Oil And Natural Gas Commission, Ongc, Vs.
Court Of Appeals  To enable the ONGC to execute the above award in its
And Pacific Cement Company, Inc. Respondents.
This proceeding involves the enforcement of a foreign
judgment rendered by the Civil Judge of Dehra Dun, India in
favor of the ONGC, OIL AND NATURAL GAS COMMISSION and
against the Pacific Cement, PACIFIC CEMENT COMPANY,
INCORPORATED.
 The ONGC is a foreign corporation owned and controlled
by the Government of India while the Pacific Cement is a
private corporation duly organized and existing under the
laws of the Philippines.
 The present conflict between the ONGC and the Pacific
Cement entered into a contract whereby the Pacific
Cement undertook to supply the ONGC 4,300 metric tons
of oil well cement.
 In consideration therefor, the ONGC bound itself to pay
the Pacific Cement the amount of ($477,300.00) by
opening an irrevocable, divisible, and confirmed letter of
credit in favor of the latter.
 The oil well cement was loaded on board the ship MV
SURUTANA NAVA at the port of Surigao City, Philippines
for delivery at Bombay and Calcutta, India. However, due
to a dispute between the shipowner and the Pacific
Cement, the cargo was held up in Bangkok and did not
reach its point of destination.
 Notwithstanding the fact that the Pacific Cement had
already received payment and despite several demands
made by the ONGC, the Pacific Cement failed to deliver
the oil well cement.
 Thereafter, negotiations ensued between the parties and
they agreed that the Pacific Cement will replace the entire
4,300 metric tons of oil well cement with Class G cement
cost free at the ONGCs designated port.
 However, upon inspection, the Class G cement did not
conform to the ONGCs specifications. The ONGC then
informed the Pacific Cement that it was referring its claim
to an arbitrator pursuant to Clause 16 of their contract.
 On July 23, 1988, the chosen arbitrator, one Shri N.N.
Malhotra, resolved the dispute in ONGCs favor
favor, it filed a Petition before the Court of the Civil Judge
in Dehra Dun, India (hereinafter referred to as the foreign
court for brevity), praying that the decision of the
arbitrator be made the Rule of Court in India.
 The foreign court issued notices to the Pacific Cement for
filing objections to the petition.
 The Pacific Cement complied and sent its objections dated
January 16, 1989. Subsequently, the said court directed
the Pacific Cement to pay the filing fees in order that the
latters objections could be given consideration. Instead of
paying the required filing fees, the Pacific Cement sent
communication addressed to the Civil Judge of Dehra Dun
 Despite notice sent to the Pacific Cement of the foregoing
order and several demands by the ONGC for compliance
therewith, the Pacific Cement refused to pay the amount
adjudged by the foreign court as owing to the ONGC.
 Accordingly, the ONGC 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 Pacific Cement moved to dismiss the complaint on
the following grounds:
o (1) plaintiffs lack of legal capacity to sue;
o (2) lack of cause of action; and
o (3) plaintiffs claim or demand has been waived,
abandoned, or otherwise extinguished.
 The ONGC filed its opposition to the said motion to
dismiss, and the Pacific Cement, its rejoinder thereto. On
January 3, 1992, the RTC issued an order upholding the
ONGCs legal capacity to sue, albeit dismissing the
complaint for lack of a valid cause of action.
 The RTC held that the rule prohibiting foreign corporations
transacting business in the Philippines without a license
from maintaining a suit in Philippine courts admits of an
exception, that is, when the foreign corporation is suing
on an isolated transaction as in this case.
 Anent the issue of the sufficiency of the ONGCs cause of
action, however, the RTC found the referral of the dispute
between the parties to the arbitrator under Clause 16 of
their contract erroneous.
ISSUE: whether or not the judgment of the foreign court is
enforceable in this jurisdiction in view of the Pacific Cements
allegation that it is bereft of any statement of facts and law
upon which the award in favor of the ONGC was based. The
pertinent portion of the judgment of the foreign court reads:
Award dated 23.7.88, Paper No. 3/B-1 is made Rule
of the Court. On the basis of conditions of award
decree is passed. Award Paper No. 3/B-1 shall be a
part of the decree. The plaintiff shall also be entitled
to get from defendant ( US$ 899, 603.77 (US$ Eight
Lakhs ninety nine thousand six hundred and three
point seventy seven only) alongwith 9% interest per
annum till the last date of realisation.
 As specified in the order of the Civil Judge of Dehra Dun,
Award Paper No. 3/B-1 shall be a part of the decree. This
is a categorical declaration that the foreign court adopted
the findings of facts and law of the arbitrator as contained
in the latters Award Paper. Award Paper No. 3/B-1,
contains an exhaustive discussion of the respective claims
and defenses of the parties, and the arbitrators evaluation
of the same. Inasmuch as the foregoing is deemed to
have been incorporated into the foreign courts judgment
the appellate court was in error when it described the
latter to be a simplistic decision containing literally, only
the dispositive portion.
 The constitutional mandate that no decision shall be
rendered by any court without expressing therein clearly
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. In Francisco v. Permskul, this Court held that the
following memorandum decision of the Regional Trial
Court of Makati did not transgress the requirements of
Section 14, Article VIII of the Constitution:
After a careful perusal, evaluation and study of the
records of this case, this Court hereby adopts by
reference the findings of fact and conclusions of law
contained in the decision of the Metropolitan Trial
Court of Makati, Metro Manila, Branch 63 and finds
that there is no cogent
 Hence, even in this jurisdiction, incorporation by reference
is allowed if only to avoid the cumbersome reproduction
of the decision of the lower courts, or portions thereof, in
the decision of the higher court.
 This is particularly true when the decision sought to be
incorporated is a lengthy and thorough discussion of the
facts and conclusions arrived at, as in this case, where
Award Paper No. 3/B-1 consists of eighteen (18) single
spaced pages.
 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.
 Thus, if under the procedural rules of the Civil Court of
Dehra Dun, India, a valid judgment may be rendered by
adopting the arbitrators findings, then the same must be
accorded respect. In the same vein, 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
 Finally, we reiterate hereunder our pronouncement in the
case of Northwest Orient Airlines, Inc. v. Court of Appeals
that:
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 Under Section 50,
Rule 39 of the Rules of Court, a judgment in an
action in personam 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. Also, under Section 3 of Rule 131, a
court, whether of the Philippines or elsewhere,
enjoys the presumption that it was acting in the
lawful exercise of jurisdiction and has regularly
performed its official duty.
 Consequently, the party attacking a foreign judgment, the
Pacific Cement herein, had the burden of overcoming the
presumption of its validity which it failed to do in the
instant case.
 The foreign judgment being valid, there is nothing else left
to be done than to order its enforcement, despite the fact
that the ONGC merely prays for the remand of the case to
the RTC for further proceedings. As this Court has ruled on
the validity and enforceability of the said foreign
judgment in this jurisdiction, further proceedings in the
RTC for the reception of evidence.