ASIAVEST MERCHANT BANKERS (M) BERHAD vs.

CA and PNCC
G.R. No. 110263, July 20, 2001

Facts: Petitioner Asiavest Merchant Bankers (M) Berhad is a corporation organized

under the laws of Malaysia while private respondent Philippine National
Construction Corporation is a corporation duly incorporated and existing under
Philippine laws.

Petitioner initiated a suit for collection against private respondent, then known as
Construction and Development Corporation of the Philippines, before the High
Court of Malaya in Kuala Lumpur entitled Asiavest Merchant Bankers (M) Berhad
v. Asiavest CDCP Sdn. Bhd. and Construction and Development Corporation of the
Philippines.

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

The High Court of Malaya (Commercial Division) rendered judgment in favor of the
petitioner and against the private respondent. Following unsuccessful attempts to
secure payment from private respondent under the judgment, petitioner initiated
the complaint before RTC of Pasig, Metro Manila, to enforce the judgment of the
High Court of Malaya.

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

Subsequently, private respondent filed its Answer with Compulsory Counter

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

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

Issue: Whether or not the CA erred in denying recognition and enforcement to the
Malaysian Court judgment.

Ruling: Yes.

Generally, in the absence of a special compact, no sovereign is bound to give

effect within its dominion to a judgment rendered by a tribunal of another
country; however, the rules of comity, utility and convenience of nations have
established a usage among civilized states by which final judgments of foreign
courts of competent jurisdiction are reciprocally respected and rendered
efficacious under certain conditions that may vary in different countries.

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

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

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

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

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

361 SCRA 489 Conflict of Laws Private International Law Foreign Judgments
How Assailed

In 1985, the High Court of Malaysia ordered the Philippine National Construction
Corporation (PNCC) to pay $5.1 million to Asiavest Merchant Bankers (M) Berhad.
This was the result of a recovery suit filed by Asiavest against PNCC in Malaysia
for PNCCs failure to complete a construction project there despite due payment
from Asiavest. Despite demand, PNCC failed to comply with the judgment in
Malaysia hence Asiavest filed a complaint for the enforcement of the Malaysian
ruling against PNCC in the Philippines. The case was filed with the Pasig RTC which
eventually denied the complaint. The Court of Appeals affirmed the decision of the
RTC.

Asiavest appealed. In its defense, PNCC alleged that the foreign judgment cannot
be enforced here because of want of jurisdiction, want of notice to PNCC, collusion
and/or fraud, and there is a clear mistake of law or fact. Asiavest assailed the
arguments of PNCC on the ground that PNCCs counsel participated in all the
proceedings in the Malaysian Court.

ISSUE: Whether or not the Malaysian Court judgment should be enforced against
PNCC in the Philippines.

HELD: Yes. PNCC failed to prove and substantiate its bare allegations of want of
jurisdiction, want of notice, collusion and/or fraud, and mistake of fact. On the
contrary, Asiavest was able to present evidence as to the validity of the
proceedings that took place in Malaysia. Asiavest presented the certified and
authenticated copies of the judgment and the order issued by the Malaysian
Court. It also presented correspondences between Asiavests lawyers and PNCCs
lawyers in and out of court which belied PNCCs allegation that the Malaysian
court never acquired jurisdiction over it. PNCCs allegation of fraud is not sufficient
too, further, it never invoked the same in the Malaysian Court.
The Supreme Court notes, to assail a foreign judgment the party must present
evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or
clear mistake of law or fact. Otherwise, the judgment enjoys the presumption of
validity so long as it was duly certified and authenticated. In this case, PNCC failed
to present the required evidence.

HILSEC INVESTMENT et al vs.CA et al

G.R. No. 103493
June 19, 1997
FACTS: Private respondent Ducat obtained separate loans from petitioners Ayala
International Finance Limited (AYALA) and Philsec Investment Corp (PHILSEC),
secured by shares of stock owned by Ducat.
In order to facilitate the payment of the loans, private respondent 1488, Inc., through
its president, private respondent Daic, assumed Ducats obligation under an
Agreement, whereby 1488, Inc. executed a Warranty Deed with Vendors Lien by which
it sold to petitioner Athona Holdings, N.V. (ATHONA) a parcel of land in Texas, U.S.A.,
while PHILSEC and AYALA extended a loan to ATHONA as initial payment of the
purchase price. The balance was to be paid by means of a promissory note executed by
ATHONA in favor of 1488, Inc. Subsequently, upon their receipt of the money from
1488, Inc., PHILSEC and AYALA released Ducat from his indebtedness and delivered
to 1488, Inc. all the shares of stock in their possession belonging to Ducat.
As ATHONA failed to pay the interest on the balance, the entire amount covered by the
note became due and demandable. Accordingly, private respondent 1488, Inc. sued
petitioners PHILSEC, AYALA, and ATHONA in the United States for payment of the
balance 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, Inc. under the Agreement.
While the Civil Case was pending in the United States, petitioners filed a complaint
For Sum of Money with Damages and Writ of Preliminary Attachment against private
respondents in the RTC Makati. The complaint reiterated the allegation of petitioners
in their respective counterclaims in the Civil Action in 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.
Ducat moved to dismiss the Civil Case in the RTC-Makati on the grounds of (1) litis
pendentia, vis-a-vis the Civil Action in the U.S., (2) forum non conveniens, and (3)
failure of petitioners PHILSEC and BPI-IFL to state a cause of action.
The trial court granted Ducats MTD, stating that the evidentiary requirements of the
controversy may be more suitably tried before the forum of the litis pendentia in the
U.S., under the principle in private international law of forum non conveniens, even as
it noted that Ducat was not a party in the U.S. case.
Petitioners appealed to the CA, arguing that the trial court erred in applying the
principle of litis pendentia and forum non conveniens.
The CA affirmed the dismissal of Civil Case against Ducat, 1488, Inc., and Daic on the
ground of litis pendentia.
ISSUE: is the Civil Case in the RTC-Makati barred by the judgment of the U.S. court?
HELD: CA reversed. Case remanded to RTC-Makati
NO
 While this Court has given the effect of res judicata to foreign judgments in several
cases, it was after the parties opposed to the judgment had been given ample
opportunity to repel them on grounds allowed under the law. This is because in this
jurisdiction, with respect to actions in personam, as distinguished from actions in rem,
a foreign judgment merely constitutes prima facie evidence of the justness of the claim
of a party and, as such, is subject to proof to the contrary. Rule 39, 50 provides:
Sec. 50. Effect of foreign judgments. The effect of a judgment of a tribunal of a
foreign country, having jurisdiction to pronounce the judgment is as follows:
(a) In case of a judgment upon a specific thing, the judgment is conclusive upon the
title to the thing;
(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; but
the judgment may be repelled by evidence of a want of jurisdiction, want of notice to
the party, collusion, fraud, or clear mistake of law or fact.
In the case at bar, it cannot be said that petitioners were given the opportunity to
challenge the judgment of the U.S. court as basis for declaring it res judicata or
conclusive of the rights of private respondents. The proceedings in the trial court were
summary. Neither the trial court nor the appellate court was even furnished copies of
the pleadings in the U.S. court or apprised of the evidence presented thereat, to assure
a proper determination of whether the issues then being litigated in the U.S. court were
exactly the issues raised in this case such that the judgment that might be rendered
would constitute res judicata.
Second. Nor is the trial courts refusal to take cognizance of the case justifiable under
the principle of forum non conveniens:
First, a MTD is limited to the grounds under Rule 16, sec.1, which does not include
forum non conveniens. The propriety of dismissing a case based on this principle
requires a factual determination, hence, it is more properly considered a matter of
defense.
Second, while it is within the discretion of the trial court to abstain from assuming
jurisdiction on this ground, it should do so only after vital facts are established, to
determine whether special circumstances require the courts desistance.

Philippine Aluminum Wheels vs FASGI Enterprises

GR 137378; 12 October 2000

Facts:

On 01 June 1978, FASGI Enterprises Incorporated (FASGI), a corporation organized and

existing under and by virtue of the laws of the State of California, United States of America,
entered into a distributorship arrangement with Philippine Aluminum Wheels, Incorporated
(PAWI), a Philippine corporation, and Fratelli Pedrini Sarezzo S.P.A. (FPS), an Italian
corporation. The agreement provided for the purchase, importation and distributorship in the
United States of aluminium wheels manufactured by PAWI. FASGI then paid PAWI the FOB
value of the wheels. Unfortunately, FASGI later found the shipment to be defective and in
non-compliance with the contract.
On 21 September 1979, FASGI instituted an action against PAWI and FPS for breach of
contract and recovery of damages in the amount of US$2,316,591.00 before the United States
District Court for the Central District of California. In the interim, two agreements were
entered by the parties but PAWI kept on failing to discharge its obligations therein. Irked by
PAWIs persistent default, FASGI filed with the US District Court of the Central District of
California the agreements for judgment against PAWI.

On 24 August 1982, FASGI filed a notice of entry of judgment. Unable to obtain satisfaction of
the final judgment within the United States, FASGI filed a complaint for enforcement of
foreign judgment, before RTC Makati. The Makati court, however, dismissed the case, on the
ground that the decree was tainted with collusion, fraud, and clear mistake of law and fact.
The lower court ruled that the foreign judgment ignored the reciprocal obligations of the
parties. While the assailed foreign judgment ordered the return by PAWI of the purchase
amount, no similar order was made requiring FASGI to return to PAWI the third and fourth
containers of wheels. This situation amounted to an unjust enrichment on the part of FASGI.
Furthermore, the RTC said, agreements which the California court had based its judgment
were a nullity for having been entered into by Mr. Thomas Ready, counsel for PAWI, without
the latters authorization. However, the Court of Appeals reversed this decision.

Issue: WON the Philippine Court may enforce the said foreign judgment.

Held:

In this jurisdiction, a valid judgment rendered by a foreign tribunal may be recognized insofar
as the immediate parties and the underlying cause of action are concerned so long as it is
convincingly shown that there has been an opportunity for a full and fair hearing before a
court of competent jurisdiction; that trial upon regular proceedings has been conducted,
following due citation or voluntary appearance of the defendant and under a system of
jurisprudence likely to secure an impartial administration of justice; and that there is nothing
to indicate either a prejudice in court and in the system of laws under which it is sitting or
fraud in procuring the judgment. PAWI claims that its counsel, Mr. Ready, has acted without
its authority. Verily, in this jurisdiction, it is clear that an attorney cannot, without a clients
authorization, settle the action or subject matter of the litigation even when he honestly
believes that such a settlement will best serve his clients interest. However, PAWI failed to
substantiate this complain with sufficient evidence. Hence, the foreign judgment must be
enforced.

Even if PAWI assailed that fraud tainted the agreements which the US Court based its
judgment, this cannot prevent the enforcement of said judgment. PAWI claimed that there
was collusion and fraud in the signing of the agreements. Although the US Court already
adjudicated on this matter, PAWI insisted on raising it again in this Court. Fraud, to hinder
the enforcement within this jurisdiction of a foreign judgment, must be extrinsic, i.e., fraud
based on facts not controverted or resolved in the case where judgment is rendered, or that
which would go to the jurisdiction of the court or would deprive the party against whom
judgment is rendered a chance to defend the action to which he has a meritorious case or
defense. In fine, intrinsic fraud, that is, fraud which goes to the very existence of the cause of
action such as fraud in obtaining the consent to a contract is deemed already adjudged,
and it, therefore, cannot militate against the recognition or enforcement of the foreign
judgment.
Conflict of Laws Private International Law Foreign Judgments When May It Be
Enforced

In 1978, FASGI Enterprises Inc. (FASGI), a foreign corporation organized under the
laws of California, USA, entered into a contract with Philippine Aluminum Wheels,
Inc. (PAWI), a Philippine corporation, whereby the latter agrees to deliver 8,594
wheels to FASGI. FASGI received the wheels and so it paid PAWI $216,444.30.
Later however, FASGI found out that the wheels are defective and did not comply
with certain US standards. So in 1979, FASGI sued PAWI in a California court. In
1980, a settlement was reached but PAWI failed to comply with the terms of the
agreement. A second agreement was made but PAWI was again remiss in its
obligation. The agreement basically provides that PAWI shall return the purchase
price in installment and conversely, FASGI shall return the wheel in installment.
PAWI was only able to make two installments (which were actually made beyond
the scheduled date). FASGI also returned the corresponding number of wheels.
Eventually in 1982, FASGI sought the enforcement of the agreement and it
received a favorable judgment from the California court. PAWI is then ordered to
pay an equivalent of P252k plus damages but FASGI was not ordered to return the
remaining wheels. PAWI was not able to comply with the court order in the US. So
in 1983, FASGI filed a complaint for the enforcement of a foreign judgment with
RTC-Makati. Hearings were made and in 1990, the trial judge ruled against FASGI
on the ground that the foreign judgment is tainted with fraud because FASGI was
not ordered to return the remaining wheels (unjust enrichment) and that PAWIs
American lawyer entered into the agreements without the consent of PAWI. On
appeal, the Court of Appeals reversed the trial court.

ISSUE: Whether or not the foreign judgment may be enforced here in the
Philippines.

HELD: Yes. The judgment is valid. A valid judgment rendered by a foreign tribunal
may be recognized insofar as the immediate parties and the underlying cause of
action are concerned so long as it is convincingly shown that there has been an
opportunity for a full and fair hearing before a court of competent jurisdiction; that
trial upon regular proceedings has been conducted, following due citation or
voluntary appearance of the defendant and under a system of jurisprudence likely
to secure an impartial administration of justice; and that there is nothing to
indicate either a prejudice in court and in the system of laws under which it is
sitting or fraud in procuring the judgment. A foreign judgment is presumed to be
valid and binding in the country from which it comes, until a contrary showing, on
the basis of a presumption of regularity of proceedings and the giving of due
notice in the foreign forum.

In this case, PAWI was very well represented in the California court. PAWIs
insistence that its American lawyer colluded with FASGI; that he entered into the
compromise agreement without PAWIs authority is belied by the fact that PAWI
initially complied with the agreement. It did not disclaim the agreement. It sent
two installments (though belatedly) but failed to comply on the rest. It cannot now
aver that the agreement is without its authority. Further, it is just but fair for the
California court not to order FASGI to return the remaining wheels because of
PAWIs arrears.

PHILIPPINE ALUMINUM WHEELS, INC. vs. FASGI

G.R. No. 137378 October 12, 2000

FACTS: On 01 June 1978, FASGI Enterprises Incorporated, a corporation organized

and existing under and by virtue of the laws of the State of California, United
States of America, entered into a distributorship arrangement with Philippine
Aluminum Wheels, Incorporated (PAWI), a Philippine corporation, and Fratelli
Pedrini Sarezzo S.P.A., an Italian corporation. The agreement provided for the
purchase, importation and distributorship in the United States of aluminum wheels
manufactured by PAWI. On 21 September 1979, FASGI instituted an action against
PAWI and FPS for breach of contract and recovery of damages in the amount of
US$2,316,591.00 before the United States District Court for the Central District of
California. During the pendency of the case, the parties entered into a settlement,
entitled "Transaction", where it was stipulated that FPS and PAWI would accept the
return of not less than 8,100 wheels after restoring to FASGI the purchase price of
US$268,750.00 via four (4) irrevocable letters of credit (LC). In its telex message,
FASGI insisted that PAWI should meet the terms of the proposed schedule of
payments, specifically its undertaking to open the first LC within April of 1980,
and that "If the letter of credit is not opened by April 30, 1980, then it
would immediately take all necessary legal action to protect its
position." Despite its assurances, and FASGI's insistence, PAWI failed to open the
first LC in April 1980 allegedly due to Central Bank "inquiries and restrictions,"
prompting FASGI to pursue its complaint for damages against PAWI before the
California district court. A certificate of finality of judgment was issued, on 07
September 1982, by the US District Judge of the District Court for the Central
District of California. Unable to obtain satisfaction of the final judgment within the
United States, FASGI filed a complaint for "enforcement of foreign judgment" in
February 1983, before the Regional Trial Court, Branch 61, of Makati, Philippines.
The Makati court, however, in an order of 11 September 1990, dismissed the case,
thereby denying the enforcement of the foreign judgment within Philippine
jurisdiction, on the ground that the decree was tainted with collusion, fraud, and
clear mistake of law and fact. On appeal, the CA reversed the decision of the trial
court and ordered the full enforcement of the California judgment. Hence this
petition.

ISSUE: Whether or not the judgment of the District Court for the Central District
Court of California should be denied recognition or enforcement before Philippine
Courts.

RULING: California judgment must be enforced. In this jurisdiction, a valid

judgment rendered by a foreign tribunal may be recognized insofar as the
immediate parties and the underlying cause of action are concerned so long as it
is convincingly shown that there has been an opportunity for a full and fair
hearing before a court of competent jurisdiction; that trial upon regular
proceedings has been conducted, following due citation or voluntary appearance
of the defendant and under a system of jurisprudence likely to secure an impartial
administration of justice; and that there is nothing to indicate either a prejudice in
court and in the system of laws under which it is sitting or fraud in procuring the
judgment. A foreign judgment is presumed to be valid and binding in the country
from which it comes, until a contrary showing, on the basis of a presumption of
regularity of proceedings and the giving of due notice in the foreign forum.

PHILIPPINE ALUMINUM WHEELS, INC., petitioner,

vs.
FASGI ENTERPRISES, INC., respondent.

Parties:
FASGI Enterprises Incorporated
Philippine Aluminum Wheels, Incorporated ("PAWI") Philippine corporation
Fratelli Pedrini Sarezzo S.P.A. ("FPS") Italian corporation

Underlying transaction Distributorship Agreement

Purchase, importation and distributorship in the United States of aluminum wheels
manufactured by PAWI
8,594 wheels
shipment was found to be defective and in non-compliance with stated requirements

FASGI instituted an action against PAWI and FPS for breach of contract and recovery of damages
before the US District Court
During the pendency of the case, the parties entered into a settlement
o FPS and PAWI would accept the return of some of the wheels after restoring to FASGI the
purchase price of US$268,750.00 via four (4) irrevocable letters of credit ("LC")
PAWI twice failed to comply with the the settlement agreement
FASGI pursued its complaint for damages earlier brought against PAWI before the US district
court.
During its pendency, entered into another settlement agreement
o In the event of breach of the Supplemental Settlement Agreement, FASGI shall have the right
to apply immediately to the Court for entry of Judgment pursuant to the Stipulation for
Judgment
PAWI managed to pay the first and second LC but defaulted on the remaining.
FASGI filed with the US District Court the stipulation for judgment against PAWI
FASGI filed a notice of entry of judgment. A certificate of finality of judgment was issued by the
US District Judge
 Unable to obtain satisfaction of the final judgment within the United States, FASGI filed a
complaint for "enforcement of foreign judgment" in February 1983, before the Regional Trial
Court, Branch 61, of Makati.
The Makati court on 11 September 1990, dismissed the case, thereby denying the enforcement of
the foreign judgment within Philippine jurisdiction, on the ground that the decree was tainted with
collusion, fraud, and clear mistake of law and fact.
The lower court ruled that the foreign judgment ignored the reciprocal obligations of the parties.
According said court, while the assailed foreign judgment ordered the return by PAWI of the
purchase amount, no similar order was made requiring FASGI to return to PAWI the third and
fourth containers of wheels, which was tantamount to unjust enrichment on the part of FASGI.
Furthermore, the settlement agreement and motion for entry of judgment were a nullity for having
been entered into by Mr. Thomas Ready, counsel for PAWI, without the latter's authorization
FASGI appealed the decision of the trial court to the Court of Appeals. Appellate court reversed the
decision of the trial court and ordered the full enforcement of the California judgment.

ISSUE: Should the foreign judgment be enforced?

HELD: Yes
In this jurisdiction, a valid judgment rendered by a foreign tribunal may be recognized insofar as
the immediate parties and the underlying cause of action are concerned so long as it is
convincingly shown that it has been rendered by a court of competent jurisdiction, impartially and
according an opportunity for a full and fair hearing.
A foreign judgment is presumed to be valid and binding in the country from which it comes, until a
contrary showing, on the basis of a presumption of regularity of proceedings and the giving of due
notice in the foreign forum.
PAWI claims that its counsel, Mr. Ready, has acted without its authority.
o In this jurisdiction, it is clear that an attorney cannot, without a client's authorization, settle
the action or subject matter of the litigation even when he honestly believes that such a
settlement will best serve his client's interest.
o If Mr. Ready was indeed not authorized, PAWI could have disclaimed the settlement
o On the contrary, PAWI confirmed the supplemental settlement when it sought forbearance for
the impending delay in its payments
Even if PAWI claimed that there was collusion and fraud in the signing of the agreements, this
cannot prevent the enforcement of the judgment. Although the US Court already adjudicated on
this matter, PAWI insisted on raising it again in this Court. Fraud, to hinder the enforcement within
this jurisdiction of a foreign judgment, must be extrinsic, i.e., fraud based on facts not controverted
or resolved in the case where judgment is rendered, or that which would go to the jurisdiction of
the court or would deprive the party against whom judgment is rendered a chance to defend the
action to which he has a meritorious case or defense. In fine, intrinsic fraud, that is, fraud which
goes to the very existence of the cause of action - such as fraud in obtaining the consent to a
contract - is deemed already adjudged, and it, therefore, cannot militate against the recognition or
enforcement of the foreign judgment.
In line with the principle of international comity, a court of another jurisdiction should refrain, as a
matter of propriety and fairness, from so assuming the power of passing judgment on the
correctness of the application of law and the evaluation of the facts of the judgment issued by
another tribunal
CONFLICT OF LAWS Gil Miguel Puyat vs Ron Zabarte
 Civil Law Conflict of Laws Processual Presumption Forum Non Conveniens
Remedial Law Civil Procedure Rule 34 Summary Judgment
Gil Miguel Puyat, a foreigner, lost a collection suit filed against him by Ron
Zabarte in a court in California, USA. The California court ordered Puyat to pay
the amount of $241k. Puyat was only able to pay $5k.
In January 1994, Zabarte filed an action to enforce the California judgment
here in the Philippines against Puyat. Puyat filed an Answer where he alleged,
among others, that the California court had no jurisdiction over the case,
hence, the foreign judgment is void. He likewise averred that the trial court
had no jurisdiction because the issue involved are partnership matters which
are under the jurisdiction of the Securities and Exchange Commission (SEC).
Zabarte then filed a motion for summary judgment as he argued that Puyats
Answer tendered no issue. The trial court granted the motion and eventually
gave a favorable judgment for Zabarte. The Court of Appeals affirmed the
decision of the trial court.
On appeal, Puyat now avers that the trial court should have never taken
cognizance of the case because it had no jurisdiction over the case pursuant
to the forum non conveniens rule. He averred that under this principle, since
all the transaction involved in this case occurred in California, he being a
foreigner, and the California law was not properly determined, the trial court
had no jurisdiction. He also assailed the validity of the trial courts act in
granting the motion for summary judgment filed by Zabarte.
ISSUE: Whether or not Puyat is correct.
HELD: No. The allowance of summary judgment is proper. In this case, Puyats
Answer did not really tender an issue. Summary judgment is resorted to in
order to avoid long drawn out litigations and useless delays. When affidavits,
depositions and admissions on file show that there are no genuine issues of
fact to be tried, the Rules allow a party to pierce the allegations in the
pleadings and to obtain immediate relief by way of summary judgment. In
short, since the facts are not in dispute, the court is allowed to decide the case
summarily by applying the law to the material facts. In this case, Puyats
Answer merely alleged that the California court, a civil court, had no
jurisdiction because the case involved was a partnership issue. He however
admitted that the issue involved is the payment of money upon promissory
notes with damages. Puyat also did not attach a copy of the complaint filed by
Zabarte with the California court. As such, the trial court properly presumed,
applying the principle of processual presumption, that the California law is the
same as Philippine law that cases involving collection of money is
cognizable by civil courts. And by applying the principle of processual
presumption, theres no longer a need to try the facts in this case, hence, a
summary judgment was in order.
Anent the issue of forum non conveniens, such does not exist in this
case. Under the principle of forum non conveniens, even if the exercise of
jurisdiction is authorized by law, courts may nonetheless refuse to entertain a
case for any of the following practical reasons:
 1. The belief that the matter can be better tried and decided elsewhere,
either because the main aspects of the case transpired in a foreign jurisdiction
or the material witnesses have their residence there;
2. The belief that the non-resident plaintiff sought the forum[,] a practice
known as forum shopping[,] merely to secure procedural advantages or to
convey or harass the defendant;
3. The unwillingness to extend local judicial facilities to non-residents or
aliens when the docket may already be overcrowded;
4. The inadequacy of the local judicial machinery for effectuating the right
sought to be maintained; and The difficulty of ascertaining foreign law.

None of the above existed in this case, hence, the trial court properly took
cognizance of the case.
OIL AND NATURAL GAS COMMISSION v Court of Appeals Case Digest
OIL AND NATURAL GAS COMMISSION v CA

FACTS:

This proceeding involves the enforcement of a foreign judgment rendered by the Civil Judge
of Dehra Dun, India in favor of the petitioner, against the private respondent, PACIFIC
CEMENT COMPANY, INCORPORATED. The petitioner is a foreign corporation owned and
controlled by the Government of India while the private respondent is a private corporation
duly organized and existing under the laws of the Philippines.

The conflict between the petitioner and the private respondent rooted from the failure of the
respondent to deliver 43,000 metric tons of oil well cement to the petitioner even it had
already received payment and despite petitioners several demands. The petitioner then
informed the private respondent that it was referring its claim to an arbitrator pursuant to
Clause 16 of their contract which stipulates that he venue for arbitration shall be at Dehra
dun.
The chosen arbitrator, one Shri N.N. Malhotra, resolved the dispute in favour of the petitioner
setting forth the arbitral award. To enable the petitioner to execute the above award, it filed a
Petition before the Court of the Civil Judge in Dehra Dun. India praying that the decision of
the arbitrator be made "the Rule of Court" in India. This was objected by the respondent but
foreign court refused to admit the private respondent's objections for failure to pay the
required filing fees. Despite notice sent to the private respondent of the foregoing order and
several demands by the petitioner for compliance therewith, the private respondent refused to
pay the amount adjudged by the foreign court as owing to the petitioner.

The petitioner filed a complaint with Branch 30 of the Regional Trial Court (RTC) of Surigao
City for the enforcement of the aforementioned judgment of the foreign court. The private
respondent moved to dismiss the complaint. RTC dismissed the complaint for lack of a valid
cause of action. The petitioner then appealed to the respondent Court of Appeals which
affirmed the dismissal of the complaint. In its decision, the appellate court concurred with the
RTC's ruling that the arbitrator did not have jurisdiction over the dispute between the parties,
thus, the foreign court could not validly adopt the arbitrator's award. The petitioner filed this
petition for review on certiorari,
ISSUE:

Whether or not the arbitrator had jurisdiction over the dispute between the petitioner and the
private respondent under Clause 16 of the contract.

RULING:

The constitutional mandate that no decision shall be rendered by any court without
expressing therein dearly and distinctly the facts and the law on which it is based does not
preclude the validity of "memorandum decisions" which adopt by reference the findings of fact
and conclusions of law contained in the decisions of inferior tribunals.

Furthermore, the recognition to be accorded a foreign judgment is not necessarily affected by

the fact that the procedure in the courts of the country in which such judgment was rendered
differs from that of the courts of the country in which the judgment is relied on. If the
procedure in the foreign court mandates that an Order of the Court becomes final and
executory upon failure to pay the necessary docket fees, then the courts in this jurisdiction
cannot invalidate the order of the foreign court simply because our rules provide otherwise.

WHEREFORE, the instant petition is GRANTED, and the assailed decision of the Court of
Appeals sustaining the trial court's dismissal of the OIL AND NATURAL GAS COMMISSION's
complaint before Branch 30 of the RTC of Surigao City is REVERSED,

OIL AND NATURAL GAS COMMISSION, petitioner,

vs.
COURT OF APPEALS and PACIFIC CEMENT COMPANY, INC., respondents.

Parties:
Petitioner - Indian GOCC
Respondent - Philippine private corporation

Underlying transaction:
Contact for the respondent to supply to petitioner 4,300 metric tons of oil well cement
Consideration: $477,300.00 through a confirmed letter of credit

Events:
The oil well cement was loaded and shipped but due to a dispute between ship owner and respondent,
the cargo was held up in Bangkok and did not reach its point destination.
Despite having already received payment and several demands by the petitioner, the private
respondent failed to deliver the oil well cement
Upon negotiations, they agreed that the private respondent will replace the entire 4,300 metric tons of
oil well cement with Class "G" cement. However, on inspection, the Class "G" cement did not
conform to the petitioner's specifications
The petitioner then informed the private respondent that it was referring its claim to an arbitrator
pursuant to Clause 16 of their contract
Arbitrator ruled in favor of petitioner awarding him USD 899,603.77. The award was confirmed by
the foreign court.
 Despite the award and demands by petitioner, respondent refused to pay. Petitioner then filed a
complaint with the RTC of Surigao City for the enforcement of the foreign judgment.
The RTC dismissed the complaint, ruling that the Arbitrator did not have jurisdiction over the dispute
on the ground that the referral to the arbitrator under Clause 16 of their contract is erroneous. The
breach consisting of the non-delivery of the purchased materials, should have been properly litigated
before a court of law, pursuant to Clause No. 15
On appeal, the CA affirmed RTC ruling. The CA likewise noted that judgment of the foreign court
did not contain any statement of facts and law upon which the award was based; hence, the judgment
cannot be enforced by any Philippine court
MR was denied, thus petition for review on certiorari

Issues:

I. Whether the Arbitrator had jurisdiction over the dispute

Yes. The real issue that was bought to the Arbitrator was the non-conformity of the Class "G"
cement with the specifications agreed upon, and no longer the non-delivery of the oil well cement
which was supposedly within the exclusive jurisdiction of the courts as set forth in Clause 15.
Clause 16 pertain only to matters involving the technical aspects of the contract
Clause 15: All questions, disputes and differences, arising under out of or in connection with this
supply order, shall be subject to the exclusive jurisdiction of the court

II. Whether the foreign judgment is enforceable in this jurisdiction

Yes. The foreign court adopted the findings of facts and law of the arbitrator as contained in the
latter's Award Paper
The constitutional provision that decisions must express the facts and the law on which it is based
does not preclude the validity of "memorandum decisions" which adopt by reference the findings
of fact and conclusions of law contained in the decisions of inferior tribunals
Furthermore, the recognition to be accorded a foreign judgment is not necessarily affected by the
fact that the procedure in the courts of the country in which such judgment was rendered differs
from that of the courts of the country in which the judgment is relied on. This Court has held that
matters of remedy and procedure are governed by the lex fori or the internal law of the forum.

The contention that respondent was not accorded due process is likewise without merit. The
essence of due process is to be found in the reasonable opportunity to be heard and submit any
evidence one may have in support of one's defense.
A foreign judgment is presumed to be valid and binding in the country from which it comes,
until the contrary is shown. It is also proper to presume the regularity of the proceedings and
the giving of due notice therein. Consequently, the party attacking a foreign judgment
(Pacific Cement) had the burden of overcoming the presumption of its validity which it failed
to do in the instant case.

OIL AND NATURAL GAS COMMISSION, petitioner,

 vs.
COURT OF APPEALS and PACIFIC CEMENT COMPANY, INC., respondents.

Parties:
Petitioner - Indian GOCC
Respondent - Philippine private corporation

Underlying transaction:
Contact for the respondent to supply to petitioner 4,300 metric tons of oil well cement
Consideration: $477,300.00 through a confirmed letter of credit

Events:
The oil well cement was loaded and shipped but due to a dispute between ship owner and respondent,
the cargo was held up in Bangkok and did not reach its point destination.
Despite having already received payment and several demands by the petitioner, the private
respondent failed to deliver the oil well cement
Upon negotiations, they agreed that the private respondent will replace the entire 4,300 metric tons of
oil well cement with Class "G" cement. However, on inspection, the Class "G" cement did not
conform to the petitioner's specifications
The petitioner then informed the private respondent that it was referring its claim to an arbitrator
pursuant to Clause 16 of their contract
Arbitrator ruled in favor of petitioner awarding him USD 899,603.77. The award was confirmed by
the foreign court.

Despite the award and demands by petitioner, respondent refused to pay. Petitioner then filed a
complaint with the RTC of Surigao City for the enforcement of the foreign judgment.
The RTC dismissed the complaint, ruling that the Arbitrator did not have jurisdiction over the dispute
on the ground that the referral to the arbitrator under Clause 16 of their contract is erroneous. The
breach consisting of the non-delivery of the purchased materials, should have been properly litigated
before a court of law, pursuant to Clause No. 15
On appeal, the CA affirmed RTC ruling. The CA likewise noted that judgment of the foreign court
did not contain any statement of facts and law upon which the award was based; hence, the judgment
cannot be enforced by any Philippine court
MR was denied, thus petition for review on certiorari

Issues:

III. Whether the Arbitrator had jurisdiction over the dispute

Yes. The real issue that was bought to the Arbitrator was the non-conformity of the Class "G"
cement with the specifications agreed upon, and no longer the non-delivery of the oil well cement
which was supposedly within the exclusive jurisdiction of the courts as set forth in Clause 15.
Clause 16 pertain only to matters involving the technical aspects of the contract
 Clause 15: All questions, disputes and differences, arising under out of or in connection with this
supply order, shall be subject to the exclusive jurisdiction of the court

IV. Whether the foreign judgment is enforceable in this jurisdiction

Yes. The foreign court adopted the findings of facts and law of the arbitrator as contained in the
latter's Award Paper
The constitutional provision that decisions must express the facts and the law on which it is based
does not preclude the validity of "memorandum decisions" which adopt by reference the findings
of fact and conclusions of law contained in the decisions of inferior tribunals
Furthermore, the recognition to be accorded a foreign judgment is not necessarily affected by the
fact that the procedure in the courts of the country in which such judgment was rendered differs
from that of the courts of the country in which the judgment is relied on. This Court has held that
matters of remedy and procedure are governed by the lex fori or the internal law of the forum.

The contention that respondent was not accorded due process is likewise without merit. The
essence of due process is to be found in the reasonable opportunity to be heard and submit any
evidence one may have in support of one's defense.
A foreign judgment is presumed to be valid and binding in the country from which it comes,
until the contrary is shown. It is also proper to presume the regularity of the proceedings and
the giving of due notice therein. Consequently, the party attacking a foreign judgment
(Pacific Cement) had the burden of overcoming the presumption of its validity which it failed
to do in the instant case.

FACTS:

May 9 1991: a complaint was filed by ten Filipino citizens representing a class of
10,000 members who each alleged having suffered human rights abuses such as arbitrary
detention, torture and rape in the hands of police or military forces during the Marcos
regime with the United States District Court (US District Court), District of Hawaii, against
the Estate of former Philippine President Ferdinand E. Marcos (Marcos Estate)
US District Court and Affirmed by US CA: awarded them $1,964,005,859.90
Petitioners filed Complaint with Makati RTC for the enforcement of the Final Judgment
Marcos Estate filed a motion to dismiss, raising, among others, the non-payment of the
correct filing fees paying only P410
Petitioners claimed that an action for the enforcement of a foreign judgment is not
capable of pecuniary estimation
RTC: estimated the proper amount of filing fees was approximately P472 and
dismissing the case without prejudice
Petition for Certiorari under Rule 65

ISSUE: W/N the enforcement of a foreign judgment is incapable of pecuniary estimation

HELD: NO. (But belongs to "other actions not involving property") petition is GRANTED.
 There is an evident distinction between a foreign judgment in an action in rem and one
in personam. For an action in rem, the foreign judgment is deemed conclusive upon the
title to the thing, while in an action in personam, the foreign judgment is presumptive, and
not conclusive, of a right as between the parties and their successors in interest by a
subsequent title
However, in both cases, the foreign judgment is susceptible to impeachment in our
local courts on the grounds of want of jurisdiction or notice to the party, collusion, fraud, or
clear mistake of law or fact. Thus, the party aggrieved by the foreign judgment is entitled
to defend against the enforcement of such decision in the local forum. It is essential that
there should be an opportunity to challenge the foreign judgment, in order for the court in
this jurisdiction to properly determine its efficacy even if such judgment has conclusive
effect as in the case of in rem actions, if only for the purpose of allowing the losing party
an opportunity to challenge the foreign judgment. Consequently, the party attacking a
foreign judgment has the burden of overcoming the presumption of its validity. Absent
perhaps a statutory grant of jurisdiction to a quasi-judicial body, the claim for enforcement
of judgment must be brought before the regular courts.
There are distinctions, nuanced but discernible, between the cause of action arising
from the enforcement of a foreign judgment, and that arising from the facts or allegations
that occasioned the foreign judgment. They may pertain to the same set of facts, but
there is an essential difference in the right-duty correlatives that are sought to be
vindicated. Extensive litigation is thus conducted on the facts, and from there the right to
and amount of damages are assessed. On the other hand, in an action to enforce a
foreign judgment, the matter left for proof is the foreign judgment itself, and not the facts
from which it prescinds.
As stated in Section 48, Rule 39, the actionable issues are generally restricted to a
review of jurisdiction of the foreign court, the service of personal notice, collusion, fraud, or
mistake of fact or law. The limitations on review is in consonance with a strong and
pervasive policy in all legal systems to limit repetitive litigation on claims and issues.
Otherwise known as the policy of preclusion, it seeks to protect party expectations
resulting from previous litigation, to safeguard against the harassment of defendants, to
insure that the task of courts not be increased by never-ending litigation of the same
disputes, and in a larger sense to promote what Lord Coke in the Ferrer's Case of 1599
stated to be the goal of all law: "rest and quietness." If every judgment of a foreign court
were reviewable on the merits, the plaintiff would be forced back on his/her original cause
of action, rendering immaterial the previously concluded litigation.
Marcos Estate cites Singsong v. Isabela Sawmill and Raymundo v. Court of Appeals:
In determining whether an action is one the subject matter of which is not
capable of pecuniary estimation this Court has adopted the criterion of first ascertaining
the nature of the principal action or remedy sought. If it is primarily for the recovery of a
sum of money, the claim is considered capable of pecuniary estimation, and whether
 jurisdiction is in the municipal courts or in the courts of first instance would depend on the
amount of the claim. However, where the basic issue is something other than the right to
recover a sum of money, where the money claim is purely incidental to, or a consequence
of, the principal relief sought, this Court has considered such actions as cases where the
subject of the litigation may not be estimated in terms of money, and are cognizable
exclusively by courts of first instance (now Regional Trial Courts).
An examination of Section 19(6), B.P. 129 reveals that the instant complaint for
enforcement of a foreign judgment, even if capable of pecuniary estimation, would fall
under the jurisdiction of the Regional Trial Courts
The complaint to enforce the US District Court judgment is one capable of pecuniary
estimation. But at the same time, it is also an action based on judgment against an estate,
thus placing it beyond the ambit of Section 7(a) of Rule 141. It is covered by Section 7(b)
(3), involving as it does, "other actions not involving property." The petitioners thus paid
the correct amount of filing fees, and it was a grave abuse of discretion for respondent
judge to have applied instead a clearly inapplicable rule and dismissed the complaint.

FACTS:

May 9 1991: a complaint was filed by ten Filipino citizens representing a class of
10,000 members who each alleged having suffered human rights abuses such as arbitrary
detention, torture and rape in the hands of police or military forces during the Marcos
regime with the United States District Court (US District Court), District of Hawaii, against
the Estate of former Philippine President Ferdinand E. Marcos (Marcos Estate)
US District Court and Affirmed by US CA: awarded them $1,964,005,859.90
Petitioners filed Complaint with Makati RTC for the enforcement of the Final Judgment
Marcos Estate filed a motion to dismiss, raising, among others, the non-payment of the
correct filing fees paying only P410
Petitioners claimed that an action for the enforcement of a foreign judgment is not
capable of pecuniary estimation
RTC: estimated the proper amount of filing fees was approximately P472 and
dismissing the case without prejudice
Petition for Certiorari under Rule 65

ISSUE: W/N the enforcement of a foreign judgment is incapable of pecuniary estimation

HELD: NO. (But belongs to "other actions not involving property") petition is GRANTED.

There is an evident distinction between a foreign judgment in an action in rem and one
in personam. For an action in rem, the foreign judgment is deemed conclusive upon the
title to the thing, while in an action in personam, the foreign judgment is presumptive, and
not conclusive, of a right as between the parties and their successors in interest by a
subsequent title
However, in both cases, the foreign judgment is susceptible to impeachment in our
local courts on the grounds of want of jurisdiction or notice to the party, collusion, fraud, or
clear mistake of law or fact. Thus, the party aggrieved by the foreign judgment is entitled to
 defend against the enforcement of such decision in the local forum. It is essential that there
should be an opportunity to challenge the foreign judgment, in order for the court in this
jurisdiction to properly determine its efficacy even if such judgment has conclusive effect as
in the case of in rem actions, if only for the purpose of allowing the losing party an
opportunity to challenge the foreign judgment. Consequently, the party attacking a foreign
judgment has the burden of overcoming the presumption of its validity. Absent perhaps a
statutory grant of jurisdiction to a quasi-judicial body, the claim for enforcement of judgment
must be brought before the regular courts.
There are distinctions, nuanced but discernible, between the cause of action arising
from the enforcement of a foreign judgment, and that arising from the facts or allegations
that occasioned the foreign judgment. They may pertain to the same set of facts, but there
is an essential difference in the right-duty correlatives that are sought to be vindicated.
Extensive litigation is thus conducted on the facts, and from there the right to and amount
of damages are assessed. On the other hand, in an action to enforce a foreign judgment,
the matter left for proof is the foreign judgment itself, and not the facts from which it
prescinds.
As stated in Section 48, Rule 39, the actionable issues are generally restricted to a
review of jurisdiction of the foreign court, the service of personal notice, collusion, fraud, or
mistake of fact or law. The limitations on review is in consonance with a strong and
pervasive policy in all legal systems to limit repetitive litigation on claims and issues.
Otherwise known as the policy of preclusion, it seeks to protect party expectations
resulting from previous litigation, to safeguard against the harassment of defendants, to
insure that the task of courts not be increased by never-ending litigation of the same
disputes, and in a larger sense to promote what Lord Coke in the Ferrer's Case of 1599
stated to be the goal of all law: "rest and quietness." If every judgment of a foreign court
were reviewable on the merits, the plaintiff would be forced back on his/her original cause
of action, rendering immaterial the previously concluded litigation.
Marcos Estate cites Singsong v. Isabela Sawmill and Raymundo v. Court of Appeals:
In determining whether an action is one the subject matter of which is not
capable of pecuniary estimation this Court has adopted the criterion of first ascertaining the
nature of the principal action or remedy sought. If it is primarily for the recovery of a sum
of money, the claim is considered capable of pecuniary estimation, and whether jurisdiction
is in the municipal courts or in the courts of first instance would depend on the amount of
the claim. However, where the basic issue is something other than the right to recover a
sum of money, where the money claim is purely incidental to, or a consequence of, the
principal relief sought, this Court has considered such actions as cases where the subject
of the litigation may not be estimated in terms of money, and are cognizable exclusively by
courts of first instance (now Regional Trial Courts).
An examination of Section 19(6), B.P. 129 reveals that the instant complaint for
enforcement of a foreign judgment, even if capable of pecuniary estimation, would fall
under the jurisdiction of the Regional Trial Courts
The complaint to enforce the US District Court judgment is one capable of pecuniary
estimation. But at the same time, it is also an action based on judgment against an estate,
thus placing it beyond the ambit of Section 7(a) of Rule 141. It is covered by Section 7(b)
(3), involving as it does, "other actions not involving property." The petitioners thus paid
the correct amount of filing fees, and it was a grave abuse of discretion for respondent
judge to have applied instead a clearly inapplicable rule and dismissed the complaint.