the Court of First Instance of Manila. No. R. Harden explicitly declares that said litis expensae shall be "in addition to" appellee's share of 25% of the increase in the allowance of Mrs.110. he filed with this Court a petition for a writ of habeas corpus against the Director of Prisons.000 for his expenses. Australia and China and Fred M. Harden to comply.Soon after the issuance of our resolution in said case G. also." 76 . the amount of labor.837. Esperanza P. Appellants. payment. likewise. motions. (G. allegedly to defray expenses in resisting a new tax assessment against him in the United States. On July 10. said order of April 28.00.In civil case No. from the former's deposit in a local bank. Chartered Bank of India. No. on which date he was arrested and placed in confinement at the New Bilibid Prison. Fred M.000. by an order of April 28. Recto to Mrs. Mr. 12. further contend. the lower court issued an order directing Mr.608. Under their second assignment of error. it was decided. Harden. 1948. for their subsistence. L-3687. the return thereof and/or its deposit with the clerk of court. consisted of 966 pages. for the recovery of P1. and Mrs. time (1941 to 1952) and trouble involved therein. namely. in such capacity. appellee filed with the lower court the corresponding formal charges against Mr. California. the balance to be chargeable exclusively against Mr. which had been sent abroad. and Mrs. states clearly that the aforementioned sum of P175. Recto from Mrs.

she may not insist upon its occurrence. prior to the enforcement of the rights of the herein appellee. PCPI is the company established by PIL to undertake its business of ready-mix concrete. but after due notice and full dress hearing. principally.) It should be noted. whereas those of the appellee were so numerous that. not summarily.109. It may not be amiss to add that the value of the properties involved has been assessed.97. What is more. The factual and procedural antecedents of the case are as follows: On January 16. One-half (1/2) thereof. which were made for the evident purpose of defeating appellee's claim for attorney's fees. This line of argument overlooks the fact that said contract of services was made. said conjugal partnership would have been dissolved and then liquidated. therefore. consists of three (3) parts. Harden. SP No. McDonald (McDonald) and Philip J. Appellants presented Exhibits 1 to 58. Harden therein would have been fixed. on account of said contingent fees. Todaro alleged that PIL is a corporation duly organized and existing under the laws of Australia and is principally engaged in the ready-mix concrete and concrete aggregates business. in contemplation of a suit for divorce that. DECISION AUSTRIA-MARTINEZ.Appellants' arguments in support thereof may be summarized as follows: The contract of services in question provides that appellee's contingent fees shall be 20% of the share of Mrs. June 8. Pursuant to law. INC. owing to the aforementioned agreements between Mr. However. (PPHI). Inc. Harden shall be determined upon the liquidation of said partnership. the sum of P80. Pioneer Philippines Holdings. Pioneer Concrete Philippines. PIL 77 . apart from the litis expensae already paid to him.110. Inasmuch as the appellee has collected. concrete aggregates and quarrying operations in the Philippines. and Mrs. said contract of services — of the event upon which the amount of said fees depended. hence. Had she filed said action for divorce and secured a decree of divorce. No such limitation appears in the second and third paragraphs of said contract. in the course of which both parties introduced testimonial and documentary evidence. TODARO. PIONEER CONCRETE PHILIPPINES. 54155 and its Resolution 2 of August 21. 1998. in consideration of which the creditor agreed to the period. representing the share of Mrs.841. the decision appealed from is hereby affirmed. according to Mrs. and (c) 20% of her share in the conjugal partnership. Harden. which lasted ten (10) days. Hence. ANTONIO D. PPHI is the company established by PIL to own and hold the stocks of its operating company in the Philippines. worth P1. Harden.70. 154830. she intended to file before a competent court in California. Todaro (Todaro) filed with the Regional Trial Court (RTC) of Makati City. the share of Mrs. in the event of termination of the case or amicable settlement thereof within two (2) years from the filing of the complaint. it appears that the assets of the conjugal partnership between Mr. PIONEER PHILIPPINES HOLDINGS.] 16.554. "and of the liquidation of the conjugal partnership between" her and Mr. Civil Code) and "the debtor shall lose every right to make use of the period" when he "violates any undertaking. In conclusion. 1186. and the circumstances under which they entered into. was rendered impossible by Mrs. The firstparagraph limited the rights of appellee thereunder to two (2) years. J p: Before the Court is a Petition for Review on Certiorari seeking to annul and set aside the Decision 1 of the Court of Appeals (CA) dated October 31. whether such event be regarded as a condition or as a period. and Mrs. So ordered. for "the condition shall be deemed fulfilled when the obligor voluntarily prevents its fulfillment" (Art. Harden. and PHILIP J. he resigned from Betonval in February 1996. McDonald is the Chief Executive of the Hongkong office of PIL. and. (b) litis expensae.85. 2000 in CA-G. it cannot be effected until the dissolution of the marriage relation between Mr.R. the occurrence. vs. there results in his favor a balance of P304. Subject to this qualification. Civil Code.00. this cannot take place.000. with costs against the appellants. and. The transcript of the hearing. a complaint for Sum of Money and Damages with Preliminary Attachment against Pioneer International Limited ( PIL). also. petitioners. Twenty percentum (20%) of this sum is P384. John G. Klepzig is the President and Managing Director of PPHI and PCPI. that the compensation agreed upon for appellee's services.. (PCPI). as yet. Inc. no further discussion thereof is necessary. Inasmuch as this relation subsists. Klepzig (Klepzig). No. Hence. 2002 denying petitioners' Motion for Reconsideration. herein respondent Antonio D. respectively. In other words. having begun with Exhibit A. Todaro has been the managing director of Betonval Readyconcrete. or in the foreseeable future. The second and third parts were the object of the second and third paragraphs. (Betonval). 3 In his complaint. 1198. Harden." (Art. which is the contingent fee due to the appellee. Harden. also.97.110. his last piece of documentary evidence was marked Exhibit 26 Y's. within the time contemplated by the parties — bearing in mind the nature of. The other assignments of error made by appellants herein are mere corollaries of those already disposed of. in May 1996.920. Harden in the conjugal partnership. The first part was dealt with in the first paragraph of their contract of services. a company engaged in pre-mixed concrete and concrete aggregate production. THIRD DIVISION [G. 2007. which has not taken place. either now. is therefore. Harden. and the share of Mrs. covers over 220 pages.R. respondent. it follows that the amount of attorney's fees due to appellee herein should not have been determined in the decision appealed from. namely: (a) 25% of the increase in the allowance of Mrs. the same were intended by the parties to be fully operative under any and all conditions. Harden are reasonably valued at P3. KLEPZIG. and Mrs. Inc.

2000. however. C THE COURT OF APPEALS DISREGARDED AND FAILED TO CONSIDER THE PRINCIPLE OF "FORUM NON CONVENIENS" AS A VALID GROUND FOR DISMISSING A COMPLAINT. 9 On October 31. that the RTC has no jurisdiction over the subject matter of the complaint. petitioners argue that even if PCPI and PPHI are held liable. the RTC of Makati. such as Klepzig. Petitioners assert that the annexes to respondent's complaint show that PIL's offer was for respondent to be employed as the manager only of its pre-mixed concrete operations and not as the company's managing director or CEO. a contract is not binding upon and cannot be enforced against one who was not a party to it even if he be aware of such contract and has acted with knowledge thereof. as defendants. Hence. was not accepted by PIL. denied herein petitioners' respective motions to dismiss. Branch 147. 1999. On August 3. that the offer must be certain and the acceptance absolute. 1999 but the trial court denied it via its Order8 dated June 3. THE COURT OF APPEALS' CONCLUSION THAT THE COMPLAINT STATES A CAUSE OF ACTION AGAINST PETITIONERS IS WITHOUT ANY LEGAL BASIS. the CA rendered its presently assailed Decision denying herein petitioners' Petition for Certiorari. even if they are subsidiary corporations of the latter. for the sake of argument. 5 TIDcEH In its Order dated January 4. may not also be held liable because they are juridical entities with personalities which are separate and distinct from PIL. Furthermore. PCPI and PPHI were not privy to the negotiations between PIL and respondent for the possible employment of the latter. that a qualified acceptance constitutes a counter-offer. filed an Urgent Omnibus Motion 7 for the reconsideration of the trial court's Order of January 4. PIL and Todaro came to an agreement wherein the former consented to engage the services of the latter as a consultant for two to three months. As to their second assigned error. In other words.contacted Todaro and asked him if he was available to join them in connection with their intention to establish a ready-mix concrete plant and other related operations in the Philippines. Assuming. Todaro informed PIL of his availability and interest to join them. THE COURT OF APPEALS DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN ACCORD WITH LAW AND WITH APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT UPHELD THE JURISDICTION OF THE TRIAL COURT DESPITE THE FACT THAT THE COMPLAINT INDUBITABLY SHOWS THAT IT IS AN ACTION FOR AN ALLEGED BREACH OF EMPLOYMENT CONTRACT. Petitioners assert that since PIL did not accept respondent's counter-offer. that PIL may be held liable for breach of employment contract. and under Article 1311 of the Civil Code. petitioners contend that PCPI and PPHI. PPHI. Petitioners further assert that petitioner Klepzig may not be held liable because he is simply acting in his capacity as president of PCPI and PPHI and settled is the rule that an officer of a corporation is not personally liable for acts done in the performance of his duties and within the bounds of the authority conferred on him. he would be employed as the manager of PIL's ready-mix concrete operations should the company decide to invest in the Philippines. in effect did not accept PIL's offer of employment and instead made a counter-offer. there never was any employment contract that was perfected between them. Petitioners filed a Motion for Reconsideration but the CA denied it in its Resolution dated August 21. 1999. petitioners contend that there was no perfected employment contract between PIL and herein respondent. Petitioners argue that when respondent reiterated his intention to become the manager of PIL's overall business venture in the Philippines. 78 . petitioners contend that since herein respondent's claims for actual. 6 Herein petitioners. as the same is within the jurisdiction of the NLRC. consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. THE ANNEXES TO THE COMPLAINT CLEARLY BELIE THE ALLEGATION OF EXISTENCE OF AN EMPLOYMENT CONTRACT BETWEEN PRIVATE RESPONDENT AND PETITIONERS. Petitioners also aver that the annexes to respondent's complaint show that the negotiations on the alleged employment contract took place between respondent and PIL through its office in Hongkong. subsequently. one of the requisites for a contract to be perfected is the consent of the contracting parties. herein Petition for Review on Certiorari based on the following assignment of errors: A. 4 Instead of filing an Answer. 1999. PIL started its operations in the Philippines. the present case should be considered as falling within the exclusive jurisdiction of the NLRC. which. Petitioners also contend that under Article 1318 of the Civil Code. B. and that the complaint should be dismissed on the basis of the doctrine of forum non conveniens. Petitioners further argue that respondent's claim for damages based on the provisions of Articles 19 and 21 of the Civil Code is baseless because it was shown that there was no perfected employment contract. PCPI and Klepzig separately moved to dismiss the complaint on the grounds that the complaint states no cause of action. after which. however. that under Article 1319 of the same Code. 10 In their first assigned error. respondent still has no cause of action against Klepzig because PCPI and PPHI have personalities which are separate and distinct from those acting in their behalf. subsequently. herein petitioners filed a Petition for Certiorari with the CA. 2002. it refused to comply with its undertaking to employ Todaro on a permanent basis. FALLS WITHIN THE EXCLUSIVE JURISDICTION OF THE NATIONAL LABOR RELATIONS COMMISSION. he. AND HENCE. moral and exemplary damages are solely premised on the alleged breach of employment contract.

Petitioners contend that since the majority of the defendants in the present case are not residents of the Philippines. 79 . who is in the best position to determine whether special circumstances require that the court desist from assuming jurisdiction over the suit. Annex "H" 17 of the complaint shows that it was Klepzig who informed respondent that his company was no longer interested in employing respondent. as amended. This Court has reviewed respondent's allegations in its Complaint. Respondent further argues that there is a perfected contract between him and petitioners as they both agreed that the latter shall employ him to manage and operate their ready-mix concrete operations in the Philippines. based on the allegations in the Complaint and the annexes attached thereto. Even assuming that they can be summoned. rather than that a claim has been defectively stated. the trial court correctly limited itself to examining the sufficiency of the allegations in the Complaint as well as the annexes thereto. respondent contends that the complaint he filed was not based on a contract of employment. Even assuming that there was no perfected contract. respondent argues. respondent has a cause of action against herein petitioners. Petitioners conclude that based on the foregoing factual circumstances. not the veracity of the material allegations. (3) an act or omission on the part of such defendant violative of the right of the plaintiff or constituting a breach of the obligation of the defendant to the plaintiff for which the latter may maintain an action for recovery of damages. 11 In Hongkong and Shanghai Banking Corporation Limited v. A cause of action exists if the following elements are present: (1) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created. the complaint must show that the claim for relief does not exist. in resolving whether or not the Complaint in the present case states a cause of action. petitioners assert that the principle of forum non conveniens dictates that even where exercise of jurisdiction is authorized by law. If the allegations in the complaint furnish sufficient basis on which it can be maintained. the events which led to the present controversy occurred outside the Philippines. or is ambiguous. their appearance would entail excessive costs. Hence. As to the question of jurisdiction. Klepzig conducted negotiations with respondent regarding the latter's possible employment. respondent contends that his complaint alleges an alternative cause of action which is based on the provisions of Articles 19 and 21 of the Civil Code. This allegation is sufficient to constitute a cause of action for damages. this will have to be done at the trial on the merits of the case. It is proscribed from inquiring into the truth of the allegations in the Complaint or the authenticity of any of the documents referred or attached to the Complaint. respondent extensively quoted the assailed CA Decision maintaining that the factual allegations in the complaint determine whether or not the complaint states a cause of action. it should not be dismissed regardless of the defense that may be presented by the defendants. considering that its resolution would necessarily entail an examination of the veracity of the allegations not only of herein respondent as plaintiff but also of petitioners as defendants. the claim for damages must have a reasonable causal connection with the employer-employee relationship of petitioners and respondent. and. IaHCAD In his Comment. respondent asserts that for the NLRC to acquire jurisdiction. the complaint does not have to establish or allege facts proving the existence of a cause of action at the outset. In fact. It is evident from paragraphs 24 to 28 of the Complaint 16 that.With respect to the third assigned error. Rule 2 of the Rules of Court. 13 Moreover. they are not subject to compulsory processes of the Philippine court handling the case for purposes of requiring their attendance during trial. this issue must be taken up during trial. on various occasions. defines a cause of action as the act or omission by which a party violates a right of another. Section 2. 12 this Court held: The elementary test for failure to state a cause of action is whether the complaint alleges facts which if true would justify the relief demanded. This breach. courts may refuse to entertain a case involving a foreign element where the matter can be better tried and decided elsewhere. As to the applicability of the doctrine of forum non conveniens. respondent alleged that herein petitioners reneged on their contractual obligation to employ him on a permanent basis. Even assuming that there was an employment contract. respondent avers that the question of whether a suit should be entertained or dismissed on the basis of the principle of forum non conveniens depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial judge. gave rise to an action for damages which is cognizable by the regular courts. Catalan. it was based on petitioners' unwarranted breach of their contractual obligation to employ respondent. The Court does not agree with petitioners' contention that they were not privy to the negotiations for respondent's possible employment. the case should be dismissed under the principle of forum non conveniens. may the court render a valid judgment upon the facts alleged therein? The inquiry is into the sufficiency. In a nutshell. 14 To sustain a motion to dismiss for lack of cause of action. Petitioners further assert that there is no allegation in the complaint from which one can conclude that the evidence to be presented during the trial can be better obtained in the Philippines. rather. Stated otherwise. (2) an obligation on the part of the named defendant to respect or not to violate such right. Petitioners also argue that one of the factors in determining the most convenient forum for conflicts problem is the power of the court to enforce its decision. since these are deemed hypothetically admitted by the respondent. 15 Hence. either because the main aspects of the case transpired in a foreign jurisdiction or the material witnesses have their residence there and the plaintiff sought the forum merely to secure procedural advantage or to annoy or harass the defendant. indefinite or uncertain. The petition lacks merit. The issue as to whether or not there was a perfected contract between petitioners and respondent is a matter which is not ripe for determination in the present case. Moreover. Rather.

FELIPE ADAYA. BANGI. STANDARD FRUIT CO. The petitions in G. ALEJANDR petitioners. DEL MONTE TROPICAL FRUIT CO. MIGUEL G.A. AQUINO. in conflicts of law cases. ALVARADO. Nos. 22 (emphasis supplied) In the present case. to avoid overcrowded dockets.. ULYSES M. ARONG. the factual circumstances cited by petitioners which would allegedly justify the application of the doctrine of forum non conveniensare matters of defense. No. 5617. 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. WHEREFORE. Rule 16 of the Rules of Court does not include said doctrine as a ground.. JR. FELIPE ALCANTARA. ANOCHE. vs. BERNABE L. SHELL OIL CO. CHIQUITA BRANDS INTERNATIONAL. vs. BENJAMIN M. other labor statutes or any collective bargaining agreement. it should do so only after vital facts are established. ELEANOR AMOLATA. MARCELO S. it is clear that the present action is within the realm of civil law. no employer-employee relationship exists between petitioners and respondent. such as to secure procedural advantages. SALVADOR M. BALLENA. BARBERO. AFRICA. ALCARIA. EMNIANO BALMONTE. and that the propriety of dismissing a case based on this principle of forum non conveniens requires a factual determination. DEL MONTE FRESH PRODUCE N. TRIFINO F. OCCIDENTAL CHEMICAL CORP. 2011. ARSENIO B. HERMOGENES T. ARINZOL. but seeks payment of damages on account of petitioners' alleged breach of their obligation under their agreement to employ him. STANDARD FRUIT & STEAMSHIP CO. INC. BANGI. ANTONIO B. Court of Appeals 21 is instructive. J p: Before the Court are consolidated Petitions for Review on Certiorari under Rule 45 of the Rules of Court. DOLE FRESH FRUIT CO. FIRST DIVISION [G. In fact. Regional Trial Court. emerged in private international law to deter the practice of global forum shopping. ALBERTO R. RODOLFO P. ARAS. the merits of which should properly be threshed out during trial.. ABANGAN. DIZON. Whether a suit should be entertained or dismissed on the basis of said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court. Presiding Judge. the instant petition is DENIED and the assailed Decision and Resolution of the Court of Appeals are AFFIRMED. RAMON E... ALEJADO. Branch 37. It is settled that an action for breach of contractual obligation is intrinsically a civil dispute. DOW CHEMICAL CO. FERNANDO C.. Under this doctrine. literally meaning 'the forum is inconvenient'. NUMERIANO S. RODRIGO D. This Court further ruled that while it is within the discretion of the trial court to abstain from assuming jurisdiction on this ground. DOMINGO ANTOPINA. that the following requisites are met: (1) that the Philippine Court is one to which the parties may conveniently resort to. to wit: The doctrine of forum non conveniens. ARANIA. JR..R. In the case of Communication Materials and Design. NAVIDA. and jurisdiction over it belongs to the regular courts. ARINZOL. . in Civil Case No. FELIPE P... this Court has consistently held that where no employer-employee relationship exists between the parties and no issue is involved which may be resolved by reference to the Labor Code.. SOFRONIO BALINGIT.R. it is the Regional Trial Court that has jurisdiction.] 17. in his complaint. 20 With respect to the applicability of the principle of forum non conveniens in the present case. MAXIMO M. HERMINIGILDO AQUINO. RUPERTO G. INC. this Court held that ". and CHIQUITA BRANDS. LEOPOLDO N. ORLANDITO A. provided. ANTINO. DIOSDADO BARREDO.. Hence. 1996 of the Regional Trial Court (RTC) of General Santos City. hence it is more properly considered a matter of defense. FLORO I. ANCORDA. Investment Corporation vs. or to select a more friendly venue. JOSE P. that is to prevent non-resident litigants from choosing the forum or place wherein to bring their suit for malicious reasons. MANSUETO M. ALFONSO. DOLE FOOD CO. ABARQUEZ. 125078 1 and 125598 2 both assail the Order 3 dated May 20.As to the question of jurisdiction. 1.. Inc. respondent seeks redress on the basis of the provisions of Articles 19 and 21 of the Civil Code. BARBECHO.. a court. NELSON M. 18 In the present case. DECISION LEONARDO-DE CASTRO. EDGARADO P. to annoy and harass the defendant.R. ANDRADA. VIRGILIO BASAS. this Court enunciated in Philsec. The said Order decreed the dismissal of the case in view of the perceived lack of 80 . respondents. Costs against petitioners. BERT B. ISAGANI D. that the doctrine of forum non conveniens should not be used as a ground for a motion to dismiss because Sec.. (2) that the Philippine Court is in a position to make an intelligent decision as to the law and the facts. [a] Philippine Court may assume jurisdiction over the case if it chooses to do so. TEODORO A. SO ORDERED. ANTECRISTO. Branch 37. ARSENIO ARCE. private respondent is not seeking any relief under the Labor Code. ALBAO. RONNIE BACAYO. INC. (3) that the Philippine Court has or is likely to have power to enforce its decision. 19 In the alternative." Moreover. ABISON. 125078. and. this Court's ruling in Bank of America NT & SA v. May 30. JR. ASTRALABIO. . which arose out of two civil cases that were filed in different courts but whose factual background and issues are closely intertwined. to determine whether special circumstances require the court's desistance. Court of Appeals. Court of Appeals. APARICIO. General Santos City. HON. ALMODIEL. CEFERINO P.

17 On May 15. 16 excluding Dead Sea Bromine Co.and fourth-party defendants have: (1)participated in expedited discovery in the United States . in the event that the highest court of any foreign country finally affirms the dismissal for lack of jurisdiction of an action commenced by a plaintiff in these actions in his home country or the country in which he was injured. filed an Amended Joint Complaint. 1995. and 128398 were consolidated in the Resolutions dated February 10. 24. et al. a number of personal injury suits were filed in different Texas state courts by citizens of twelve foreign countries. .. and (5)submitted within 40 days after the entry of this Memorandum and Order an agreement binding them to satisfy any final judgment rendered in favor of plaintiffs by a foreign court. 1997 11 and March 10. 1997.18 81 . 1996. (4)stipulated within 40 days after the entry of this Memorandum and Order that any discovery conducted during the pendency of these actions may be used in any foreign proceeding to the same extent as if it had been conducted in proceedings initiated there. Ltd. and Amvac Chemical Corp. that they were exposed to this chemical during the early 1970's up to the early 1980's when they used the same in the banana plantations where they worked at. H-94-1359. Dead Sea Bromine Co. in Civil Case No. as party defendants. 6 127856. Shell Oil Co. and/or when they resided within the agricultural area where such chemical was used. The thousands of plaintiffs sought damages for injuries they allegedly sustained from their exposure to dibromochloropropane (DBCP). they were allowed to be exposed to the said products. The case was docketed as Civil Case No. (DOW). et al. 12 The factual antecedents of the petitions are as follows: Proceedings before the Texas Courts Beginning 1993. According to NAVIDA. et al. prayed for the payment of damages in view of the illnesses and injuries to the reproductive systems which they allegedly suffered because of their exposure to DBCP. Ltd. and Del Monte Tropical Fruit Co.. Nos. On the other hand. The defendants in the consolidated cases prayed for the dismissal of all the actions under the doctrine of forum non conveniens. which also dismissed the case on the ground of lack of jurisdiction. Inc. No. and Amvac Chemical Corp. 15 During the pendency of the motions. . and "Juan Ramon Valdez.. et al. Shell Oil Co. Valdez and Isae Carcamo will be dismissed 90 days after the entry of this Memorandum and Order provided that defendants and third. Any plaintiff desiring to bring such an action will do so within 30 days after the entry of this Memorandum and Order. DEScaT In a Memorandum and Order dated July 11. 1996 4 and July 9. 5617. (The aforementioned defendants are hereinafter collectively referred to as defendant companies. the Federal District Court for the Southern District of Texas. 125078. H-95-1356. 1996. Ameribrom. 126654. Dole Food Co. the court ordered that: Delgado." which was docketed as Civil Action No. 1995. Branch 16. among others.. Occidental Chemical Corp. Bromine Compounds. v. Ltd. which the defendant companies knew. (CHIQUITA). the Federal District Court conditionally granted the defendants' motion to dismiss.. the remaining defendant companies filed their various Motions for Bill of Particulars.jurisdiction of the RTC over the subject matter of the complaint. Inc. (hereinafter collectively referred to as DEL MONTE). 1999. 7 and 128398 8 seek the reversal of the Order 9 dated October 1.. Del Monte Fresh Produce N. while working on farms in 23 foreign countries. and Chiquita Brands International.. The cases were eventually transferred to.R.. NAVIDA. and consolidated in. Ameribrom. Inc.. DOW filed an Answer with Counterclaim." which was docketed as Civil Action No. Houston Division. on March 13. Standard Fruit and Steamship Co.. 5617 before the RTC of General Santos City and G. Bromine Compounds. The petition in G. upon proper motion. 10 April 28. Again.. v. et al. a chemical used to kill nematodes (worms)..251-96. et al. 5617... 125598 also challenges the Orders dated June 4. the petitions in G. 13 Civil Case No. (3)waived within 40 days after the entry of this Memorandum and Order any limitations-based defense that has matured since the commencement of these actions in the courts of Texas. Ltd. most of the defendant companies respectively filed their Motions for Bill of Particulars.A.R.. claimed that their illnesses and injuries were due to the fault or negligence of each of the defendant companies in that they produced. Nos. (OCCIDENTAL).R..) filed a Joint Complaint 14 in the RTC of General Santos City on August 10. 126654.. a total of 336 plaintiffs from General Santos City (the petitioners in G. Inc. sold and/or otherwise put into the stream of commerce DBCP-containing products. Named as defendants therein were: Shell Oil Co. or ought to have known. that plaintiff may return to this court and. 127856. Pertinently. Nos. 125598. xxx xxx xxx Notwithstanding the dismissals that may result from this Memorandum and Order. Instead of answering the complaint. G. No. hereinafter referred to as NAVIDA. Standard Fruit Co.) NAVIDA. Dole Fresh Fruit Co. NAVIDA. Dow Chemical Co. 125078 and 125598 In accordance with the above Memorandum and Order.. Jorge Carcamo.R. 5 which held that the RTC of General Santos City no longer had jurisdiction to proceed with Civil Case No.R. the court will resume jurisdiction over the action as if the case had never been dismissed for [forum non conveniens]. (2)either waived or accepted service of process and waived any other jurisdictional defense within 40 days after the entry of this Memorandum and Order in any action commenced by a plaintiff in these actions in his home country or the country in which his injury occurred. 1996 of the RTC of Davao City. They claimed. were highly injurious to the former's health and well-being.. (hereinafter collectively referred to as DOLE). et al. including the Philippines. Chiquita Brands. 125078. (SHELL). Inc. The cases therein that involved plaintiffs from the Philippines were "Jorge Colindres Carcamo. et al. 1996.. et al.

that the Regional Trial Court has jurisdiction over the present case. viz. of filing the case in the Philippine courts violated the rules on forum shopping and litis pendencia. thus: THE DEFENDANTS' SUBMISSION TO JURISDICTION IS CONDITIONAL AS IT IS ILLUSORY Defendants have appointed their agents authorized to accept service of summons/processes in the Philippines pursuant to the agreement in the U. District Court dismissing the case is not yet final and executory since both the plaintiffs and defendants appealed therefrom (par. . the RTC of General Santos City issued an Order dismissing the complaint. is premised on being the manufacturer of the pesticides. First. the RTC of General Santos City adjudged that NAVIDA. et al. 1995. without resolving the motions filed by the parties. Consequently.. if and only if the Civil Code of the Philippines. merely to comply with the U. The decision of the U. outside and beyond the jurisdiction of Philippine Courts. et al. the trial court ascribed little significance to the voluntary appearance of the defendant companies therein. it becomes stark clear that such averments describe and identify the category of specific tort known as product liability tort. which is asserted to be the proximate cause of the damages sustained by the plaintiff workers.S. 1996. District Court's Order dated July 11. et al.. Amended Complaint). but rather were coerced to do so.S. resulting in their becoming part of the stream of commerce. the subject matter stated in the complaint and which is uniquely particular to the present case. . their distribution through sale or other disposition. the trial court determined that it did not have jurisdiction to hear the case. being subject to a suspensive condition. District Court. .S. consisted of activity or course of conduct engaged in by foreign defendants outside Philippine territory. hence. It is clear. 22 Fifth.: FILING OF CASES IN THE PHILIPPINES — COERCED AND ANOMALOUS The Court views that the plaintiffs did not freely choose to file the instant action. and in order to keep open to the plaintiffs the opportunity to return to the U. These acts of defendants cited in the complaint included the manufacture of pesticides.. 19 Second. it appears that such voluntary appearance of the defendants in this case is conditional. the RTC of General Santos City declared that the tort alleged by NAVIDA. 3(h). 20 Third. 21 Fourth. Thus in the "Defendants' Amended Agreement Regarding Conditions of Dismissal for Forum Non Conveniens" (Annex to the Complaint) filed with the U. This is necessarily so.On May 20. in their complaint is a tort category that is not recognized in Philippine laws. defendants declared that "(t)he authority of each designated representative to accept service of process will become effective upon final dismissal of these actions by the Court". therefore. thus produces no legal effect and is ineffective at the moment. or a suppletory special law prescribes a product liability tort. since the authority of the agent of the defendants in the Philippines is conditioned on the final adjudication of the case pending with the U.S. because it is the productmanufactured by defendant foreign companies. the RTC of General Santos City ruled that the act of NAVIDA. courts. BECAUSE IT IS NOT A TORT CATEGORY WITHIN THE PURVIEW OF THE PHILIPPINE LAW The specific tort asserted against defendant foreign companies in the present complaint is product liability tort. inclusive of and comprehending the specific tort described in the complaint of the plaintiff workers. Said the trial court: IcaEDC THE TORT ASSERTED IN THE PRESENT COMPLAINT AGAINST DEFENDANT FOREIGN COMPANIES IS NOT WITHIN THE SUBJECT MATTER JURISDICTION OF THE REGIONAL TRIAL COURT. . were coerced into submitting their case to the Philippine courts. the acquisition of jurisdiction by this court over the persons of the defendants is also conditional. 3(i). their packaging in containers.S. to wit: THE COMPLAINT FOR DAMAGES FILED WITH THE REGIONAL TRIAL COURT SHOULD BE DISMISSED FOR LACK OF JURISDICTION xxx xxx xxx The substance of the cause of action as stated in the complaint against the defendant foreign companies cites activity on their part which took place abroad and had occurred outside and beyond the territorial domain of the Philippines. The appointment of agents by the defendants. The trial court expounded: THE JURISDICTION FROWNS UPON AND PROHIBITS FORUM SHOPPING 82 . and the liability of the defendant foreign companies. Accordingly.S. court that defendants will voluntarily submit to the jurisdiction of this court. District Court. When the averments in the present complaint are examined in terms of the particular categories of tort recognized in the Philippine Civil Code. While it is true that this court acquires jurisdiction over persons of the defendants through their voluntary appearance. including the present Regional Trial Court.

But the same insistence would actually thwart the very ends of justice which it seeks to achieve. would be violative of the constitutional provision on the Bill of Rights guaranteeing speedy disposition of cases (Ref. 125078. There exists litis pendencia since there are two cases involving the same parties and interests. which was docketed asG.R. DOW and OCCIDENTAL also filed a Joint Motion for Reconsideration 28 of the RTC Order dated May 20. which is really a matter of venue.R. In a Resolution 35 dated November 13. . .S. 1996.S. the RTC of General Santos City declared that it had already lost its jurisdiction over the case as it took into consideration the Manifestation of the counsel of NAVIDA. in essence. 1996. this case is now considered DISMISSED. For to continue with these proceedings. which stated that the latter had already filed a petition for review on certiorari before this Court.This court frowns upon the fact that the parties herein are both vigorously pursuing their appeal of the decision of the U. It is settled that initial acquisition of jurisdiction divests another of its own jurisdiction. WHEREFORE. District court dismissing the case filed thereat. 1996. 1996. DEL MONTE and SHELL each filed a motion for reconsideration 26 of the RTC Order dated May 20. 1996 and July 9. in view of the foregoing considerations. 1996. et al. No. 1996. CHIQUITA and SHELL filed their motions for reconsideration 30 of the above order. This court takes note that the U. In an Order 29 dated July 9. No. 1996.251-96 before the RTC of Davao City and G. and 128398 83 . et al. .S. this court concludes that since the case between the parties in the U. The case was dismissed on the ground of forum non conveniens.S. 126018. violates the rule on 'forum shopping' so abhorred in this jurisdiction. 1996. the RTC of General Santos City likewise issued an Order. District Court did not decline jurisdiction over the cause of action. CHIQUITA.S. 34 which sought the reversal of the RTC Orders dated May 20. The RTC of General Santos City then issued an Order 31 dated August 14. Civil Case No. 1996. . Subsequently. DcCEHI This evaluation and action is made not on account of but rather with due consideration to the fact that the dismissal of this case does not necessarily deprive the parties — especially the plaintiffs — of their possible remedies. court involves the same parties. Article III.. 125078." 23 In fine. might accord this court a charming appearance. the case filed in the U. then this case is barred by the rule on "litis pendencia. the filing of the case in the U. 1996. 125598 with G. CHIQUITA filed a Motion for Reconsideration. 1997. the trial court held that: It behooves this Court. as it is now presented. as in this case. June 4. 16. The court has no other choice. same rights and interests. 127856. .R. NAVIDA. 5617 and reiterated that it no longer had any jurisdiction over the case. xxx xxx xxx THE FILING OF THE CASE IN U. courts divested this court of its own jurisdiction. To allow the parties to litigate in this court when they are actively pursuing the same cases in another forum. DOW and OCCIDENTAL filed their Petition for Review on Certiorari. To insist on further proceedings with this case.S.S. 126654. the U. In a Resolution 33 dated October 7. 24. . then to dismiss this case. concurrent jurisdiction with this court over the subject matter of this case.R. No. 1996. while DOW filed a motion for reconsideration 27 of the RTC Order dated June 4. the subsequent case must be dismissed. Their petition was docketed as G. CHIQUITA filed a Petition for Review on Certiorari. DOW and OCCIDENTAL aver that the RTC of General Santos City erred in ruling that it has no jurisdiction over the subject matter of the case as well as the persons of the defendant companies. . District Court has. By taking cognizance of the case. 1996. Sec. No. 24 On June 4. On July 11. On August 30. DIVESTED THIS COURT OF ITS OWN JURISDICTION Moreover. July 9. Applying the foregoing [precept] to the case-at-bar. 25 dismissing DOW's Answer with Counterclaim. . In their petition.R. Constitution). The court would like to emphasize that in accordance with the rule on litis pendencia. 36 but the same was denied through a Resolution 37 dated January 27. is still pending. 1996..R. 32 challenging the orders of the RTC of General Santos City dated May 20. 1996 and August 14. . which merely noted the incidents still pending in Civil Case No. Nos. 1996. filed a Petition for Review on Certiorari in order to assail the RTC Order dated May 20. . the Court dismissed the aforesaid petition for failure of CHIQUITA to show that the RTC committed grave abuse of discretion. 1996. The court is cognizant that the Federal Court may resume proceedings of that earlier case between the herein parties involving the same acts or omissions as in this case. No.. 125598. xxx xxx xxx THIS CASE IS BARRED BY THE RULE OF "LITIS PENDENCIA" Furthermore. The petition was docketed as G. this Court resolved to consolidate G.

Del Monte Fresh Produce. et al. DEL MONTE. This case was docketed as Civil Case No. This means there is no available evidence which will prove and disprove the relation between sterility and DBCP. Occidental Chemical Corporation. et al. 18). 2. the Federal District Court issued a Memorandum and Order conditionally dismissing several of the consolidated actions including those filed by the Filipino complainants. et al. sold. 126654. the said plaintiffs may return to that court and. which the defendant companies knew or ought to have known. assails before this Court the abovequoted order of the RTC of Davao City. DOLE Fresh Fruit Company. used.251-96 on the ground of lack of jurisdiction. 84 . but not limited to. ABELLA.Former Justice Secretary Demetrio Demetria in a May 1995 opinion said: 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. These plaintiffs (the petitioners in G. et al. Except for DOW. The RTC of Davao City.A. reads: Upon a thorough review of the Complaint and Amended Complaint for: Damages filed by the plaintiffs against the defendants Shell Oil Company. DEL MONTE also filed its motion for reconsideration. plaintiffs seeking for payment of damages based on negligence. junked Civil Case No. DOLE. No. One of the conditions imposed was for the plaintiffs to file actions in their home countries or the countries in which they were injured . such exposure resulted in "serious and permanent injuries to their health. et al. conspiracy and international tort theories (par. S. had they exercised ordinary care and prudence.. ABELLA. including.Retired High Court Justice Rodolfo Nocom stated that there is simply an absence of doctrine here that permits these causes to be heard. alleged that. DOLE Food Company.) 11. claim that the RTC of Davao City erred in dismissing Civil Case No. . filed on November 12. all foreign corporations with Philippine Representatives. strict liability. produced. based on the opinions of legal luminaries reported in a newspaper. the Court will resume jurisdiction as if the case had never been dismissed for forum non conveniens. et al. 1996. 1996. DOW and DEL MONTE filed their respective Answers dated May 17. 24. and CHIQUITA was filed before Branch 16 of the RTC of Davao City by 155 plaintiffs from Davao City. . upon proper motion. 38 Similar to the complaint of NAVIDA. as workers in the banana plantation and/or as residents near the said plantation.Retired Supreme Court Justice Abraham Sarmiento opined that while a class suit is allowed in the Philippines the device has been employed strictly. which contained the chemical DBCP. and Del Monte Tropical Fruit Co.) amended their Joint-Complaint on May 21. 126654. DOW. No product liability ever filed or tried here. Courts will reassume jurisdiction. et al. Reply to Opposition dated July 22..Another joint complaint for damages against SHELL. plaintiffs aver that: on 11 July 1995. filed their opposition. 24.. the Memorandum and [O]rder further provided that should the highest court of any foreign country affirm the dismissal for lack of jurisdictions over these actions filed by the plaintiffs in their home countries [or] the countries where they were injured. the RTC of Davao City has jurisdiction over the subject matter of the case since Articles 2176 and 2187 of the Civil Code are broad enough to cover the acts complained of and to support their claims for damages. is convinced that plaintiffs "would have this Honorable Court dismiss the case to pave the way for their getting an affirmance by the Supreme Court" (#10 of Defendants' Del Monte Fresh Produce. Consider these: 1)In the original Joint Complaint. 1996.. 24. Should the Philippine Courts refuse or deny jurisdiction. the U. as plaintiffs. 19). et al. The Court however is constrained to dismiss the case at bar not solely on the basis of the above but because it shares the opinion of legal experts given in the interview made by the Inquirer in its Special report "Pesticide Cause Mass Sterility. Mass sterility will not qualify as a class suit injury within the contemplation of Philippine statute. in its entirety. According to ABELLA. According to ABELLA. and/or made available in commerce. and Del Monte Tropical Fruits Co. USA. upon defendants' Motion to Dismiss on Forum non [conveniens]. further aver that the dismissal of the case. 1996 and June 24. They also maintain that the absence of jurisprudence regarding the award of damages in favor of those adversely affected by the DBCP does not preclude them from presenting evidence to prove their allegations that their exposure to DBCP caused their sterility and/or infertility.R.. . they have no agents as well (par. There has been no decided case in Philippine Jurisprudence awarding to those adversely affected by DBCP. DOW Chemicals Company. 1996 by ABELLA. 40 Docketed as G. Case ordered dismissed. 27). a petition was filed by same plaintiffs against same defendants in the Courts of Texas. et al. Standard Fruit and Steamship.251-96. sterility and severe injuries to their reproductive capacities." to wit: 1.In the Amended Joint Complaint. Chiquita Brands. SHELL. 1996 of the RTC of Davao City. CaEIST ABELLA.. No. Inc. are now compelled by a decision of a Texas District Court to file cases under torts in this jurisdiction for causes of actions which occurred abroad (par. 3. said petition was provisionally dismissed on condition that these cases be filed in the Philippines or before 11 August 1995 (Philippine date.251-96 in its Order dated October 1. DBCP without warning the users of its hazardous effects on health. et al. distributed. plaintiffs state that: defendants have no properties in the Philippines. which contained an additional motion for the inhibition of the presiding judge. DOW.R. they were made to use and/or were exposed to nematocides. 1996). by the RTC of Davao City is bereft of basis.. plaintiffs are suing the defendants for tortuous acts committed by these foreign corporations on their respective countries. claimed that the defendant companies manufactured. their cause of action is based on quasi-delict under Article 2176 of the Civil Code.. N. Notwithstanding. as correctly pointed out by one of the defendants. the Court." 39 ABELLA. According to them. N. hereinafter referred to as ABELLA. Chiquita Brands International. Standard Fruit Company.. the petition for review. however.. after having elected to sue in the place of defendants' residence.A. OCCIDENTAL. and without providing instructions on its proper use and application. which. and CHIQUITA each filed their respective motions for reconsideration of the Order dated October 1. the other defendant companies filed their respective motions for bill of particulars to which ABELLA...

this Court in its Resolution 43 dated July 28. this Court consolidated G.et al. 1997.R. 1997. 1997. CHIQUITA argues that the RTC of Davao City erred in dismissing the case motu proprio as it acquired jurisdiction over the subject matter of the case as well as over the persons of the defendant companies which voluntarily appeared before it.. the case was re-raffled to Branch 13 of the RTC of Davao City. 51 and DOW and OCCIDENTAL jointly filed a Memorandum on December 23. No. 52 The Motion to Withdraw Petition for Review in G. Its petition was docketed as G. questioning the Orders dated October 1. On September 26.251-96. dismissed the petition filed by CHIQUITA for submitting a defective certificate against forum shopping. and SHELL as Party-Respondents filed by NAVIDA. DEL MONTE claims that the RTC of Davao City has jurisdiction over Civil Case No. Nos. CHIQUITA also claims that the RTC of Davao City cannot dismiss the case simply on the basis of opinions of alleged legal experts appearing in a newspaper article. 125598. In its petition. the motion to withdraw petition for review filed by DOW and OCCIDENTAL. and March 10. 1999. later. this Court. Initially. 125598. On March 7. 2004. 1997. The Consolidated Motion to Drop DOW.R. Indemnity. and ABELLA.R. 1996 of the RTC of Davao City. THE ISSUES 85 ." which were attached to the said motion. CHIQUITA filed its Memorandum on August 28. 45 The plaintiff claimants alleged that they had amicably settled their cases with DOW. 1998. however.. NAVIDA. This settlement agreement was evidenced by facsimiles of the "Compromise Settlement. however. OCCIDENTAL.R.R. No. 48 DOLE filed its Memorandum on October 12. April 28. 1998. and arguments adduced by the parties. 125078. an answer to the complaint. In the Resolutions dated February 10. et al. 2004. 1999. No. issues. In an Order 42 dated December 16. 46 required all the parties to submit their respective memoranda. 1998 49 while DEL MONTE filed on October 13. filed before this Court a Consolidated Motion (to Drop PartyRespondents). On September 27.. 56 stating that it has no objections to the withdrawal of the petition filed by DOW and OCCIDENTAL in G. 1997. 1997. DEL MONTE filed its Comment on Motion to Withdraw Petition for Review Filed by Petitioners in G. OCCIDENTAL. and 128398. the plaintiff claimants sought to withdraw their petitions as against DOW. Thereafter. 1996. 1998. et al. 2004.The presiding judge of Branch 16 then issued an Order 41 dated December 2. and Hold Harmless Agreement.R. 2004. This case was docketed as G. 127856.. No. DOLE filed its Manifestation dated September 6. Thus. Pursuant to said agreement. also filed their Comment dated September 14. 125598 On July 13. voluntarily inhibiting himself from trying the case. 125598. and denied the respective motions for reconsideration filed by defendant companies. filed a motion for reconsideration. et al. as well as the settlement entered into between the plaintiff claimants and DOW. 47 SHELL asked to be excused from the filing of a memorandum alleging that it had already executed a compromise agreement with the plaintiff claimants. and ABELLA. et al. among others. in a Resolution dated June 22. 128398. NAVIDA. OCCIDENTAL. 1996. OCCIDENTAL. as well as other settling defendant companies. CHIQUITA. which was granted by this Court in the Resolution 44 dated October 8. No. 125598 has become moot and academic because Civil Case No. 1999.R. 1996 and December 16. should be retained as defendants for purposes of prosecuting the cross-claims of DOLE. acted beyond its authority when it dismissed the case motu proprio or without any motion to dismiss from any of the parties to the case. therefore. 53 explaining that the said petition "is already moot and academic and no longer presents a justiciable controversy" since they have already entered into an amicable settlement with NAVIDA. 1997. the RTC of Davao City.. 54 interposing no objection to the withdrawal of the petition. 2004. 50 NAVIDA. this Court granted. DOW and OCCIDENTAL added that they have fully complied with their obligations set forth in the 1997 Compromise Agreements. and further stating that they maintain their position that DOW and OCCIDENTAL. DOLE. 127856. DEL MONTE and CHIQUITA. in the event that the complaint below is reinstated. CHIQUITA filed a Petition for Review dated March 5. et al. 24. et al. and ABELLA. No. According to DEL MONTE. et al. and SHELL. and SHELL. 55 stating that they agree with the view of DOW and OCCIDENTAL that the petition in G. as defined under the law and that the said court already obtained jurisdiction over its person by its voluntary appearance and the filing of a motion for bill of particulars and. 125598. DOW and OCCIDENTAL filed a Motion to Withdraw Petition for Review in G. 5617 had already been amicably settled by the parties in 1997.R. No. filed their Consolidated Memorandum on February 3. the RTC of Davao City affirmed the Order dated October 1. 126654. 1996. In a Resolution 57 dated October 11. and SHELL sometime in July 1997. The Memoranda of the Parties Considering the allegations. DEL MONTE also filed its petition for review on certiorari before this Court assailing the above-mentioned orders of the RTC of Davao City. opposed the motion.

et al. etc.7 million in damages for each plaintiff claimant.251-96. which amount falls within the jurisdiction of the RTC. and ABELLA. 2176 of the Civil Code of the Philippines is broad enough to cover the acts complained of. the use of and exposure to DBCP that was manufactured.. and ABELLA. the courts a quo should have dismissed the civil cases on the ground that the Amended Joint-Complaints of NAVIDA.251-96 was proper. as well as Article 2176 thereof. thus. In addition. et al. assert that the provisions of Chapter 2 of the Preliminary Title of the Civil Code.7 million for each of the plaintiff claimants.251-96 be reversed and that the said cases be remanded to the courts a quo for further proceedings.Assumption of jurisdiction by the U. the general principles of law.. not the place of manufacture.. et al. 5617 and 24. b)The court dismissed the case because it was convinced that it did not have jurisdiction. Said fact allegedly constitutes reasonable basis for our courts to assume jurisdiction over the case. Occidental and Shell does not unjustifiably prejudice remaining respondents Dole. and ABELLA. et al. Del Monte and Chiquita. and ABELLA. et al.. sale. Thus. et al. pray that the respective rulings of the RTC of General Santos City and the RTC of Davao City in Civil Case Nos. NAVIDA. packaging. Article 9 of the Civil Code dictates that a judge may not refuse to render a decision on the ground of insufficiency of the law. point to their alleged exposure to DBCP which occurred in the Philippines. b. which states that the law of the place where the alleged wrong was committed will govern the action. specifically for approximately P2.. CHIQUITA. DOLE.THE COURT DISMISSED THE CASE DUE TO LACK OF JURISDICTION.251-96 given that newspaper articles are hearsay and without any evidentiary value. The court may still resolve the case. Remarkably. 5617 and 24. NAVIDA. NAVIDA. respectively 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. 58 DISCUSSION On the issue of jurisdiction Essentially. none of the parties to this case claims that the courts a quo are bereft of jurisdiction to determine and resolve the abovestated cases. DOLE adds that the RTC of Davao City gravely erred in relying upon newspaper reports in dismissing Civil Case No. Furthermore. DOLE states that if there were no actionable wrongs committed under Philippine law. a. and ABELLA. the crux of the controversy in the petitions at bar is whether the RTC of General Santos City and the RTC of Davao City erred in dismissing Civil Case Nos.. applying the customs of the place and. 86 . In a similar vein. Specifically. All parties contend that the RTC of General Santos City and the RTC of Davao City have jurisdiction over the action for damages. given that plaintiff claimants merely prosecuted the cases with the sole intent of securing a dismissal of the actions for the purpose of convincing the U. cICHTD d. distribution. without any notice to the parties.The acts complained of occurred within Philippine territory. The RTC of General Santos City and the RTC of Davao City have jurisdiction over Civil Case Nos. et al. et al. NAVIDA. 59 Once vested by law. are broad enough to cover their claim for damages.S. None of the defendant companies ever objected to the exercise of jurisdiction by the courts a quo over their persons. This is in consonance with the lex loci delicti commisi theory in determining the situs of a tort.. of the said chemical. c. in the absence thereof. respectively.. however..The Compromise Agreement and the subsequent Consolidated Motion to Drop Party Respondents Dow. et al. et al. Likewise. a)The court did not simply dismiss the case because it was filed in bad faith with petitioners intending to have the same dismissed and returned to the Texas court. Finally..S. CHIQUITA avers that the pertinent matter is the place of the alleged exposure to DBCP. 5617 and 24..In their Consolidated Memorandum. 24. et al. presented the following issues for our consideration: IN REFUTATION I. and ABELLA. which falls under Article 2176 of the Civil Code. 5617 and 24. 5617 and 24.251-96 to the RTC of General Santos City and the RTC of Davao City.Art. prays for the remand of Civil Case Nos. for lack of jurisdiction. IN SUPPORT OF THE PETITION II. District Court over petitioner[s'] claims did not divest Philippine [c]ourts of jurisdiction over the same. argue that the allegedly tortious acts and/or omissions of defendant companies occurred within Philippine territory. opines that the dismissal of Civil Case Nos. respectively. DOLE also argues that if indeed there is no positive law defining the alleged acts of defendant companies as actionable wrong. as the cause of the sterility and other reproductive system problems that they allegedly suffered.THE TRIAL COURT HAS JURISDICTION OVER THE SUBJECT MATTER OF THE CASE. CHIQUITA argues that the courts a quo had jurisdiction over the subject matter of the cases filed before them. Federal District Court to re-assume jurisdiction over the cases.251-96. stated no cause of action against the defendant companies. the alleged legal opinions cited in the newspaper reports were taken judicial notice of.. CHIQUITA and the other defendant companies also submitted themselves to the jurisdiction of the RTC by making voluntary appearances and seeking for affirmative reliefs during the course of the proceedings. on a particular court or body. irrespective of whether the plaintiffs are entitled to all or some of the claims asserted therein. distributed or otherwise put into the stream of commerce by defendant companies happened in the Philippines. the jurisdiction over the subject matter or nature of the action cannot be dislodged by anybody other than by the legislature through the enactment of a law.. et al. The Amended Joint-Complaints sought approximately P2. DOLE similarly maintains that the acts attributed to defendant companies constitute a quasi-delict. DOLE posits that the Philippines is the situs of the tortious acts allegedly committed by defendant companies as NAVIDA.

000. SOLD. THEY allowed Plaintiffs to be exposed to. the plaintiffs suffered serious and permanent injuries TO THEIR HEALTH. DBCP not only destroyed nematodes. AND/OR MADE AVAILABLE IN COMMERCE nematocides containing the chemical dibromochloropropane.At the time of the filing of the complaints. sought in their similarly-worded Amended Joint-Complaints filed before the courts a quo.. produced.00).Jurisdiction in civil cases. 7691. Supreme Court Administrative Circular No.7 million for each of the plaintiff claimants. attorney's fees. 61 From the foregoing. DBCP-containing materials which THEY knew. as both claims by NAVIDA. it is clear that the claim for damages is the main cause of action and that the total amount sought in the complaints is approximately P2. NAVIDA. where the demand. 87 .000. applies to cases where the damages are merely incidental to or a consequence of the main cause of action..P. exclusive of interest. c)TO PAY EACH PLAINTIFF exemplary damages in the amount of Six Hundred Thousand Pesos (P600.00) each. 129. and e)TO PAY THE COSTS of the suit.A. were highly harmful and injurious to the Plaintiffs' health and well-being. PRODUCED. the allegations in both Amended Joint-Complaints narrate that: THE CAUSES OF ACTION 4.000.The Defendants WHO MANUFACTURED.000. et al. sold. and ABELLA. which plagued banana plantations. AS IT TURNED OUT. states: 2.The exclusion of the term "damages of whatever kind" in determining the jurisdictional amount under Section 19 (8) and Section 33 (1) of B. premises considered. but not limited to. was: SEC. No. et al. and ABELLA. commonly known as DBCP. used.Failed to provide plaintiffs with information as to what should be reasonably safe and sufficient clothing and proper protective equipment and appliances. if any. or one of the causes of action.00) or.500. as amended by R. and/or (b) they resided within the agricultural area WHERE IT WAS USED. and costs or the value of the property in controversy exceeds One hundred thousand pesos (P100. The RTCs unmistakably have jurisdiction over the cases filed in General Santos City and Davao City. 7. judgment be rendered in favor of the plaintiffs ordering the defendants: a)TO PAY EACH PLAINTIFF moral damages in the amount of One Million Five Hundred Thousand Pesos (P1. MADE AVAILABLE OR PUT DBCP INTO THE STREAM OF COMMERCE were negligent OR AT FAULT in that they. b)TO PAY EACH PLAINTIFF nominal damages in the amount of Four Hundred Thousand Pesos (P400.. IT ALSO CAUSED ILL-EFFECTS ON THE HEALTH OF PERSONS EXPOSED TO IT AFFECTING the human reproductive system as well. Here. However. exclusive of the abovementioned items exceeds Two hundred thousand pesos (P200. Blg. 7691. DISTRIBUTED. or in the exercise of ordinary care and prudence ought to have known. 129.The Defendants manufactured.THE DEFENDANTS WERE AT FAULT OR WERE NEGLIGENT IN THAT THEY MANUFACTURED. the amount of such claim shall be considered in determining the jurisdiction of the court. the following prayer: PRAYER WHEREFORE. THE CHEMICAL WAS USED AGAINST the parasite known as the nematode. as amended by Republic Act No. damages of whatever kind. AMONG OTHERS: a. the jurisdiction of the RTC in civil cases under Batas Pambansa Blg.The plaintiffs were exposed to DBCP in the 1970s up to the early 1980s WHILE (a) they used this product in the banana plantations WHERE they were employed. and/or USED DBCP and/or otherwise. STERILITY and severe injuries to their reproductive capacities. EaIDAT Moreover.Failed to adequately warn Plaintiffs of the dangerous characteristics of DBCP.000.000. 60 Corollary thereto. b. or to cause their subsidiaries or affiliates to so warn plaintiffs. 09-94. 6.. sold. et al. INCLUDING THOSE in the Philippines. to protect plaintiffs from the harmful effects of exposure to DBCP.00).00). 5. As a result of such exposure. fall within the purview of the definition of the jurisdiction of the RTC under Batas Pambansa Blg. distributed. in cases where the claim for damages is the main cause of action. or to cause their subsidiaries or affiliates to do so.00). including. litigation expenses. d)TO PAY EACH PLAINTIFF attorneys fees of Two Hundred Thousand Pesos (P200. in such other cases in Metro Manila. PUT THE SAME into the stream of commerce. it is most respectfully prayed that after hearing. 129. 19. et al. — Regional Trial Courts shall exercise exclusive original jurisdiction: xxx xxx xxx (8)In all other cases in which the demand. WITHOUT INFORMING THE USERS OF ITS HAZARDOUS EFFECTS ON HEALTH AND/OR WITHOUT INSTRUCTIONS ON ITS PROPER USE AND APPLICATION.

outside the jurisdiction of the RTCs. NAVIDA. if there is no pre-existing contractual relation between the parties. As specifically enumerated in the amended complaints. The jurisdiction of the court cannot be made to depend upon the defenses set up in the answer or upon the motion to dismiss. Such fault or negligence. in a language understandable to the worker. for otherwise. Thus. or to cause said products to be tested." 63 Verily. Chiquita Brands.Failed to place adequate labels on containers of said products to warn them of the damages of said products. i. et al. The averments therein and the character of the relief sought are the ones to be consulted. et al.Failed to test said products for adverse health effects.7 million for each plaintiff claimant. and ABELLA.e. and ABELLA.Failed to reveal the results of tests conducted on DBCP to each plaintiff. et al. e." 65 and.... Article 2176 of the Civil Code provides: Article 2176. The RTC of General Santos City and the RTC of Davao City obviously have reasonable basis to assume jurisdiction over the cases.Failed to test DBCP prior to releasing these products for sale. took place abroad and had occurred outside and beyond the territorial boundaries of the Philippines. with individual claims of approximately P2.Failed to adequately supervise and instruct Plaintiffs in the safe and proper application of DBCP-containing products. there being fault or negligence.. or omission which causes damage to another. and Chiquita Brands International. 62 (Emphasis supplied and words in brackets ours. c. and f. and ABELLA. and/or otherwise putting into the stream of commerce. is called a quasi-delict and is governed by the provisions of this Chapter. f. in that they failed to exercise reasonable care to prevent each plaintiff's harmful exposure to DBCP-containing products which defendants knew or should have known were hazardous to each plaintiff in that they.Failed to take reasonable precaution or to exercise reasonable care to publish. et al. point to the acts and/or omissions of the defendant companies in manufacturing. or to cause their subsidiaries or affiliate to do so. Inc. and ABELLA. "the manufacture of the pesticides. Dole Fresh Fruit Company. the allegations in the Amended Joint-Complaints of NAVIDA. and ABELLA.A.Failed to place adequate warnings. et al. governmental agencies and the public. et al.Concealed from Plaintiffs information concerning the observed effects of said products on Plaintiffs.) Quite evidently. their packaging in containers. What determines the jurisdiction of the court is the nature of the action pleaded as appearing from the allegations in the complaint.. or to cause such to be implemented. e. therefore. To be precise. allegedly suffered resulted from their exposure to DBCP while they were employed in the banana plantations located in the Philippines or while they were residing within the agricultural areas also located in the Philippines... attribute to defendant companies certain acts and/or omissions which led to their exposure to nematocides containing the chemical DBCP.. irrespective of whether or not the plaintiffs are entitled to recover upon all or some of the claims asserted therein. their distribution through sale or other disposition. adopt and enforce a safety plan and a safe method of handling and applying DBCP. et al. or to cause their subsidiaries or affiliates to do so. these allegations in the complaints constitute the cause of action of plaintiff claimants — a quasi-delict. in Citibank. et al. which undeniably occurred in the Philippines. g.Failed to implement proper methods and techniques of application of said products. which NAVIDA. 8. AMONG OTHERS: a. et al. Clearly then. et al. is obliged to pay for the damage done.Failed to use substitute nematocides for said products or to cause such substitutes to [be] used. or to cause their subsidiaries or affiliates to do so. the acts and/or omissions attributed to the defendant companies constitute a quasi-delict which is the basis for the claim for damages filed by NAVIDA. Inc. N. d. which obviously falls within the purview of the civil action jurisdiction of the RTCs.Failed to monitor the health of plaintiffs exposed to said products. on containers of DBCPcontaining materials to warn of the dangers to health of coming into contact with DBCP. d.Failed to warn Plaintiffs of the hazards of exposure to said products or to cause them to be so warned.. such exposure to the said chemical caused ill effects. hence. resulting in their becoming part of the stream of commerce.c. et al. v. 88 .. Court of Appeals. using. selling. which under the Civil Code is defined as an act. 64 this Court has always reminded that jurisdiction of the court over the subject matter of the action is determined by the allegations of the complaint.The illnesses and injuries of each plaintiff are also due to the FAULT or negligence of defendants Standard Fruit Company.Whoever by act or omission causes damage to another.. b. The factual allegations in the Amended Joint-Complaints all point to their cause of action. injuries and illnesses. According to NAVIDA. and ABELLA. error on the part of the courts a quo when they dismissed the cases on the ground of lack of jurisdiction on the mistaken assumption that the cause of action narrated by NAVIDA. or to cause their subsidiaries or affiliates to do so. It is. "without informing the users of its hazardous effects on health and/or without instructions on its proper use and application. Dole Food Company. the question of jurisdiction would almost entirely depend upon the defendants.. there being fault or negligence. Moreover.. Inc. specifically to their reproductive system. producing.. et al. nematocides which contain DBCP. and h. the injuries and illnesses.

et al..R. apart from the RTC of General Santos City and the RTC of Davao City having jurisdiction over the subject matter in the instant civil cases. the testimonial and documentary evidence from important witnesses.. plaintiff claimants are all residents of the Philippines. This Court deals with facts. at the election of the plaintiff.. the decision on all questions arising therefrom is but an exercise of such jurisdiction. Second. demonstrate that. the RTC of General Santos City and the RTC of Davao City have validly acquired jurisdiction over the persons of the defendant companies. justice and law will be short-lived. the cases below are not criminal cases where territoriality. are further praying that DOW. OCCIDENTAL.continues until the termination of the proceedings. et al. 70 Plaintiffs' purported bad faith in filing the subject civil cases in Philippine courts Anent the insinuation by DOLE that the plaintiff claimants filed their cases in bad faith merely to procure a dismissal of the same and to allow them to return to the forum of their choice. family members and other members of the community. Any error that the court may commit in the exercise of its jurisdiction is merely an error of judgment. the Rules of Court allow the action to be commenced and tried in the appropriate court. 5617 and 24. the active participation of a party in the proceedings is tantamount to an invocation of the court's jurisdiction and a willingness to abide by the resolution of the case. where any of the plaintiffs or defendants resides. and ABELLA. not the orders or the decision rendered therein. In personal civil actions. where he may be found. which does not affect its authority to decide the case. and that the courts a quo have also acquired jurisdiction over the persons of all the defendant companies. All the defendant companies submitted themselves to the jurisdiction of the courts a quo by making several voluntary appearances.. and by actively participating during the course of the proceedings below. et al. When this Court acts on appearances instead of realities. 67 The RTC of General Santos City and the RTC of Davao City validly acquired jurisdiction over the persons of all the defendant companies It is well to stress again that none of the parties claims that the courts a quo lack jurisdiction over the cases filed before them. All parties voluntarily. NAVIDA. and SHELL were executed. In line herewith. the convenient fora for trying these cases.251-96 to the RTC of General Santos City and the RTC of Davao City. and ABELLA. the specific areas where they were allegedly exposed to the chemical DBCP are within the territorial jurisdiction of the courts a quo wherein NAVIDA. Considering the great number of plaintiff claimants involved in this case. On the issue of the dropping of DOW. it therefore. The non-settling defendants allegedly manifested that they intended to file their cross-claims against their co-defendants who entered into compromise agreements." Jurisdiction refers to the authority to decide a case. It must be remembered that this Court does not rule on allegations that are unsupported by evidence on record. et al. or the situs of the act complained of. would be easier to gather in the Philippines. 71 This is especially true with respect to allegations of bad faith. coupled with the fact that the alleged cause of action of NAVIDA. Section 20 of the 1997 Rules of Civil Procedure provides that "[t]he defendant's voluntary appearance in the action shall be equivalent to service of summons. First. which has been acquired and has been vested on the courts a quo. in Meat Packing Corporation of the Philippines v.. this Court finds such argument much too speculative to deserve any merit. would be determinative of jurisdiction and venue for trial of cases. considering the fact that the RTC of General Santos City and the RTC of Davao City have jurisdiction over the subject matter of the amended complaints filed by NAVIDA. indeed. What is more.251-96. where a court has jurisdiction over the persons of the defendants and the subject matter. such as doctors. not appearances." In this connection. by praying for various affirmative reliefs. on realities. argue that the non-settling defendants did not aver any cross-claim in their answers to the complaint and that they subsequently sought to amend their answers to plead their cross-claims only after the settlement between the plaintiff claimants and DOW. and ABELLA. such as claims for payment of damages. behooves this Court to order the remand of Civil Case Nos. 5617 and 24. as well as in Civil Case Nos. as these may not exist at all. et al. 68 held that jurisdiction over the person of the defendant in civil cases is acquired either by his voluntary appearance in court and his submission to its authority or by service of summons. This Court does not rule on allegations which are manifestly conjectural. and will bar said party from later on impugning the court or body's jurisdiction. 69 Thus. these additional factors. et al. 66 HCDAcE In a very real sense. assert that the cross-claims are already barred. or in the case of a non-resident defendant.. Rule 14. Accordingly. 89 . et al. and ABELLA.. and ABELLA. initially filed their claims for damages.. et al. and ABELLA. Third. therefore. Thus. and ABELLA. respectively. against the defendant companies for damages occurred in the Philippines. either in General Santos City or in Davao City. All parties are one in asserting that the RTC of General Santos City and the RTC of Davao City have validly acquired jurisdiction over the persons of the defendant companies in the action below. as in the case of the courts a quo. Furthermore.. not fancies.. in line with the basic rule that good faith is always presumed and bad faith must be proved. and ABELLA.. et al. 72 In sum. it is not far-fetched to assume that voluminous records are involved in the presentation of evidence to support the claim of plaintiff claimants. all the defendant companies designated and authorized representatives to receive summons and to represent them in the proceedings before the courts a quo. Sandiganbayan. Nos. as well as over the subject matter of the instant case. et al. most of the evidence required to prove the claims of NAVIDA. OCCIDENTAL and SHELL as respondents in view of their amicable settlement with NAVIDA. much less divest the court of the jurisdiction over the case. they are.. NAVIDA. this jurisdiction. et al. et al. OCCIDENTAL and SHELL be dropped as respondents in G. are available only in the Philippines. unconditionally and knowingly appeared and submitted themselves to the jurisdiction of the courts a quo. NAVIDA. et al. It may also be pertinently stressed that "jurisdiction" is different from the "exercise of jurisdiction. et al. co-workers. 125078 and 126654.. et al.. et al. this Court.Certainly..

which means not only the delivery of money but also the performance. In accordance with the alleged compromise agreements with the four plaintiffs in Civil Case No. Moreover. Nos. with the interest for the payment already made. Thereafter. stating that similar settlement agreements were allegedly executed by the plaintiff claimants with DEL MONTE and CHIQUITA sometime in 1999. He who made the payment may claim from his co-debtors only the share which corresponds to each. only pertained to DOW. a third party complaint or a separate trial. the responsibility of two or more persons who are liable for the same quasi-delict is solidary. and Hold Harmless Agreement between DEL MONTE and the settling plaintiffs." Like any other contract.In their Memoranda. et al. perfected by mere consent. 5617 jointly filed a complaint without individually specifying their claims against DEL MONTE or any of the other defendant companies. 81 In solidary obligations. 5617 and 24. Attached to the said manifestation were copies of the Compromise Settlement. respectively. if any. such share shall be borne by all his co-debtors. to wit: Art. but DEL MONTE qualified that it entered into a settlement agreement with only four of the plaintiff claimants in Civil Case No. 74 DEL MONTE specified therein that there were "only four (4) plaintiffs in Civil Case No. should likewise be referred to the said trial courts for appropriate disposition. 77 A compromise has upon the parties the effect and authority of res judicata 78 and this holds true even if the agreement has not been judicially approved. the trial courts can then determine who among the defendants may be dropped from the said cases. Under Article 2028 of the Civil Code. avoid a litigation or put an end to one already commenced. Having adjudged that Civil Case Nos. At the point in time where the proceedings below were prematurely halted. thus. the latter being manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. 5617. however. et al. the Court deems that the Consolidated Motions (to Drop Party-Respondents) filed by NAVIDA. is the operative fact which will entitle either of the solidary debtors to seek reimbursement for the share which corresponds to each of the [other] debtors. 79 In addition. no interest for the intervening period may be demanded. "[a] compromise is a contract whereby the parties. it is within the 90 . after the parties have submitted their respective memoranda. If the payment is made before the debt is due. and ABELLA. and the Court subsequently orders the remand of the action to the trial court for continuance. Incidentally. in subsequent developments. in view of the above settlement agreements with ABELLA.Payment made by one of the solidary debtors extinguishes the obligation. A trial on the merits must necessarily be conducted first in order to establish whether or not defendant companies are liable for the claims for damages filed by the plaintiff claimants. When one of the solidary debtors cannot. as well as their corresponding rights and obligations therein.. No. 5617 who are claiming against the Del Monte parties" 75and that the latter have executed amicable settlements which completely satisfied any claims against DEL MONTE. which would necessarily give rise to an obligation to pay on the part of the defendants. et al. This solidary obligation on the part of all the defendants allegedly gives any co-defendant the statutory right to proceed against the other codefendants for the payment of their respective shares. Indemnity. the 336 plaintiff claimants in Civil Case No.. Significantly. Indemnity. However. et al. It is a consensual contract. be granted. because of his insolvency.R. 80 In light of the foregoing legal precepts.251-96. and ABELLA... in any other manner. of the obligation. on April 2. be denied. et al. and the corresponding liability of the co-debtors to reimburse. to drop DOW. 5617 and 24..251-96.. CHIQUITA and DOLE are opposing the above motion of NAVIDA. a compromise agreement determines the rights and obligations of only the parties to it. in Civil Case No. 125078 and 126654. The Court notes that the Consolidated Motions (to Drop Party-Respondents) that was filed by NAVIDA. DEL MONTE filed a Manifestation and Motion 73 before the Court. Furthermore. et al. will only arise. Furthermore. 5617 and 24. 76 Judicial approval is not required for its perfection. IaDcTC There is. These four plaintiff claimants were allegedly the only ones who were asserting claims against DEL MONTE. a primary need to establish who the specific parties to the alleged compromise agreements are. would only unduly delay and complicate the proceedings. CHIQUITA and DOLE would allegedly be deprived of their right to prosecute their cross-claims against their other co-defendants. CHIQUITA and DOLE similarly insist that the motion of NAVIDA. Purportedly included in the agreements were Civil Case Nos. as well as the Release in Full executed by the latter. as a binding contract.. DEL MONTE and CHIQUITA supposedly reached their own amicable settlements with the plaintiff claimants. and each of the creditors is entitled to demand the satisfaction of the whole obligation from any or all of the debtors. the RTC of General Santos City and the RTC of Davao City should first receive in evidence and examine all of the alleged compromise settlements involved in the cases at bar to determine the propriety of dropping any party as a defendant therefrom. OCCIDENTAL and SHELL in view of the latter companies' alleged compromise agreements with the plaintiff claimants. the said allegation of DEL MONTE was simply stipulated in their Compromise Settlement. et al. If and when such a cross-claim is made by a non-settling defendant against a settling defendant.R. et al. no cross-claims have been interposed by any defendant against another defendant. Should the subject motion of NAVIDA. et al. 5617. an extrajudicial compromise agreement is not excepted from rules and principles of a contract.251-96. The above right of reimbursement of a paying debtor. SHELL and OCCIDENTAL as respondents in G. 82 "[p]ayment.. et al. since the latter's Amended Complaints cited several instances of tortious conduct that were allegedly committed jointly and severally by the defendant companies. by making reciprocal concessions. in proportion to the debt of each. as well as in Civil Case Nos. However. and Hold Harmless Agreement and its truth could not be verified with certainty based on the records elevated to this Court. under Article 2194 of the Civil Code. If two or more solidary debtors offer to pay." 83 In the cases at bar. there is no right of reimbursement to speak of as yet. if a solidary debtor who is made to answer for an obligation actually delivers payment to the creditor. the paying debtor's right of reimbursement is provided for under Article 1217 of the Civil Code. 2007. Court of Appeals. according to CHIQUITA. and ABELLA. 1217.251-96.. As succinctly held in Lapanday Agricultural Development Corporation v. and ABELLA. not one plaintiff claimant filed a motion for the removal of either DEL MONTE or CHIQUITA as defendants in Civil Case Nos. and ABELLA. the courts a quo may require the presentation of additional evidence from the parties. 24.251-96 should be remanded to the RTC of General Santos City and the RTC of Davao City.. It is true that. 5617 and 24. DEL MONTE stated that it no longer wished to pursue its petition in G. the creditor may choose which offer to accept. reimburse his share to the debtor paying the obligation. DEL MONTE sought the dismissal of the Amended Joint-Complaint in the said civil case. 127856 and accordingly prayed that it be allowed to withdraw the same. A solidary obligation is one in which each of the debtors is liable for the entire obligation.. on the basis of the records of the cases at bar and the additional evidence submitted by the parties. For this purpose. et al.

concur. v. On March 30.. Kotake as project manager of the BBRI Project. Inc. 11 For their part.respondent. 24. LTD. 149177. No. 2000. C. vs. on June 20. 10 As he was not able to generate a positive response from the petitioners. the Department of Public Works and Highways (DPWH) engaged the consultancy services of Nippon. et al. 127856 and 125598 are considered CLOSED AND TERMINATED. In view of the previous grant of the motion to withdraw the petition in G. 126654. 2000 Civil Case No. Nippon's general manager for its International Division.. No. 84 the Court had the occasion to state that "where there are. 1996 denying reconsideration in Civil Case No. a Japanese national permanently residing in the Philippines. respondent. 8 On February 28. THIRD DIVISION [G. this time for the detailed engineering and construction supervision of the Bongabon-Baler Road Improvement (BBRI) Project. petitioners. JJ. MINORU KITAMURA. and ABELLA. His services would be engaged by the company only up to the substantial completion of the STAR Project on March 31. 2001 Resolution 2 denying the motion for reconsideration thereof. SP No. 12 In the meantime. 5 Nippon then assigned respondent to work as the project manager of the Southern Tagalog Access Road (STAR) Project in the Philippines. 125078. WHEREFORE. (Nippon). Inc. No. with some of the defendant companies. the Court hereby GRANTS the petitions for review on certiorari in G. is not affected by the compromise agreements allegedly entered into by NAVIDA. both G. informed respondent that the company had no more intention of automatically renewing his ICA. respondent consequently initiated on June 1. 125598.. 2007. should not be precluded from invoking in the same proceedings an adequate relief therefor. The Court likewise GRANTS the motion filed by Del Monte to withdraw its petition in G.. in Civil Case No. 2000. J p: Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court assailing the April 18. Peralta * and Perez. DECISION NACHURA.1. on January 28.R. 2001 Decision 1 of the Court of Appeals (CA) in CA-G. 00-0264 for specific performance and damages with the Regional Trial Court of Lipa City. They asserted that the claim for improper pre-termination of respondent's ICA could only be heard and ventilated in the proper courts of Japan following the principles of lex loci celebrationis and lex contractus. if proper. Corona. Ltd. petitioners. in Philippine International Surety Co. 13 91 . 1999. and its subsequent Order dated December 16. along with the parties to the compromise. 3 entered into an Independent Contractor Agreement (ICA) with respondent Minoru Kitamura. KAZUHIRO HASEGAWA and NIPPON ENGINEERING CONSULTANTS CO. 1996 of the Regional Trial Court of General Santos City..R. and REMAND the records of this case to the respective Regional Trial Courts of origin for further and appropriate proceedings in line with the ruling herein that said courts have jurisdiction over the subject matter of the amended complaints in Civil Case Nos. requested a negotiation conference and demanded that he be assigned to the BBRI project. the right of the remaining defendant(s) to seek reimbursement in the above situation. v. following the company's consultancy contract with the Philippine Government. 127856. 9 cDSAEI Threatened with impending unemployment. In Armed Forces of the Philippines Mutual Benefit Association. Branch 16. 5617. 2000.251-96. petitioner Kazuhiro Hasegawa. Hence. Velasco. and the Order dated October 1. SO ORDERED.R. the DPWH approved Nippon's request for the replacement of Kitamura by a certain Y. in a joint and solidary obligation. through his lawyer. 1996 of the Regional Trial Court of Davao City.. and 128398. other persons involved in the litigation who have not taken part in concluding the compromise agreement but are adversely affected or feel prejudiced thereby. moved to dismiss the complaint for lack of jurisdiction.discretion of the trial court to determine the propriety of allowing such a cross-claim and if the settling defendant must remain a party to the case purely in relation to the cross claim.. a Japanese consultancy firm providing technical and management support in the infrastructure projects of foreign governments. 1999.] 18. 5617 and 24.. November 23.R.R. petitioner Nippon Engineering Consultants Co. 2000. Gonzales. et al. the paying debtor may file a third-party complaint and/or a cross-claim to enforce his right to seek contribution from his co-debtors. and refused to negotiate for the renewal of the ICA. 4 The agreement provides that respondent was to extend professional services to Nippon for a year starting on April 1. Court of Appeals.J. 86 the Court upheld the ruling of the trial court that. and the July 25. Nos. 6 When the STAR Project was near completion. Branch 37. 60827. We REVERSE and SET ASIDEthe Order dated May 20. Nos. just in time for the ICA's expiry." 85 Relevantly. Jr. contending that the ICA had been perfected in Japan and executed by and between Japanese nationals. No pronouncement as to costs.R. 7Respondent was named as the project manager in the contract's Appendix 3. Nippon insisted that respondent's contract was for a fixed term that had already expired..251-96.

the CA resolved to dismiss the petition on procedural grounds — for lack of statement of material dates and for insufficient verification and certification against forum shopping. However. 18 On August 23. 92 . on September 19.R. Frank 14 that matters connected with the performance of contracts are regulated by the law prevailing at the place of performance. among others. 36 In a plethora of cases. 2000. The aforesaid September 4. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN OVERLOOKING THE NEED TO REVIEW OUR ADHERENCE TO THE PRINCIPLE OF LEX LOCI SOLUTIONIS IN THE LIGHT OF RECENT DEVELOPMENT[S] IN PRIVATE INTERNATIONAL LAWS. 26 The pivotal question that this Court is called upon to resolve is whether the subject matter jurisdiction of Philippine courts in civil cases for specific performance and damages involving contracts executed outside the country by foreign nationals may be assailed on the principles of lex loci celebrationis. SP No. the "state of the most significant relationship rule. SP No. this Court has liberally applied the Rules or even suspended its application whenever a satisfactory explanation and a subsequent fulfillment of the requirements have been made. or file a second petition attaching thereto the appropriate verification and certification — as they. the status of the aforesaid first petition before the CA. because nowhere in the pleadings was the validity of the written agreement put in issue. 60205 on account of the petition's defective certification of non-forum shopping. is not a fatal defect. is limited in scope — its wordings indicate that Hasegawa is given the authority to sign for and act on behalf of the company only in the petition filed with the appellate court. still within the reglementary period. In other words. on the same subject matter and theory. lex contractus.On June 29. within the prescribed period 30 in Section 4. a second Petition for Certiorariunder Rule 65 already stating therein the material dates and attaching thereto the proper verification and certification." or forum non conveniens. 60205 has already barred the filing of the second petition docketed as CA-G. 2001 Decision 22 finding no grave abuse of discretion in the trial court's denial of the motion to dismiss. in fact did — and stating therein the material dates. DESPITE THE FACT THAT THE CONTRACT SUBJECT MATTER OF THE PROCEEDINGS A QUO WAS ENTERED INTO BY AND BETWEEN TWO JAPANESE NATIONALS. 34 The Court also finds no merit in respondent's contention that petitioner Hasegawa is only authorized to verify and certify. and that authority cannot extend to the instant petition for review. before ruling on this issue. 2001 Resolution. the Court cannot extend the same liberal treatment to the defect in the verification and certification. petitioners can re-file the petition. In any case. 16 The trial court subsequently denied petitioners' motion for reconsideration. 2001 Authorization were issued only by Nippon's president and chief executive officer. it was a dismissal without prejudice. the Court finds the same as sufficient compliance with the Rules. cDEICH We do not agree. because the said dismissal is without prejudice and has no res judicata effect. SP No. the appellate court rendered the assailed April 18. 32 Necessarily. Kitamura contends that the finality of the appellate court's decision in CA-G. as in the present case. 2000. The CA thus declared that the trial court was correct in applying instead the principle of lex loci solutionis. the RTC. Rule 65 of the said Rules. on August 14. the Authorization 35 dated September 4. thecertiorari petition filed with the CA and not the instant petition. The CA ruled. 21 DTESIA Ruling on the merits of the second petition. which is attached to the secondcertiorari petition and which is also attached to the instant petition for review. 17 prompting them to file with the appellate court.R. 15 denied the motion to dismiss. 60205]. however. their first Petition for Certiorari under Rule 65 [docketed as CA-G. JAPAN. an omission in the certificate of non-forum shopping about any event that will not constitute res judicata and litis pendentia. 60827. 2000. 60827 (fundamentally raising the same issues as those in the first one) and the instant petition for review thereof. 37 Given that petitioners herein sufficiently explained their misgivings on this point and appended to their Reply 38 an updated Authorization 39 for Hasegawa to act on behalf of the company in the instant petition. 2000. 29 The dismissal being without prejudice. WRITTEN WHOLLY IN THE JAPANESE LANGUAGE AND EXECUTED IN TOKYO. B. 20 Aggrieved by this development. True. 19 An Entry of Judgment was later issued by the appellate court on September 20. and even if petitioners still indicated in the verification and certification of the second certiorari petition that the first had already been dismissed on procedural grounds.R. However.R. 2000. we must first dispose of the procedural matters raised by the respondent. When the CA dismissed CA-G. As respondent pointed out. which substantially raised the same issues as those in the first. the termination of a case not on the merits does not bar another action involving the same parties. Hasegawa is truly not authorized to act on behalf of Nippon in this case. that the principle of lex loci celebrationis was not applicable to the case. 33 petitioners are no longer required by the Rules to indicate in their certification of non-forum shopping in the instant petition for review of the second certiorari petition. SP No. petitioners filed with the CA. 31 The dismissal of a case without prejudice signifies the absence of a decision on the merits and leaves the parties free to litigate the matter in a subsequent action as though the dismissed action had not been commenced. considering that the evils sought to be prevented by the said certificate are no longer present. 23 Petitioners' motion for reconsideration was subsequently denied by the CA in the assailed July 25. SP No. 24 Remaining steadfast in their stance despite the series of denials. on behalf of Nippon. This second petition. was docketed as CA-G. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT THE TRIAL COURT VALIDLY EXERCISED JURISDICTION OVER THE INSTANT CONTROVERSY.R. 2000 Authorization and even the subsequent August 17. and to which we agree. petitioners instituted the instant Petition for Review on Certiorari 25 imputing the following errors to the appellate court: A. 27 The same holds true in the CA's dismissal of the said case due to defects in the formal requirement of verification 28 and in the other requirement in Rule 46 of the Rules of Court on the statement of the material dates. invoking our ruling in Insular Government v. 2000. It will not warrant the dismissal and nullification of the entire proceedings.

as explained in Philippine Ports Authority v. can bind the corporation. Jurisdiction. no person. in the absence of authority from the board. nonetheless. to proceed to trial. 61 In the instant case. 68 This rule takes into account several contacts and evaluates them according to their relative importance with respect to the particular issue to be resolved. 62 What they rather raise as grounds to question subject matter jurisdiction are the principles of lex loci celebrationis and lex contractus. It is given only by law and in the manner prescribed by law. and introduced their new argument that the applicable principle is the [state of the] most significant relationship rule. 50On petition for review before this Court. the "minimum contacts" for one do not always provide the necessary "significant contacts" for the other." 65 It controls the nature. Thus. 49 While not abandoning this stance in their petition before the appellate court. choice of law. 00-0264 for specific performance and damages is one not capable of pecuniary estimation and is properly cognizable by the RTC of Lipa City. however. petitioners. Asserting that the RTC of Lipa City is an inconvenient forum. jurisdiction and choice of law are two distinct concepts. petitioners on certiorari significantly invoked the defense of forum non conveniens. 54 Jurisdiction considers whether it is fair to cause a defendant to travel to this state. For a court to validly exercise its power to adjudicate a controversy. the choice of law. we have ruled that corporate powers are exercised by the board of directors. To elucidate. in case of an adverse decision. it must have jurisdiction over the plaintiff or the petitioner. was negotiated. do not claim that the trial court is not properly vested by law with jurisdiction to hear the subject controversy for. the Court has observed that petitioners incorrectly filed a Rule 65 petition to question the trial court's denial of their motion to dismiss. 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. only the first phase is at issue — jurisdiction. over the issues of the case and. was to be performed. 57 In assailing the trial court's jurisdiction herein. 47 The Court notes that petitioners adopted an additional but different theory when they elevated the case to the appellate court. indeed. to elevate the entire case by appeal in due course. While jurisdiction and the choice of thelex fori will often coincide. has various aspects. Civil Case No. DCASIT Lex loci celebrationis relates to the "law of the place of the ceremony" 63 or the law of the place where a contract is made. the court should determine which state has the most substantial connection to the occurrence and the parties. in the judicial resolution of conflicts problems. 64 The doctrine of lex contractus or lex loci contractus means the "law of the place where a contract is executed or to be performed. 60 the movant must show that the court or tribunal cannot act on the matter submitted to it because no law grants it the power to adjudicate the claims. In a case involving a contract. place of business." to ascertain what state law to apply to a dispute. 55 The question of whether the law of a state can be applied to a transaction is different from the question of whether the courts of that state have jurisdiction to enter a judgment. maintained the forum non conveniens defense. 51 Be that as it may. 40 Considering that Hasegawa verified and certified the petition only on his behalf and not on behalf of the other petitioner. they are intended to effect the proper and orderly disposition of cases and effectively prevent the clogging of court dockets. the petition has to be denied pursuant to Loquias v. and cannot be the subject of the extraordinary petition for certiorari ormandamus. this Court is not inclined to deny this petition merely on the basis of the change in theory. It is a well-established rule that an order denying a motion to dismiss is interlocutory. and recognition and enforcement of judgments. in cases involving property. 70 They determine which state's law is to be applied in resolving the substantive issues of a conflicts 93 . petitioners posit that local courts have no substantial relationship to the parties 46 following the [state of the] most significant relationship rule in Private International Law. and the domicile. The power to exercise jurisdiction does not automatically give a state constitutional authority to apply forum law. petitioners are actually referring to subject matter jurisdiction. Corresponding to these phases are the following questions: (1) Where can or should litigation be initiated? (2) Which law will the court apply? and (3) Where can the resulting judgment be enforced? 53 HDTISa Analytically. and written wholly in the Japanese language. by Japanese nationals. Japan. three consecutive phases are involved: jurisdiction. not even its officers. In not a few cases. 43 CSTDIE Further. 67 Under the "state of the most significant relationship rule. following the principles of lex loci celebrationis and lex contractus. 44 While there are recognized exceptions to this rule. or place of incorporation of the parties. over the subject matter. petitioners question its jurisdiction to hear and resolve the civil case for specific performance and damages filed by the respondent. the court should consider where the contract was made. over the defendant or the respondent. petitioners never contended that the RTC is an inconvenient forum. 41 Substantial compliance will not suffice in a matter that demands strict observance of the Rules. and validity of the contract 66 and it may pertain to the law voluntarily agreed upon by the parties or the law intended by them either expressly or implicitly. In the Motion to Dismiss48 filed with the trial court. in their motion to dismiss. The ICA subject of the litigation was entered into and perfected in Tokyo. 42 While technical rules of procedure are designed not to frustrate the ends of justice. and the "state of the most significant relationship rule. 52 We only pointed out petitioners' inconstancy in their arguments to emphasize their incorrect assertion of conflict of laws principles. 59 To succeed in its motion for the dismissal of an action for lack of jurisdiction over the subject matter of the claim. This brings us to the discussion of the substantive issue of the case.not by the company's board of directors. thus. 58 It is further determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of the claims asserted therein. City of Iloilo. construction. They merely argued that the applicable law which will determine the validity or invalidity of respondent's claim is that of Japan." The Court finds the invocation of these grounds unsound. The appropriate recourse is to file an answer and to interpose as defenses the objections raised in the motion. Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign authority which establishes and organizes the court. over the res or the thing which is the subject of the litigation. and. Office of the Ombudsman. 69 Since these three principles in conflict of laws make reference to the law applicable to a dispute. 45 petitioners' case does not fall among them. petitioners dropped their other arguments. they are rules proper for the second phase. 56 In this case.

Rule 132 on proof of foreign laws. There can be no summary judgment where material allegations of the pleadings are in dispute and can be resolved only by trial on the merits. 24. FIRST. the Walden affidavit and attached US court decisions therein are not proper substantiation thereof for failure to comply with Sec.R.C. WHEREFORE. 75 EASIHa Neither can the other ground raised. On the alleged foreign law applicable. In support thereof. and (3) unauthorized conversion of his account. forum non conveniens. when the law of a foreign country is invoked to provide the proper rules for the solution of a case. While it may choose to recognize laws of foreign nations. (2) a returned check worth US$18. 74 The court's power to hear cases and controversies is derived from the Constitution and the laws. Rule 16 of the Rules of Court does not include it as a ground. The Antecedents On May 17. it is not a proper basis for a motion to dismiss because Section 1. even in matters regarding rights provided by foreign sovereigns. ATICcS Petitioner's motion for summary judgment is not proper as it does not demonstrate that respondent's claims are sham. records. Guerrero amended his complaint on April 18.00 due to signature verification problems. Nolasco & Associates for respondent. since the RTC is vested by law with the power to entertain and hear the civil case filed by respondent and the grounds raised by petitioners to assail that jurisdiction are inappropriate. returning a check due to signature verification problems. THIRD. vs.problem. Sycip Salazar Hernandez and Gatmaitan for petitioners. petitioner filed a motion for partial summary judgment. 1998 in CA-G. 1995. and/or CHEMICAL BANK. and unauthorized conversion of his account. petitioners. and decisions. premises considered. 79 Accordingly. 76 be used to deprive the trial court of its jurisdiction herein. No. and/or Chemical Bank ("the Bank" for brevity) with the Regional Trial Court of Manila ("RTC" for brevity). Before determining which law should apply. SP No. SO ORDERED. Thus. 71 Necessarily. 42310 2 affirming the trial court's denial of petitioners' motion for partial summary judgment. petitioner presented the authenticated affidavit of New York Attorney Alyssa Walden. 1994. whether a suit should be entertained or dismissed on the basis of the said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court. there are three alternatives open to the latter in disposing of it: (1) dismiss the case. In answer thereto. respondent Rafael Ma. (2) assume jurisdiction over the case and apply the internal law of the forum. petitioners' premature invocation of choice-of-law rules is exposed by the fact that they have not yet pointed out any conflict between the laws of Japan and ours. the propriety of dismissing a case based on this principle requires a factual determination. Guerrero ("Guerrero" for brevity) filed a complaint for damages against petitioner Manufacturers Hanover Trust Co. February 19. respondent. the RTC decided to assume jurisdiction. either because of lack of jurisdiction or refusal to assume jurisdiction over the case.] 19. 72 Also.000. or (3) assume jurisdiction over the case and take into account or apply the law of some other State or States. first there should exist a conflict of laws situation requiring the application of the conflict of laws rules. J p: The Case This is a petition for review under Rule 45 of the Rules of Court to set aside the Court of Appeals 1 Decision of August 24. as the only issue in this case is that of jurisdiction. 78 In this case. hence. P. the petition for review on certiorari is DENIED. this conflicts principle is more properly considered a matter of defense. Further. one involving a foreign element. GUERRERO. RAFAEL MA. 2003. the trial and appellate courts correctly denied the petitioners' motion to dismiss. 1998 and Resolution of December 14. choice-of-law rules are not only inapplicable but also not yet called for. FIRST DIVISION [G. petitioner alleged that the issue should be limited to actual damages as respondent's account is governed by the New York law. SYNOPSIS Respondent filed a complaint for damages against petitioner bank for illegally withholding taxes charged against interest on his checking account. MANUFACTURERS HANOVER TRUST CO. 77 SECOND. or contrived. fictitious.R. DECISION CARPIO. 73 It should be noted that when a conflicts case. Guerrero sought payment of damages allegedly for (1) illegally withheld taxes charged against interests on his checking account with the Bank. the court is not limited by foreign sovereign law short of treaties or other formal agreements. 94 . is brought before a court or administrative agency. the existence of such law must be pleaded and proved. 136804.

Rule 132 of the Rules on Evidence. that by stipulation Guerrero's account is governed by New York law and this law does not permit any of Guerrero's claims except actual damages. The Ruling of the Court of Appeals The Court of Appeals sustained the RTC orders denying the motion for partial summary judgment." The Bank points out that the Walden affidavit is not hearsay since Rule 35 expressly permits the use of affidavits. 19. consul general. with a CERTIFICATE that such officer has the custody.Proof of official record. and authenticated by the seal of his office. . the Bank must still comply with the procedure prescribed by the Rules to prove the foreign law. 1995. Subsequently. the Court of Appeals dismissed the petition. or records of the official acts of the sovereign authority. In its Decision dated August 24. . WHICH PROVES FOREIGN LAW AS A FACT. HOLDING THAT [THE BANK'S] AFFIDAVIT. On December 14. vice consul. IS "HEARSAY" AND THEREBY 'CANNOT SERVE AS PROOF OF THE NEW YORK LAW RELIED UPON BY PETITIONERS IN THEIR MOTION FOR SUMMARY JUDGMENT . . respectively. The Court of Appeals clarified that the Walden affidavit is not the supporting affidavit referred to in Section 2. Rule 34 that would prove the lack of genuine issue between the parties. may be evidenced by an official publication thereof or by a copy ATTESTED by the officer having the legal custody of the record. 1996 and July 17. inter alia. The Bank filed a petition for certiorari and prohibition with the Court of Appeals assailing the RTC Orders. . The Court of Appeals concluded that even if the Walden affidavit is used for purposes of summary judgment. Public documents are: (a)The written official acts." The Court of Appeals opined that the following procedure outlined in Section 24. Hence. Alyssa Walden's affidavit ("Walden affidavit" for brevity) stated that Guerrero's New York bank account stipulated that the governing law is New York law and that this law bars all of Guerrero's claims except actual damages. the instant petition. 1998.'" 3 First. official bodies and tribunals. The Philippine Consular Office in New York authenticated the Walden affidavit. the Bank filed its Answer alleging. the certificate may be made by a secretary of the embassy or legation. nominal and exemplary damages and attorney's fees. a NEW YORK ATTORNEY. temperate. — For the purpose of their presentation in evidence. The Court of Appeals considered the New York law and jurisprudence AS PUBLIC DOCUMENTS defined in Section 19 .On September 1. or by his deputy. the Court of Appeals denied the Bank's motion for reconsideration. the Bank claims that the Court of Appeals mixed up the requirements of Rule 35 on summary judgments and those of a trial on the merits in considering the Walden affidavit as "hearsay. when admissible for any purpose.Classes of Documents. STHAaD The RTC denied the Bank's Motion for Partial Summary Judgment and its motion for reconsideration on March 6. moral. Second. the Bank filed a Motion for Partial Summary Judgment seeking the dismissal of Guerrero's claims for consequential. if the record is not kept in the Philippines. xxx xxx xxx. If the office in which the record is kept is in a foreign country. the Bank argues that in moving for partial summary judgment. moral and exemplary damages as well as attorney's fees on the same ground alleged in its Answer. . supported the Bank's Motion for Partial Summary Judgment. The Court of Appeals ruled that the Walden AFFIDAVIT does not serve as PROOF of the New York LAW and jurisprudence relied on by the Bank to support its motion. 1996. Rule 132 should be followed in proving foreign law: "SEC. temperate. whether of the Philippines. 24. documents are either public or private. nominal. it was entitled to use the Walden affidavit to prove that the stipulated foreign law bars the claims for consequential. The Bank contended that the trial should be limited to the issue of actual damages. HOLDING THAT [THE BANK'S] PROOF OF FACTS TO SUPPORT ITS MOTION FOR SUMMARY JUDGMENT MAY NOT BE GIVEN BY AFFIDAVIT. as follows: "SEC. Rule 34 of the old Rules of Court allows the Bank to move with the supporting Walden affidavit for partial summary judgment in its favor. outright dismissal by summary judgment of these claims is warranted. The Issues The Bank contends that the Court of Appeals committed reversible error in — ". The affidavit of Alyssa Walden. or of a foreign country." The Court of Appeals likewise rejected the Bank's argument that Section 2. and accompanied. 95 . . . Consequently. 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. consul. Guerrero opposed the motion. and public officers. — The record of public documents referred to in paragraph (a) of Section 19. . 1998.

in the light of all the circumstances. Accordingly. as correctly ruled by the Court of Appeals. — A party against whom a claim. depositions. or a specific part thereof. et al.000." Thus. in line with this view. Fisher. and unauthorized conversion of his account. Rule 34 of the old Rules of Court which reads: "Section 2. a publication of Bancroft-Whitney Co. if the record is not kept in the Philippines. And as part of his testimony. the court can determine whether there are genuine issues in a case based merely on the affidavits or counter-affidavits submitted by the parties to the court. However." In its Answer. the moving party is entitled to a judgment as a matter of law. The certificate may be issued by any of the authorized Philippine embassy or consular officials stationed in the foreign country in which the record is kept. the Supreme Court held in the case of Willamette Iron and Steel Works v. On the contrary. the Bank argues that since Guerrero did not submit any opposing affidavit to refute the facts contained in the Walden affidavit. 6 A perusal of the parties' respective pleadings would show that there are genuine issues of fact that necessitate formal trial. upheld the Tax Court in considering the pertinent law of California as proved by the respondents' witness." A court may grant a summary judgment to settle expeditiously a case if. the record of public documents of a sovereign authority or tribunal may be proved by (1) an official publication thereof or (2) a copy attested by the officer having the legal custody thereof. The attestation must state. that the copy is a correct copy of the original. The Bank filed its motion for partial summary judgment pursuant to Section 2. Apparently. California. with a certificate that the attesting officer has the legal custody thereof. on motion of either party. Inc. Under Section 24 of Rule 132. sham or fictitious. as the case may be.. In that case. Rule 123 (Section 25. the conflicting allegations as to whether New York law or Philippine law applies to Guerrero's claims present a clear dispute on material allegations which can be resolved only by a trial on the merits. Such official publication or copy must be accompanied. the Supreme Court considered the testimony under oath of an attorney-at-law of San Francisco. Sec.Summary judgment for defending party. may be allowed and used as basis for favorable action. that Section 41. facts are asserted in Guerrero's complaint while specific denials and affirmative defenses are set out in the Bank's answer. however. admissions. 13851 (a) & (b) of the California Internal and Revenue Code as published in Derring's California Code. 8 Foreign laws are not a matter of judicial notice. He is seeking damages for what he asserts as "illegally withheld taxes charged against interests on his checking account with the Bank. in several naturalization cases. there appears from the pleadings. the counsel for respondent "testified that as an active member of the California Bar since 1951. in substance. and authenticated by the seal of his office. a returned check worth US$18. aHSTID True. fictitious or contrived. Muzzal. There can be no summary judgment where questions of fact are in issue or where material allegations of the pleadings are in dispute. the Supreme Court in the Collector of Internal Revenue v. mere authentication of the Chinese Naturalization Law by the Chinese Consulate General of Manila was held to be competent proof of that law. they must be alleged and proven. move with supporting affidavits for a summary judgment in his favor as to all or any part thereof. 4 In a motion for summary judgment. the Walden affidavit shows that the facts and material allegations as pleaded by the parties are disputed and there are substantial triable issues necessitating a formal trial. 9 Like any other fact. The Court's Ruling The petition is devoid of merit. Rule 132 of the Revised Rules of Court) does not exclude the presentation of other competent evidence to prove the existence of a foreign law.00 due to signature verification problems. the witness cited Article 4. at any time. and must be under the official seal of the attesting officer." Likewise. 7 The resolution of whether a foreign law allows only the recovery of actual damages is a question of fact as far as the trial court is concerned since foreign laws do not prove themselves in our courts. In such event. the Bank set up its defense that the agreed foreign law to govern their contractual relation bars the recovery of damages other than actual. the Court is "satisfied of the authenticity of the written proof offered. the Bank's motion for partial summary judgment as supported by the Walden affidavit does not demonstrate that Guerrero's claims are sham. a full quotation of the cited section was offered in evidence by respondents. When asked by the lower court to state the pertinent California law as regards exemption of intangible personal properties.Lastly. in a number of decisions. In that case. or cross-claim is asserted or a declaratory relief is sought may. as sufficient evidence to establish the existence of said law. Court of Appeals 10 which held that: "xxx xxx xxx: Although it is desirable that foreign law be proved in accordance with the above rule. except the amount of damages. it was held by the Court that evidence of the law of a foreign country on reciprocity regarding the acquisition of citizenship. the crucial question is: are the issues raised in the pleadings genuine." (Italics supplied) 96 . Guerrero's complaint before the RTC contains a statement of the ultimate facts on which he relies for his claim for damages. counterclaim. if.. who quoted verbatim a section of California Civil Code and who stated that the same was in force at the time the obligations were contracted. depositions or admissions accompanying the motion? 5 A genuine issue means an issue of fact which calls for the presentation of evidence as distinguished from an issue which is fictitious or contrived so as not to constitute a genuine issue for trial. and affidavits that no important issues of fact are involved. although not meeting the prescribed rule of practice. he failed to show the need for a trial on his claims for damages other than actual. Certain exceptions to this rule were recognized in Asiavest Limited v. Certainly. he is familiar with the revenue and taxation laws of the State of California. as shown by affidavits.

Walker v.Y.2d 833.Y.N. 577 N. 6.There is no concept of temperate damages in New York law. Country of Erie.D.D. requests for lost profits. 463 N. § 3.2d 396 (1st Dep't 1992). Supp. I have never heard the phrase used in American law. which does not use the phrase "temperate damages" in its index. Inc.. 73 A. The Walden affidavit cannot be considered as proof of New York law on damages not only because it is self-serving but also because it does not state the specific New York law on damages.000 check. Ring Assocs. Since Guerrero is claiming for actual damages. v." 12 97 . 213 (S. Donald Park Acres. 838. den. 1991). 319. a party can only get consequential damages if they were the type that would naturally arise from the breach and if they were "brought within the contemplation of parties as the probable result of the breach at the time of or prior to contracting. 50 A.S. 150 A. to the Complaint. These cases involved attorneys testifying in open court during the trial in the Philippines and quoting the particular foreign laws sought to be established.2d 1.S.2d 975. which may allow consequential damages in a breach of contract case (as does the UCC where there is a wrongful dishonor).2d 837. v..Y. it governs Guerrero's claim arising out of the non-payment of the $18.S. 770 F.2d 31. 8.2d 312. 215 (S. On the other hand. 7. Muzzal or Collector of Internal Revenue v.Y.In New York. cannot rely on Willamete Iron and Steel Works v. 540 N. Dobbs.2d 601.Furthermore. § 3-510. 215 (S.A. damage to reputation and mental distress are considered consequential damages.S.D.2d 241. 540 N. Soho Landmark Assocs. Such damages are awarded both in tort and contract cases when the plaintiff establishes a cause of action against the defendant. 74 A. Manufacturers Hanover Trust Co. damages will be based on the value of the stock at the time of the breach.Consequential damages are not available in the ordinary case of a justifiable refusal to pay.4(1) at 63 (emotional distress). . National Westminster Bank. 374 N. 1991)." Kenford Co.. F.S.S. trivial sums such as six cents or $1. but is unable to prove" actual damages.In cases where the issue is the breach of a contract to purchase stock. a well-respected treatise.. 54 A.2d 1023 (1983).Y.2d at 869-70. 5. UCC 1-106 provides that "neither consequential or special or punitive damages may be had except as specifically provided in the Act or by other rule of law.2d 312.E. 4. 32 (2nd Dep't 1976). Aroneck v.D. TADaCH 10.S. Motif Construction Corp. 3 (1989). v. Inc.Exemplary or punitive damages may be recovered only where it is alleged and proven that the wrong supposedly committed by defendant amounts to a fraud aimed at the public generally and involves a high moral culpability. .2d 497. "[n]ominal damages are damages in name only.Y. and have found no cases that use it. .2d 387. Moray Homes.Y.D. Thaler v.S. 36 (1918). the Walden affidavit was taken abroad ex parte and the affiant never testified in open court. 390 (3d Dep't 1989)Martin v.Under New York law. 582 N. 179 N. However.D. Stanisic v. 1991). 210..Y. 389 N.2d 718. .2d 280. Guerrero claims that this was a wrongful dishonor. 540 N. Damage to reputation is also not recoverable for a contract. 4-5 (1989) (lost profits). 281 (1st Dep't 1991). or punitive damages are not allowed for a breach of contract.Y.2d 558.Y.S.. only a private wrong and not a public right is involved. 59 N. the UCC states that "justifiable refusal to pay or accept" as opposed to dishonor.Y.N.Y. v. Catalogue Service of . Rather. Country of Erie. 90 A.. he cannot ask for nominal damages. 223 N. Atkin. 869-70 (4th Dep't 1975) damage to reputation). Official Comment 2. Supp.Under New York law. . We reproduce portions of the Walden affidavit as follows: "3.Y.D. Inc.N. 770 F. Ltd. Sheldon.Y. 210. and could not verify Guerrero's signature.g. 12.D. 242 (2d Dep't 1985). Dobbs. Geler v. 488 N.2d 1.D. Inc. Law of Remedies.2d 860. Insurance Co. 374 N. 637 (2d Dep't 1980). even where the plaintiff claims the defendant acted with malice. National Westminster Bank U.D. of North America.Y. . Senior v. Geler v. National Westminster Bank.The Bank. 406 N.Y. as a matter of law.Y. I have also done a computerized search for the phrase in all published New York cases. There is no statute that permits attorney's fees in a case of this type. chester 11 v. 223 N.S. 456 N. 9. 73 N.The Uniform Commercial Code ("UCC") governs many aspects of a Bank's relationship with its depositors.S. 179 A.E. 73 N. 10 N. The North Insurance Company. v. Pitcherello v. app.2d 921. This is more restrictive than the New York common law.M.D.Y. 449 N. 14. 425 N. occurs when a bank refuses to pay a check for reasons such as a missing indorsement. a claim for emotional distress cannot be recovered for a breach of contract. 559 (4th Dep't 1982). (quoting Chapman v. 32. 13.2d 635. In this case.2d 488 (1961). a plaintiff is not entitled to attorneys' fees unless they are provided by contract or statute. consistent with the UCC.. 319. MHT returned the check because it had no signature card on . Buffalo Savings Bank.As a matter of New York law.. E.S.2d 966. a missing or illegible signature or a forgery.S.2d 268.Y.D. Camatron Sewing Mach. Law of Remedies §12. Buffalo Savings Bank. In my opinion. Supp. Fisher to support its cause.2d 165.2d 66 (1st Dep't 1978). New York courts will not take into consideration the performance of the stock after the breach.Geler v." UCC 4-103 further provides that consequential damages can be recovered only where there is bad faith. however.2d 868.Motif Construction Corp.2d 1276. 210.S..32 at 294 (1993). Fargo.Y. that is a legitimate and justifiable reason not to pay. 63 A.2d 401.Y. 770 F. it has been consistently held under New York law that exemplary damages are not available for a mere breach of contract for in such a case. Kenford Co..S. I have reviewed Dobbs. 11.Under New York law. .Exemplary. 110 A.Y.

There is a need to determine by presentation of evidence in a regular trial if the Bank is guilty of any wrongdoing and if it is liable for damages under the applicable laws. Guerrero did not admit. DE CATALAN On 18 November 2004. The case was docketed as Special Proceedings (Spec. While the Bank attached copies of some of the U. 183622. February 8. show that. The Decision dated August 24. 2012. CATALAN-LEE. 42310 is AFFIRMED. DTEScI This case has been delayed long enough by the Bank's resort to a motion for partial summary judgment. respondent. there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. vs. the courts a quo correctly denied the Bank's motion for partial summary judgment. on 25 February 2005. The Bank's intention in presenting the Walden affidavit is to prove New York law and jurisprudence. the Bank has the burden of clearly demonstrating the absence of any genuine issue of fact and that any doubt as to the existence of such issue is resolved against the movant. The facts are as follows: Orlando B. Felicitas Amor. As the party moving for summary judgment. court decisions cited in the Walden affidavit. After allegedly obtaining a divorce in the United States from his first wife. is only permissive and not mandatory. MEROPE ENRIQUEZ VDA. Catalan. expressly or impliedly. DE CATALAN. he contracted a second marriage with MEROPE ENRIQUEZ VDA. Proc. However. the Bank makes much of Guerrero's failure to submit an opposing affidavit to the Walden affidavit. what New York law and jurisprudence are on the matters at issue. RESOLUTION SERENO. to aid parties in avoiding the expense and loss of time involved in a trial. Next.S. the pertinent provision of Section 3. SP No. it would have been redundant and pointless for Guerrero to submit an opposing affidavit considering that what the Bank seeks to be opposed is the very subject matter of the complaint. SECOND DIVISION [G.S. the judgment sought shall be rendered forthwith if the pleadings. thus: "SEC. Catalan was a naturalized American citizen. 3. the veracity of the statements in the Walden affidavit." (Italics supplied) It is axiomatic that the term "may" as used in remedial law. depositions and admissions on file. the Bank has successfully defeated the very purpose for which summary judgments were devised in our rules. Guerrero need not file an opposing affidavit to the Walden affidavit because his complaint itself controverts the matters set forth in the Bank's motion and the Walden affidavit. these copies do not comply with Section 24 of Rule 132 on proof of official records or decisions of foreign courts. the Bank has only alleged. Guerrero may not have presented an opposing affidavit. but has not proved. Orlando died intestate in the Philippines.Motion and proceedings thereon. 1998 and the Resolution dated December 14. together with the affidavits.R.S. 13 Guerrero cannot be said to have admitted the averments in the Bank's motion for partial summary judgment and the Walden affidavit just because he failed to file an opposing affidavit.) No. — The motion shall be served at least ten (10) days before the time specified for the hearing. LOUELLA A.The Walden affidavit states conclusions from the affiant's personal interpretation and opinion of the facts of the case vis a vis the alleged laws and jurisprudence without citing any law in particular. After the hearing. The adverse party prior to the day of hearing may serve opposing affidavits. because the Walden affidavit did not establish what the Bank intended to prove. Rule 35 of the old Rules of Court did not make the submission of an opposing affidavit mandatory. petitioner. although he did not present an opposing affidavit. 1998 of the Court of Appeals in CA-G. the petition is DENIED for lack of merit.] 20. No. Certainly. because of the failure to comply with Section 24 of Rule 132 on how to prove a foreign law and decisions of foreign courts. However. A party should not be made to deny matters already averred in his complaint. The Bank still had the burden of proving New York law and jurisprudence even if Guerrero did not present an opposing affidavit. J p: Before us is a Petition for Review assailing the Court of Appeals (CA) Decision 1 and Resolution 2 regarding the issuance of letters of administration of the intestate estate of Orlando B. court decisions do not constitute proof of the official records or decisions of the U. Guerrero opposed the motion for partial summary judgment. There being substantial triable issues between the parties. 14 Moreover. except as to the amount of damages. WHEREFORE. Pangasinan a Petition for the issuance of letters of administration for her appointment as administratrix of the intestate estate of Orlando. the Walden affidavit did not prove the current state of New York law and jurisprudence. SO ORDERED. 228. 98 . courts. Ironically. petitioner filed with the Regional Trial Court (RTC) of Burgos. which is. as there was no need for one. Thereafter.R. Thus. The citations in the Walden affidavit of various U.

Catalan-Lee. 3 The trial court ruled that since the deceased was a divorced American citizen. the RTC should have first required the parties to present their evidence before it ruled on the matter. filed a similar petition with the RTC docketed as Spec. considering that Spec. Pangasinan. 228 covering the same estate was already pending. Bigamy is an illegal marriage committed by contracting a second or subsequent marriage before the first marriage has been dissolved or before the absent spouse has been declared presumptively dead by a judgment rendered in a proper proceedings. and docketed as Crim. Contrary to its findings in Crim. a marriage certificate. like any other public document. and since that divorce was not recognized under Philippine jurisdiction. the RTC held that the marriage between Merope and Eusebio Bristol was valid and subsisting when she married Orlando. the relief being founded on the same acts. 228 was pending. Pangasinan dismissed the Petition for the issuance of letters of administration filed by Merope and granted that of Louella. Merope had never been married to Eusebio Bristol. regardless of which party is successful. could be appointed as administrator for as long as he files his petition ahead of any other person. On 6 August 1998. As a spouse. since the Petition for Certiorari was filed within the fifteen-day reglementary period for filing a petition for review under Sec. No. Section 6 of the Revised Rules of Court. Case No. No. Proc. she insisted that.alleging grave abuse of discretion on the part of the RTC in dismissing her Petition for the issuance of letters of administration. Louella alleged that petitioner was not considered an interested person qualified to file a petition for the issuance of letters of administration of the estate of Orlando. to yield to the contention of the petitioner would render nugatory the provision of the Rules requiring a petitioner for letters of administration to be an "interested party. in derogation of the rights of those specifically mentioned in the order of preference in the appointment of administrator under Rule 78. In the case at bar. No. 232 on the ground of litis pendentia. Case No. which provides: xxx xxx xxx The petitioner. filed her petition for letters of administration. A petition for letters of administration is a special proceeding. to determine who has a better right to administer the decedent's properties. the trial court held that Merope was not an interested party who may file a petition for the issuance of letters of administration. the CA promulgated the assailed Decision. Felicitas Amor filed a Complaint for bigamy. (b) identity of rights asserted and relief prayed for. She should have instead filed a petition for review rather than a petition for certiorari. there must be: (a) identity of the parties or at least such as to represent the same interest in both actions. the RTC had ACQUITTED petitioner of bigamy. is only prima facieevidence of the facts stated therein. 232. On 26 June 2006. the CA allowed the Petition and continued to decide on the merits of the case. it held that petitioner undertook the wrong remedy. the trial court found that. in contrast to an ordinary civil action. And. First. Apparently. Nevertheless. it ruled in this wise: As to the issue of litis pendentia. Without expounding. Thus. amount to res judicata in the other. Proc. it took note of the action for declaration of nullity then pending action with the trial court in Dagupan City filed by Felicitas Amor against the deceased and petitioner. Branch 70 of the RTC of Burgos. petitioner elevated the matter to the Court of Appeals (CA) via her Petition for Certiorari. respondent alleged that a criminal case for bigamy was filed against Merope before Branch 54 of the RTC of Alaminos. Considering its nature. Proc. armed with a marriage certificate. It considered the pending action to be a prejudicial question in determining the guilt of Merope for the crime of bigamy. The two cases were subsequently consolidated. in the first place. or a particular fact." the defect was cured by the appearance of a real party-in-interest. while a petition for letters of administration may have been filed by an "uninterested person. No. Proc. 4 After the subsequent denial of her Motion for Reconsideration. The contention of the petitioner must perforce fail. the petitioner would have been preferred to administer the estate of Orlando B.On 3 March 2005. it reasoned further that her acquittal in the previous bigamy case was fatal to her cause. HCEcaT Petitioner reiterated before the CA that the Petition filed by respondent should have been dismissed on the ground of litis pendentia. Moreover. Catalan. the MARRIAGE between him and petitioner was NOT valid. and (c) the identity in the two cases should be such that the judgment which may be rendered in one would. the petitioner was not a party to the petition filed by the private respondent. in the same manner that the latter was not made a party to the petition filed by the former. In support of her contention. The first element of litis pendentiais wanting." inasmuch as any person. we find it not applicable in the case. A special proceeding is an application or proceeding to establish the status or right of a party. while Spec. alleging that Merope contracted a second marriage to Orlando despite having been married to one Eusebio Bristol on 12 December 1959. HcaDIA On the other hand. Finally. Petitioner prayed for the dismissal of Spec. one of the children of Orlando from his first marriage. respondent Louella A. The fact that the petitioner had been charged with bigamy and was acquitted has not been disputed by the petitioner. a subsequent petition for letters of administration can hardly be barred by a similar pending petition involving the estate of the same decedent unless both petitions are filed by the same person. a special proceeding involves no defendant or respondent. Thus. Thus. for that matter. 2699-A. On 18 October 2007. The deduction of the trial court that the acquittal of the petitioner in the said case negates the validity of her 99 . However. regardless of whether he has valid interest in the estate sought to be administered. The only party in this kind of proceeding is the petitioner of the applicant. For litis pendentia to be a ground for the dismissal of an action. She also insisted that. 4 of Rule 43. 2699-A. Furthermore.

the document must first be presented and admitted in evidence. 2699-A was dismissed. a writing or document may be proven as a public or official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by the officer having legal custody of the document. 9 to wit: Respondent is getting ahead of himself. Case No. that once proven that respondent was no longer a Filipino citizen when he obtained the divorce from petitioner. we had already ruled that under the principles of comity. 8 to wit: In Van Dorn v. provided they are valid according to their national law. However. the Federal Republic of Germany. Second. 6 She alleged that the reasoning of the CA was illogical in stating. Romillo. aliens may obtain divorces abroad. the Court held in Quita v. In the same case. Nonetheless. it follows that the first marriage with Bristol still existed and was valid. . while. premises considered. In this case. this Petition. Under Sections 24 and 25 of Rule 132. At the outset. appearance is not sufficient. The decree purports to be a written act or record of an act of an official body or tribunal of a foreign country. we held that owing to the nationality principle embodied in Article 15 of the Civil Code. We hold that the divorce obtained by Lorenzo H. If the record is not kept in the Philippines. 5 (Emphasis supplied) Petitioner moved for a reconsideration of this Decision. the marriage enjoys the presumption of validity. Jr. Court of Appeals. the trial court concluded that. For failing to apply these doctrines. The divorce decree between respondent and Editha Samson appears to be an authentic one issued by an Australian family court. TCaADS 100 . such copy must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office. We reiterated this principle in Llorente v. .subsequent marriage with Orlando B. which may be recognized in the Philippines. There. our jurisdiction recognizes a valid divorce obtained by a spouse of foreign nationality. No pronouncement as to costs. There is therefore no basis for us to make a contrary finding. Recio. the petition is DISMISSED for lack of merit. the CA denied her motion. 7 wherein we said: It is true that owing to the nationality principle embodied in Article 15 of the Civil Code. She insists that with her acquittal of the crime of bigamy. Ibay-Somera. the dismissal of her petition for letters of administration by the trial court is in place. . Court of Appeals. Catalan has not been disproved by her. compliance with the aforementioned rules on evidence must be demonstrated.] the same being considered contrary to our concept of public policy and morality. Romillo. we recognized the divorce obtained by the respondent in his country. the divorce in Nevada released private respondent from the marriage from the standards of American law. Hence. Llorente from his first wife Paula was valid and recognized in this jurisdiction as a matter of comity. However. . because petitioner was acquitted of bigamy. the ruling in Van Dorn would become applicable and petitioner could "very well lose her right to inherit" from him. . In Pilapil v. still holding that her marriage with Orlando was invalid. on the one hand. only Philippine nationals are covered by the policy against absolute divorces[. it seems that the RTC in the special proceedings failed to appreciate the finding of the RTC in Crim. xxx xxx xxx WHEREFORE. the Court ruled that aliens may obtain divorces abroad. the decision of the Court of Appeals must be reversed. Thus. CaTcSA Citing this landmark case. Catalan. on the other hand. . not being an interested party and a stranger to the estate of Orlando B. 2699-A that petitioner was never married to Eusebio Bristol. we stated that divorce and its legal effects may be recognized in the Philippines insofar as respondent is concerned in view of the nationality principle in our civil law on the status of persons. both the RTC and CA held that petitioner was not an interested party in the estate of Orlando. There was not even an attempt from the petitioner to deny the findings of the trial court. This doctrine was established as early as 1985 in Van Dorn v. the fact of divorce must still first be proven as we have enunciated in Garcia v. only Philippine nationals are covered by the policy against absolute divorces. Before a foreign judgment is given presumptive evidentiary value. AacDHE SO ORDERED. on the other hand. Thus. By failing to take note of the findings of fact on the nonexistence of the marriage between petitioner and Bristol. Indeed the best evidence of a judgment is the judgment itself. Case No. under which divorce dissolves the marriage. the same being considered contrary to our concept of public policy and morality. A divorce obtained abroad is proven by the divorce decree itself. that she was acquitted of bigamy. provided they are valid according to their national law. it is imperative to note that at the time the bigamy case in Crim. Jr. On 20 June 2008.

Australia. Like any other facts. premises considered. San Luis. freed from the protective cloak of their former states. they must be alleged and proved. and defendants have the burden of proving the material allegations in their answer when they introduce new matters. it was admitted in evidence and accorded weight by the judge. would have vested Felicidad with the legal personality to file the present petition as Felicisimo's surviving spouse. there is a need to remand the proceedings to the trial court for further reception of evidence to establish the fact of divorce. thus. By becoming an Australian. Hence. (Emphasis supplied) aTIEcA It appears that the trial court no longer required petitioner to prove the validity of Orlando's divorce under the laws of the United States and the marriage between Merope and Orlando. the burden of proving the pertinent Australian law validating it falls squarely upon him. plaintiffs have the burden of proving the material allegations of the complaint when those are denied by the answer. such copy must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kep t and (b) authenticated by the seal of his office. Otherwise. It held that presentation solely of the divorce decree is insufficient and that proof of its authenticity and due execution must be presented. judges may take judicial notice of foreign laws in the exercise of sound discretion.S. the Australian divorce law is allegedly known by Philippine courts. Pangasinan for further proceedings in accordance with this Decision. Burden of Proving Australian Law Respondent contends that the burden to prove Australian divorce law falls upon petitioner. Let this case be REMANDED to Branch 70 of the Regional Trial Court of Burgos. not to its admissibility. don the attires of their adoptive countries. it is imperative for the trial court to first determine the validity of the divorce to ascertain the rightful party to be issued the letters of administration over the estate of Orlando B. We are not persuaded. 10 in which we said: Applying the above doctrine in the instant case. 13 and 52) of the Family Code is not necessary. Naturalized citizens.Fortunately for respondent's cause. when the divorce decree of May 18. Therefore.S. in accordance with Sec. He contends that petitioner was satisfied with the original of the divorce decree and was cognizant of the marital laws of Australia. Compliance with the quoted articles (11. the Court cannot take judicial notice of foreign laws as they must be alleged and proved. who is undisputedly the daughter or next of kin of the deceased. As stated in Garcia. 101 . the Court laid down the specific guidelines for pleading and proving foreign law and divorce judgments. The power of judicial notice must be exercised with caution. 6 of Rule 78 of the Revised Rules of Court. Australian marital laws are not among those matters that judges are supposed to know by reason of their judicial function. a writing or document may be proven as a public or official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by the officer having LEGAL CUSTODY of the document. With regard to respondent's marriage to Felicisimo allegedly solemnized in California. she has the preferential right to be issued the letters of administration over the estate. The Decision dated 18 October 2007 and the Resolution dated 20 June 2008 of the Court of Appeals are hereby REVERSED and SET ASIDE. subject to petitioner's qualification. If the record is not kept in the Philippines. Besides. Naturalization is the legal act of adopting an alien and clothing him with the political and civil rights belonging to a citizen. respondent was no longer bound by Philippine personal laws after he acquired Australian citizenship in 1992. she submitted photocopies of the Marriage Certificate and the annotated text of the Family Law Act of California which purportedly show that their marriage was done in accordance with the said law. the Petition is hereby PARTIALLY GRANTED. but only to the fact that it had not been registered in the Local Civil Registry of Cabanatuan City.A. this case should be remanded to the trial court for further reception of evidence on the divorce decree obtained by Merry Lee and the marriage of respondent and Felicisimo. WHEREFORE. respondent severed his allegiance to the Philippines and the vinculum juris that had tied him to Philippine personal laws. Should petitioner prove the validity of the divorce and the subsequent marriage. Since the divorce was a defense raised by respondent. U. Under Sections 24 and 25 of Rule 132. however. (Emphasis supplied) Thus. and every reasonable doubt upon the subject should be resolved in the negative. Thus. petitioner's failure to object properly rendered the divorce decree admissible as a written act of the Family Court of Sydney. the records show that there is insufficient evidence to prove the validity of the divorce obtained by Merry Lee as well as the marriage of respondent and Felicisimo under the laws of the U. letters of administration may be issued to respondent. In Garcia v.A. DcSEHT SO ORDERED." In civil cases.. the divorce decree allegedly obtained by Merry Lee which absolutely allowed Felicisimo to remarry. because she is the party challenging the validity of a foreign judgment. This is consistent with our ruling in San Luis v. 1989 was submitted in evidence. The trial court ruled that it was admissible. Catalan. Recio. Indeed. The burden of proof lies with the "party who alleges the existence of a fact or thing necessary in the prosecution or defense of an action. because she had lived and worked in that country for quite a long time. It is well-settled in our jurisdiction that our courts cannot take judicial notice of foreign laws. However. counsel for petitioner objected.

However. before Rev. 1994. On December 17. He further claimed that Felicidad has no legal personality to file the petition because she was only a mistress of Felicisimo since the latter. Tobias. filed a motion to dismiss 9 on the grounds of improper venue and failure to state a cause of action. Rodolfo claimed that the petition for letters of administration should have been filed in the Province of Laguna because this was Felicisimo's place of residence prior to his death. Article 26 of the Family Code cannot be given retroactive effect to validate respondent's bigamous marriage with Felicisimo because this would impair vested rights in derogation of Article 256 16 of the Family Code. 1968. United States of America (U. petitioner. California. who was the former governor of the Province of Laguna. that the decedent's surviving heirs are respondent as legal spouse. CV No. EDGAR SAN LUIS. 1992. Jr. which reversed and set aside the September 12. valued at P30. 1973. San Luis (Felicisimo). Respondent alleged that she is the widow of Felicisimo. 133743.S. Respondent prayed that the conjugal partnership assets be liquidated and that letters of administration be issued to her. J p: Before us are consolidated petitions for review assailing the February 4. No. at the time of his death. 2007. The instant case involves the settlement of the estate of Felicisimo T. 1995 2 and January 31. then surnamed Sagalongos. petitioner Rodolfo San Luis. Merry Lee.] 21. one of the children of Felicisimo by his first marriage. She submitted documentary evidence showing that while Felicisimo exercised the powers of his public office in Laguna. Further. the trial court issued an Order 11 denying the two motions to dismiss. another daughter of Felicisimo from his first marriage. FELICIDAD SAN LUIS. Linda. Minister of the United Presbyterian at Wilshire Boulevard. 1994. DECISION YNARES-SANTIAGO. at the time of his death. his six children by his first marriage. Emilita and Manuel. Tensuan pending the resolution of said motion. Fr. His first marriage was with Virginia Sulit on March 17. Proc. 1994 her opposition 12 thereto. Edgar. New Alabang Village. Unaware of the denial of the motions to dismiss. 1963. Los Angeles. On April 21. February 6. State of Hawaii to prove that the marriage of Felicisimo to Merry Lee had already been dissolved. 1994. 1998 Decision 1 of the Court of Appeals in CA-G. Rodolfo and herein petitioner Edgar San Luis. William Meyer. Thereafter.). Linda. he regularly went home to their house in New Alabang Village. the motion for disqualification was deemed moot and academic 18 because then Acting Presiding Judge Santos was substituted by Judge Salvador S. 1971. petitioner. Felicidad sought the dissolution of their conjugal partnership assets and the settlement of Felicisimo's estate . On August 11. 13 Article 26 of the Family Code and the doctrine laid down in Van Dorn v. that. U. Felicisimo contracted three marriages. she claimed that Felicisimo had the legal capacity to marry her by virtue of paragraph 2. 102 . 15 They asserted that paragraph 2. she presented the decree of absolute divorce issued by the Family Court of the First Circuit. namely: Rodolfo. vs. 1994. FELICIDAD SAGALONGOS alias FELICIDAD SAN LUIS.A. and son by his second marriage.304. Santos from hearing the case. filed a Complaint for Divorce 5 before the Family Court of the First Circuit. It ruled that Felicidad. 6 On June 20. On October 24. vs.00 more or less. Alabang. Mila. Proc. that the decedent does not have any unpaid debts. Felicidad filed on March 5. Metro Manila. 7 He had no children with respondent but lived with her for 18 years from the time of their marriage up to his death on December 18. was still legally married to Merry Lee.S. on May 1. respondent. Virginia predeceased Felicisimo. filed a motion to disqualify Acting Presiding Judge Anthony E. On February 15. 1942 out of which were born six children. Felicisimo married Merry Lee Corwin. 52647. State of Hawaii. 14 Thereafter. which issued a Decree Granting ABSOLUTE Divorce and Awarding Child Custody on December 14. Meanwhile. 134029. No. On February 28. the trial court issued an Order 17 denying the motions for reconsideration. as widow of the decedent. 2007] RODOLFO SAN LUIS.178. docketed as SP. 1994. M-3708. M-3708 which was raffled to Branch 146 thereof. 1993.R.R. possessed the legal standing to file the petition and that venue was properly laid.A. During his lifetime.THIRD DIVISION [G. Metro Manila which they bought sometime in 1982. Branch 134 in SP. Five years later. and its May 15. she filed a petition for letters of administration 8 before the Regional Trial Court of Makati City. that the decedent left real properties. on October 15. 1998 Resolution 4 denying petitioners' motion for reconsideration.R. with whom he had a son. Alabang. Linda invoked the same grounds and joined her brother Rodolfo in seeking the dismissal 10 of the petition. the decedent was residing at 100 San Juanico Street. Felicisimo married respondent Felicidad San Luis. an American citizen. 1974. [G. Mila. No. separately filed motions for reconsideration from the Order denying their motions to dismiss. No. 1996 3 Resolutions of the Regional Trial Court of Makati City. Romillo. TAaIDH On February 4. February 6. respondent. both conjugal and exclusive. Thus.

the petition for letters of administration was properly filed in Makati City. It found that the decree of absolute divorce dissolving Felicisimo's marriage to Merry Lee was not valid in the Philippines and did not bind Felicisimo who was a Filipino citizen. the Orders dated February 28 and October 24. 31 It found that the marriage between Felicisimo and Merry Lee was validly dissolved by virtue of the decree of absolute divorce issued by the Family Court of the First Circuit. — there is no justiciable reason to sustain the individual view — sweeping statement — of Judge Arc[h]angel. Under Section 1. 227. 1996 are hereby REVERSED and SET ASIDE. 33 Edgar. par. thus. . 1992. 1994 are REINSTATED. DScTaC The petition lacks merit. Guray 37 andRomualdez v.Mila filed a motion for inhibition 19 against Judge Tensuan on November 16. Petitioners also contend that respondent's marriage to Felicisimo was void and bigamous because it was performed during the subsistence of the latter's marriage to Merry Lee. and the records of the case is REMANDED to the trial court for further proceedings. 22 the trial court required the parties to submit their respective position papers on the twin issues of venue and legal capacity of respondent to file the petition. 7. the petition for letters of administration should have been filed in Sta." In the case of Garcia Fule v. The issues for resolution: (1) whether venue was properly laid. . Article 26 of the Family Code and the rulings in Van Dorn v. 1995. Br. For this reason. 1995 and January 31. Jr. On November 25. the petition should have been filed in Sta. Rule 73 of the Rules of Court. 1994. They argue that paragraph 2. 2 of the Family Code. for purposes of fixing the venue of the settlement of his estate. The foreign divorce having been obtained by the Foreigner on December 14. On July 2. 38 "residence" is synonymous with "domicile" which denotes a fixed permanent residence to which when absent. 1998. and Rodolfo filed separate motions for reconsideration 34 which were denied by the Court of Appeals. Linda. the dispositive portion of which states: WHEREFORE. Tacloban City. the trial court dismissed the petition for letters of administration. refers to the personal. Muntinlupa. Since Felicisimo never changed his domicile. On September 12. or actual residence or place of abode of a person as distinguished from legal residence or domicile. Felicisimo was a resident of Sta. Edgar manifested 23 that he is adopting the arguments and evidence set forth in his previous motion for reconsideration as his position paper. at the time of his death. Felicisimo was capacitated to contract a subsequent marriage with respondent. 1998. On May 5. 24 and June 20. under Article 130 of the Family Code. It noted that although Felicisimo discharged his functions as governor in Laguna. the petitioner as the surviving spouse can institute the judicial proceeding for the settlement of the estate of the deceased. They contend that pursuant to our rulings in Nuval v. that "Article 26. 1995. Laguna.O. of the Family Code of the Philippines. Edgar also filed a motion for reconsideration 20 from the Order denying their motion for reconsideration arguing that it does not state the facts and law on which it was based. Pilapil. As a result. 32 the Filipino divorcee. On even date. the Orders dated September 12. 36 In the instant consolidated petitions. Romillo. On April 24. Ibay-Somera. 29 The appellate court ruled that under Section 1. All that the courts should do is to give force and effect to the express mandate of the law. Cruz. . Article 26 of the Family Code cannot be retroactively applied because it would impair the vested rights of Felicisimo's legitimate children. courts cannot deny what the law grants. RTC. one intends to return. Thus. Felicisimo was the duly elected governor and a resident of the Province of Laguna. the term "place of residence" of the decedent. the doctrines in Van Dorn. he actually resided in Alabang. 35 Rodolfo later filed a manifestation and motion to adopt the said petition which was granted. Respondent and Rodolfo filed their position papers on June 14. actual or physical habitation. 1994. No. 30 and Pilapil v. Arcangel. State of Hawaii. They claim that a person can only have one domicile at any given time. Hence. and the reason and philosophy behind the enactment of E. under paragraph 2. void ab initio. Cruz. It also ruled that respondent was without legal capacity to file the petition for letters of administration because her marriage with Felicisimo was bigamous. contravenes the basic policy of our state against divorce in any form whatsoever." Indeed. Article 26. have capacity to remarry under Philippine laws". 25 1995. The case was re-raffled to Branch 134 presided by Judge Paul T. 39 Rule 73 of the Rules of Court. CDTHSI Respondent moved for reconsideration 26 and for the disqualification 27 of Judge Arcangel but said motions were denied. "shall . 28 Respondent appealed to the Court of Appeals which reversed and set aside the orders of the trial court in its assailed Decision dated February 4. . Laguna and not in Makati City. Judge Tensuan issued an Order 21 granting the motion for inhibition. Cruz. Therefore. Laguna. . Article 26. 1995. 40 we laid 103 . The Court of Appeals also held that Felicisimo had legal capacity to marry respondent by virtue of paragraph 2. respectively. Edgar appealed to this Court via the instant petition for review on certiorari. It also ruled that paragraph 2. It held that. Court of Appeals. and (2) whether respondent has legal capacity to file the subject petition for letters of administration. the marriage between the deceased and petitioner should not be denominated as "a bigamous marriage. Thus — With the well-known rule — express mandate of paragraph 2. the petition for letters of administration of the estate of Felicisimo should be filed in the Regional Trial Court of the province "in which he resides at the time of his death. Edgar and Rodolfo insist that the venue of the subject petition for letters of administration was improperly laid because at the time of his death.

Anent the issue of respondent Felicidad's legal personality to file the petition for letters of administration. Ed. In the instant case. Claiming that the divorce was not valid under Philippine law. The Court. Rule 73 of the Revised Rules of Court is of such nature — residence rather than domicile is the significant factor. Jr. and the deceased's calling cards 49 stating that his home/city address is at "100 San Juanico. which may not necessarily be his legal residence or domicile provided he resides therein with continuity and consistency." Respondent also presented proof of membership of the deceased in the Ayala Alabang Village Association 46 and Ayala Country Club. private respondent is no longer the husband of petitioner. it is possible that a person may have his residence in one place and domicile in another. recognized the validity of the divorce and held that the alien spouse had no interest in the properties acquired by the Filipino wife after the divorce. 52 involved a marriage between a foreigner and his Filipino wife. Atherton. 1974. Muntinlupa from 1982 up to the time of his death. She also presented billing statements 45 from the Philippine Heart Center and Chinese General Hospital for the period August to December 1992 indicating the address of Felicisimo at "100 San Juanico. she should not be required to perform her marital duties and obligations." like the terms "residing" and "residence. pursuant to his national law. Laguna. we must first resolve the issue of whether a Filipino who is divorced by his alien spouse abroad may validly remarry under the Civil Code. 47 letter-envelopes 48 from 1988 to 1990 sent by the deceased's children to him at his Alabang address. not legal residence or domicile. 799: "The purpose and effect of a decree of divorce from the bond of matrimony by a competent jurisdiction are to change the existing status or domestic relation of husband and wife." From the foregoing.down the doctrinal rule for determining the residence — as contradistinguished from domicile — of the decedent for purposes of fixing the venue of the settlement of his estate: [T]he term "resides" connotes ex vi termini "actual residence" as distinguished from "legal residence or domicile. actual or physical habitation of a person. Muntinlupa" while his office/provincial address is in "Provincial Capitol. one has the intention of returning. Cruz. Residence simply requires bodily presence as an inhabitant in a given place. the subject petition for letters of administration was validly filed in the Regional Trial Court 50 which has territorial jurisdiction over Alabang. Muntinlupa. that is. which validly exercised jurisdiction over him. (2) considering that there is sufficient jurisprudential basis allowing us to rule in the affirmative. In the application of venue statutes and rules — Section 1. 53 As to the effect of the divorce on the Filipino wife. that is. that the guilty party shall not marry again. Inc. "residence" and "domicile" are treated as synonymous terms. under which divorce dissolves the marriage." The rulings in Nuval and Romualdez are inapplicable to the instant case because they involve election cases. The marriage tie. Romillo. the Court ruled that she should no longer be considered married to the alien spouse. 41 (Emphasis supplied) STIcEA It is incorrect for petitioners to argue that "residence." In other words. 1983 showing that the deceased purchased the aforesaid property. In this popular sense. while petitioners established that Felicisimo was domiciled in Sta. "resides" should be viewed or understood in its popular sense. the term means merely residence. Ayala Alabang Village. As he is bound by the Decision of his own country's Court. A husband without a wife. Even where the statute uses the word "domicile" still it is construed as meaning residence and not domicile in the technical sense. however. or before the Family Code took effect on August 3. At that time." This term "resides. we need not retroactively apply the provisions of the Family Code. Needless to say. the divorce in Nevada released private respondent from the marriage from the standards of American law. Some cases make a distinction between the terms "residence" and "domicile" but as generally used in statutes fixing venue. The case of Van Dorn v. considering that Felicidad's marriage to Felicisimo was solemnized on June 20. actual residence or place of abode. 45 L. which marriage was subsequently dissolved through a divorce obtained abroad by the latter. personal residence. is synonymous with "domicile. and to free them both from the bond. we find that Felicisimo was a resident of Alabang. 26. while domicile requires bodily presence in that place and also an intention to make it one's domicile. the subject petition was validly filed before the Regional Trial Court of Makati City. Sta. that party." is elastic and should be interpreted in the light of the object or purpose of the statute or rule in which it is employed. 51 Thus. Further. In resolving this issue. In election cases. When the law provides. the residence must be more than temporary." for purposes of fixing the venue of the settlement of the estate of Felicisimo. particularly Art. 42However. It signifies physical presence in a place and actual stay thereat. He would have no standing to sue in the case below as petitioner's husband entitled to exercise control over conjugal assets. 1988.. Respondent submitted in evidence the Deed of Absolute Sale 44 dated January 5. As stated by the Federal Supreme Court of the United States in Atherton vs. Muntinlupa. when thus severed as to one party. for purposes of fixing venue under the Rules of Court. in the nature of a penalty. and convey the same meaning as the term "inhabitant. the terms are synonymous. 43Hence. 1993. par. meaning. the alien spouse alleged that his interest in the properties from their conjugal partnership should be protected. the "residence" of a person is his personal. Laguna. he is estopped by his own representation before said Court from asserting his right over the alleged conjugal property. respondent proved that he also maintained a residence in Alabang. Cruz. however. actual or physical habitation. ceases to bind either. as well as the other. or actual residence or place of abode. and whose decision he does not repudiate. Ayala Alabang. Thus: In this case. No particular length of time of residence is required though. Muntinlupa for purposes of fixing the venue of the settlement of his estate. It held: 104 . the fixed permanent residence to which when absent. Consequently. 3. there is a distinction between "residence" for purposes of election laws and "residence" for purposes of fixing the venue of actions. is still absolutely freed from the bond of the former marriage. The subject petition was filed on December 17. or a wife without a husband. Muntinlupa was still a municipality and the branches of the Regional Trial Court of the National Capital Judicial Region which had territorial jurisdiction over Muntinlupa were then seated in Makati City as per Supreme Court Administrative Order No. the personal. 794. is unknown to the law." Thus.

Article 26 thereof. The Van Dorn case involved a marriage between a Filipino citizen and a foreigner. hence the actuations of one would not affect or cast obloquy on the other. amending Articles 26. Executive Order No. and valid there as such." 59 In Garcia v. Tolentino cited Van Dorn stating that "if the foreigner obtains a valid foreign divorce. 209. Such is the state of affairs where the alien spouse obtains a valid divorce abroad against the Filipino spouse. 54 (Emphasis added) AcaEDC This principle was thereafter applied in Pilapil v." 56 Likewise. except those prohibited under Articles 35(1). 57 the Court stated that where a Filipino is divorced by his naturalized foreign spouse. 61 In the recent case of Republic v. except those prohibited under Articles 35. to wit: Brief Historical Background On July 6. being a mutual and shared commitment between two parties. Arturo M. according to Judge Alicia Sempio-Diy. a member of the Civil Code Revision Committee. of the Civil Code cannot be just. (4). Article 26 thereof states: All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized. HAaECD Indeed. Interestingly. With the enactment of the Family Code and paragraph 2. is no longer married to the Filipino spouse. the Van Dorn case is sufficient basis in resolving a situation where a divorce is validly obtained abroad by the alien spouse. when the object of a marriage is defeated by rendering its continuance intolerable to one of the parties and productive of no possible good to the community. On July 17.To maintain. 1987. petitioner has to be considered still married to private respondent and still subject to a wife's obligations under Article 109. and valid there as such. The Court held therein that a divorce decree validly obtained by the alien spouse is valid in the Philippines. A second paragraph was added to Article 26. Court of Appeals. 1988. Jr. as in this case." which took effect on August 3. The Court stated that "the severance of the marital bond had the effect of dissociating the former spouses from each other. seq. the divorce in the said case was obtained in 1954 when the Civil Code provisions were still in effect. and render support to private respondent. shall also be valid in this country. 26. She should not be discriminated against in her own country if the ends of justice are to be served. In the said case. 37. it was held that the alien spouse is not a proper party in filing the adultery suit against his Filipino wife. 1998. then President Corazon Aquino signed into law Executive Order No. 105 . under our laws. Petitioner should not be obliged to live together with. Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn v. 227 was likewise signed into law. shall also be valid in this country. 62 the historical background and legislative intent behind paragraph 2. the Filipino spouse shall have capacity to remarry under Philippine law. 63 (Emphasis added) As such. otherwise known as the "Family Code. 1987. In his treatise. As so amended. 64 Marriage. Dr. 36. The significance of the Van Dorn case to the development of limited recognition of divorce in the Philippines cannot be denied. the Filipino spouse is capacitated to remarry under Philippine law. Romillo. 37 and 38. it now provides: ART. The latter should not continue to be one of her heirs with possible rights to conjugal property. cannot possibly be productive of any good to the society where one is considered released from the marital bond while the other remains bound to it. (5) and (6). Ibay-Somera 55 where the Court recognized the validity of a divorce obtained abroad. is to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. 36. observe respect and fidelity. after obtaining a divorce. et. in Quita v. that. and consequently. relief in some way should be obtainable. 60 the Court likewise cited the aforementioned case in relation to Article 26. Recio. our lawmakers codified the law already established through judicial precedent.All marriages solemnized outside the Philippines in accordance with the laws in force in the country where they were solemnized. Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry. the Filipino spouse shall have capacity to remarry under Philippine law. Article 26 of the Family Code were discussed. (Emphasis supplied) xxx xxx xxx Legislative Intent Records of the proceedings of the Family Code deliberations showed that the intent of Paragraph 2 of Article 26. the ruling in Van Dornapplies. and 38. The ruling has long been interpreted as severing marital ties between parties in a mixed marriage and capacitating the Filipino spouse to remarry as a necessary consequence of upholding the validity of a divorce obtained abroad by the alien spouse. 58 Although decided on December 22. as private respondent does. shortly after the signing of the original Family Code. Orbecido III. and 39 of the Family Code.

" so we are warned. the Filipino spouse should not be discriminated against in his own country if the ends of justice are to be served. If she proves the validity of the divorce and Felicisimo's capacity to remarry. Thus when the facts warrants. is to render justice.. unless the contrary is proven. or their marriage is void from the beginning. . and not merely indirect or contingent. Under Sections 24 and 25 of Rule 132. In a co-ownership. Section 2. An "interested person" has been defined as one who would be BENEFITED by the estate. we interpret the law in a way that will render justice. and likewise. because only of our nature and functions. 75 In the instant case. in slavish obedience to their language. we interpret and apply the law not independently of but in consonance with justice. the law should never be interpreted in such a way as to cause injustice as this is never within the legislative intent. as far as known to the petitioner: . that the law be dispensed with justice.S. 71 With regard to respondent's marriage to Felicisimo allegedly solemnized in California. efforts and industry. We do not and must not unfeelingly apply the law as it is worded. It held that presentation solely of the divorce decree is insufficient and that proof of its authenticity and due execution must be presented. while generally valid. However. however. 69 Applying the above doctrine in the instant case. . In such a situation. or one who has a claim against the estate.. nevertheless. 77 106 . for we presume the good motives of the legislature. we find that the latter has the legal personality to file the subject petition for letters of administration. U. Justice is always an essential ingredient of its decisions. As stated in Garcia. in light of this Court's rulings in the cases discussed above. that justice may be done even as the law is obeyed. 73 Therefore. Even assuming that Felicisimo was not capacitated to marry respondent in 1974. she submitted photocopies of the Marriage Certificate and the ANNOTATED text 72 of the Family Law Act of California which purportedly show that their marriage was done in accordance with the said law. and we must keep them so. TIEHDC Section 6. 70 the Court laid down the specific guidelines for pleading and proving foreign law and divorce judgments. there are some laws that. Recio. in fact. — A petition for letters of administration must be filed by an interested person and must show.Contents of petition for letters of administration. As judges. What we do instead is find a balance between the word and the will. yielding like robots to the literal command without regard to its cause and consequence. In Garcia v. such copy must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office . as she may be considered the co-owner of Felicisimo as regards the properties that were acquired through their joint efforts during their cohabitation. Thus. . 2. such as a creditor. by its purposes. Any property acquired during the union is prima facie presumed to have been obtained through their joint efforts. a writing or document may be proven as a public or official record of a foreign country by either (1) an official publication or (2) a copy thereof attested by the officer having legal custody of the document. such as an heir. we are not automatons. Law and justice are inseparable. to begin with. An indispensable part of that intent. 67 In Alonzo v. in seeking the meaning of the law. the first concern of the judge should be to discover in its provisions the intent of the lawmaker. may seem arbitrary when applied in a particular case because of its peculiar circumstances. 74 Rule 78 of the Rules of Court states that letters of administration may be granted to the surviving spouse of the decedent.Petitioners cite Articles 15 65 and 17 66 of the Civil Code in stating that the divorce is void under Philippine law insofar as Filipinos are concerned. If the record is not kept in the Philippines. we are not bound. "Courts are apt to err by sticking too closely to the words of a law. Justinian defined justice "as the constant and perpetual wish to render every one his due. the divorce decree allegedly obtained by Merry Lee which absolutely allowed Felicisimo to remarry.A. To be sure. However. 68 the Court stated: But as has also been aptly observed." That wish continues to motivate this Court when it assesses the facts and the law in every case brought to it for decision. Rule 79 thereof also provides in part: SEC.S." xxx xxx xxx More than twenty centuries ago. Hence. the portions belonging to the co-owners shall be presumed equal. However. then she may be considered as a co-owner under Article 144 76 of the Civil Code. It provides that the property acquired by either or both of them through their work or industry or their wages and salaries shall be governed by the rules on co-ownership.A. presuming that it was the intention of the lawmaker. Intermediate Appellate Court. Unquestionably. the Court cannot take judicial notice of foreign laws as they must be alleged and proved. by Justice Holmes again. this case should be remanded to the trial court for further reception of evidence on the divorce decree obtained by Merry Lee and the marriage of respondent and Felicisimo. but fails to prove that her marriage with him was validly performed under the laws of the U.S. the existence of which was not denied by petitioners. respondent would qualify as an interested person who has a direct interest in the estate of Felicisimo by virtue of their cohabitation. we test a law by its results. the records show that there is insufficient evidence to prove the validity of the divorce obtained by Merry Lee as well as the marriage of respondent and Felicisimo under the laws of the U. The interest must be material and direct. It is a cardinal rule that. it is not necessary that the property be acquired through their joint labor. This provision governs the property relations between parties who live together as husband and wife without the benefit of marriage. "where these words import a policy that goes beyond them.A. to apply them just the same. would have vested Felicidad with the legal personality to file the present petition as Felicisimo's surviving spouse. we may add.

MARIA PAZ GALELA MARINAY. WHEREFORE. and THE ADMINISTRATOR AND CIVIL REGISTRAR GENERAL OF THE NATIONAL STATISTICS OFFICE. Q-11-68582 and its Resolution dated 2 March 2011 denying petitioner's Motion for Reconsideration. the burden of proof rests upon the party who. J p: The Case This is a direct recourse to this Court from the Regional Trial Court (RTC). Co-ownership will only be up to the extent of the proven actual contribution of money. Court of Appeals.R.Meanwhile. their contributions and corresponding shares shall be presumed to be equal. which involved the issue of co-ownership of properties acquired by the parties to a bigamous marriage and an adulterous relationship. Branch 107. 80 The Court described the property regime under this provision as follows: The regime of limited co-ownership of property governing the union of parties who are not legally capacitated to marry each other. 196049. The marriage did not sit well with petitioner's parents. petitioner.. SECOND DIVISION [G. The Decision of the Court of Appeals reinstating and affirming the February 28. as determined by the pleadings or the nature of the case. Fernandez. No. Sr. they lost contact with each other. JJ. Eventually. Article 148 governs. The petition assails the Order 1 dated 31 January 2011 of the RTC in Civil Case No. Marinay met another Japanese.] 22. the applicable provision would be Article 148 of the Family Code which has filled the hiatus in Article 144 of the Civil Code by expressly regulating the property relations of couples living together as husband and wife but are incapacitated to marry. However. 5 and (3) for the RTC to direct the Local Civil 107 . we ruled that proof of actual contribution in the acquisition of the property is essential. the petition is DENIED. vs. DECISION CARPIO. Callejo. Marinay allegedly suffered physical abuse from Maekara. if respondent fails to prove the validity of both the divorce and the marriage. applies to properties acquired during said cohabitation in proportion to their respective contributions. Let this case be REMANDED to the trial court for further proceedings. and Tumlos v. . respondents. Shinichi Maekara (Maekara). As in other civil cases. 81 In view of the foregoing. xxx xxx xxx In the cases of Agapay v. Austria-Martinez. through a petition for review on certiorari under Rule 45 of the Rules of Court on a pure question of law. respectively. MINORU FUJIKI. Thus. 1994 Order which dismissed petitioners' motion for reconsideration is AFFIRMED. property or industry. Philippines. Maekara brought Marinay to Japan. Fujiki could not bring his wife to Japan where he resides. SO ORDERED. In 2010. and Chico-Nazario. 3 Fujiki and Marinay met in Japan and they were able to reestablish their relationship. (2) that the bigamous marriage between Marinay and Maekara be declared void ab initio under Articles 35 (4) and 41 of the Family Code of the Philippines. . 78 In Saguid v. asserts an affirmative issue. . we find that respondent's legal capacity to file the subject petition for letters of administration may arise from her status as the surviving wife of Felicisimo or as his co-owner under Article 144 of the Civil Code or Article 148 of the Family Code. Fujiki filed a petition in the RTC entitled: "Judicial Recognition of Foreign Judgment (or Decree of Absolute Nullity of Marriage). Marinay and Maekara were married on 15 May 2008 in Quezon City. . LOCAL CIVIL REGISTRAR OF QUEZON CITY. June 26. to file the petition." Fujiki prayed that (1) the Japanese Family Court judgment be recognized. Palang. 79 we held that even if the cohabitation or the acquisition of property occurred before the Family Code took effect. Minoru Fujiki. 4 On 14 January 2011. Contentions must be proved by competent evidence and reliance must be had on the strength of the party's own evidence and not upon the weakness of the opponent's defense. 1994 Order of the Regional Trial Court which denied petitioners' motion to dismiss and its October 24. Fujiki helped Marinay obtain a judgment from a family court in Japan which declared the marriage between Marinay and Maekara void on the ground of bigamy. SHINICHI MAEKARA. Without the first marriage being dissolved. The RTC dismissed the petition for "Judicial Recognition of Foreign Judgment (or Decree of Absolute Nullity of Marriage)" based on improper venue and the lack of personality of petitioner. In 2008. but who nonetheless live together as husband and wife. . . concur. Absent proof of the extent thereof. 2013. The Facts Petitioner Minoru Fujiki (Fujiki) is a Japanese national who married respondent Maria Paz Galela Marinay (Marinay) in the Philippines 2 on 23 January 2004. She left Maekara and started to contact Fujiki. Quezon City.

" 20 Moreover. The RTC ruled. . In the words of Fujiki. CaAIES Fujiki's motion for reconsideration in the RTC also asserted that the trial court "gravely erred" when. — (a)Who may file. petitioner alleged that the trial court should not have "immediately dismissed" the petition under Section 5 of A. The City Civil Registrar of Himamaylan City. . 21 The trial court reiterated its two grounds for dismissal. The trial court held that this is a "jurisdictional ground" to dismiss the petition. — A petition for declaration of absolute nullity of void marriage may be filed solely by the husband or the wife." in this case either Maekara or Marinay. On 2 March 2011. 16 The Civil Register Law imposes a duty on the "successful petitioner for divorce or annulment of marriage to send a copy of the final decree of the court to the local registrar of the municipality where the dissolved or annulled marriage was solemnized. The RTC considered Fujiki as a "third person" 22 in the proceeding because he "is not the husband in the decree of divorce issued by the Japanese Family Court. . 02-11-10-SC): Sec. .Registrar of Quezon City to annotate the Japanese Family Court judgment on the Certificate of Marriage between Marinay and Maekara and to endorse such annotation to the Office of the Administrator and Civil Registrar General in the National Statistics Office (NSO)." 24 The RTC further justified its motu proprio dismissal of the petition based on Braza v. xxx xxx xxx Sec. the RTC took the view that only "the husband or the wife. ." 26 Braza emphasized that the "validity of marriages as well as legitimacy and filiation can be questioned only in a direct action seasonably filed by the proper party.Petition for declaration of absolute nullity of void marriages. the petition in the RTC sought to establish (1) the status and concomitant rights of Fujiki and Marinay as husband and wife and (2) the fact of the rendition of the Japanese Family Court judgment declaring the marriage between Marinay and Maekara as void on the ground of bigamy. Rule 108 is the "procedural implementation" of the Civil Register Law (Act No. 6 The Ruling of the Regional Trial Court A few days after the filing of the petition. 13 Thus. where he may be found in the Philippines. No. . a right or a particular fact. 02-11-10-SC provides that "a petition for declaration of absolute nullity of void marriages may be filed solely by the husband or the wife. on its own." 17 Section 2 of Rule 108 provides that entries in the civil registry relating to "marriages. Intermediate Appellate Court 19 which held that the "trial court cannot pre-empt the defendant's prerogative to object to the improper laying of the venue by motu proprio dismissing the case. which is Sec. 7 The RTC cited the following provisions of the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A. The petitioner contended that the Japanese judgment was consistent with Article 35 (4) of the Family Code of the Philippines 11 on bigamy and was therefore entitled to recognition by Philippine courts.M.M. or the prevention or redress of a wrong. No. 02-11-10-SC applied only to void marriages under Article 36 of the Family Code on the ground of psychological incapacity. or in the case of a non-resident respondent." To apply Section 2 (a) in bigamy would be absurd because only the guilty parties would be permitted to sue.." 9 and not a civil action which is "for the enforcement or protection of a right. 02-1110-SC applies because the petitioner.M. Fujiki argued that Rule 108 (Cancellation or Correction of Entries in the Civil Registry) of the Rules of Court is applicable. Section 2 (a) of A. .M. No. . 02-11-10-SC which provides that "[f]ailure to comply with any of the preceding requirements may be a ground for immediate dismissal of the petition.Venue. In its Resolution. i. the RTC stated that A. the RTC immediately issued an Order dismissing the petition and withdrawing the case from its active civil docket. because it is lack of jurisdiction which allows a court to dismiss a case on its own. which "seeks to establish a status. it dismissed the petition based on improper venue." 14 Fujiki had material interest and therefore the personality to nullify a bigamous marriage. Negros Occidental. in effect. . A." 8 Apparently. 4." 23 On the other hand. . the trial court has no jurisdiction to nullify marriages . The trial court based its dismissal on Section 5 (4) of A. 2 (a) . He argued that A.M. can file the petition to declare their marriage void. without further explanation.M. No. 3753) 15 in relation to Article 413 of the Civil Code. difficult to realize that the party interested in having a bigamous marriage declared a nullity would be the husband in the prior. No. . — The petition shall be filed in the Family Court of the province or city where the petitioner or the respondent has been residing for at least six months prior to the date of filing. 28 Moreover. 12 In any case." 10 In other words. Fujiki cited Dacoycoy v. No. Thus." "judgments of annulments of marriage" and "judgments declaring marriages void from the beginning" are subject to cancellation or correction. .M. that the petition was in "gross violation" of the above provisions. . . which he now seeks to be judicially recognized. No. the RTC resolved to deny petitioner's motion for reconsideration. Fujiki moved that the Order be reconsidered. .M. . No. ." 27 The RTC considered the petition as a collateral attack on the validity of marriage between Marinay and Maekara. 2. the RTC did not explain its ground of impropriety of venue. the verification and certification against forum shopping of the petition was 108 . as a ground for dismissal of this case[.e. and not Fujiki. and not through a collateral attack such as [a] petition [for correction of entry] . "[i]t is not. Fujiki stated that the RTC may be confusing the concept of venue with the concept of jurisdiction. 18 The petition in the RTC sought (among others) to annotate the judgment of the Japanese Family Court on the certificate of marriage between Marinay and Maekara. 02-11-10-SC. It only said that "[a]lthough the Court cited Sec. . prays for a decree of absolute nullity of marriage.] it should be taken together with the other ground cited by the Court . . lack of personality to sue and improper venue under Sections 2 (a) and 4 of A. 4 (Venue) . 02-11-10-SC because he substantially complied with the provision. 02-11-10-SC contemplated ordinary civil actions for declaration of nullity and annulment of marriage. 02-11-10-SC does not apply. . A petition for recognition of foreign judgment is a special proceeding. pre-existing marriage. No. 25The Court in Braza ruled that "[i]n a special proceeding for correction of entry under Rule 108 (Cancellation or Correction of Entries in the Original Registry). of course. it was also Fujiki's view that A.M. at the election of the petitioner.

30 The public respondents. De Castro 39and Niñal v. as the object of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the status or right of a party or a particular fact.M.M." 48 I. who is a Filipino citizen. The latter is clearly the aggrieved party as the bigamous marriage not only threatens the financial and the property ownership aspect of the prior marriage but most of all. events and judicial decrees concerning the civil status of persons" in the civil registry as required by Article 407 of the Civil Code. No. The Manifestation and Motion of the Office of the Solicitor General and the Letters of Marinay and Maekara On 30 May 2011. A. . No. 45 She would like to maintain her silence for fear that anything she say might cause misunderstanding between her and Fujiki. the Solicitor General filed a Manifestation and Motion. 02-11-10-SC) is applicable. 34 The Solicitor General contended that the petition to recognize the Japanese Family Court judgment may be made in a Rule 108 proceeding. No. Moreover. 02-11-10-SC) does not apply in a petition to recognize a foreign judgment relating to the status of a marriage where one of the parties is a citizen of a foreign country. 43 Maekara also denied that he inflicted any form of violence on Marinay. To be more specific. The subsequent marriage will always be a reminder of the infidelity of the spouse and the disregard of the prior marriage which sanctity is protected by the Constitution.M. the Solicitor General argued that there is no jurisdictional infirmity in assailing a void marriage under Rule 108. 02-11-10-SC does not apply in cases of bigamy. 02-11-10-SC . (3)Whether the Regional Trial Court can recognize the foreign judgment in a proceeding for cancellation or correction of entries in the Civil Registry under Rule 108 of the Rules of Court. Should parties in a subsequent marriage benefit from the bigamous marriage. For Philippine courts to recognize a foreign judgment relating to the status of a marriage where one of the parties is a citizen of a foreign country. as the spouse of the first marriage. .M. Instead of a comment. ." 37 WhileCorpuz concerned a foreign divorce decree. it causes an emotional burden to the prior spouse." 41 Marinay and Maekara individually sent letters to the Court to comply with the directive for them to comment on the petition. 02-11-10-SC. No. In other words. 42 Maekara wrote that Marinay concealed from him the fact that she was previously married to Fujiki. The Solicitor General asserted that Rule 108 of the Rules of Court is the procedure to record "[a]cts. Bayadog 40 which declared that "[t]he validity of a void marriage may be collaterally attacked. Republic 33 which held that Section 2 (a) of A. He prayed that the RTC's "pronouncement that the petitioner failed to comply with .44 On the other hand. 02-11-10-SC that only the husband or wife can file a declaration of nullity or annulment of marriage "does not apply if the reason behind the petition is bigamy.M. 31 The Solicitor General agreed with the petition. in the present case the Japanese Family Court judgment also affected the civil status of the parties. the Court required respondents to file their comment on the petition for review. in such circumstance. . The Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A. Republic. No. in Juliano-Llave v. this Court explained: SCHATc [t]he subsequent spouse may only be expected to take action if he or she had only discovered during the connubial period that the marriage was bigamous. this also warranted the "immediate dismissal" of the petition under the same provision. citing De Castro v. The Solicitor General citedJuliano-Llave v. the petitioner only needs to prove the foreign judgment as a fact under the Rules of Court. (2)Whether a husband or wife of a prior marriage can file a petition to recognize a foreign judgment nullifying the subsequent marriage between his or her spouse and a foreign citizen on the ground of bigamy. The Ruling of the Court We grant the petition. No.not authenticated as required under Section 5 29 of A. In Juliano-Llave. is an injured party who can sue to declare the bigamous marriage between Marinay and Maekara void. 36 this Court held that "[t]he recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself. the "injured spouse" who should be given a legal remedy is the one in a subsisting previous marriage. Santo Tomas." 38 The Japanese Family Court judgment directly bears on the civil status of a Filipino citizen and should therefore be proven as a fact in a Rule 108 proceeding.M. participated through the Office of the Solicitor General. . 32 The Solicitor General argued that Fujiki. a copy of the 109 . 47 this Court held that the rule in A. especially Marinay. Hence. and especially if the conjugal bliss had already vanished. 46 ScTaEA The Issues Petitioner raises the following legal issues: (1)Whether the Rule on Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A. it would not be expected that they would file an action to declare the marriage void and thus. be set aside" and that the case be reinstated in the trial court for further proceedings. . 35 In Corpuz v. . Moreover. Marinay wrote that she had no reason to oppose the petition. "[t]he law requires the entry in the civil registry of judicial decrees that produce legal consequences upon a person's legal capacity and status . the Local Civil Registrar of Quezon City and the Administrator and Civil Registrar General of the NSO.

condition and legal capacity of persons are binding upon citizens of the Philippines. but the recognition of a foreign divorce decree does not involve the extended procedure under A. 1. condition and legal capacity of its parties." Moreover. order or decree concerning the civil status of persons which has been recorded in the civil register. Philippine courts exercise limited review on foreign judgments. Sto. Section 48 (b) of the Rules of Court. the effect of a foreign judgment is not automatic. These are facts of public consequence such as birth. ECcTaS Section 48 (b). They cannot substitute their judgment on the status. While the Philippines has no divorce law. 62 Since 1922 in Adong v. It will defeat the purpose of recognizing foreign judgments. fraud. Tomas this Court declared that "[t]he recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself. the Japanese Family Court judgment is fully consistent with Philippine public policy. recognize a foreign divorce decree under the second paragraph of Article 26 of the Family Code.e. the Philippine State may require. 3753. which is "to limit repetitive litigation on claims and issues. 110 . even though living abroad. 61 as well as respecting the jurisdiction of other states. in Corpuz v. 51 the service of summons. it may be made in a special proceeding for cancellation or correction of entries in the civil registry under Rule 108 of the Rules of Court." 67 AIaHES Rule 108. or a particular fact. the plaintiff would be forced back on his/her original cause of action. (Emphasis supplied) Fujiki has the personality to file a petition to recognize the Japanese Family Court judgment nullifying the marriage between Marinay and Maekara on the ground of bigamy because the judgment concerns his civil status as married to Marinay. the certification may be made by the proper diplomatic or consular officer of the Philippine foreign service in Japan and authenticated by the seal of office. Rule 39 of the Rules of Court provides that a foreign judgment or final order against a person creates a "presumptive evidence of a right as between the parties and their successors in interest by a subsequent title. Who may file petition. for effectivity in the Philippines. 52 the investigation of the public prosecutor. For the same reason he has the personality to file a petition under Rule 108 to cancel the entry of marriage between Marinay and Maekara in the civil registry on the basis of the decree of the Japanese Family Court. While the Philippines does not have a divorce law. If the office which has custody is in a foreign country such as Japan. as the object of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the status or right of a party or a particular fact. In Mijares v.foreign judgment may be admitted in evidence and proven as a fact under Rule 132. Thus. 53 the setting of pre-trial. in relation to Rule 39. collusion. as bigamous marriages are declared void from the beginning under Article 35 (4) of the Family Code. it can only be repelled on grounds external to its merits. Once a foreign judgment is admitted and proven in a Philippine court. i. or clear mistake of law or fact. 60 Article 15 of the Civil Code provides that "[l]aws relating to family rights and duties. Thus.M. Rule 1. may file a verified petition for the cancellation or correction of any entry relating thereto. Rañada. Philippine courts can only recognize the foreign judgment as a fact according to the rules of evidence. over whom it exercises personal jurisdiction relating to the status. As noted by the Solicitor General. Philippine courts must determine if the foreign judgment is consistent with domestic public policy and other mandatory laws. a right. condition and legal capacity of such citizen. 66which the State has an interest in recording. Philippine courts may. Section 3 of the Rules of Court provides that "[a] special proceeding is a remedy by which a party seeks to establish a status. or clear mistake of law or fact. 58 this Court explained that "[i]f every judgment of a foreign court were reviewable on the merits. in relation to Rule 39.. No. rendering immaterial the previously concluded litigation. want of notice to the party." Thus. "want of jurisdiction." Rule 108 creates a remedy to rectify facts of a person's life which are recorded by the State pursuant to the Civil Register Law or Act No. Sections 24 and 25. however. or to the status. condition and legal capacity of the foreign citizen who is under the jurisdiction of another state. To extend the effect of a foreign judgment in the Philippines. Philippine courts cannot presume to know the foreign laws under which the foreign judgment was rendered. 02-11-10-SC or the rules of ordinary trial. including the form and contents of the petition. Courts are not allowed to delve into the merits of a foreign judgment.M." This is the rule of lex nationalii in private international law. fraud. 64 Divorce involves the dissolution of a marriage. 49 Petitioner may prove the Japanese Family Court judgment through (1) an official publication or (2) a certification or copy attested by the officer who has custody of the judgment. " 57 The interpretation of the RTC is tantamount to relitigating the case on the merits. A petition to recognize a foreign judgment declaring a marriage void does not require relitigation under a Philippine court of the case as if it were a new petition for declaration of nullity of marriage. 56 This is absurd because it will litigate the case anew. Since the recognition of a foreign judgment only requires proof of fact of the judgment. to capacitate a Filipino citizen to remarry when his or her foreign spouse obtained a divorce decree abroad. event. 02-11-10-SC applies to a petition for recognition of foreign judgment would mean that the trial court and the parties should follow its provisions. death or marriage. No. Section 48 (b) of the Rules of Court. Sections 24 and 25. 65 There is therefore no reason to disallow Fujiki to simply prove as a fact the Japanese Family Court judgment nullifying the marriage between Marinay and Maekara on the ground of bigamy. with the Regional Trial Court of the province where the corresponding civil registry is located. Bigamy is a crime under Article 349 of the Revised Penal Code. want of notice to the party. Section 1 of the Rules of Court states: Sec. Fujiki can prove the existence of the Japanese Family Court judgment in accordance with Rule 132. 63 Philippine courts have recognized foreign divorce decrees between a Filipino and a foreign citizen if they are successfully proven under the rules of evidence. Thus." 59 A foreign judgment relating to the status of a marriage affects the civil status." The rule on limited review embodies the policy of efficiency and the protection of party expectations. — Any person interested in any act. Cheong Seng Gee. However. recognition by Philippine courts of a foreign judgment affecting its citizen. II. Section 48 of the Rules of Court states that "the judgment or final order may be repelled by evidence of a want of jurisdiction. 54 the trial 55 and the judgment of the trial court. 50 EaISTD To hold that A. collusion.

02-11-10-SC. 84 the liquidation. it causes an emotional burden to the prior spouse.M. a petition for correction or cancellation of an entry in the civil registry cannot substitute for an action to invalidate a marriage. No. . . 111 ." 87 In other words. 79 Juliano-Llave ruled that the prior spouse "is clearly the aggrieved party as the bigamous marriage not only threatens the financial and the property ownership aspect of the prior marriage but most of all. is the civil aspect of Article 349 of the Revised Penal Code. 72 but a spouse's right in a marriage extends further to relational rights recognized under Title III ("Rights and Obligations between Husband and Wife") of the Family Code. The prior spouse does not only share in the public interest of prosecuting and preventing crimes. 88 this Court recognized the legislative intent of the second paragraph of Article 26 which is "to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. On the contrary. No. Thus. Orbecido. the "validity of marriage[] . 02-11-10-SC and other related laws.A. Under Article 35 (4) of the Family Code.M. increase. which presupposes a case which was already tried and decided under foreign law. as a petition for cancellation or correction of entries in the civil registry may be filed in the Regional Trial Court "where the corresponding civil registry is located.M. after obtaining a divorce. The second paragraph of Article 26 of the Family Code only authorizes Philippine courts to adopt the effects of a foreign divorce decree precisely because the Philippines does not allow divorce.There is no doubt that the prior spouse has a personal and material interest in maintaining the integrity of the marriage he contracted and the property relations arising from it. For this purpose. Section 2 (a) of A. However. 69 These property interests in marriage include the right to be supported "in keeping with the financial capacity of the family" 70 and preserving the property regime of the marriage. partition and distribution of the properties of the spouses. No. which compromises the public record of his marriage. Bigamy is a public crime. Article 26 of the Family Code confers jurisdiction on Philippine courts to extend the effect of a foreign divorce decree to a Filipino spouse without undergoing trial to determine the validity of the dissolution of the marriage. A direct action is necessary to prevent circumvention of the substantive and procedural safeguards of marriage under the Family Code." 80 Being a real party in interest.76 which penalizes bigamy. which declares bigamous marriages void from the beginning. No. EAcTDH Braza is not applicable because Braza does not involve a recognition of a foreign judgment nullifying a bigamous marriage where one of the parties is a citizen of the foreign country. the spouse is clearly an injured party and is therefore interested in the judgment of the suit. there should be no more impediment to cancel the entry of the bigamous marriage in the civil registry. A. A recognition of a foreign judgment is not an action to nullify a marriage. Philippine courts cannot try the case on the merits because it is tantamount to trying a case for divorce. No. No." In Republic v. No. 02-11-10-SC preserves this substantive right by limiting the personality to sue to the husband or the wife of the union recognized by law. No. 82 The RTC relied on Braza in dismissing the petition for recognition of foreign judgment as a collateral attack on the marriage between Marinay and Maekara. a Filipino citizen cannot dissolve his marriage by the mere expedient of changing his entry of marriage in the civil registry. The City Civil Registrar of Himamaylan City. 83 support pendente lite of the spouses and children.M. this does not apply in a petition for correction or cancellation of a civil registry entry based on the recognition of a foreign judgment annulling a marriage where one of the parties is a citizen of the foreign country. 73 A. can be questioned only in a direct action" to nullify the marriage. The second paragraph of Article 26 of the Family Code provides that "[w]here a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry. Among these safeguards are the requirement of proving the limited grounds for the dissolution of marriage. 71 Property rights are already substantive rights protected by the Constitution. In Braza v. The husband or the wife of the prior subsisting marriage is the one who has the personality to file a petition for declaration of absolute nullity of void marriage under Section 2 (a) of A. There is also no doubt that he is interested in the cancellation of an entry of a bigamous marriage in the civil registry. the parties in a bigamous marriage are neither the husband nor the wife under the law. the prior spouse is entitled to sue in order to declare a bigamous marriage void. 02-11-10SC does not apply in a petition to recognize a foreign judgment annulling a bigamous marriage where one of the parties is a citizen of the foreign country. When the right of the spouse to protect his marriage is violated. Thus. the Filipino spouse shall have capacity to remarry under Philippine law. he can petition a court to recognize a foreign judgment nullifying the bigamous marriage and judicially declare as a fact that such judgment is effective in the Philippines. It is an action for Philippine courts to recognize the effectivity of a foreign judgment. To be sure. or modify" the substantive right of the spouse to maintain the integrity of his marriage. 8369. The procedure in A. 85 and the investigation of the public prosecutor to determine collusion. DHSCTI Section 2 (a) of A. bigamous marriages are void from the beginning. in limited instances) 68 his most intimate human relation. 02-11-10SC cannot "diminish.M. Once established.M. Neither can R. There is neither circumvention of the substantive and procedural safeguards of marriage under Philippine law. nor of the jurisdiction of Family Courts under R. anyone can initiate prosecution for bigamy because any citizen has an interest in the prosecution and prevention of crimes. he is also personally interested in the purely civil aspect of protecting his marriage. 02-11-10-SC does not preclude a spouse of a subsisting marriage to question the validity of a subsequent marriage on the ground of bigamy. III. 78 there is more reason to confer personality to sue on the husband or the wife of a subsisting marriage. The interest derives from the substantive right of the spouse not only to preserve (or dissolve. Article 35 (4) of the Family Code. 77 If anyone can file a criminal action which leads to the declaration of nullity of a bigamous marriage. Negros Occidental. 81 Thus. 8369). but also to protect his property interests that arise by operation of law the moment he contracts marriage. 86 A direct action for declaration of nullity or annulment of marriage is also necessary to prevent circumvention of the jurisdiction of the Family Courts under the Family Courts Act of 1997 (Republic Act No.A. this Court held that a "trial court has no jurisdiction to nullify marriages" in a special proceeding for cancellation or correction of entry under Rule 108 of the Rules of Court. when Section 2 (a) states that "[a] petition for declaration of absolute nullity of void marriage may be filed solely by the husband or the wife" 75 — it refers to the husband or the wife of the SUBSISTING marriage. is no longer married to the Filipino spouse" 89 under the laws of his or her country. 8369 define the jurisdiction of the foreign court. 74 In any case.

the Filipino spouse will be discriminated — the foreign spouse can remarry while the Filipino spouse cannot remarry. concur. No. hired DUPO as Civil Structural Superintendent to work in Saudi Arabia for its principal.] 23. 02-11-10-SC is inapplicable.e. The anomaly consists in the Filipino spouse being tied to the marriage while the foreign spouse is free to marry under the laws of his or her country. July 13. 1992. which is already effective in the country where it was rendered. under Article 91 of the Revised Penal Code. The Regional Trial Court is ORDERED to REINSTATE the petition for further proceedings in accordance with this Decision. April 14. Under the second paragraph of Article 26 of the Family Code.M. In a foreign judgment relating to the status of a marriage involving a citizen of a foreign country. Philippine courts already have jurisdiction to extend the effect of a foreign judgment in the Philippines to the extent that the foreign judgment does not contravene domestic public policy. Romillo 90 which declared that the Filipino spouse "should not be discriminated against in her own country if the ends of justice are to be served. Philippine courts are empowered to correct a situation where the Filipino spouse is still tied to the marriage while the foreign spouse is free to marry. the Court no longer sees the need to address the questions on venue and the contents and form of the petition under Sections 4 and 5. and a foreign citizen. The recognition of the foreign judgment nullifying a bigamous marriage is a subsequent event that establishes a new status. The antecedent facts are as follows: LWV CONSTRUCTION. No. WHEREFORE.The second paragraph of Article 26 is only a corrective measure to address the anomaly that results from a marriage between a Filipino. SO ORDERED. DUPO signed his first overseas employment contract. respondent. collusion. but this is not the only remedy available to him or her. without prejudice to a criminal prosecution for bigamy. denying the motion for reconsideration..640. Q-11-68582 are REVERSED and SET ASIDE.M. Branch 107. November 16. 76843 and its Resolution 2 dated April 12. Brion. as a ground for the nullity of marriage. 1996. SP No.. 2005 of the Court of Appeals in CA-G. SECOND DIVISION [G. is fully consistent with Philippine public policy as expressed in Article 35 (4) of the Family Code and Article 349 of the Revised Penal Code. vs. If the foreign judgment is not recognized in the Philippines.R. Philippine courts only decide whether to extend its effect to the Filipino party. 1997. Moreover. whose laws allow divorce. by default. and March 26. "[t]he term of prescription [of the crime of bigamy] shall not run when the offender is absent from the Philippine archipelago. or clear mistake of law or fact. Moreover. and (2) whether any alleging party is able to prove an extrinsic ground to repel the foreign judgment. under the rule of lex nationalii expressed in Article 15 of the Civil Code." CcHDSA Since A. renewable after one year. The Court of Appeals had ruled that under Article 87 of the Saudi Labor and Workmen Law (Saudi Labor Law). LWV CONSTRUCTION CORPORATION. All were fixed-period contracts for one year." 91 IDETCA The principle in Article 26 of the Family Code applies in a marriage between a Filipino and a foreign citizen who obtains a foreign judgment nullifying the marriage on the ground of bigamy. 1994. January 22. Otherwise. Philippine courts will only determine (1) whether the foreign judgment is inconsistent with an overriding public policy in the Philippines. It was renewed five times on the following dates: May 10. a domestic corporation which recruits Filipino workers.R. 02-11-10-SC. The sixth and last contract stated that 112 . A critical difference between the case of a foreign divorce decree and a foreign judgment nullifying a bigamous marriage is that bigamy. No. Mohammad Al-Mojil Group/Establishment (MMG). 2009. right and fact 92 that needs to be reflected in the civil registry.33. In the recognition of foreign judgments. No. JJ.M. The Filipino spouse may file a petition abroad to declare the marriage void on the ground of bigamy. DUPO. fraud. J p: Petitioner LWV Construction Corporation appeals the Decision 1 dated December 6. 2006. Section 48 (b). whose laws do not allow divorce. The Filipino spouse has the option to undergo full trial by filing a petition for declaration of nullity of marriage under A. However. of A. or on the status." Upon recognition of the foreign judgment. The correction is made by extending in the Philippines the effect of the foreign divorce decree. 93 The recognition of a foreign judgment nullifying a bigamous marriage is not a ground for extinction of criminal liability under Articles 89 and 94 of the Revised Penal Code. On February 26. there will be an inconsistency between the recognition of the effectivity of the foreign judgment and the public records in the Philippines. 1993. Del Castillo. They cannot decide on the "family rights and duties. Thus. is capacitated to remarry under the laws of his or her country. The principle in the second paragraph of Article 26 of the Family Code applies because the foreign spouse. For this purpose. respectively. want of notice to the party. recognize the foreign judgment as part of the comity of nations. MARCELO B. we GRANT the petition. Philippine courts are incompetent to substitute their judgment on how a case was decided under foreign law. Perez and Perlas-Bernabe. petitioner. Rule 39 of the Rules of Court states that the foreign judgment is already "presumptive evidence of a right between the parties. Quezon City. i. notwithstanding Article 26 of the Family Code. Philippine courts are limited to the question of whether to extend the effect of a foreign judgment in the Philippines. If there is neither inconsistency with public policy nor adequate proof to repel the judgment. 1998. The Order dated 31 January 2011 and the Resolution dated 2 March 2011 of the Regional Trial Court. 172342. this right becomes conclusive and the judgment serves as the basis for the correction or cancellation of entry in the civil registry. want of jurisdiction. DECISION QUISUMBING. respondent Marcelo Dupo is entitled to a service award or longevity pay amounting to US$12. The second paragraph of Article 26 of the Family Code is based on this Court's decision in Van Dorn v. after the foreign judgment nullifying the marriage. Philippine courts have jurisdiction to recognize a foreign judgment nullifying a bigamous marriage. condition and legal capacity" of the foreign citizen who is a party to the foreign judgment. 02-11-10-SC. the recognition of a foreign judgment nullifying a bigamous marriage is without prejudice to prosecution for bigamy under Article 349 of the Revised Penal Code. in Civil Case No. Philippine courts should.

Under Article 87. that he needs to extend his vacation because his son was hospitalized.) xxx xxx xxx According to DUPO. On May 28. 12 the Labor Arbiter ordered LWV CONSTRUCTION to pay DUPO longevity pay of US$12. He reconstructed the computation of his long service award or longevity pay and he arrived at the following computation exactly the same with the amount he was previously offered [which is US$12. LWV CONSTRUCTION offered payment and prescription as defenses. 2000. caCEDA III. the NLRC dismissed the appeal and affirmed the Labor Arbiter's decision. 1999.96. LWV CONSTRUCTION maintained that MMG "pays its workers theirService Award or Severance Pay every conclusion of their Labor Contracts pursuant to Article 87 of the [Saudi Labor Law]".640. March 16. interrupted the prescriptive period under the Saudi Labor Law until his claim was categorically denied. DUPO left Saudi Arabia on April 30. 1999 and arrived in the Philippines on May 1. He also sought a promotion with salary adjustment. 1993. For its part. LWV CONSTRUCTION concluded that the one-year prescriptive period had lapsed because DUPO filed his complaint on December 11. The Court of Appeals denied the petition and affirmed the NLRC. LWV CONSTRUCTION filed the instant petition raising the following issues: I. finding no grave abuse of discretion amounting to lack or in (sic) excess of jurisdiction on the part of public DUPO NLRC. MMG "will be compelled to cancel [his] slot". 1999. 4 On July 6. that his services are still needed. made a month after his cause of action accrued. MMG informed DUPO that his promotion is subject to management's review. December 18. In his letter to MMG. 1999. an employee who rendered at least five (5) years in a company within the jurisdiction of Saudi Arabia. DUPO averred in his position paper that: xxx xxx xxx Under the Law of Saudi Arabia. the petition is denied. In both cases inclusive of all benefits and allowances. Based on the payroll.562.) xxx xxx xxx DUPO said that he did not grab the offer for he intended to return after his vacation.640. 1999. 1999. Cordillera Administrative Region. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN FINDING NO GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION ON THE PART OF PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSION. I am entitled for a long service award. 6 On December 11. LWV CONSTRUCTION informed him that MMG did not respond. LWV CONSTRUCTION added that under Article 13 10 of the Saudi Labor Law. DUPO filed a complaint 7 for payment of service award against LWV CONSTRUCTION before the National Labor Relations Commission (NLRC). DUPO informed MMG. 1998 and April 30. II. 2000. when he followed up his claim for long service award on December 7. otherwise. March 21. and that his decision regarding his employment must be made within seven days. The NLRC decision dated November 29. 9 DUPO was already paid his service award or severance pay for his latest (sixth) employment contract. Aggrieved.DUPO's employment starts upon reporting to work and ends when he leaves the work site. and that the severance pay received by DUPO cannot be equated with service award. In excess of five years an employee is entitled to one month pay for every year of service. 3 In reply. he also stated: xxx xxx xxx I am aware that I still have to do a final settlement with the company and hope that during my more than seven (7) [years] services.69 and attorney's fees of P64. Baguio City. 113 . 2001 Decision. that LWV CONSTRUCTION was unable to convincingly refute DUPO's claim that MMG offered him longevity pay before he went on vacation on May 1. 1994. June 8. 1995. DUPO resigned. and that DUPO's claim was not barred by prescription since his claim on July 6. 1999. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN FINDING THAT THE SERVICE AWARD OF THE RESPONDENT [HAS] NOT PRESCRIBED WHEN HIS COMPLAINT WAS FILED ON DECEMBER 11. 14 The NLRC ruled that DUPO is entitled to longevity pay which is different from severance pay. "payment of the award is at the end or termination of the Labor Contract concluded for a specific period". 13 The Labor Arbiter ruled that DUPO's seven-year employment with MMG had sufficiently oriented him on the benefits given to workers.33]. This benefit was offered to complainant before he went on vacation. Regional Arbitration Branch. 2003 Resolution are hereby AFFIRMED in toto. this was engrained in his mind. 5 (Emphasis supplied. 15 After its motion for reconsideration was denied. hence. is entitled to the so-called long service award which is known to others as longevity pay of at least one half month pay for every year of service.27 or a total of P713. In support of his claim. LWV CONSTRUCTION brought the case to the Court of Appeals through a petition for certiorari under Rule 65 of the Rules of Court. The dispositive portion of the Court of Appeals decision reads: WHEREFORE. 1997. DUPO's six contracts ended when he left Saudi Arabia on the following dates: April 15. LWV CONSTRUCTION appealed. that he was issued a plane ticket for his return flight to Saudi Arabia on May 31. 2000. through the petitioner. the action to enforce payment of the service award must be filed within one year from the termination of a labor contract for a specific period.418.33 or P648. 1999. 2000 or one year and seven months after his sixth contract ended. 2002 as well as and (sic) its January 31. SO ORDERED. However. as the Saudi Law stated.856. 8 (Emphasis supplied. 11 STcADa In his June 18. The Court of Appeals ruled that service award is the same as longevity pay.

) DUPO.33 as longevity pay before he returned to the Philippines on May 1. We find that DUPO's service award under Article 87 of the Saudi Labor Law has already been paid. Article 87 clearly grants a service award. the workman shall be entitled to an award which is proportionate to his service period during that year. 1999 letter to MMG where he could only express his hope that he was entitled to a long service award and where he never mentioned the supposed previous offer. 7 OF THE SAUDI LABOR AND WORKMEN LAW TO SUPPORT ITS FINDING THAT THE BASIS OF THE SERVICE AWARD IS LONGEVITY [PAY] OR LENGTH OF SERVICE RENDERED BY AN EMPLOYEE. If the workman is leaving the work as a result of a force majeure beyond his control. The Court of Appeals agreed. and wrong to call service award as longevity pay? We found the answer in the pleadings and evidence presented. The payroll submitted by LWV CONSTRUCTION showed that DUPO received severance pay of SR2. 25 Regarding DUPO's claim that he was offered US$12. 17 (Emphasis supplied. and wrong to agree with LWV CONSTRUCTION that service award is the same as severance pay? And why would it be correct to say that service award is severance pay. the employer shall pay to the workman an award for the period of his service to be computed on the basis of half a month's pay for each of the first five years and one month's pay for each of the subsequent years." 24 As it is.248. and arrived at the . If both parties continue to enforce the contract. DUPO's position paper mentioned how his long service award or longevity pay is computed: half-month's pay per year of service and one-month's pay per year after five years of service. DUPO's employment contracts expressly stated that his employment ended upon his departure from work. we are constrained to reverse the Court of Appeals. DUPO's claim that his monthly compensation is SR10. 19 The computation below shows that DUPO's severance pay of SR2. Pertinently. it shall be considered renewed for an unspecified period.640. IV. Article 72 of the Saudi Labor Law is also of similar import. computation exactly the same with the amount he was previously offered" is not only beyond belief. LWV CONSTRUCTION alleges that the Court of Appeals erred in ruling that DUPO's July 6. v. 114 .438) + (9 days/365 days) x 1/2 (SR5. We also said in that case that under American law. he "submits that such offer indeed exists" as he sees no reason for MMG to offer the benefit if no law grants it. LWV CONSTRUCTION maintains that the benefit granted by Article 87 of the Saudi Labor Law is service award which was already paid by MMG each time DUPO's contract ended. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN APPLYING ARTICLE NO. LWV CONSTRUCTION insists that prescription barred DUPO's claim for service award as the complaint was filed one year and seven months after the sixth contract ended. the workman shall be entitled to the service award provided for at the beginning of this article in the following cases: A. it terminates on the expiration of such period. "[w]here a contract specifies the period of its duration. A contract of employment for a definite period terminates by its own terms at the end of such period.786 was his service award under Article 87.92 26 is belied by the payroll which shows that he receives SR5. On the other hand. LWV CONSTRUCTION points out that the Labor Arbiter awarded longevity pay although the Saudi Labor Law grants no such benefit. the Labor Arbiter was unable to specify any law to support his award of longevity pay. 1999 claim interrupted the running of the prescriptive period. Our computation will show that the severance pay received by DUPO was his service award. DUPO is entitled to service award or longevity pay under Article 87 and that longevity pay is different from severance pay.438) Service Award = SR2. . LWV CONSTRUCTION claimed that the service award is the same as severance pay. The last rate of pay shall be taken as basis for the computation of the award. 1998 to April 29. Zamora.WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN APPLYING IN THE CASE AT BAR [ARTICLE 1155 OF THE CIVIL CODE]. His categorical assertion about the offer being "engrained in his mind" such that he "reconstructed the computation . It reads: HAEDIS Article 87 Where the term of a labor contract concluded for a specified period comes to an end or where the employer cancels a contract of unspecified period. Inc.33 under the provisions of the Saudi Labor Law. has called the benefit other names such as long service award and longevity pay. . . 18 He anchored the award on his finding that DUPO's allegations were more credible because his seven-year employment at MMG had sufficiently oriented him on the benefits given to workers. Notably.786. and the NLRC confused longevity pay and service award. Each year he departed from work and successively new contracts were executed before he reported for work anew. If a workman resigns because of marriage or childbirth. To the NLRC.640. C. the issue is whether the Court of Appeals erred in ruling that DUPO is entitled to a service award or longevity pay of US$12. DUPO counters that he is entitled to longevity pay under the provisions of the Saudi Labor Law and quotes extensively the decision of the Court of Appeals. Furthermore.786 for his sixth employment contract covering the period April 21. It reads: HIACEa A labor contract concluded for a specified period shall terminate upon the expiry of its term. Related to this issue are LWV CONSTRUCTION's defenses of payment and prescription. in Brent School. Service Award = 1/2 (SR5. why is it correct to agree with DUPO that service award is the same as longevity pay. 23 as in this case. If he is called to military service. Thus.640. 1999. Such assertion is also a stark departure from his July 6. After a careful study of the case.04 DUPO's service award for the sixth contract is equivalent only to half-month's pay plus the proportionate amount for the additional nine days of service he rendered after one year. B.33 before his one-month vacation in the Philippines in 1999. Moreover. we find that he was not candid on this particular point. His service was not cumulative.438 per month. 1999. Article 87 has the same formula to compute the service award. . He points out that LWV CONSTRUCTION has not refuted the Labor Arbiter's finding that MMG offered him longevity pay of US$12. 22 we said that "a fixed term is an essential and natural appurtenance" of overseas employment contracts. Considering that Article 87 expressly grants a service award. thereafter. For fractions of a year. however. 16 Essentially. Such ruling is contrary to Article 13 of the Saudi Labor Law which provides that no case or claim relating to any of the rights provided for under said law shall be heard after the lapse of 12 months from the date of the termination of the contract.

23 of 1976 provides: "A claim arising out of a contract of employment shall not be actionable after the lapse of one year from the date of the expiry of the contract" . ATCI OVERSEAS CORPORATION. but applies also to claims of overseas contract workers. petitioners. Conflict of Laws. however. which is inconsistent with or contradictory to Section 48 of the Code of Civil Procedure (Paras. the petition is GRANTED. 28 The following ruling in Cadalin v. SO ORDERED.200. WHEREFORE. the characterization of a statute into a procedural or substantive law becomes irrelevant when the country of the forum has a "borrowing statute". of the Court of Appeals in CA-G. 29 xxx xxx xxx Thus. October 11. 2005 and Resolution dated April 12. Private International Law. The courts of the forum will not enforce any foreign claim obnoxious to the forum's public policy . DTaSIc No pronouncement as to costs. as well as the Decision dated June 18. denominated as a Memorandum of Agreement (MOA). otherwise they shall be forever barred. 1 all newly-hired employees undergo a probationary period of one (1) year and are covered by Kuwait's Civil Service Board Employment Contract No.R. .00. . it is also barred in the Philippine Islands. IKDAL and MINISTRY OF PUBLIC HEALTH-KUWAIT.] 24. 27 we held that Article 291 covers all money claims from employer-employee relationship and is broader in scope than claims arising from a specific law. DECISION CARPIO MORALES. 104 [7th ed. This is true even if the action is based upon a foreign substantive law (Restatement of the Conflict of Laws. Procedural matters. — All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three (3) years from the time the cause of action accrued. albeit the payroll termed such payment as severance pay. 152-153 [1938]). While there are several kinds of "borrowing statutes". ScCIaA 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. 2003 of the NLRC in NLRC CA No. In the light of the 1987 Constitution. MA. such as service of process. one form provides that an action barred by the laws of the place where it accrued. Under the MOA. This point. has already been mooted by our finding that DUPO's service award had been paid. the action is barred. in our considered view. are governed by the laws of the forum. DUPO's complaint was filed well within the three-year prescriptive period under Article 291 of our Labor Code. Sec. The Complaint of DUPO is hereby DISMISSED. respondent. Section 48 of our Code of Civil Procedure is of this kind. Article 2270 of said Code repealed only those provisions of the Code of Civil Procedure as to which were inconsistent with it. joinder of actions. 2002 and Resolution dated January 31. 2. There is no provision in the Civil Code of the Philippines. On the matter of prescription. depending on the characterization given such a law. 115 . . .]). xxx xxx xxx In Cadalin v. will not be enforced in the forum even though the local statute has not run against it (Goodrich and Scoles. What applies is Article 291 of our Labor Code which reads: ART.We therefore emphasize that such payroll should have prompted the lower tribunals to examine closely DUPO's computation of his supposed longevity pay before adopting that computation as their own. Salonga. . The assailed Decision dated December 6. 291. 685. for the position of medical technologist under a two-year contract. the Ministry of Public Health of Kuwait (the Ministry). 23 of 1976 or a Philippine law on prescription that shall be the governing law. Said Section provides: "If by the laws of the state or country where the cause of action arose. JOSEFA ECHIN. 23 of 1976. we cannot agree with LWV CONSTRUCTION that DUPO's action has prescribed under Article 13 of the Saudi Labor Law. Section 48 [of the Code of Civil Procedure] cannot be enforced ex proprio vigore insofar as it ordains the application in this jurisdiction of [Article] 156 of the Amiri Decree No. however. with a monthly salary of US$1. Philippine Conflict of Laws. 183 [1975]). RAB-CAR-12-064900 and the Decision dated November 29. xxx xxx xxx However. 152-153 [1938]).vs.R. Conflicts. 131 [1979]). 23 of 1976 as regards the claims in question would contravene the public policy on the protection to labor. Article 156 of the Amiri Decree No. however. As a general rule. J p: Josefina Echin was hired by ATCI Overseas Corporation in behalf of its principal-co-ATCI Corporation. period and requisites for appeal. It is not limited to money claims recoverable under the Labor Code. Money claims. AMALIA G. A "borrowing statute" directs the state of the forum to apply the foreign statute of limitations to the pending claims based on a foreign law (Siegel. Conflict of Laws. 2010. THIRD DIVISION [G. SP No. 178551. and so forth. ." Section 48 has not been repealed or amended by the Civil Code of the Philippines. 2001 of the Labor Arbiter in NLRC Case No. 2006. POEA's Administrator. No. To enforce the one-year prescriptive period of the Amiri Decree No. 028994-01 (NLRC RABCAR-12-0649-00) are REVERSED and SET ASIDE. 76843. Said statute has the practical effect of treating the foreign statute of limitation as one of substance (Goodrich. POEA's Administrator is instructive: First to be determined is whether it is the Bahrain law on prescription of action based on the Amiri Decree No. a foreign procedural law will not be applied in the forum.

as the foreign principal. ATCI Corporation ATCI cannot likewise be held liable. 2004. 2007. the appellate court held that under Sec. the appellate court noted that under the law. morals. Indeed. ATCI Corporations' motion for reconsideration having been denied by the appellate court by Resolution 7 of June 27. Otherwise. shouldering her own air fare. as in fact it did not sign any document agreeing to be held jointly and solidarily liable. and that ECHIN was validly dismissed for her failure to meet the performance rating within the one-year period as required under Kuwait's Civil Service Laws. contending that their principal. . It is hornbook principle. can be held jointly and solidarily liable. she returned to the Philippines on March 17." Finally. is immune from suit and. directors and partners of a recruitment agency may themselves be jointly and solidarily liable with the recruitment agency for money claims and damages awarded to overseas workers. but the same extends up to and until the expiration of the employment contracts of the employees recruited and employed pursuant to the said recruitment agreement. good customs. terms and conditions as they may deem convenient. more so since the Ministry's liability had not been judicially determined as jurisdiction was not acquired over it. ATCI Corporations argue that even the Philippine Overseas Employment Act (POEA) Rules relative to master employment contracts (Part III. ATCI Corporations posit that assuming arguendo that Philippine labor laws are applicable. under the doctrine of processual presumption which. 9 Verily. that the party invoking the application of a foreign law has the burden of proving the law. The petition fails.Skippers United Pacific v. Maguad 8 explains: . 2001. the responsibilities of such parties towards the contracted employees under the agreement do not at all end. ATCI Corporations further contended that Ikdal should not be liable as an officer of ATCI Corporation ATCI. they appealed to the Court of Appeals. customs and practices of the host country." corporate officers. the present petition for review on certiorari was filed. including the laws which they wish to govern their respective obligations. Sec. in this case. that the terms of her engagement shall be governed by prevailing Kuwaiti Civil Service Laws and Regulations as in fact POEA Rules accord respect to such rules. v. a contract freely entered into is considered the law between the parties who can establish stipulations. 2002. . ATCI Corporation ATCI. The Court's ruling in EDI-Staffbuilders Int'l. 10 of Republic Act No. the "Migrant and Overseas Filipinos' Act of 1995.. 2 of the POEA Rules and Regulations) accord respect to the "customs. Amalia Ikdal (Ikdal). ECHIN filed with the National Labor Relations Commission (NLRC) a complaint 2 for illegal dismissal against ATCI Corporation ATCI as the local recruitment agency. representing her salary for the three months unexpired portion of her contract. or that such foreign principal's liability must first be established before it. They thus conclude that it was patent error for the labor tribunals and the appellate court to apply the Labor Code provisions governing probationary employment in deciding the present case. ATCI Corporations maintain that they should not be held liable because ECHIN's employment contract specifically stipulates that her employment shall be governed by the Civil Service Law and Regulations of Kuwait . On appeal of ATCI Corporations ATCI and Ikdal. By Decision 3 of November 29. In providing for the joint and solidary liability of private recruitment agencies with their foreign principals. etc. the employment contract signed by Gran specifically states that Saudi Labor Laws will govern matters not provided for in the contract (e. as long as they are not contrary to law. this will render nugatory the very purpose for which the law governing the employment of workers for foreign jobs abroad was enacted. finding that ATCI Corporations neither showed that there was just cause to warrant ECHIN's dismissal nor that she failed to qualify as a regular employee. cannot evade responsibility for the money claims of Overseas Filipino workers (OFWs) which it deploys abroad by the mere expediency of claiming that its foreign principal is a government agency clothed with immunity from suit. being a foreign government agency. represented by ATCI Corporation. ATCI Corporations failed to discharge. Republic Act No. 2004.). 2007. 8042 precisely affords the OFWs with a recourse and assures them of immediate and sufficient payment of what is due them. the NLRC affirmed the Labor Arbiter's decision by Resolution 4 of January 26. Being the law intended by the 116 . she not having allegedly passed the probationary period. a private employment agency shall assume all responsibilities for the implementation of the contract of employment of an overseas worker. as a private recruitment agency. the appellate court affirmed the NLRC Resolution. Further. held that ECHIN was illegally dismissed and accordingly ordered ATCI Corporations to pay her US$3. By Decision 6 of March 30. (emphasis supplied) The imposition of joint and solidary liability is in line with the policy of the state to protect and alleviate the plight of the working class. to allow ATCI Corporations to simply invoke the immunity from suit of its foreign principal or to wait for the judicial determination of the foreign principal's liability before ATCI Corporation can be held liable renders the law on joint and solidary liability inutile.ECHIN was deployed on February 17. hence. [T]he obligations covenanted in the recruitment agreement entered into by and between the local agent and its foreign principal are not coterminous with the term of such agreement so that if either or both of the parties decide to end the agreement. ATCI Corporations' motion for reconsideration having been denied by Resolution 5 of April 22. and the Ministry. 2000 but was terminated from employment on February 11. the same was not substantiated. NLRC 10 illuminates: In the present case. however. ATcaHS As to Ikdal's liability. 2001. the Labor Arbiter. clauses. practices. it can be sued jointly and severally with the foreign principal for any violation of the recruitment agreement or contract of employment. On July 27. the Ministry. as such. In brushing aside ATCI Corporations' contention that they only acted as agent of the Ministry and that they cannot be held jointly and solidarily liable with it. As the Ministry denied ECHIN's request for reconsideration. given that the foreign principal is a government agency which is immune from suit.600.g. public order or public policy. as agent.00. company policies and labor laws and legislation of the host country. the immunity extended to them. specific causes for termination. 8042. As to ATCI Corporations' contentions that Philippine labor laws on probationary employment are not applicable since it was expressly provided in ECHIN's employment contract. which she voluntarily entered into. termination procedures. 2001.

thus. as the case may be. MANUEL PADOLINA. vs. The foreign law is treated as a question of fact to be properly pleaded and proved as the judge or labor arbiter cannot take judicial notice of a foreign law. 24. is not proved. Thus. Thus the subject certifications read: xxx xxx xxx This is to certify that the herein attached translation/s from Arabic to English/Tagalog and or vice versa was/were presented to this Office for review and certification and the same WAS/WERE FOUND TO BE IN ORDER. they must be proven. — The record of public documents referred to in paragraph (a) of Section 19. ATCI Corporations submitted the following: MOA between ECHIN and the Ministry. This provision shall be incorporated in the contract for overseas employment and shall be a condition precedent for its approval. 120135. (emphasis supplied) SEC. HON. Head of the Department of Foreign Affairs-Office of Consular Affairs Inslamic Certification and Translation Unit. through their wholly-owned corporations. without specifying the grounds therefor. four additional vessels which were registered in the names of their corporations. among others. William R. LTD. exemplary and other forms of damages. March 31.R. LITONJUA. as required under the Rules. the petition is DENIED. — Notwithstanding any provision of law to the contrary. shall be answerable for all money claims or damages that may be awarded to the workers. it did not prove the pertinent Saudi laws on the matter. Unfortunately for ATCI Corporation. Thereafter. This Office. 2003. however. SYNOPSIS The Litonjuas were engaged in the shipping business and owned two vessels. 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. — Whenever a copy of a document or record is attested for the purpose of the evidence. The performance bond to be filed by the recruitment/placement agency.. If the recruitment/placement agency is a juridical being. do not sufficiently prove that ECHIN was validly terminated as a probationary employee under Kuwaiti civil service laws. the party who wants to have a foreign law applied to a dispute or case HAS THE BURDEN OF PROVING THE FOREIGN LAW. assumes no responsibility as to the contents of the document/s. shall themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims and damages. Mustapha Alawi. Saudi Labor Laws should govern all matters relating to the termination of the employment of Gran. may be evidenced by an official publication thereof or by a copy attested by the officer having the legal custody of the record. as provided by law. respondents. that petitioners as trustees did not fully render an account of all the income derived from the operation of the vessels as well as the proceeds of the subsequent foreclosure sale and that the loans acquired for 117 . in substance.] 25. the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide. cHDAIS The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint and several. what ATCI Corporations submitted were mere certifications attesting only to the correctness of the translations of the MOA and the termination letter which does not prove at all that Kuwaiti civil service laws differ from Philippine laws and that under such Kuwaiti laws. 10. 8042 on money claims. consul. To prove the Kuwaiti law. the International Law doctrine of presumed-identity approach or processual presumption comes into play. Instead of submitting a copy of the pertinent Kuwaiti labor laws duly authenticated and translated by Embassy officials thereat. He is presumed to know only domestic or forum law. with a certificate that such officer has the custody. With their business doing well.parties (lex loci intentiones) to apply to the contract. the presumption is that foreign law is the same as ours. EDUARDO LITONJUA.What attestation of copy must state. even if pleaded.Money Claims. offering them easy loans to acquire said vessels. hence. BANK OF AMERICA INTERNATIONAL. and authenticated by the seal of his office. the attestation must state. the petitioner banks induced them to increase the number of their ships in operation. These documents. The Litonjuas claimed. if there be any. (emphasis and underscoring supplied) The Philippines does not take judicial notice of foreign laws.A. JR.. she was given a rating of "Excellent" albeit it changed due to changes in her shift of work schedule.Proof of official record. SECOND DIVISION [G. which provides that the employee is subject to a probationary period of one (1) year and that the host country's Civil Service Laws and Regulations apply. as represented by ATCI. To prove a foreign law. consul general. whether taken singly or as a whole. or if he be the clerk of a court having a seal. the corporate officers and directors and partners as the case may be. the certificate may be made by a secretary of the embassy or legation. vice consul.: SEC. and ECHIN's letter 13 of reconsideration to the Ministry. petitioners acquired. through Litonjuas' corporations as borrowers. and a translated copy of the certificate of termination. If the office in which the record is kept is in a foreign country. (emphasis supplied) Respecting Ikdal's joint and solidary liability as a corporate officer. Agcaoili & Associates for petitioner. ECHIN was validly terminated. under the seal of such court. Veto for respondent. that the copy is a correct copy of the original. and accompanied. No. the party invoking it must present a copy thereof and comply with Sections 24 and 25 of Rule 132 of the Revised Rules of Court which reads: SEC. Where a foreign law is not pleaded or. (emphasis and underscoring supplied) WHEREFORE. the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual moral. and AURELIO K. The attestation must be under the official seal of the attesting officer. a translated copy 11 (Arabic to English) of the termination letter to ECHIN stating that she did not pass the probation terms. BANK OF AMERICA NT&SA. This certification is being issued upon request of the interested party for whatever legal purpose it may serve. or by his deputy. we apply Philippine labor laws in determining the issues presented before us. petitioners. SR. the same is in order too following the express provision of R. if the record is not kept in the Philippines. HcACTE In international law. or a specific part thereof. COURT OF APPEALS. they must not only be alleged.. wherein she noted that in her first eight (8) months of employment. 25. 12 both of which documents were certified by Mr. when admissible for any purpose. within ninety (90) calendar days after the filing of the complaint. viz.

They assailed the above-quoted order as well as the subsequent denial of their Motion for Reconsideration. THE RESPONDENT COURT OF APPEALS FAILED TO REALIZE THAT WHILE THE PRINCIPLE OF FORUM NON CONVENIENS IS NOT MANDATORY. 8 and the possession of the vessels was also placed by defendant banks in the hands of persons selected and designated by them (defendant banks). being mere shareholders. COROLLARY TO THIS. 19 and that while private respondents 118 . THE PENDENCY OF FOREIGN ACTION MAY BE THE LEGAL BASIS FOR THE DISMISSAL OF THE COMPLAINT FILED BY THE PRIVATE RESPONDENT. DISMISSAL OF THE COMPLAINT ON THE GROUND OF FORUM NON-CONVENIENS IS MORE APPROPRIATE AND PROPER. and (3) that the Philippine Court has or is likely to have the power to enforce its decision. they deposited their revenues from said business together with other funds with the branches of said banks in the United Kingdom and Hongkong up to 1979. HOWEVER. BEYOND ANY DOUBT. "2. BANK OF AMERICAs maintain that these foreign corporations are the legal entities that have the personalities to sue and not herein private respondents. 17 Hence. have no claim on the vessels as owners since they merely have an inchoate right to whatever may remain upon the dissolution of the said foreign corporations and after all creditors have been fully paid and satisfied. THE RESPONDENT COURT OF APPEALS FAILED TO CONSIDER THE FACT THAT PRIVATE RESPONDENTS ARE GUILTY OF FORUM SHOPPING. the Motion to Dismiss is hereby DENIED. Court of Appeals. through their wholly-owned corporations. they (Litonjuas) lost sizeable amounts of their own personal funds equivalent to ten percent (10%) of the acquisition cost of the four vessels and were left with the unpaid balance of their loans with defendant banks. prompting defendant banks to have all the six vessels. Ltd. the loans acquired for the purchase of the four additional vessels then matured and remained unpaid. through their (Litonjuas') corporations as the borrowers: (a) El Carrier 4 . UNDER THE CIRCUMSTANCES SURROUNDING THE INSTANT CASE. DECISION AUSTRIA-MARTINEZ. 16 The appellate court dismissed the petition and denied BANK OF AMERICAs' Motion for Reconsideration. J p: This is a petition for review on certiorari under Rule 45 of the Rules of Court assailing the November 29. RESPONDENT COURT OF APPEALS FAILED TO CONSIDER THE FACT THAT THE SEPARATE PERSONALITIES OF THE PRIVATE RESPONDENTS (MERE STOCKHOLDERS) AND THE FOREIGN CORPORATIONS (THE REAL BORROWERS) CLEARLY SUPPORT. vs. "SO ORDERED. the revenues derived from the operation of all the vessels declined drastically. thus: "WHEREFORE. provided. In the case of Communication Materials and Design. Eduardo K. "3. including the two vessels originally owned by the private respondents. (b) El General 5 . 10 because of the breach of their fiduciary duties and/or negligence of the BANK OF AMERICAs and/or the persons designated by them in the operation of private respondents' six vessels. (defendant banks for brevity) alleging that: they were engaged in the shipping business. the defendant banks induced them to increase the number of their ships in operation. the defendant banks acquired. 13 On December 3. the complaint contains the three elements of a cause of action. herein petition anchored on the following grounds: "1. they owned two vessels: Don Aurelio and El Champion. 9 The Litonjuas claimed that defendant banks as trustees did not fully render an account of all the income derived from the operation of the vessels as well as of the proceeds of the subsequent foreclosure sale. and (d) El Conqueror 7 . that private respondents. and in view of the foregoing consideration. offering them easy loans to acquire said vessels. the vessels were registered in the names of their corporations." 18 As to the first assigned error: BANK OF AMERICAs argue that the borrowers and the registered owners of the vessels are the foreign corporations and not private respondents Litonjuas who are mere stockholders.the purchase of the four additional vessels matured and remained unpaid. Sr. unlike lack of cause of action which refers to the insufficiency of factual basis for the action. THERE ARE. (2) that the Philippine Court is in a position to make an intelligent decision as to the law and the facts. foreclosed and sold at public auction. (c) El Challenger 6 . the operation and the funds derived therefrom were placed under the complete and exclusive control and disposition of the BANK OF AMERICAs. this petition. Litonjua. but the same was denied by the trial court. 1994 decision of the Court of Appeals 1 and the April 28. The Court of Appeals denied petitioners' petition for review on certiorari and motion for reconsideration. but rather the fact that the complaint states no cause of action. the trial court issued an Order denying the Motion to Dismiss. and Aurelio J. The Court further ruled that whether a suit should be entertained or dismissed on the basis of the doctrine of forum non conveniens depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court. The defendant is therefore. the Supreme Court ruled that it is not the lack or absence of cause of action that is a ground for dismissal of the complaint. SOME GUIDELINES TO FOLLOW IN DETERMINING WHETHER THE CHOICE OF FORUM SHOULD BE DISTURBED. In denying the petition. THE PROPOSITION THAT THE PRIVATE RESPONDENTS HAVE NO PERSONALITIES TO SUE. 1993." 14 Instead of filing an answer the defendant banks went to the Court of Appeals on a "Petition for Review on Certiorari" 15 which was aptly treated by the appellate court as a petition for certiorari. 1995 resolution denying petitioners' motion for reconsideration. damages for breach of trust. THE PRINCIPLE OF RES JUDICATA IS NOT LIMITED TO FINAL JUDGMENT IN THE PHILIPPINES. and that the revenues derived from the operations of all the vessels are deposited in the accounts of the corporations. Evidently. including the two vessels originally owned by the private respondents. Hence. Failure to state a cause of action refers to the insufficiency of allegation in the pleading. Petitioners filed a motion to dismiss on grounds of forum non conveniens and lack of cause of action against them. for brevity) filed a Complaint 2 before the Regional Trial Court of Pasig against the Bank of America NT&SA and Bank of America International. 1993. prompting petitioners to have all the six vessels. all these requisites are present in the instant case. exemplary damages and attorney's fees. given a period of ten (10) days to file its Answer to the complaint. with their business doing well. Litonjua (Litonjuas. this Court held that a Philippine Court may assume jurisdiction over the case if it chooses to do so. Hence. 12 Defendant banks filed a Motion to Dismiss on grounds of forum non conveniens and lack of cause of action against them. In the case at bar. 11 The Litonjuas prayed for the accounting of the revenues derived in the operation of the six vessels and of the proceeds of the sale thereof at the foreclosure proceedings instituted by BANK OF AMERICAs. 3thereafter. IN FACT. The factual background of the case is as follows: On May 10. that the following requisites are met: (1) that the Philippine Court is one to which the parties may conveniently resort to. foreclosed and sold at public auction to answer for the obligations incurred for and in behalf of the operation of the vessels. Inc.

. INC. "vii) The revenues of the vessels and the proceeds of the sales of these vessels were ALL deposited to the Accounts of the foreign CORPORATIONS abroad. 29 Private respondents also argue that the dismissal by the Court of Appeals of the petition forcertiorari was justified because there was neither allegation nor any showing whatsoever by the BANK OF AMERICAs that they had no appeal.. (e) PACIFIC NAVIGATORS CORP. 2098) against (a) LIBERIAN TRANSPORT NAVIGATION." 23 In support of their claim that the local court is not the proper forum. (c) EDUARDO KATIPUNAN LITONJUA and (d) AURELIO KATIPUNAN LITONJUA. and (h) EDUARDO KATIPUNAN LITONJUA.A.. (g) AURELIO KATIPUNAN LITONJUA. said discretion is limited by the guidelines pertaining to the private as well as public interest factors in determining whether plaintiffs' choice of forum should be disturbed. 4040 of 1992). proceed to trial and await judgment before making an appeal.) A civil action in the Supreme Court of Hong Kong High Court (Action No. SA. and "viii) Bank of America International Ltd. LITONJUA & (h) AURELIO K. (c) the cost of obtaining attendance of willing witnesses. (g) AURELIO KATIPUNAN LITONJUA. "2. to wit: "1. as clearly mentioned in the Complaint..A. "ii) The loan transactions were obtained. Commercial Court (1992-Folio No.. vs. "iii) The monies were advanced outside the Philippines.) Civil action in England in its High Court of Justice. nor any plain. (b) EL CHALLENGER S. (c) the avoidance of unnecessary problems in conflict of laws or in the application of foreign law. (b) the availability of compulsory process for the attendance of unwilling witnesses. SA. (f) LITONJUA CHARTERING (EDYSHIP) CO. 22 to wit: "Private interest factors include: (a) the relative ease of access to sources of proof. Gilbert 21 and Piper Aircraft Co. not based in the Philippines. 32 and that herein private respondents did not actually participate in the proceedings in the foreign courts. 28 that while the complaint was filed only by the stockholders of the corporate borrowers. 31 Finally. 26 Finally. (c) EL CHALLENGER SA. perfected. (b) EL CHALLENGER S. 30 that as upheld by the Court of Appeals.. is not licensed nor engaged in trade or business in the Philippines. INC. SA.. that it would then be imposing a significant and unnecessary expense and burden not only upon the parties to the transaction but also to the local court. BANK OF AMERICAs posit that while the application of the principle of forum non conveniens is discretionary on the part of the Court. (g) EDUARDO K. (b) ESPRIONA SHIPPING COMPANY S. that the prefatory statement failed to state that part of the security of the foreign loans were mortgages on a 39-hectare piece of real estate located in the Philippines. and adequate remedy in the ordinary course of law from the Order of the trial judge denying their Motion to Dismiss. that the remedy available to the BANK OF AMERICAs after their Motion to Dismiss was denied was to file an Answer to the complaint. SA. Public interest factors include: (a) the administrative difficulties flowing from court congestion. security documentation and all subsequent restructuring agreements uniformly.. expeditious and inexpensive. and the deliveries of the sold mortgaged vessels were likewise made outside the Philippines.A. "v) The Restructuring Agreements were ALL governed by the laws of England.. speedy. 20 Anent the second assigned error. JR. private respondents contend that certain material facts and pleadings are omitted and/or misrepresented in the present petition for certiorari. aside from the said corporate borrowers being but their alter-egos. "3. or (d) all other practical problems that make trial of a case easy..." 24 BANK OF AMERICAs argue further that the loan agreements.A. (c) ESPRIONA SHIPPING COMPANY S. 27 On the other hand.A. (d) PACIFIC NAVIGATORS CORPORATION (e) EDDIE NAVIGATION CORPORATION S. 25 that Philippine Courts would then have to apply English law in resolving whatever issues may be presented to it in the event it recognizes and accepts herein case.may have allegedly spent amounts equal to 10% of the acquisition costs of the vessels in question.A. the decision of the trial court in not applying the principle of forum non conveniens is in the lawful exercise of its discretion.. and (h) EDUARDO KATIPUNAN LITONJUA.A. are based in Hongkong and England. 4039 of 1992). the evidence and the witnesses are not readily available in the Philippines. 2245) against (a) EL CHALLENGER S.A. It is a well-settled rule that the order denying the motion to dismiss CANNOT be the subject of petition for certiorari. (c) ESPRIONA SHIPPING COMPANY S. Queen's Bench Division. "4. BANK OF AMERICAs allege the following: "i) The Bank of America Branches involved. consummated and partially paid outside the Philippines. (b) ESHLEY COMPANIA NAVIERA SA.. BANK OF AMERICAs should have filed an answer to the complaint.. their 10% however represents their investments as stockholders in the foreign corporations. against (a) ESHLEY COMPANIA NAVIERA S. Furthermore. (f) EDDIE NAVIGATION CORP. unconditionally and expressly provided that they will be governed by the laws of England. "vi) The subsequent sales of the mortgaged vessels and the application of the sales proceeds occurred and transpired outside the Philippines." and that private respondents' alleged cause of action is already barred by the pendency of another action or by litis pendentia as shown above. Reyno. "iv) All the loans involved were granted to the Private Respondents' foreign CORPORATIONS. as elucidated in Gulf Oil Corp. or (d) the unfairness of burdening citizens in an unrelated forum with jury duty. As such. 33 We deny the petition for lack of merit. (d) ESPRIONA SHIPPING CO. BANK OF AMERICAs claim that private respondents have already waived their alleged causes of action in the case at bar for their refusal to contest the foreign civil cases earlier filed by the BANK OF AMERICAs against them in Hongkong and England.) Civil action in the Supreme Court of Hongkong High Court (Action No. the mortgaged vessels were part of an offshore fleet. private respondents aver that the statement of BANK OF AMERICAs that the doctrine of res judicata also applies to foreign judgment is merely an opinion advanced by them and not based on a categorical ruling of this Court..A. (d) PACIFIC NAVIGATORS CORPORATION (e) EDDIE NAVIGATION CORPORATION S. BANK OF AMERICAs insist that the inconvenience and difficulty of applying English law with respect to a wholly foreign transaction in a case pending in the Philippines may be avoided by its dismissal on the ground of forum non conveniens. As repeatedly held by this Court: 119 . JR... (f) LITONJUA CHARTERING (EDYSHIP) CO..A. LITONJUA. performed. the latter are wholly-owned by the private respondents who are Filipinos and therefore under Philippine laws. they have interests of their own in the vessels. Queen's Bench Division Commercial Court (1992-Folio No. (b) the local interest in having localized controversies decided at home. vs.) Civil action in England in its High Court of Justice. against (a) ESHLEY COMPANIA NAVIERA S.

Under certain situations. since the institution of another action upon a revised complaint would not be foreclosed. admissions or evidence presented. 36 this Court clarified that a complaint states a cause of action where it contains three essential elements of a cause of action. Court of Appeals. 44 In the case of Communication Materials and Design. 50 In case at bar. and that the propriety of dismissing a case based on this principle of forum non conveniens requires a factual determination. . emerged in private international law to deter the practice of global forum shopping. that is. being mere stockholders of the foreign corporations. i. to determine whether special circumstances require the court's desistance. they were clients of BANK OF AMERICAs which induced them to acquire loans from said BANK OF AMERICAs to invest on the additional ships. namely: (1) the legal right of the plaintiff. is untenable.e. all these requisites are present in the instant case. 49 Parenthetically. 120 . . 40 ". not prove to be a speedy and adequate remedy? We will resolve said questions in conjunction with the issues raised by the parties. still the other requirements necessary for litis pendentia were not shown by BANK OF AMERICA. 47 that the doctrine of forum non conveniens should not be used as a ground for a motion to dismiss because Sec. (b) where there is patent grave abuse of discretion by the trial court. and. Inc. First issue. This Court further ruled that while it is within the discretion of the trial court to abstain from assuming jurisdiction on this ground. such a course. 51 as well as the reversal in positions of plaintiffs and defendants 52 . it is not the lack or absence of cause of action that is a ground for dismissal of the complaint but rather the fact that the complaint states NO cause of action."An order denying a motion to dismiss is interlocutory and cannot be the subject of the extraordinary petition forcertiorari or mandamus. as trustees by reason of the fiduciary relationship that was created between the parties involving the vessels in question. herein private respondents. . the complaint contains the three elements of a cause of action. [a] Philippine Court may assume jurisdiction over the case if it chooses to do so. and (c) the identity in the two cases should be such that the judgment which may be rendered in one would. . Court of Appeals. The remedy of the aggrieved party is to file an answer and to interpose as defenses the objections raised in his motion to dismiss. vs.. (b) identity of rights asserted and relief prayed for." 34 Records show that the trial court acted within its jurisdiction when it issued the assailed Order denying BANK OF AMERICAs' motion to dismiss. Did the trial court commit grave abuse of discretion in refusing to dismiss the complaint on the ground that plaintiffs have no cause of action against defendants since plaintiffs are merely stockholders of the corporations which are the registered owners of the vessels and the borrowers of BANK OF AMERICAs? No. . such as to secure procedural advantages. As held in the San Lorenzo case. the relief being founded on the same acts. 38 "Failure to state a cause of action" refers to the insufficiency of allegation in the pleading. assuming that the allegation of facts constituting plaintiffs' cause of action is not as clear and categorical as would otherwise be desired. to abort the action on account of the alleged fatal flaws of the complaint would obviously be indecisive and would not end the controversy. not all the requirements for litis pendentia are present. It merely mentioned that civil cases were filed in Hongkong and England without however showing the identity of rights asserted and the reliefs sought for as well as the presence of the elements of res judicata should one of the cases be adjudged. or (c) appeal would not prove to be a speedy and adequate remedy as when an appeal would not promptly relieve a defendant from the injurious effects of the patently mistaken order maintaining the plaintiff's baseless action and compelling the defendant needlessly to go through a protracted trial and clogging the court dockets by another futile case. to avoid overcrowded dockets. It alleges that: (1) plaintiffs. Does the denial of the motion to dismiss constitute a patent grave abuse of discretion? Would appeal. We agree with private respondents. 43 Whether a suit should be entertained or dismissed on the basis of said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court." 46 Evidently. Rule 16 of the Rules of Court does not include said doctrine as a ground. hence it is more properly considered a matter of defense. (3) that the Philippine Court has or is likely to have power to enforce its decision. and therefore. 1. 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. Lack of personality to sue can be used as a ground for a Motion to Dismiss based on the fact that the complaint. the complaint should be dismissed. Court of Appeals. amount to res judicata in the other. and (3) BANK OF AMERICAs failed to do the same. (2) BANK OF AMERICAs have the obligation. as trustees. . (a) when the trial court issued the order without or in excess of jurisdiction. the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of action. provided. proceed to trial. 39 In the case at bar. BANK OF AMERICAs' argument that private respondents. unlike "lack of cause of action" which refers to the insufficiency of factual basis for the action. Under this doctrine. Investment Corporation vs. or to select a more friendly venue. regardless of which party is successful. under the circumstances. Should the complaint be dismissed on the ground of forum non-conveniens? No. any uncertainty thereby arising should be so resolved as to enable a full inquiry into the merits of the action. While there may be identity of parties. ." As this Court has explained in the San Lorenzo case. that the corporate entities have juridical personalities separate and distinct from those of the private respondents. have no personalities to sue. 37 To emphasize. in conflicts of law cases. If these elements are absent. while "lack of cause of action" may be raised any time after the questions of fact have been resolved on the basis of stipulations. have the right to demand for an accounting from defendants (herein BANK OF AMERICAs). that the following requisites are met: (1) that the Philippine Court is one to which the parties may conveniently resort to. Moreover. BANK OF AMERICAs insist that they do not have any obligation to the private respondents as they are mere stockholders of the corporation.35 In San Lorenzo Village Association. evidently states no cause of action. Are private respondents guilty of forum shopping because of the pendency of foreign action? No. this Court enunciated in Philsec. and in case of an adverse decision. 42 that is to prevent non-resident litigants from choosing the forum or place wherein to bring their suit for malicious reasons. The doctrine of forum non-conveniens. "Failure to state a cause of action" may be raised at the earliest stages of an action through a motion to dismiss the complaint. 45 this Court held that ". Forum shopping exists where the elements of litis pendentia are present and where a final judgment in one case will amount to res judicata in the other. To do otherwise. to elevate the entire case by appeal in due course. (2) that the Philippine Court is in a position to make an intelligent decision as to the law and the facts. vs. 41 Second Issue. to annoy and harass the defendant. (2) the correlative obligation of the defendant. literally meaning 'the forum is inconvenient'. a court. it should do so only after vital facts are established. to render such an accounting. notwithstanding the presence of other respondents. recourse to certiorari or mandamus is considered appropriate. and (3) the act or omission of the defendant in violation of said legal right. Private respondents maintain that the corporations are wholly owned by them and prior to the incorporation of such entities. for litis pendentia to be a ground for the dismissal of an action there must be: (a) identity of the parties or at least such as to represent the same interest in both actions. and conduce to the definitive determination and termination of the dispute. A case is dismissible for lack of personality to sue upon proof that the plaintiff is not the real party-in-interest. would preclude multiplicity of suits which the law abhors. Inc. on the face thereof. 48 Third issue.

J p: The Case This Petition for Review on Certiorari 1 seeks to set aside the October 18. The Ruling of the Labor Arbiter In his February 10. 1993 letter for curricula vitae of qualified applicants for the position of "Computer Specialist. INC. 121 . 14 Labor Arbiter Manuel R. October 26. his monthly basic salary was fixed at SR 2. which was docketed as POEA ADJ (L) 94-06-2194 for underpayment of wages/salaries and illegal dismissal. in Riyadh. both courts correctly denied the dismissal of herein subject complaint. which was equivalent to USD 600. dated October 3. his employment was terminated through OAB's July 9. . petitioner. Gran instituted a complaint. (OAB) jointly and severally to pay Eleazar S. to whom Gran's case was assigned.500. 12 3. Gran questioned the discrepancy in his monthly salary — his employment contract stated USD 850. Gran's monthly salary was USD 600. 1998 Decision. the petition is DENIED for lack of merit. against ESI/EDI. OAB. GRAN. 1993.R. ordering Expertise Search International (ESI). and on the same day. On July 11. Quezon City. 'D' and `E'". 'C'. 56120 which affirmed the January 15..948. Private respondent Gran was an OFW recruited by EDI. However. No. 1999 Resolution 4 rendered by the National Labor Relations Commission (NLRC) (Third Division) in POEA ADJ (L) 94-06-2194. NATIONAL LABOR RELATIONS COMMISSION and ELEAZAR S. Upon arrival in Riyadh. p. did aver that "Copies of the foreign judgments are hereto attached and made integral parts hereof as Annexes 'B'. he executed a Declaration 13 releasing OAB from any financial obligation or otherwise. Insubordination or disobedience to Top Management Order and/or instructions (non-submittal of daily activity reports despite several instructions). it selected Gran for the position of "Computer Specialist. How then could We have been expected to rule on this issue even if We were to hold that foreign judgments could be the basis for the application of the aforementioned principle of res judicata? 53 Consequently. . 1994. failed to provide this Court with relevant and clear specifications that would show the presence of the above-quoted elements or requisites for res judicata. 1999 Decision 3 and September 30. SP No. 8 After accepting OAB's offer of employment. Gran received from OAB the total amount of SR 2. 145587. Gran was then deployed to Riyadh. one of which was a monthly salary of SR (Saudi Riyal) 2. they failed. to include a single foreign judgment in their pleadings submitted to this Court as annexes to their petition.00. 5 ESI is another recruitment agency which collaborated with EDI to process the documentation and deployment of private respondent to Saudi Arabia.00 representing his final pay. [T]he BANK OF AMERICAs. While it is true that the BANK OF AMERICAs in their motion for reconsideration (CA Rollo. 6 It appears that OAB asked EDI through its October 3. F-5751-93.150. National Capital Region.. After his arrival in the Philippines. OAB informed EDI that. Kingdom of Saudi Arabia on February 7. and in his Confirmation of Appointment as Computer Specialist. while his Philippine Overseas Employment Agency (POEA) Information Sheet indicated USD 600.00. vs. 11 on the following grounds: 1. and deployed by ESI to work for OAB.00).As the Court of Appeals aptly observed: . Inc. to justify that Gran had no claim for unpaid salaries or wages against OAB. 1994. Non-compliance to pre-qualification requirements by the recruitment agency[. WHEREFORE. EDI-STAFFBUILDERS INTERNATIONAL. respondents." The faxed letter also stated that if Gran agrees to the terms and conditions of employment contained in it.00 for a period of two years. and Western Guaranty Corporation with the NLRC. 2007. 2. 1994. Country Bankers Insurance Corporation.00. . EDI may arrange for Gran's immediate dispatch. The Facts Petitioner EDI is a corporation engaged in recruitment and placement of Overseas Filipino Workers (OFWs).00 a month. Kingdom of Saudi Arabia. OAB agreed to pay Gran USD 850. ruled that there was neither underpayment nor illegal dismissal.] 26. after enumerating the various civil actions instituted abroad. 72). Gran (Gran) the amount of USD 16. 2000 Decision 2 of the Court of Appeals (CA) in CA-G.250. ICDcEA The Labor Arbiter reasoned that there was no underpayment of salaries since according to the POEA-Overseas Contract Worker (OCW) Information Sheet. Costs against BANK OF AMERICAs. (EDI). Gran signed an employment contract 9 that granted him a monthly salary of USD 850. on July 21.00.00 only. TIcEDC SO ORDERED. EDI-Staffbuilders International." 7 In a facsimile transmission dated November 29. wittingly or inadvertently. 10 After Gran had been working for about five months for OAB..] vide OAB letter ref. SECOND DIVISION [G. 1994 letter.R. Non-compliance to contract requirements by the recruitment agency primarily on your salary and contract duration. Caday. and Omar Ahmed Ali Bin Bechr Est.00 (USD 600. towards him. through the assistance of the EDI office in Riyadh. . JR. from the applicants'curricula vitae submitted to it for evaluation.00 as unpaid salaries. DECISION VELASCO. Arbiter Caday also cited the Declaration executed by Gran. by simply enumerating the civil actions instituted abroad involving the parties herein . 1993.

no evidence was presented to show how and why Gran was considered to be incompetent..00) representing his salaries for the unexpired portion of his contract. he should have just been suspended or reprimanded. The appellate court ratiocinated that EDI had the burden of proving Gran's incompetence. 16 Gran then filed a Motion for Execution of Judgment 17 on March 29. EDI filed a Petition for Certiorari before the CA."22 The court also held that petitioner EDI failed to prove that private respondent was terminated for a valid cause and in accordance with due process. 1998. on August 26. Dissatisfied. 1999. (4) that Gran's employment contract had never been substituted. the appellate court held that "Gran's failure to furnish a copy of his appeal memorandum [to EDI was] a mere formal lapse.150. on October 18." the appellate court found that EDI failed to show that the submission of the "Daily Activity Report" was a part of Gran's duty or the company's policy. Hence. 18 To prevent the execution. and Gran was not even afforded the required notice and investigation on his alleged offenses. (1) that Gran did not submit a single activity report of his daily activity as dictated by company policy. The CA also held that Gran was not afforded due process. it was found that Gran did not commit any act that constituted a legal ground for dismissal. he would not have been hired and deployed abroad. In addition. The appellate court found that the Declaration was in the form of a quitclaim. (2) that he was not qualified for the job as computer specialist due to his insufficient knowledge in programming and lack of knowledge in ACAD system. 2000. As for the charge of insubordination and disobedience due to Gran's failure to submit a "Daily Activity Report. Finally. 20 The NLRC then issued a Resolution 21 denying petitioner's Motion for Reconsideration. EDI Staffbuilders Int'l. CIDTcH On the procedural issue. Third Division. and ruled upon" in the Decision. 1999. Arbiter Caday dismissed Gran's complaint for lack of merit.00. however. (OAB) are hereby ordered jointly and severally liable to pay the complainant Eleazar Gran the Philippine peso equivalent at the time of actual payment of SIXTEEN THOUSAND ONE HUNDRED FIFTY US DOLLARS (US$16. petitioner filed. and as such is frowned upon as contrary to public policy especially where the monetary consideration given in the Declaration was very much less than what he was legally entitled to — his backwages amounting to USD 16. The alleged non-compliance with contractual stipulations relating to Gran's salary and contract duration. this instant petition is before the Court. on February 10. Respondents Expertise Search International. the appellate court denied the petition to set aside the NLRC Decision. The court held that since the law requires the recruitment agencies to subject OFWs to trade tests before deployment.. and his failure to submit daily activity reports. the dispositive portion of which reads: WHEREFORE. ratiocinating that the issues and arguments raised in the motion "had already been amply discussed. 1998 with the NLRC. the Labor Arbiter decided that Gran was validly dismissed from his work due to insubordination. The court found that Gran was terminated on the same day he received the termination letter. SETAcC The Ruling of the NLRC The NLRC held that EDI's seemingly harmless transfer of Gran's contract to ESI is actually "reprocessing. without having been apprised of the bases of his dismissal or afforded an opportunity to explain his side. (5) and that Gran was paid a monthly salary of USD 850. Inc.00. it appears from the records that Gran failed to furnish EDI with a copy of his Appeal Memorandum. given that OAB did not abide by the twin notice requirement. As a result of these findings. In addition. This scheme constituted misrepresentation through the conspiracy between EDI and ESI in misleading Gran and even POEA of the actual terms and conditions of the OFW's employment. which dealt directly with OAB. However." which is a prohibited transaction under Article 34 (b) of the Labor Code. and Omar Ahmed Ali Bin Bechr Est. otherwise. SO ORDERED. the assailed decision is SET ASIDE. 1999 with the NLRC and petitioner receiving a copy of this motion on the same date. (3) that Gran refused to follow management's instruction for him to gain more knowledge of the job to prove his worth as computer specialist. the Labor Arbiter found that Gran failed to refute EDI's allegations.With regard to the issue of illegal dismissal. Thus. a Motion for Reconsideration of the NLRC Decision after receiving a copy of the Decision on August 16. the CA held that the Declaration signed by Gran did not bar him from demanding benefits to which he was entitled. other than the termination letter. considered. Gran must have been competent and qualified. and the absence of pre-qualification requirements cannot be attributed to Gran but to EDI. and that Gran's Declaration releasing OAB from any monetary obligation had no force and effect. Thus. disobedience. and that there was "no cogent reason or patent or palpable error that warrant any disturbance thereof." Unconvinced of the NLRC's reasoning.00 monthly as food allowance. The Issues Petitioner raises the following issues for our consideration: 122 . the NLRC reversed the Labor Arbiter's Decision and rendered a new one. Inc. Seeing that the NLRC did not act on Gran's motion after EDI had filed its Opposition. but not dismissed. Gran filed an Appeal 15 on April 6.150. and USD 350. Petitioner claimed in its petition that the NLRC committed grave abuse of discretion in giving due course to the appeal despite Gran's failure to perfect the appeal. the charge of insubordination was not substantiated. The Ruling of the Court of Appeals The CA subsequently ruled on the procedural and substantive issues of EDI's petition. an excusable neglect and not a jurisdictional defect which would justify the dismissal of his appeal. The court also held that even if Gran was guilty of insubordination. Accordingly. petitioner filed an Opposition 19 to Gran's motion arguing that the Writ of Execution cannot issue because it was not notified of the appellate proceedings before the NLRC and was not given a copy of the memorandum of appeal nor any opportunity to participate in the appeal. namely.

30 The post office's list shows that private respondent Gran sent two pieces of mail on the same date: one addressed to a certain Dan O. it should not be given due course either. Gran submitted a copy of Camp Crame Post Office's list of mail/parcels sent on April 7. This position is devoid of merit. and hence. proof shall be made by such affidavit and registry receipt issued by the mailing office. Makati. 26 (Emphasis supplied. an excusable neglect. 13.D. He should have submitted an affidavit proving that he mailed the Appeal Memorandum together with the registry receipt issued by the post office. This mailing list. in such a situation. SEHaTC Also. The registry return card shall be filed immediately upon its receipt by the sender. National Labor Relations Commission.) The J. The records reveal that the NLRC discovered that Gran failed to furnish EDI a copy of the Appeal Memorandum. but if the addressee fails to claim his mail from the post office within five (5) days from the date of first notice of the postmaster. proof thereof shall consist of an affidavit of the person mailing of facts showing compliance with section 7 of this Rule. NLRC. 24 this Court set aside the order of the NLRC which dismissed an appeal on the sole ground that the appellant did not furnish the appellee a memorandum of appeal contrary to the requirements of Article 223 of the New Labor Code and Section 9. NLRC. place and manner of service.) Hence. Rule 13 of the Rules of Court. While Gran's failure to furnish EDI with a copy of the Appeal Memorandum is excusable. WHETHER THE PRIETO VS. is not a conclusive proof that EDI indeed received a copy of the Appeal Memorandum. if the service is done through registered mail. V. National Labor Relations Commission. Inc. 28 and in Sunrise Manning Agency. Proof of service. 29 Thus. NLRC RULING. Magpayo. However. Sec. Magpayo Customs Brokerage Corp. Based on the foregoing provision. or in lieu thereof the unclaimed letter together with the certified or sworn copy of the notice given by the postmaster to the addressee (emphasis supplied). the NLRC Rules do not state what would constitute proper proof of service.D. in such a case. The Court ratiocinated as follows: The failure to give a copy of the appeal to the adverse party was a mere formal lapse. afterwards. provides for proofs of service: AHacIS Section 13. it is only deemed complete when the addressee or his agent received the mail or after five (5) days from the date of first notice of the postmaster. 27 Pagdonsalan v. containing a full statement of the date.Service by registered mail is complete upon receipt by the addressee or his agent. Garcia (or Gran). in J. the appeal should not be dismissed. service shall take effect after such time. 31 of Ermita. If service is made by registered mail. II. Rules of Court. WHETHER PETITIONER EDI HAS ESTABLISHED BY WAY OF SUBSTANTIAL EVIDENCE THAT GRAN'S TERMINATION WAS JUSTIFIABLE BY REASON OF INCOMPETENCE. NLRC. We act on the petitions and simply require the petitioners to comply with the rule. an excusable neglect. Rule XIII of its Implementing Rules and Regulations. the duty that is imposed on the NLRC. nor is it conclusive proof that EDI received its copy of the Appeal Memorandum. WHETHER GRAN IS ENTITLED TO BACKWAGES FOR THE UNEXPIRED PORTION OF HIS CONTRACT. Gran should have immediately filed the registry return card. In compliance with the order. 123 . not a jurisdictional defect. the doctrine that evolved from these cases is that failure to furnish the adverse party with a copy of the appeal is treated only as a formal lapse. — Proof of personal service shall consist of a written admission of the party served or the official return of the server. it was ruled that failure of appellant to furnish a copy of the appeal to the adverse party is not fatal to the appeal. WHETHER GRAN WAS AFFORDED DUE PROCESS PRIOR TO TERMINATION.I. the abject failure of the NLRC to order Gran to furnish EDI with the Appeal Memorandum constitutes grave abuse of discretion. IS APPLICABLE IN THE INSTANT CASE. 1998. v. COROLLARY HERETO. and the other appears to be addressed to Neil B. As enunciated in J. If the service is by ordinary mail. AS APPLIED BY THE COURT OF APPEALS. 32 Proof and completeness of service. 5 of the NLRC Rules of Procedure (1990) provides for the proof and completeness of service in proceedings before the NLRC: Section 5. Time and again We have acted on petitions to review decisions of the Court of Appeals even in the absence of proof of service of a copy thereof to the Court of Appeals as required by Section 1 of Rule 45. Accordingly. however. it is obvious that the list submitted by Gran is not conclusive proof that he had served a copy of his appeal memorandum to EDI. 23 The Court's Ruling The petition lacks merit except with respect to Gran's failure to furnish EDI with his Appeal Memorandum filed with the NLRC. WHETHER THE FAILURE OF GRAN TO FURNISH A COPY OF HIS APPEAL MEMORANDUM TO PETITIONER EDI WOULD CONSTITUTE A JURISDICTIONAL DEFECT AND A DEPRIVATION OF PETITIONER EDI'S RIGHT TO DUE PROCESS AS WOULD JUSTIFY THE DISMISSAL OF GRAN'S APPEAL. v. The NLRC then ordered Gran to present proof of service. (Emphasis supplied. III. IV. however. WHETHER PETITIONER HAS ESTABLISHED BY WAY OF SUBSTANTIAL EVIDENCE THAT GRAN'S TERMINATION WAS JUSTIFIABLE BY REASON OF INSUBORDINATION AND DISOBEDIENCE. First Issue: NLRC's Duty is to Require Respondent to Provide Petitioner a Copy of the Appeal Petitioner EDI claims that Gran's failure to furnish it a copy of the Appeal Memorandum constitutes a jurisdictional defect and a deprivation of due process that would warrant a rejection of the appeal.D. de Guzman of Legaspi Village. is to require the appellant to comply with the rule that the opposing party should be provided with a copy of the appeal memorandum. In Estrada v. Manila — both of whom are not connected with petitioner. Sec. In a catena of cases. the order of dismissal of an appeal to the NLRC based on the ground that "there is no showing whatsoever that a copy of the appeal was served by the appellant on the appellee" 25 was annulled. or the affidavit of the party serving. Magpayo ruling was reiterated in Carnation Philippines Employees Labor Union-FFW v. — The return is prima facie proof of the facts indicated therein.

the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. Being the law intended by the parties (lex loci intentiones) to apply to the contract. EDI failed to establish any such bases to show how petitioner found Gran incompetent. Petitioner EDI claims that it had proven that Gran was legally dismissed due to incompetence and insubordination or disobedience. The glaring failure of NLRC to ensure that Gran should have furnished petitioner EDI a copy of the Appeal Memorandum before rendering judgment reversing the dismissal of Gran's complaint constitutes an evasion of the pertinent NLRC Rules and established jurisprudence. In many cases. Section 33 of Article 277 of the Labor Code 38 states that: ART. In addition. but it should have required Gran to properly furnish the opposing parties with copies of his Appeal Memorandum as prescribed in J. However. morals. 41 This is consistent with the principle of security of tenure as guaranteed by the Constitution and reinforced by Article 277 (b) of the Labor Code of the Philippines. 1994 termination letter. An allegation of incompetence should have a factual foundation. provided they are not contrary to law. 36 Where a foreign law is not pleaded or. Worse. The second is an unsigned April 11. as this constitutes grave abuse of discretion. 124 . the employer has the burden of proving that the dismissal is for just and valid causes. the International Law doctrine ofpresumedidentity approach or processual presumption comes into play. the rights and obligations among and between the OFW. only to receive a copy of Gran's Motion for Execution of Judgment which also informed them that Gran had obtained a favorable NLRC Decision." 46 However. the local recruiter/agent. Managing Director of OAB. without any other evidence. from Andrea E. Incompetence may be shown by weighing it against a standard. clauses.g. 40 Taking into account the character of the charges and the penalty meted to an employee. specific causes for termination. insubordinate. This claim has no merit. MISCELLANEOUS PROVISIONS 39 (b) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code. and convincing evidence to prove that the dismissal is valid and legal." 45 Petitioner also claims that Gran was justifiably dismissed due to insubordination or disobedience because he continually failed to submit the required "Daily Activity Reports. good customs. and the foreign employer/principal are governed by the employment contract. A contract freely entered into is considered law between the parties. To prove its allegations. However. and ESI experienced when they thought that the dismissal of Gran's complaint became final. or criterion. termination procedures. no other evidence was presented to show how and why Gran was considered incompetent. The first is the July 9. accurate. Any decision taken by the employer shall be without prejudice to the right of the workers to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. EDI submitted two letters as evidence. . is not proved. the employment contract signed by Gran specifically states that Saudi Labor Laws will govern matters not provided for in the contract (e. the parties may establish such stipulations. instead of annulling the dispositions of the NLRC and remanding the case for further proceedings we will resolve the petition based on the records before us to avoid a protracted litigation. or disobedient. Saudi Labor Laws should govern all matters relating to the termination of the employment of Gran. the NLRC should not have simply accepted the post office's list of mail and parcels sent. and failure to do so would necessarily mean that the dismissal was not justified and therefore illegal. due to incompetence and insubordination or disobedience. The rights of the employers to procedural due process cannot be cavalierly disregarded for they too have rights assured under the Constitution. 35 Unfortunately for petitioner. Petitioner's imputation of incompetence on private respondent due to his "insufficient knowledge in programming and zero knowledge of the ACAD system" based only on the above mentioned letters. He is presumed to know only domestic or forum law. petitioner claims that private respondent Gran was validly dismissed for just cause. One can only surmise the shock and dismay that OAB. and hence. Nicolaou. should be respected. this failure deprived EDI of procedural due process guaranteed by the Constitution which can serve as basis for the nullification of proceedings in the appeal before the NLRC. which outlined the reasons why OAB had terminated Gran's employment. 277. the presumption is that foreign law is the same as ours. EDI. other than the abovementioned letters. This is not level playing field and absolutely unfair and discriminatory against the employer and the job recruiters. it did not prove the pertinent Saudi laws on the matter. it has been established by Philippine law and jurisprudence that the employer should prove that the dismissal of employees or personnel is legal and just. insubordination.D. terms and conditions as they may deem convenient. we apply Philippine labor laws in determining the issues presented before us. Petitioner EDI had clearly failed to overcome the burden of proving that Gran was validly dismissed. the party who wants to have a foreign law applied to a dispute or case has the burden of PROVING the foreign law. . they will be discussed jointly. cannot be given credence. the employer is bound to adduce clear. 33 The second and third issues have a common matter — whether there was just cause for Gran's dismissal — hence. In illegal dismissal cases. the elements that must concur for the charge of insubordination or willful disobedience to prosper were not present. benchmark. and disobedience In cases involving OFWs. consistent. The foreign law is treated as a question of fact to be properly pleaded and proved as the judge or labor arbiter cannot take judicial notice of a foreign law. 43 addressed to Gran. thus.Hence. The NLRC should not have proceeded with the adjudication of the case. even if pleaded. 34 HAaDcS In the present case. public order. In international law. 42 aEAIDH In the instant case. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer.). In formulating the contract. Magpayo and the other cases. etc. it has been held that in termination disputes or illegal dismissal cases. 37 Thus. or public policy. Second and Third Issues: Whether Gran's dismissal is justifiable by reason of incompetence. 1995 letter 44 from OAB addressed to EDI and ESI. after seeing that Gran failed to attach the proof of service. Petitioner claims that Gran was incompetent for the Computer Specialist position because he had "insufficient knowledge in programming and zero knowledge of [the] ACAD system. .

our laws and rules on the requisites of due process relating to termination of employment shall apply. Gran misrepresented himself in hiscurriculum vitae as a Computer Specialist. Inc. 59 On the other hand. No. indeed. Since OAB was in breach of the due process requirements under the Labor Code and its regulations. lawful. made known to the employee and must pertain to the duties which he had been engaged to discharge. it can be presumed that Gran had passed the required trade test and that Gran is qualified for the job." 50 The CA. Obviously. Clearly. the July 9. even before Gran was furnished the termination letter. this Court ruled that "[i]t is presumed that before their deployment. Pursuant to the doctrine laid down in Agabon. the Prieto ruling is not applicable because in the case at hand. Moreover. the following twin elements must concur: (1) the employee's assailed conduct must have been willful. the employer must give the employee two written notices and a hearing or opportunity to be heard if requested by the employee before terminating the employment: a notice specifying the grounds for which dismissal is sought a hearing or an opportunity to be heard and after hearing or opportunity to be heard. Fifth and Last Issue: Gran is Entitled to Backwages We reiterate the rule that with regard to employees hired for a fixed period of employment. as prescribed by the Labor Code. Before the Labor Arbiter. In any case. he was not qualified for the job for which he was hired. (1) if the dismissal is based on a just cause under Article 282. they are entitled to the payment of their salaries corresponding to the unexpired portion of their contract. in cases arising before the effectivity of R. Gran's job description.000. Thus. In Prieto. for cases arising after the effectivity of R. According to petitioner. OAB. NLRC. The CA is correct in applying Prieto. Since EDI deployed Gran to Riyadh. lawful. This shows that OAB had already condemned Gran to dismissal. he would not have been hired. 8042 58 (Migrant Workers and Overseas Filipinos Act) on August 25.A. EAHcCT Under the twin notice requirement.00 as indemnity. are liable to Gran in the amount of PhP30. Gran was notified and his employment arbitrarily terminated on the same day. they should have adduced additional evidence to convincingly show that Gran's employment was validly and legally terminated. and (2) the order violated must have been reasonable. The purpose of the required trade test is to weed out incompetent applicants from the pool of available workers. the employer must give the employee and the Department of Labor and Employment written notices 30 days prior to the effectivity of his separation. NLRC. and EDI. through the same letter. We disagree. thus. Philippine Labor laws and regulations shall govern the relationship between Gran and EDI. there was no intention to provide Gran with due process. the employees should be given a hearing or opportunity to defend themselves personally or by counsel of their choice. In Agabon v. the petitioners were subjected to trade tests required by law to be conducted by the recruiting agency to insure employment of only technically qualified workers for the foreign principal. the worker shall be entitled to the full reimbursement of his placement fee with 125 . In addition. 53 cited by the CA in its Decision. that when the contract is for a fixed term and the employees are dismissed without just cause. 51 EDI also claims that the requirements of due process. NLRC. and pertains to the duties which he had been engaged to discharge. when the termination of employment is without just.A. insubordination. otherwise. jointly and solidarily. more particularly by a Computer Specialist. and (2) a second notice to communicate to the employees that their employment is being terminated. Petitioner EDI claims that private respondent Gran was afforded due process. 55 A careful examination of the records revealed that. The burden devolves not only upon the foreign-based employer but also on the employment or recruitment agency for the latter is not only an agent of the former. since he was allowed to work and improve his capabilities for five months prior to his termination. and (2) if the dismissal is based on authorized causes under Articles 283 and 284. OAB did not schedule a hearing or conference with Gran to defend himself and adduce evidence in support of his defenses. made known to the employee. In between the first and second notice. It is supposed to reveal applicants with false educational backgrounds. valid or authorized cause as defined by law or contract. Fourth Issue: Gran was not Afforded Due Process As discussed earlier. or willful disobedience. Even though EDI and/or ESI were merely the local employment or recruitment agencies and not the foreign employer. v. Petitioner also raised the issue that Prieto v. and expose bogus qualifications. ruled that Gran must have passed the test. it was still EDI's responsibility to subject Gran to a trade test. 1995. As indicated by the second requirement provided for in Micro Sales Operation Network. were properly observed in the present case. the employees must be given two (2) notices before their employment could be terminated: (1) a first notice to apprise the employees of their fault. 47 EDI failed to discharge the burden of proving Gran's insubordination or willful disobedience. petitioner failed to prove that Gran was justifiably dismissed due to incompetence. 57 an employer is liable to pay nominal damages as indemnity for violating the employee's right to statutory due process. v. he was denied the opportunity to respond to said notice. It should also be pointed out that OAB failed to give Gran the chance to be heard and to defend himself with the assistance of a representative in accordance with Article 277 of the Labor Code. petitioner failed to show that the order of the company which was violated — the submission of "Daily Activity Reports" — was part of Gran's duties as a Computer Specialist. and its failure to do so only weakened its position but should not in any way prejudice Gran. 1994 termination letter was effective on the same day. in order to justify willful disobedience. that is. we must determine whether the order violated by the employee is reasonable. Even if there was no objective trade test done by EDI. 52 and Malaya Shipping Services. 48 aTADCE Thus. Gran was not afforded due process. a notice of the decision to dismiss. Therefore. This position is untenable.In Micro Sales Operation Network v. 49 as used by the CA in its Decision. using the ruling in the said case. the issue is rendered moot and academic because Gran's incompetency is unproved. 8042. No. In the case at bar. it failed to furnish Gran the written notice apprising him of the charges against him. NLRC. in the absence of proof of Saudi laws. is not applicable to the present case. characterized by a wrongful and perverse attitude. OAB's manner of dismissing Gran fell short of the two notice requirement. but is also solidarily liable with the foreign principal for any claims or liabilities arising from the dismissal of the worker. ESI. and for unjustified grounds. as enunciated inSantos Jr. Summing up. EDI should have provided a copy of the company policy. EDI was at fault when it deployed Gran who was allegedly "incompetent" for the job. While it furnished Gran the written notice informing him of his dismissal. 54 this Court held that: Procedurally. we held that: For willful disobedience to be a valid cause for dismissal. NLRC. or any other document that would show that the "Daily Activity Reports" were required for submission by the employees. 56 Consequently.

citing Periquet v. Certainly. On July 21. is unreasonably low. then the consideration should be much much more than the monthly salary of SR 3. The factual circumstances surrounding the execution of the Declaration would show that Gran did not voluntarily and freely execute the document. or the terms of settlement are unconscionable on its face. the transaction must be recognized as a valid and binding undertaking. 60 In the present case.A. plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term whichever is less. in the amount of SR 2. 1994 to leave Riyadh on July 12. 1994. and quitclaims: Not all waivers and quitclaims are invalid as against public policy. the employment contract provides that the employment contract shall be valid for a period of two (2) years from the date the employee starts to work with the employer.00 for the payment of his ticket. d. that the law will step in to annul the questionable transaction. his employment contract is until February 7. 62 hence. before the effectivity of R.190.948. 64 the parameters for valid compromise agreements. HAS NO FINANCIAL OBLIGATION IN MY FAVOUR AFTER RECEIVING THE ABOVE MENTIONED AMOUNT IN CASH. with full understanding of what he was doing. in regard not only to the words and terms used.150.00). 1994. Panganiban in Land and Housing Development Corporation v. Gran received a copy of his letter of termination. 61 Gran arrived in Riyadh. The waivers should be carefully examined. The court may however step in when such amount is unconscionably low or unreasonable although the employee voluntarily agreed to it. This requirement was clearly articulated by Chief Justice Artemio V. 1994.948. Saudi Arabia and started to work on February 7. If the Declaration is a quitclaim. 65 c. 66 126 . the amount is unreasonably small compared to the future wages of Gran. it is binding on the parties and may not later be disowned simply because of a change of mind. 1994. 3. The foregoing events readily reveal that Gran was "forced" to sign the Declaration and constrained to receive the amount of SR 2.00. 63(Emphasis supplied.00 is even lower than his monthly salary of SR 3. 1994. I ATTEST TO THE TRUTHFULNESS OF THIS STATEMENT BY AFFIXING MY SIGNATURE VOLUNTARILY.00) — although possibly less than the estimated Gran's salaries for the remaining duration of his contract and other benefits as employee of OAB. The Court finds the waiver and quitclaim null and void for the following reasons: 1.00 (SAUDI RIYALS TWO THOUSAND NINE HUNDRED FORTY EIGHT ONLY) REPRESENTING COMPLETE PAYMENT (COMPENSATION) FOR THE SERVICES I RENDERED TO OAB ESTABLISHMENT. On July 12. the employer is being unjust to the employee as there is no meaningful choice on the part of the employee while the terms are unreasonably favorable to the employer. 1994. The relevant portions of the Declaration are as follows: aEDCAH I.00 is actually the payment for Gran's salary for the services he rendered to OAB as Computer Specialist. In the case of the Declaration. the payment of SR 2. Gran departed from Riyadh. I HEREBY DECLARE THAT OAB EST. The Declaration reveals that the payment of SR 2.948. 2.) Is the waiver and quitclaim labeled a Declaration valid? It is not. As correctly pointed out by the court a quo. On July 11.00 even if it was against his will — since he was told on July 10. ELEAZAR GRAN Courts must undertake a meticulous and rigorous review of quitclaims or waivers. He could have entertained some apprehensions as to the status of his stay or safety in Saudi Arabia if he would not sign the quitclaim. Esquillo: Quitclaims. The court a quo is correct in its finding that the Declaration is a contract of adhesion which should be construed against the employer. OAB.00 (USD 850. Petitioner EDI questions the legality of the award of backwages and mainly relies on the Declaration which is claimed to have been freely and voluntarily executed by Gran. On July 9. AcHCED 2. (Emphasis supplied. I STATE FURTHER THAT OAB EST. If the agreement was voluntarily entered into and represents a reasonable settlement. b.00 (USD 850. He had no other choice but to sign the Declaration as he needed the amount of SR 2.R. 1994. it is also very much less than the USD 16. more particularly those executed by employees. he is therefore entitled to backwages corresponding to the unexpired portion of his contract. and the consideration for the quitclaim is credible and reasonable. No. releases and other waivers of benefits granted by laws or contracts in favor of workers should be strictly scrutinized to protect the weak and the disadvantaged. 8042. Saudi Arabia.948. In addition. Consider the following chronology of events: a.) This Court had also outlined in Land and Housing Development Corporation. waivers. he signed the Declaration. The salary paid to Gran upon his termination. ELEAZAR GRAN (COMPUTER SPECIALIST) AFTER RECEIVING MY FINAL SETTLEMENT ON THIS DATE THE AMOUNT OF: S. Gran was instructed to depart Saudi Arabia and required to pay his plane ticket.00 which is the amount Gran is legally entitled to get from petitioner EDI as backwages. 4.948. It is only where there is clear proof that the waiver was wangled from an unsuspecting or gullible person.interest of twelve percent (12%) per annum.190. 1996. On July 10. A quitclaim will understandably be lower than the sum total of the amounts and benefits that can possibly be awarded to employees or to be earned for the remainder of the contract period since it is a compromise where the employees will have to forfeit a certain portion of the amounts they are claiming in exchange for the early payment of a compromise amount. Since he was illegally dismissed on July 9. but also the factual circumstances under which they have been executed. Gran filed the Complaint before the NLRC. An adhesion contract is contrary to public policy as it leaves the weaker party — the employee — in a "take-it-or-leave-it" situation. which was equivalent to USD 16. But where it is shown that the person making the waiver did so voluntarily.948. NLRC.150. and e. 1994. SIGNED. HAS NO OBLIGATION TOWARDS ME IN WHATEVER FORM.

and 4.500. shall be final and binding upon the parties and the NLRC or any court "shall not assume jurisdiction over issues involved therein except in case of non-compliance thereof or if there is prima facie evidence that the settlement was obtained through fraud.Thus. However. The case was then set for pre-trial conference.265.R. However. respondents. On July 26. The Court. said agreements should contain the following: 1. The October 18. granted the said Motion and admitted the annexes attached thereto as the reconstituted records of this case per Order dated September 6. THE COURT OF APPEALS and ANTONIO HERAS. The HERAS admits the existence of the judgment dated December 28. On October 19. duress. The benefits of the employees if possible with the corresponding amounts. 1984 as well as its amendment dated April 13. At the conference. The only issue for this Court to determine is. or undue influence exerted on their person. 1984. 1988.40 or its equivalent in Hong Kong currency at the time of payment with legal interest from December 28.810. 2. 1988. want of notice to the party. The document should be subscribed and sworn to under oath preferably before any administering official of the Department of Labor and Employment or its regional office. WHEREFORE. Q-52452. 128803. petitioner. 1984 until fully paid. the petition is DENIED. or coercion. It is made clear that the foregoing rules on quitclaim or waiver shall apply only to labor contracts of OFWs in the absence of proof of the laws of the foreign country agreed upon to govern said contracts. DECISION DAVIDE. 1987 against the defendant Antonio Heras praying that said defendant be ordered to pay to the ASIAVEST LTD the amounts awarded by the Hong Kong Court Judgment dated December 28. The antecedents are summarized in the 24 August 1990 Decision 1 of Branch 107 of the Regional Trial Court of Quezon City in Civil Case No.00 to respondent Gran as nominal damages for non-compliance with statutory due process. There should be two (2) witnesses to the execution of the quitclaim who must also sign the quitclaim. misrepresentation. SP No. TCHEDA 2. Antonio Heras. the foreign laws shall apply. 1999 Decision and September 30. the NLRC or a labor attaché in a foreign country. J p: In issue is the enforceability in the Philippines of a foreign judgment. A fixed amount as full and final compromise settlement. No. 3. was denied by the Court in its Order of October 4. and 3) HK$905. 67 This compromise settlement becomes final and binding under Article 227 of the Labor Code which provides that: [A]ny compromise settlement voluntarily agreed upon with the assistance of the Bureau of Labor Relations or the regional office of the DOLE. such as to overcome the presumption established in Section 50. before the court could resolve the said motion. Otherwise. litigation expenses and cost. vs. A statement that the employer has clearly explained to the employee in English.00 at 9. with interest thereon from the date of the judgment until fully paid. thus:. intimidation. 2000 Decision in CA-G. the Declaration purporting to be a quitclaim and waiver is unenforceable under Philippine laws in the absence of proof of the applicable law of Saudi Arabia. On March 3. through counsel filed a Motion for Reconstitution of Case Records. 1999 Resolution of the NLRC is AFFIRMED with the MODIFICATION that petitioner EDI-Staffbuilders International. 1988. violence. but not necessarily the authenticity or validity thereof. Rule 39 of the Rules of Court in favor of foreign judgments. and 4) at least $80. In order to prevent disputes on the validity and enforceability of quitclaims and waivers of employees under Philippine laws. the parties could not arrive at any settlement. a fire which partially razed the Quezon City Hall Building on June 11. 2) interest on the sum of US$1. after allowing the HERAS to react thereto.875% per annum from October 31. The plaintiff Asiavest Limited filed a complaint on December 3.] 27. Such official shall assist the parties regarding the execution of the quitclaim and waiver. ASIAVEST LIMITED. A statement that the employees signed and executed the document voluntarily. 3. is New Manila. 1988 HERAS filed his Answer. It is advisable that the stipulations be made in English and Tagalog or in the dialect known to the employee. the ASIAVEST LIMITED. 1988 the HERAS filed a Motion to Dismiss. equipment and properties. 1987. Quezon City. September 25.000. The ASIAVEST LIMITED is not doing business and is not licensed to do business in the Philippines. JR.R.00 representing attorney's fees. whether or not the judgment of the Hong Kong Court has been repelled by evidence of want of jurisdiction. or in the dialect known to the employees — that by signing the waiver or quitclaim. 56120 of the Court of Appeals affirming the January 15. Filipino. FIRST DIVISION [G. together with all its records. and had fully understood the contents of the document and that their consent was freely given without any threat. the Motion to Dismiss. No costs. 1998. 1987 to wit: 1) US$1. shall pay the amount of PhP30. Thereafter. which the employees are giving up in consideration of the fixed compromise amount. they agreed on the following stipulations of facts: 1. the Bureau of Labor Relations.00 at fixed cost in the action. 1984 and amended on April 13. 127 . Inc. 1988 totally destroyed the office of this Court. the resolution of which had been deferred. The residence of HERAS. they are forfeiting or relinquishing their right to receive the benefits which are due them under the law. 1984 to December 28. fraud or clear mistake of law or fact.000. collusion.

In view of the admission by the HERAS of the existence of the aforementioned judgment (Pls. See Stipulations of Facts in the Order dated
January 5, 1989 as amended by the Order of January 18, 1989) as well as the legal presumption in favor of the ASIAVEST LIMITED as
provided for in paragraph (b), Sec. 50, (Ibid.), the ASIAVEST LIMITED presented only documentary evidence to show rendition, existence,
and authentication of such judgment by the proper officials concerned (Pls. See Exhibits "A" thru "B", with their submarkings). In addition,
the ASIAVEST LIMITED presented testimonial and documentary evidence to show its entitlement to attorney's fees and other expenses of
litigation . . .
On the other hand, the HERAS presented two witnesses, namely, Fortunata dela Vega and Russel Warren Lousich.
The gist of Ms. dela Vega's testimony is to the effect that no writ of summons or copy of a statement of claim of Asiavest Limited was ever
served in the office of the Navegante Shipping Agency Limited and/or for Mr. Antonio Heras, and that no service of the writ of summons was
either served on the HERAS at his residence in New Manila, Quezon City. Her knowledge is based on the fact that she was the personal
secretary of Mr. Heras during his JD Transit days up to the latter part of 1972 when he shifted or diversified to shipping business in Hong
Kong; that she was in-charge of all his letters and correspondence, business commitments, undertakings, conferences and appointments,
until October 1984 when Mr. Heras left Hong Kong for good; that she was also the Officer-in-Charge or Office Manager of Navegante
Shipping Agency LTD, a Hong Kong registered and based company acting as ships agent, up to and until the company closed shop sometime
in the first quarter of 1985 when shipping business collapsed worldwide; that the said Company held office at 34-35 Connaught Road,
Central Hong Kong and later transferred to Caxton House at Duddel Street, Hong Kong, until the company closed shop in 1985; and that she
was certain of such facts because she held office at Caxton House up to the first quarter of 1985.
Mr. Lousich was presented as an expert on the laws of Hong Kong, and as a representative of the law office of the HERAS's
counsel who made a verification of the record of the case filed by the ASIAVEST LIMITED in Hong Kong against the HERAS as well as the
procedure in serving Court processes in Hong Kong.
In his affidavit (Exh. "2") which constitutes his direct testimony the said witness stated that:
The HERAS was sued on the basis of his personal guarantee of the obligations of Compania Hermanos de Navegacion S.A. There
is no record that a writ of summons was served on the person of the HERAS in Hong Kong, or that any such attempt at service
was made. Likewise, there is no record that a copy of the judgment of the High Court was furnished or served on the HERAS;
anyway, it is not a legal requirement to do so under Hong Kong laws;
a) The writ of summons or claim can be served by the solicitor (lawyer) of the claimant or ASIAVEST LIMITED. In Hong Kong there are no
Court personnel who serve writs of summons and/or most other processes.
b) If the writ of summons or claim (or complaint) is not contested, the claimant or the ASIAVEST LIMITED is not required to present proof of
his claim or complaint nor present evidence under oath of the claim in order to obtain a Judgment.
c) There is no legal requirement that such a Judgment or decision rendered by the Court in Hong Kong [to] make a recitation of the facts or
the law upon which the claim is based.
d) There is no necessity to furnish the HERAS with a copy of the Judgment or decision rendered against him.
e) In an action based on a guarantee, there is no established legal requirement or obligation under Hong Kong laws that the
creditor must first bring proceedings against the principal debtor. The creditor can immediately go against the guarantor.
On cross examination, Mr. Lousich stated that before he was commissioned by the law firm of the HERAS's counsel as an expert witness
and to verify the records of the Hong Kong case he had been acting as counsel for the HERAS in a number of commercial matters; that
there was an application for service of summons upon the HERAS outside the jurisdiction of Hong Kong; that there was an order of the
Court authorizing service upon Heras outside of Hong Kong, particularly in Manila or any other place in the Philippines (p. 9, TSN, 2/14/90);
that there must be adequate proof of service of summons otherwise the Hong Kong Court will refuse to render judgment (p. 10, ibid); that
the mere fact that the Hong Kong Court rendered judgment, it can be presumed that there was service of summons; that in this case, it is
not just a presumption because there was an affidavit stating that service was effected in [sic] a particular man here in Manila; that such
affidavit was filed by one Jose R. Fernandez of the firm Sycip Salazar on the 21st of December 1984 and stated in essence that "on Friday
the 23rd of November 1984 he served the 4th HERAS at No. 6 First Street, Quezon City by leaving it at that address with Mr. Dionisio Lopez,
the son-in-law of the 4th HERAS the copy of the writ and Mr. Lopez informed me and I barely believed that he would bring the said writ to
the attention of the 4th "HERAS" (pp. 11-12, ibid.); that upon filing of that affidavit the Court was asked and granted judgment against the
4th HERAS; and that if the summons or claim is not contested, the claimant of the ASIAVEST LIMITED is not required to present proof of his
claim or complaint or present evidence under oath of the claim in order to obtain judgment; and that such judgment can be enforced in the
same manner as a judgment rendered after full hearing.
The trial court held that since the Hong Kong court judgment had been duly proved, it is a presumptive evidence of a right as between the
parties; hence, the party impugning it had the burden to prove want of jurisdiction over his person. HERAS failed to discharge that burden.
He did not testify to state categorically and under oath that he never received summons. Even his own witness Lousich admitted that HERAS
was served with summons in his Quezon City residence. As to De la Vega's testimony regarding non-service of summons, the same was
hearsay and had no probative value. prLL
As to HERAS' contention that the Hong Kong court judgment violated the Constitution and the procedural laws of the Philippines because it
contained no statements of the facts and the law on which it was based, the trial court ruled that since the issue related to procedural
matters, the law of the forum, i.e., Hong Kong laws, should govern. As testified by the expert witness Lousich, such legalities were
not required under Hong Kong laws. The trial court also debunked HERAS' contention that the principle of excussion under Article 2058 of
the Civil Code of the Philippines was violated. It declared that matters of substance are subject to the law of the place where the
transaction occurred; in this case, Hong Kong laws must govern.
The trial court concluded that the Hong Kong court judgment should be recognized and given effect in this jurisdiction for failure of HERAS
to overcome the legal presumption in favor of the foreign judgment It then decreed; thus:
WHEREFORE, judgment is hereby rendered ordering HERAS to pay to the ASIAVEST LIMITED the following sums or their equivalents in
Philippine currency at the time of payment: US$1,810,265.40 plus interest on the sum of US$1,500,000.00 at 9.875% per annum from
October 31, 1984 to December 28, 1984, and HK$905 as fixed cost, with legal interests on the aggregate amount from December 28, 1984,
and to pay attorneys fees in the sum of P80,000.00.
ASIAVEST moved for the reconsideration of the decision. It sought an award of judicial costs and an increase in attorney's fees in the
amount of US$19,346.45 with interest until full payment of the said obligations. On the other hand, HERAS no longer opposed the motion
and instead appealed the decision to the Court of Appeals, which docketed the appeal as CA-G.R. CV No. 29513.
In its order 2 of 2 November 1990, the trial court granted ASIAVEST's motion for reconsideration by increasing the award of attorney's fees
to "US$19,345.65 OR ITS EQUIVALENT IN PHILIPPINE CURRENCY, AND TO PAY THE COSTS OF THIS SUIT," provided that ASIAVEST would

128

pay the corresponding filing fees for the increase. ASIAVEST appealed the order requiring prior payment of filing fees. However, it later
withdrew its appeal and paid the additional filing fees.
On 3 April 1997, the Court of Appeals rendered its decision 3 reversing the decision of the trial court and dismissing ASIAVEST's complaint
without prejudice. It underscored the fact that a foreign judgment does not of itself have any extraterritorial application. For it to be given
effect, the foreign tribunal should have acquired jurisdiction over the person and the subject matter. If such tribunal has not acquired
jurisdiction, its judgment is void.
The Court of Appeals agreed with the trial court that matters of remedy and procedure such as those relating to service of summons upon
the HERAS are governed by the lex fori, which was, in this case, the law of Hong Kong. Relative thereto, it gave weight to Lousich's
testimony that under the Hong Kong law, the substituted service of summons upon HERAS effected the Philippines by the clerk of Sycip
Salazar Hernandez & Gatmaitan firm would be valid provided that it was done in accordance with Philippine laws. It then stressed that
where the action is in personam and the HERAS is in the Philippines, the summons should be personally served on the HERAS pursuant
to Section 7, Rule 14 of the Rules of Court. 4Substituted service may only be availed of where the HERAS cannot be promptly served in
person, the fact of impossibility of personal service should be explained in the proof of service. It also found as persuasive HERAS' argument
that instead of directly using the clerk of the Sycip Salazar Hernandez & Gatmaitan law office, who was not authorized by the judge of the
court issuing the summons, ASIAVEST should have asked for leave of the local courts to have the foreign summons served by the sheriff or
other court officer of the place where service was to be made, or for special reasons by any person authorized by the judge. cdasia
The Court of Appeals agreed with HERAS that "notice sent outside the state to a non-resident is unavailing to give jurisdictionin an action
against him personally for money recovery." Summons should have been personally served on HERAS in Hong Kong, for, as claimed by
ASIAVEST, HERAS was physically present in Hong Kong for nearly 14 years. Since there was not even an attempt to serve summons on
HERAS in Hong Kong, the Hong Kong Supreme Court did not acquire jurisdiction over HERAS. Nonetheless, it did not totally foreclose the
claim of ASIAVEST; thus:
While we are not fully convinced that [HERAS] has a meritorious defense against [ASIAVEST's] claims or that [HERAS] ought to be absolved
of any liability, nevertheless, in view of the foregoing discussion, there is a need to deviate from the findings of the lower court in the
interest of justice and fair play This, however, is without prejudice to whatever action [ASIAVEST] might deem proper in order to enforce its
claims against [HERAS].
Finally, the Court of Appeals also agreed with HERAS that it was necessary that evidence supporting the validity of the foreign judgment be
submitted and that our courts are not bound to give effect to foreign judgments which contravene our laws and the principle of sound
morality and public policy.
ASIAVEST forthwith filed the instant petition alleging that the Court of Appeals erred in ruling that
I.. . . IT WAS NECESSARY FOR [ASIAVEST] TO PRESENT EVIDENCE 'SUPPORTING THE VALIDITY OF THE JUDGMENT';
II.. . . THE SERVICE OF SUMMONS ON [HERAS] WAS DEFECTIVE UNDER PHILIPPINE LAW;
III.. . . SUMMONS SHOULD HAVE BEEN PERSONALLY SERVED ON HERAS IN HONG KONG;
IV.. . . THE HONG KONG SUMMONS SHOULD HAVE BEEN SERVED WITH LEAVE OF PHILIPPINE COURTS;
V.. . . THE FOREIGN JUDGMENT 'CONTRAVENES PHILIPPINE LAWS, THE PRINCIPLES OF SOUND MORALITY, AND THE PUBLIC POLICY OF
THE PHILIPPINES.
Being interrelated, we shall take up together the assigned errors.
Under paragraph (b) of Section 50, Rule 39 of the Rules of Court, 5 which was the governing law at the time this case was decided by the
trial court and respondent Court of Appeals, a foreign judgment against a person rendered by a court having jurisdiction to pronounce the
judgment is presumptive evidence of a right as between the parties and their successors in interest by the subsequent title. However, the
judgment may be repelled by evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact.
Also, Section 3(n) of Rule 131 of the New Rules of Evidence provides that in the absence of proof to the contrary, a court, or judge acting as
such, whether in the Philippines or elsewhere, is presumed to have acted in the lawful exercise of jurisdiction.
Hence, once the authenticity of the foreign judgment is proved, the burden to repel it on grounds provided for in paragraph (b) of
Section 50, Rule 39 of the Rules of Court is on the party challenging the foreign judgment — HERAS in this case.
At the pre-trial conference, HERAS admitted the existence of the Hong Kong judgment. On the other hand, ASIAVEST presented evidence to
prove rendition, existence, and authentication of the judgment by the proper officials. The judgment is thus presumed to be valid and
binding in the country from which it comes, until the contrary is shown. 6 Consequently, the first ground relied upon by ASIAVEST has
merit. The presumption of validity accorded foreign judgment would be rendered meaningless were the party seeking to
enforce it be required to first establish its validity.
The main argument raised against the Hong Kong judgment is that the Hong Kong Supreme Court did not acquire jurisdiction over the
person of HERAS. This involves the issue of whether summons was properly and validly served on HERAS. It is settled that matters of
remedy and procedure such as those relating to the service of process upon the HERAS are governed by the lex fori or the law of the
forum, 7 i.e., the law of Hong Kong in this case. HERAS insisted that according to his witness Mr. Lousich, who was presented as an
expert on Hong Kong laws, there was no valid service of summons on him.
In his counter-affidavit, 8 which served as his direct testimony per agreement of the parties, 9 Lousich declared that the record of the Hong
Kong case failed to show that a writ of summons was served upon HERAS in Hong Kong or that any such attempt was made. Neither did the
record show that a copy of the judgment of the court was served on HERAS. He stated further that under Hong Kong laws (a) a writ of
summons could be served by the solicitor of the claimant or ASIAVEST LIMITED; and (b) where the said writ or claim was not contested, the
claimant or ASIAVEST LIMITED was not required to present proof under oath in order to obtain judgment.
On cross-examination by counsel for ASIAVEST, Lousich testified that the Hong Kong court authorized service of summons on HERAS
outside of its jurisdiction, particularly in the Philippines. He admitted also the existence of an affidavit of one Jose R. Fernandez of the Sycip
Salazar Hernandez & Gatmaitan law firm stating that he (Fernandez) served summons on HERAS on 13 November 1984 at No. 6, 1st St.,
Quezon City, by leaving a copy with HERAS's son-in-law Dionisio Lopez. 10 On redirect examination, Lousich declared that such
service of summons would be valid under Hong Kong laws provided that it was in accordance with Philippine laws. 11
We note that there was no objection on the part of ASIAVEST on the qualification of Mr. Lousich as an expert on the Hong Kong
law. Under Sections 24 and 25, Rule 132 of the New Rules of Evidence, the record of public documents of a sovereign authority, tribunal,

129

official body, or public officer may be proved by (1) an official publication thereof or (2) a copy attested by the officer having the legal
custody thereof, which must be accompanied, if the record is not kept in the Philippines, with a certificate that such officer has the custody.
The certificate may be issued by the secretary of the embassy or legation, consul general, consul, vice consul, or consular agent, or 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. The attestation must state, in substance, that the copy is a correct copy of the original, or a specific part thereof, as the case may
be, and must be under the official seal of the attesting officer.
Nevertheless, the testimony of an expert witness may be allowed to prove a foreign law. An authority 12 on private international law thus
noted:
Although it is desirable that foreign law be proved in accordance with the above rule, however, the Supreme Court held in the case
of Willamettee Iron and Steel Works v. Muzzal, 13 that Section 41, Rule 123 (Section 25, Rule 132 of the Revised Rules of Court) does
not exclude the presentation of other competent evidence to prove the existence of a foreign law. In that case, the Supreme
Court considered the testimony under oath of an attorney-at-law of San Francisco, California, who quoted verbatim a section of California
Civil Code and who stated that the same was in force at the time the obligations were contracted, as sufficient evidence to establish the
existence of said law. Accordingly, in line with this view, the Supreme Court in the Collector of Internal Revenue v. Fisher et al., 14upheld
the Tax Court in considering the pertinent law of California as proved by the respondents' witness. In that case, the counsel for respondent
"testified that as an active member of the California Bar since 1951, he is familiar with the revenue and taxation laws of the State of
California. When asked by the lower court to state the pertinent California law as regards exemption of intangible personal properties, the
witness cited Article 4, Sec. 13851 (a) & (b) of the California Internal and Revenue Code as published in Derring's California Code, a
publication of Bancroft-Whitney Co., Inc. And as part of his testimony, a full quotation of the cited section was offered in evidence by
respondents." Likewise, in several naturalization cases, it was held by the Court that evidence of the law of a foreign country on reciprocity
regarding the acquisition of citizenship, although not meeting the prescribed rule of practice, may be allowed and used as basis for favorable
action, if, in the light of all the circumstances, the Court is "satisfied of the authenticity of the written proof offered." 15 Thus, in a number
of decisions, mere authentication of the Chinese Naturalization Law by the Chinese Consulate General of Manila was held to be competent
proof of that law. 16
There is, however, nothing in the testimony of Mr. Lousich that touched on the specific law of Hong Kong in respect of service of
summons either in actions in rem or in personam, and where the HERAS is either a resident or nonresident of Hong Kong . In
view of the absence of proof of the Hong Kong law on this particular issue, the presumption of identity or similarity or the so-called
processual presumption shall come into play. It will thus be presumed that the Hong Kong law on the matter is similar to the Philippine
law. 17
As stated in Valmonte vs. Court of Appeals, 18 it will be helpful to determine first whether the action is in personam, in rem, orquasi in
rem because the rules on service of summons under Rule 14 of the Rules of Court of the Philippines apply according to the nature of the
action.
An action in personam is an action against a person on the basis of his personal liability. An action in rem is an action against the thing itself
instead of against the person. 19 An action quasi in rem is one wherein an individual is named as HERAS and the purpose of the proceeding
is to subject his interest therein to the obligation or lien burdening the property. 20
In an action in personam, jurisdiction over the person of the HERAS is necessary for the court to validly try and decide the case. Jurisdiction
over the person of a resident HERAS who does not voluntarily appear in court can be acquired by personal service of summons as
provided under Section 7, Rule 14 of the Rules of Court. If he cannot be personally served with summons within a reasonable time,
substituted service may be made in accordance with Section 8 of said Rule. If he is temporarily out of the country, any of the following
modes of service may he resorted to: (1) substituted service set forth in Section 8; 21 (2) personal service outside the country, with
leave of court; (3) service by publication also with leave of court; 22or (4) any other manner the court may deem sufficient. 23
However, in an action in personam wherein the HERAS is a non-resident who does not voluntarily submit himself to the authority of the
court, personal service of summons within the state is essential to the acquisition of jurisdiction over her person. 24 This method of
service is possible if such HERAS is physically present in the country. If he is not found therein, the court cannot acquire
jurisdiction over his person and therefore cannot validly try and decide the case against him. 25 An exception was laid down
in Gemperle v. Schenker 26 wherein a non-resident was served with summons through his wife, who was a resident of the Philippines and
who was his representative and attorney-in-fact in a prior civil case filed by him; moreover, the second case was a mere offshoot of the first
case.
On the other hand, in a proceeding in rem or quasi in rem, jurisdiction over the person of the HERAS is not a prerequisite to confer
jurisdiction on the court provided that the court acquires jurisdiction over the res. Nonetheless, summons must be served upon the HERAS
not for the purpose of vesting the court with jurisdiction but merely for satisfying the due process requirements. 27 Thus, where the
HERAS is a non-resident who is not found in the Philippines AND (1) the action affects the personal status of the ASIAVEST LIMITED;
(2) the action relates to, or the subject matter of which is property in the Philippines in which the HERAS has or claims a lien or interest; (3)
the action seeks the exclusion of the HERAS from any interest in the property located in the Philippines; or (4) the property of the HERAS
has been attached in the Philippines — service of summons may be effected by (a) personal service out of the country, with leave of court;
(b) publication, also with leave of court; or (c) any other manner the court may deem sufficient. 28
In the case at bar, the action filed in Hong Kong against HERAS was in personam, since it was based on his personal guarantee of the
obligation of the principal debtor. Before we can apply the foregoing rules, we must determine first whether HERAS was a resident of Hong
Kong.
Fortunata de la Vega, HERAS's personal secretary in Hong Kong since 1972 until 1985, 29 testified that HERAS was the President and part
owner of a shipping company in Hong Kong during all those times that she served as his secretary. He had in his employ a staff of
twelve. 30 He had "business commitments, undertakings, conferences, and appointments until October 1984 when [he] left Hong Kong for
good." 31 HERAS's other witness, Russel Warren Lousich, testified that he had acted as counsel for HERAS "for a number of commercial
matters." 32 ASIAVEST then infers that HERAS was a resident of Hong Kong because he maintained a business there.
It must be noted that in his Motion to Dismiss, 33 as well as in his Answer 34 to ASIAVEST's complaint for the enforcement of the Hong
Kong court judgment, HERAS maintained that the Hong Kong court did not have jurisdiction over him because the fundamental rule is
that jurisdiction in personam over non-resident HERASs, so as to sustain a money judgment, must be based upon personal
service of summons within the state which renders the judgment. 35
For its part, ASIAVEST, in its Opposition to the Motion to Dismiss 36 contended: "The question of Hong Kong court's 'want of jurisdiction' is
therefore a triable issue if it is to be pleaded by the HERAS to 'repel' the foreign judgment. Facts showing jurisdictional lack (e.g. that the
Hong Kong suit was in personam, that HERAS was not a resident of Hong Kong when the suit was filed or that he did not voluntarily submit
to the Hong Kong court's jurisdiction) should be alleged and proved by the HERAS." 37

130

summons should have been personally served on him in Hong Kong. Brown. 41 the HERAS was previously a resident of the Philippines. DECISION BRION. 6. Windsor. on January 8. With that stipulation of fact. he did not question the jurisdiction of the Philippine court over his person on the ground of invalid service of summons. Summons in the latter case was served on the HERAS's attorney-in-fact at the latter's address. New Manila. an official of the National Statistics Office (NSO) informed Gerbert that the marriage between him and Daisylyn still subsists under Philippine law. The Court held that under the facts of the case. alleged her desire to file a similar 131 . Quezon City. Later. Several days after a criminal action for concubinage was filed against him. Accordingly. Gerbert returned to Canada and filed a petition for divorce. Gerbert left for Canada soon after the wedding. 38 HERAS argued that the lack of jurisdiction over his person was corroborated by ASIAVEST's allegation in the complaint that he "has his residence at No. which statement was not disputed by ASIAVEST. The divorce decree took effect a month later. Petitioner Gerbert R. Despite the registration of the divorce decree. pursuant to NSO Circular No." As such. We therefore conclude that the stipulated fact that HERAS "is a resident of New Manila. Sto. the undisputed fact remains that he left Hong Kong not only "temporarily" but "for good. Philippines. Branch 11. Antonio Heras." Similarly. The Superior Court of Justice. since HERAS was not a resident of Hong Kong and the action against him was. HERAS." IN VIEW OF ALL THE FOREGOING. Rule 14 of the Rules of Court providing for extraterritorial service will not apply because the suit against him was in personam. No costs. She offered no opposition to Gerbert's petition and. In his Motion to Dismiss. elevated via a petition for review oncertiorari 2 under Rule 45 of the Rules of Court (present petition). SO ORDERED. August 11. Gerbert filed a petition for judicial recognition of foreign divorce and/or declaration of marriage as dissolved (petition) with the RTC. What was in issue was his residence as far as the Hong Kong suit was concerned. Although summoned." He then concluded that such Judicial admission amounted to evidence that he was and is not a resident of Hong Kong. in fact. Philippines" refers to his residence at the time jurisdiction over his person was being sought by the Hong Kong court. he abandoned the Philippines. it commissioned the Sycip Salazar Hernandez & Gatmaitan law firm to serve the summons here in the Philippines. because even if HERAS be considered as a resident of Hong Kong. and upon obtaining a favorable action on the matter. He returned to the Philippines sometime in April 2005 to surprise Daisylyn. Even assuming that HERAS was formerly a resident of Hong Kong. petitioner. he should have been "summoned in the same manner as one who does not reside and is not found in the Philippines. 4 Due to work and other professional commitments. 2006. GERBERT R. TOMAS and The SOLICITOR GENERAL. 29513. it could not be said that the HERAS was "still a resident of the Philippines because he ha[d] escaped to his country and [was] therefore an absentee in the Philippines. CV No. CORPUZ. The extraterritorial service in the Philippines was therefore invalid and did not confer on the Hong Kong court jurisdiction over his person.R. Gerbert has moved on and has found another Filipina to love. judgment is hereby rendered DENYING the petition in this case and AFFIRMING the assailed Judgment of the Court of Appeals in CA-G. J p: Before the Court is a direct appeal from the decision 1 of the Regional Trial Court (RTC) of Laoag City. Gerbert married respondent Daisylyn T. 4. vs. 186571. 3 On January 18. 2005. Tomas. 1st St. 2000. Neither can we apply Section 18. THIRD DIVISION [G. a Filipina. is New Manila. in Pasig City. Quezon City. 2010. It follows that the Hong Kong court judgment cannot be given force and effect here in the Philippines for having been rendered without jurisdiction. 5 Two years after the divorce. should have been served with summons in the same manner as a non-resident not found in Hong Kong. but was shocked to discover that his wife was having an affair with another man. Section 17. the parties came up with stipulations of facts. No. As declared by his secretary. HERAS left Hong Kong in October 1984 "for good. Quezon City. one in personam.. Significantly. DAISYLYN TIROL STO.R. he was no longer so in November 1984 when the extraterritorial service of summons was attempted to be made on him. Hurt and disappointed. In Brown v. 2005. to be enforceable. Canada granted Gerbert's petition for divorce on December 8. the foreign divorce decree must first be judicially recognized by a competent Philippine court. Daisylyn did not file any responsive pleading but submitted instead a notarized letter/manifestation to the trial court. thus. in the pre-trial conference. series of 1982. Ontario. which allows extraterritorial service on a resident HERAS who is temporarily absent from the country. was never in issue. ASIAVEST was constrained to apply for leave to effect service in the Philippines." 39 We note that the residence of HERAS insofar as the action for the enforcement of the Hong Kong court judgment is concerned. a proceeding quasi in rem was instituted against him. ASIAVEST cannot now claim that HERAS was a resident of Hong Kong at the time.] 28." 40 His absence in Hong Kong must have been the reason why summons was not served on him therein. Desirous of marrying his new Filipina fiancée in the Philippines. 6 IHDCcT Accordingly.In his Reply (to the Opposition to Motion to Dismiss). who was also an absentee. respondents. Gerbert went to the Pasig City Civil Registry Office and registered the Canadian divorce decree on his and Daisylyn's marriage certificate. He never challenged the service of summons on him through a security guard in his Quezon City residence and through a lawyer in his office in that city. among which was that "the residence of HERAS. Corpuz was a former Filipino citizen who acquired Canadian citizenship through naturalization on November 29. indisputably.

Orbecido III. 18 Recognizing the reality that divorce is a possibility in marriages between a Filipino and an alien. is consistent with the legislative intent behind the enactment of the second paragraph of Article 26 of the Family Code. contemplates the dissolution of the lawful union for cause arising after the marriage. 13 Gerbert asserts that his petition before the RTC is essentially for declaratory relief. after obtaining a divorce. 19 enacted Executive Order No. THE COURT'S RULING The alien spouse can claim no right under the second paragraph of Article 26 of the Family Code as the substantive right it establishes is in favor of the Filipino spouse The resolution of the issue requires a review of the legislative history and intent behind the second paragraph of Article 26 of the Family Code. 132 . on the other hand. requested that she be considered as a party-ininterest with a similar prayer to Gerbert's. Divorce. 37 and 38. he contends that the provision applies as well to the benefit of the alien spouse. 14both support Gerbert's position. as there is a possibility that he might be prosecuted for bigamy if he marries his Filipina fiancée in the Philippines since two marriage certificates. (5) and (6). as follows: Art. the basis for the judicial declaration of absolute nullity or annulment of the marriage exists before orat the time of the marriage.case herself but was prevented by financial and personal circumstances. thus. Aquino. the RTC stated. would be on file with the Civil Registry Office. and valid there as such. in the exercise of her legislative powers under the Freedom Constitution. This conclusion. In both cases. except those prohibited under Articles 35(1). (4). 8 in order for him or her to be able to remarry under Philippine law. 2008 decision. in accordance with the laws in force in the country where they were solemnized. He claims that the RTC ruling unduly stretched the doctrine in Orbecido by limiting the standing to file the petition only to the Filipino spouse — an interpretation he claims to be contrary to the essence of the second paragraph of Article 26 of the Family Code. except those prohibited under Articles 35(1). The RTC concluded that Gerbert was not the proper party to institute the action for judicial recognition of the foreign divorce decree as he is a naturalized Canadian citizen. She. All marriages solemnized outside the Philippines. (EO) 227. 7 the RTC denied Gerbert's petition. in their respective Comments. All marriages solemnized outside the Philippines. and valid there as such. amending Article 26 of the Family Code to its present wording. 9 Article 26 of the Family Code reads: Art. the Filipino spouse shall likewise have capacity to remarry under Philippine law. (5) and (6). is no longer married to the Filipino spouse. (4). 36. shall also be valid in this country. 12 Gerbert filed the present petition. In its October 30. 36. The Family Code recognizes only two types of defective marriages — void 15 and voidable 16 marriages. Taking into account the rationale behind the second paragraph of Article 26 of the Family Code. President Corazon C. to institute the case. vested with sufficient legal interest. similarly asks for a determination of his rights under the second paragraph of Article 26 of the Family Code. Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry. he. 26. 17 Our family laws do not recognize absolute divorce between Filipino citizens. in accordance with the laws in force in the country where they were solemnized. SAcaDE Essentially. 26." 11 THE PETITION From the RTC's ruling. shall also be valid in this country. 37 and 38. He considers himself as a proper party. similar to that filed in Orbecido. the petition raises the issue of whether the second paragraph of Article 26 of the Family Code extends to aliens the right to petition a court of this jurisdiction for the recognition of a foreign divorce decree. under the second paragraph of Article 26 of the Family Code. 10 the provision was enacted to "avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. as determined by the Court in Republic v. It ruled that only the Filipino spouse can avail of the remedy. involving him. thus. The Office of the Solicitor General and Daisylyn.

25Article 17 of the Civil Code provides that the policy against absolute divorces cannot be subverted by judgments promulgated in a foreign country. by clarifying his or her marital status. [The Filipino spouse] should not be obliged to live together with. . whose status and legal capacity are generally governed by his national law. — The effect of a judgment or final order of a tribunal of a foreign country. 24 Without the second paragraph of Article 26 of theFamily Code. or clear mistake of law or fact. the judgment or final order is presumptive evidence of a right as between the parties and their successors in interest by a subsequent title. The latter should not continue to be one of her heirs with possible rights to conjugal property. EO 227 effectively incorporated into the law this Court's holding in Van Dorn v. The foreign divorce decree is presumptive evidence of a right that clothes the party with legal interest to petition for its recognition in this jurisdiction We qualify our above conclusion — i. recognized that the foreign divorce had already severed the marital bond between the spouses. and render support to [the alien spouse]. the second paragraph of Article 26 of theFamily Code provided the Filipino spouse a substantive right to have his or her marriage to the alien spouse considered as dissolved. 48.Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry. that the second paragraph of Article 26 of the Family Code bestows no rights in favor of aliens — with the complementary statement that this conclusion is not sufficient basis to dismiss Gerbert's petition before the RTC. 22 aCHDST As the RTC correctly stated. however. an action based on the second paragraph of Article 26 of the Family Code is not limited to the recognition of the foreign divorce decree. Jr. and the purpose of the second paragraph of Article 26 of the Family Code." 23 The legislative intent is for the benefit of the Filipino spouse. under our laws. having jurisdiction to render the judgment or final order is as follows: (a) In case of a judgment or final order upon a specific thing. 21 In both cases. the RTC was correct in limiting the applicability of the provision for the benefit of the Filipino spouse. In either case. after obtaining a divorce. want of notice to the party. . settling the doubts created by the divorce decree. thus. the alien spouse can claim no right under this provision. fraud. only the Filipino spouse can invoke the second paragraph of Article 26 of the Family Code. . In other words. Romillo that: To maintain . can make a similar declaration for the alien spouse (other than that already established by the decree). In other words. whether in a proceeding instituted precisely for that purpose or as a related issue in another proceeding. She should not be discriminated against in her own country if the ends of justice are to be served. . 20 and Pilapil v. Ibay-Somera. Through the second paragraph of Article 26 of the Family Code. Romillo. capacitating him or her to remarry. The foreign divorce decree itself. The inclusion of the second paragraph in Article 26 of the Family Code provides the direct exception to this rule and serves as basis for recognizing the dissolution of the marriage between the Filipino spouse and his or her alien spouse. Essentially. and (b) In case of a judgment or final order against a person. Rule 39 of the Rules of Court which provides for the effect of foreign judgments. the Court refused to acknowledge the alien spouse's assertion of marital rights after a foreign court's divorce decree between the alien and the Filipino. Effect of foreign judgments or final orders. is no longer married to the Filipino spouse. 26 Given the rationale and intent behind the enactment. the judgment or final order is conclusive upon the title of the thing. cannot be just. No court in this jurisdiction. that. This Section states: aTEScI SEC. collusion.e. If the court finds that the decree capacitated the alien spouse to remarry. 133 . the courts can declare that the Filipino spouse is likewise capacitated to contract another marriage. after its authenticity and conformity with the alien's national law have been duly proven according to our rules of evidence. [the Filipino spouse] has to be considered still married to [the alien spouse] and still subject to a wife's obligations . Additionally. pursuant to Section 48. The Court. The Court reasoned in Van Dorn v. the Filipino spouse shall likewise have capacity to remarry under Philippine law. the unavailability of the second paragraph of Article 26 of the Family Code to aliens does not necessarily strip Gerbert of legal interest to petition the RTC for the recognition of his foreign divorce decree.. observe respect and fidelity. the judgment or final order may be repelled by evidence of a want of jurisdiction. the provision was included in the law "to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who. would be of no significance to the Filipino spouse since our laws do not recognize divorce as a mode of severing the marital bond. serves as a presumptive evidence of right in favor of Gerbert. the judicial recognition of the foreign decree of divorce.

either by (1) official publications or (2) copies attested by the officer having legal custody of the documents. In Gerbert's case. i. the res judicata effect of the foreign judgments of divorce serves as the deeper basis for extending judicial recognition and for considering the alien spouse bound by its terms. provided the divorce is valid according to his or her national law. Civil Register." 35 A judgment of divorce is a judicial decree. DCASIT We deem it more appropriate to take this latter course of action. 30but failed to include a copy of the Canadian law on divorce. 1. The records show that Gerbert attached to his petition a copy of the divorce decree. 33 In fact. in which shall be entered: (a) births. want of notice to a party. collusion. more than the principle of comity that is served by the practice of reciprocal recognition of foreign judgments between nations. the need to draw attention of the bench and the bar to what had been done. affecting a person's legal capacity and status that must be recorded. Considerations beyond the recognition of the foreign divorce decree As a matter of "housekeeping" concern. these must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office. every precaution must be taken to ensure conformity with our laws before a recognition is made. as discussed above. more or less permanent in nature. at this point. hence. purport to be official acts of a sovereign authority. If the copies of official records are not kept in the Philippines. fraud. together with the alien's applicable national law to show the effect of the judgment on the alien himself or herself. as provided in Section 48. as a rule. direct involvement or being the subject of the foreign judgment is sufficient to clothe a party with the requisite interest to institute an action before our courts for the recognition of the foreign judgment. recognizing his or her capacity to obtain a divorce. Article 407 of the Civil Code states that "[a]cts.e. Rule 39 of the Rules of Court. those affecting "all his personal qualities and relations. — A civil register is established for recording the civil status of persons. In a divorce situation. (d) annulments of marriages. EHDCAI (f) legitimations." 28 This means that the foreign judgment and its authenticity must be proven as facts under our rules on evidence. (e) divorces. " no sovereign is bound to give effect within its dominion to a judgment rendered by a tribunal of another country. shall have the effect of res judicata 32 between the parties. 29 The recognition may be made in an action instituted specifically for the purpose or in another action where a party invokes the foreign decree as an integral aspect of his claim or defense. events and judicial decrees concerning the civil status of persons shall be recorded in the civil register. such as his being legitimate or illegitimate. no less. (c) marriages. we can. Justice Herrera explained that. 3753 or the Law on Registry of Civil Status specifically requires the registration of divorce decrees in the civil registry: Sec. unless we deem it more appropriate to remand the case to the RTC to determine whether the divorce decree is consistent with the Canadian divorce law. since both the foreign divorce decree and the national law of the alien. will not obtain for the Filipino spouse were it not for the substantive rule that the second paragraph of Article 26 of the Family Code provides. we have declared. as the foreign judgment. not ordinarily terminable at his own will. 31 Under this situation. as well as the required certificates proving its authenticity. although a foreign one. This same effect.Act No. This Section requires proof. Section 24. 134 . or clear mistake of law or fact. or his being married or not. (b) deaths. In fact. that the divorce obtained by an alien abroad may be recognized in the Philippines. (g) adoptions." The law requires the entry in the civil registry of judicial decrees that produce legal consequences touching upon a person's legal capacity and status.To our mind. we note that the Pasig City Civil Registry Office has already recorded the divorce decree on Gerbert and Daisylyn's marriage certificate based on the mere presentation of the decree. once recognized. A remand. Rule 132 of the Rules of Court comes into play. (h) acknowledgment of natural children. given the Article 26 interests that will be served and the Filipina wife's (Daisylyn's) obvious conformity with the petition. at the same time.. 34 We consider the recording to be legally improper. simply dismiss the petition for insufficiency of supporting evidence. Needless to state. 27 The starting point in any recognition of a foreign divorce judgment is the acknowledgment that our courts do not take judicial notice of foreign judgments and laws. will allow other interested parties to oppose the foreign judgment and overcome a petitioner's presumptive evidence of a right by proving want of jurisdiction.

It also requires. the Pasig City Civil Registry Office was aware of the requirement of a court recognition. Branch 11. no judicial order as yet exists recognizing the foreign divorce decree. In the context of the present case. as well as its February 17. (2) Marriage register. change of name and naturalization register. The recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself. and (j) changes of name. series of 1982 37 — both of which required a final order from a competent Philippine court before a foreign judgment. Civil Register Books. 2009 order. 38 that the civil registrar and all persons who have or claim any interest must be made parties to the proceedings. No costs. respectively make the proper entries concerning the civil status of persons: (1) Birth and death register. Another point we wish to draw attention to is that the recognition that the RTC may extend to the Canadian divorce decree does not. can be registered in the civil registry. on the strength alone of the foreign decree presented by Gerbert. 2008 decision of the Regional Trial Court of Laoag City. but it. 135 . without judicial order. however." The Rules of Court supplements Article 412 of the Civil Code by specifically providing for a special remedial proceeding by which entries in the civil registry may be judicially cancelled or corrected. SO ORDERED. the Pasig City Civil Registry Office acted totally out of turn and without authority of law when it annotated the Canadian divorce decree on Gerbert and Daisylyn's marriage certificate. the law and the submission of the decree by themselves do not ipso factoauthorize the decree's registration. 40As these basic jurisdictional requirements have not been met in the present case. as the object of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the status or right of a party or a particular fact. 39 and that the time and place for hearing must be published in a newspaper of general circulation. fraud. that this ruling should not be construed as requiring two separate proceedings for the registration of a foreign divorce decree in the civil registry — one for recognition of the foreign decree and another specifically for cancellation of the entry under Rule 108 of the Rules of Court. STHDAc Article 412 of the Civil Code declares that "no entry in a civil register shall be changed or corrected. But while the law requires the entry of the divorce decree in the civil registry. among others. dissolving a marriage. as it cited NSO Circular No. we cannot consider the petition Gerbert filed with the RTC as one filed under Rule 108 of the Rules of Court. WHEREFORE. authorize the cancellation of the entry in the civil registry. (3) Legitimation. the registration of the foreign divorce decree without the requisite judicial recognition is patently void and cannot produce any legal effect. contemplated under the Rules of Court. nonetheless. 36 and Department of Justice Opinion No. We hasten to point out. may be annotated in the civil registry. in which shall be entered not only the marriages solemnized but also divorces and dissolved marriages. Rule 108 of the Rules of Court can serve as the appropriate adversarial proceeding 41 by which the applicability of the foreign judgment can be measured and tested in terms of jurisdictional infirmities. for the cancellation of entries in the civil registry. 4. in which they shall. Moreover.(i) naturalization. acknowledgment. series of 1982. We order the REMAND of the case to the trial court for further proceedings in accordance with our ruling above. A petition for recognition of a foreign judgment is not the proper proceeding. For being contrary to law. adoption. want of notice to the party. Let a copy of this Decision be furnished the Civil RegistrarGeneral. by itself. or clear mistake of law or fact. we GRANT the petition for review on certiorari. — The local registrars shall keep and preserve in their offices the following books. Thus. collusion. authorizing the cancellation or correction. Rule 108 of the Rules of Court sets in detail the jurisdictional and procedural requirements that must be complied with before a judgment. that the verified petition must be filed with the RTC of the province where the corresponding civil registry is located. and REVERSE the October 30. xxx xxx xxx Sec. 4. allowed the registration of the decree. 181. Evidently. The law should be read in relation with the requirement of a judicial recognition of the foreign judgment before it can be given res judicata effect.