Jurisdiction over the Res

Jurisdiction over the res is acquired either by:

a.) Seizure of the property through legal processes of the court (with
actual custody) or

b.) Institution of legal proceedings wherein, under special provisions

of law, the authority of the court over the property is recognized
(actual custody not required). E.g., land registration cases(El Banco
Espanol-Filipino v. Palanca)

1. in rem

Judgment is against the property; binds the whole word

e.g., land registration case, admiralty case, involves personal
status of the plaintiff (e.g., recognition of an illegit. child,
annulment, probate of a will)

2. quasi in rem

Purpose is to subject the defendants interest over the

property to the obligation or lien which burdens the property.
An individual is named as a defendant; judgment is conclusive
only between the parties.
e.g., attachment, foreclosure, partition, quieting of title

3. in personam

e.g., action for damages, collection suit

in judgments in personam, if defendant is not present in the
forum, due process only requires minimum contact;
substituted service will suffice. (Intl. Shoe v. Washington)

In actions in rem and quasi in rem, jurisdiction over the person is

not required; only on the subject matter. (El Banco Espanol-Filipino v.
Palanca)

But no adjudication can be made on personal liability of either

party (e.g., deficiency judgment in a foreclosure). Relief
granted is limited to that which can only be enforced against
the property.
If the defendant appears, the action is converted into a suit in
personam but the property remains answerable for the
claims .

1. El Banco-Espanol-Filipino v. Palanca
Plaintiff: Banco [PH]
Defendant: Palanca [China]
Court:
Action: Foreclosure of mortgage upon RP in Manila [quasi in rem[

Bank instituted foreclosure proceedings vs decedent Limquingco

for 200k debt. After executing the instrument, decedent non-
resident went back to China and died there.
Court ordered publication in newspaper in Manila. Ordered
complementary service to last known address in Amoy, China.
After 7 years, Administrator Palanca filed motion to set aside
order of default and judgment because void due to lack of
jurisdicition over defendant and subject action.

Issue: W/N the court acquired JD YES [W/N in accordance with due
process YES]

SC: Jurisdiction is the authority of court to entertain a particular

kind of action or to administer a particular kind of relief [subject
matter], or it may refer to the power over parties[person] or over
properties which is subject of litigation[res]

JD over person acquired:

1. volutnary appearance and submission to authority
2. acquired by coercive power of legal process executed over
person or by service of summons

JD over res
1. seizure of property under legal process, whereby it is brought into
actual custody of law [attachment]
2. institution of legal proceedings, if they may not be taken in custody
[registration of title to a land]

Foreclosure, quasi in rem. In rem - property alone is treated as

responsible for the claim or obligation. Quasi in rem - individual is
named as defendant to subject defendants interest tot he obligation
or lien burdening the property.

Mortgage - nominally against person, but actually to vindicate liens.

treat property as primarily indebted.

In case publication is made, and defendant appears, it becomes in

personam, otherwise, in rem.

JD is power it possess over the poprety impleaded under the ff

conditions:
1. located within district
2. purpose of litigation is to subject the prop by sale to an obligation
fixed upon it by the mortgage 3. court at proper stage of proceedings
takes custody if necessary, and exposes it to sale for purposes of
satisfying debt.
In personam
GR: for nonresident, publication and notice does not confer JD over
person. personal judgment is invalid
Except:
1. they agreed on the mode of service
2. if it affects the personal status of the plaintiff

In rem or quasi in rem

Service by publication allowed. Because property is always
assured to be in possession of owner, in person or by agent, he is
safely held to be of knowledge. It is his duty to know the status of his
property.

However, publication must strictly comply with the requirement of

rules on complementary service. But failure of Clerk of Court to
mail is not irregular because there is publication. [but
compared to in personam case, failure to mail is fatal (Pantaleon v.
Asuncion)]

2. Perkins v. Dizon
Plaintiff: Eugene [PH]

Defendant: Idonah [outside PH]

Court: CFI Manila

Action: claim of ownership over property [QIR]

Action to claim ownership over shares of stock to the exclusion of

nonresidents. Shares of stock registered in plaintiffs name but
alleges that Benguet Mining [PH Corp] withheld payment.
Answer of Benguet: Withholding and non-recog of Ps right due to
certain demands made with respect to the shares by defendants
and an Engelhard.
Shares of stock situs is place of incorporation. Prayed that
adverse claimants be made parties (defendants) and interplead
among thesemselves [Amended complaint].
Summons were served through publication. According to Idonah,
did not acquire JD over their persons since only through
publication (objection to venue, motion to quash, and demirrer to
JD).

Issue: W/N CFI acquired JD over the person of the present P as a non-
resident defndant, or notwithstanding lack of JD, can the court still try
the case.
SC: YES, with JD. Action is quasi-in rem.

ROC: When a nonresident defendant is sued in PH, and it appears

that the action relates to

1. real or personal property within PH in which defendant has

interest, actual or contingent,

2. in which relief demanded consists, wholly or in part, in

exluding such person from interest

Service of summons may be made by publication.

This case is claim of ownership over property in PH, to the

exclusion of nonresidents. Hence, publication allowed.

Furthermore, there is no need of JD over persons of Perkins because

this is a suit quasi in rem (it fixes and settles the title to the
property in controversy)

GR: suit against nonres cannot be entertained in PH courts

Except: in rem or quasi in rem in connection with property in PH, if JD
over res, JD over person of defendant is not essential.

However, if defendant called in an INTERPLEADER CASE, instead of

amended the complaint, JD over the persons of Perkins is required
because such is an action in personam, hence, mere publication is
not allowed.

3. Travelers Health Assn. vs. Virginia

Plaintiff: Travellers Health [Nebraska] non-profit members assoc
which conducts mail-order health insurance biz

Defendant: SSC[Virginia]
Court: Virginia
Action: violation of Blue Sky Law

Blue Sky Law requires those selling or offering securities to obtain

permit. If not, punishable, or can issue cease and desist order to
restain violation, after notice and hearing. NOTICE THROUGH
SERVICE BY REGISTERED MAIL IF OTHER SERVICES UNAVAILABLE.
 SSC ordered cease and desist from further solicitation and sale of
cert to Virginia residents.
Plaintiff entered special appearance to question JD (All biz
activities in Nebraska and Virginia has no power to reach them via
cease and desist proceedings).

Issue: W/N notice procedure violate due process because only by

registered mail?

HELD: NO. Already ruled in Intl Shoe and Mullane case.

Plaintiff did not engage in isoldated transactions insurance certs

systematically and widely delivered in Virginia following solicitations
based on recommendations of Virginians.

Furthermore, Virginia can issue cease and desist order because where
business reach beyond one state and create a continuing relationship
and obligation with citizen of another state, court resorts to
FICTIONAL CONSENT in order to sustain JD. There is minimum contact
and State legitimate interst to subject plaintiff to cease and desist
order.

(+) Virginia most convenient forum for policyholders and witnesses

(given great weight in applying DFNC.
Act of State Doctrine
Definition and Nature

Every sovereign state is bound to respect the independence of every

other sovereign state, and the courts of one country will not sit in
judgment in the acts of the government of another, done within its
own territory. Redress of grievances by reason of such acts must be
obtained through the means open to be availed of by sovereign
powers as between themselves. (In re PNB v. US District Courts of
Hawaii citing Underhill v. Hernandez)

The courts of a state will NOT inquire into the VALIDITY of the acts of
a foreign government done within its own territory. It doesnt matter
whether it is valid under its own laws unless it is proved that the
foreign authorities themselves deemed it invalid. (French v. Banco
National de Cuba)

Simply stated, the acts of a foreign government are presumed valid.

The doctrine is not applicable (cannot be invoked) where the validity

of a foreign government act is not in issue. (Kirkpatrick Co. v.
Environmental Tectonics Corp.)

Bases: separation of powers, beyond judicial review (political

question), so as not to hinder foreign relations

Different from Sovereign Immunity

Sovereign immunity the State cannot be sued without its consent

- Attaches both to the head of state and to the state itself

- Applies only to jure imperii (governmental acts) and not to jure
gestionis (private, commercial, proprietary act).

Coverage
o Gen. Rule: Applies only to executive and legislative
branches; judicial decisions not covered
Exception: When judgment was obtained in favor of a
sovereign (not in dispute b/w private parties) (In re PNB v.
US District Courts of Hawaii)
 o Cannot be invoked by a leader AFTER being deposed
(Before=can be invoked). (Republic v Marcos)
Examples of acts of state
- Decision No. 346 issued by the Currency Stabilization Fund, an
official instrumentality of the Cuban Government (French v. Banco
National de Cuba)
- Philippine SC forfeiture judgment in favor of the RP (In re PNB v.
US District Courts of Hawaii)
Question arises AFTER court has acquired jurisdiction. Act of
State Doctrine requires that a court, after exercising
jurisdiction, decline to review certain issues, in particular, the
validity of foreign acts of state. (Lord Day and Lord v. Socialist
Republic of Vietnam)
o So if no jurisdiction, no need to pass upon act of state
issue.

1. French vs. Banco National de Cuba

Plaintiff: Assignor of Alexander Ritter (US citizen, resided in Cuba)

Defendant: Banco National [Cuba]

Court: NY

Action: Enforcement of contract [in personam]

Fidel Castro - Regulation of Cuban Govt which prevented US and

other foreign investors from receiving foreign currency other than
Cuban pesos on their Cuban investments.
Investor involved here is plaintiffs assignor invested 350k in
Cuban farm (before the regulation) and eight certificates of tax
exemption (150K USD).
Ritter tendered certificates but Bank refused because of Decision
No. 346 (suspended the processing of tax exemption certificates).
Bank claimed sovereign immunity and act of state in refusal to
redeem certificate of tax exemption of assignee due to Cuban
Currency Stabilization Fund issued to suspend the redemption of
certificates as a means of controlling foreign currency reserve of
country.

Issue:

1. W/N defendant is entitled to sovereign immunity.

2. W/N the defendant may invoke the act of stat doctrine.

SC:

1. On sovereign immunity - not covered because it arose out of

commercial transaction

2. On act of state - ASD - american courts will nto inquire into the
validity of the acts of a foreign government done within its territory
nor will they examine a foreign law to determine whether it was
adopted in conformity with internal procedures and requirements of
enacting State. Currency control order is an act of state. The law does
not prevent banks, insurance co, and other financial institution from
using ASD as defense.

Remedy of plaintiff: diplomatic negotiation or federal legislation

designed to protect all US claim against Cuba.

In case expropriation case - different ruling.

o Sabatino Doctrini NA: not taking or expropriation

o Hieckenlooper Amendment NA: Not applies to contracts but to
claims of titles of other rights to property

ACT OF STATE DOCTRINE NOT APPLICABLE IF STATES ACT IS

CONTRARY TO INTERNATIONAL LAW.

2. In Re: Philippine National Bank v. United States District

Court for the District of Hawaii
Plaintiff: PNB [Phil]

Defendant: DC of Hawaii

Court: US CA

Action: Questions mandamus

Class suit for human rights violation and RP case for forfeiture of
prop.
Credit Seusse Case - injunction to hold assets pending
determination of proper disposal.
Ordered PNB to deposited in escrow account in SG.
RP case decision - forfeiture in favor of PH. Hence, enforced
judgment against PNB. They transferred almost all funds to PH
 PURSUANT TO COURTS JUDGMENT. Class filed injunction case
against PNB from transferring funds to PH.

Issue: WON violates ASD?

Held: YES.

1. Every state is bound to respect the independence of every other

sovereign state, and the courts of one country will not sit in judgment
on the acts of the government of another, done within its territory.
Remedy is obtained through means open to be availed of by the
sovereign powers themselves. Citing PNB in contempt would hold
invalid the forfeiture judgment of the PH court.

2. GR: ASD not applicable in judicial act, only in executive and

legislative act
Except: no inflexible rule preventing a judgment sought by foreign
govt from qualifying act of state. PH judgment is not mere dispute
between private individuals, it is an action to mandate recovery of ill
gotten wealth. Subject matter is act of state and a judgment in favor
of a sovereign.

collection efforts of the Phil Gov are governmental, hence, Act of

State.

3. GR: ASD applicable only for matters done within territory.

PH is not wholly external. Bank is ph territory. the fact that deposited
in SG does not preclude ASD. there is government interest. and PH
did not simply intrude into SG - purusant to Credt Suisse case.

Hence, Mandamus proper to correct error of DC in issuing the

injunction.
3. Republic v. Marcos
Plaintiff: ROP
Defendant: Marcos and Imelda
Court: US
Action: Appeal on Preliminary Injuction issued by the district court
(Note: Injunction is in personam]

P filed RICO (forms a pattern if it embraces criminal acts that have

the same or similar purposes, results, participants, victims, or
methods of commission, or otherwise interrelated by
 distinguishing characteristics and are not isolated events) case vs
Marcos civil liability under RICO
Marcos invoked ASD to insulate his acts of embezzling PH funds.

Issue: W/N DC had JD/ W/N injunction proper

Held: YES to both

Acts of state are beyond judicial review. This is to keep court from
making pronouncement on matters over which he has no power.
And to prevent embarrassment of a court offending the foreign
government that is exant at the time of suit.

Classification of AS is not a promise to the ruled of any foreign

country that his conduct, if challenged by his own country after
his fall, may not become subject of scrutiny in courts. No estoppel
exists insulating a dictator from accounting. When a rulers former
domain turns against him, classification of ASD is not applicable.
Purpose is to foster foreign relations, not to furnish immunity to
deposed leader.

In this case, Marcoses didnt offer evidence to support claim,

burden of proof rests upon them.