NARRA NICKEL MINING VS REDMONT G.R. NO.
considerable stockholder of petitioners, it was the
195580
Facts:
Redmont Consolidated Mines Corp. (Redmont), a
domestic corporation organized and existing under
Philippine laws, took interest in mining and exploring
certain areas of the province of Palawan. After
inquiring with the Department of Environment and
Natural Resources (DENR), it learned that the areas
where it wanted to undertake exploration and mining
activities where already covered by Mineral Production
Sharing Agreement (MPSA) applications of petitioners
Narra, Tesoro and McArthur. Petitioner McArthur,
through its predecessor-in-interest Sara Marie Mining,
Inc. (SMMI), filed an application for an MPSA and
Exploration Permit (EP) with the Mines and Geo-
Sciences Bureau (MGB), Region IV-B, Office of the
Department of Environment and Natural Resources
(DENR). Subsequently, SMMI was issued MPSA-
AMA-IVB-153 covering an area of over 1,782 hectares
in Barangay Sumbiling, Municipality of Bataraza,
Province of Palawan and EPA-IVB-44 which includes
an area of 3,720 hectares in Barangay Malatagao,
Bataraza, Palawan. The MPSA and EP were then
transferred to Madridejos Mining Corporation (MMC)
and, on November 6, 2006, assigned to petitioner
McArthur. Petitioner Narra acquired its MPSA from
Alpha Resources and Development Corporation and
Patricia Louise Mining & Development Corporation
(PLMDC) which previously filed an application for an
MPSA with the MGB, Region IV-B, DENR on January
6, 1992. Through the said application, the DENR
issued MPSA-IV-1-12 covering an area of 3.277
hectares in barangays Calategas and San Isidro,
Municipality of Narra, Palawan. Subsequently, PLMDC
conveyed, transferred and/or assigned its rights and
interests over the MPSA application in favor of Narra.
Another MPSA application of SMMI was filed with the
DENR Region IV-B, labeled as MPSA-AMA-IVB-154
(formerly EPA-IVB-47) over 3,402 hectares in
Barangays Malinao and Princesa Urduja, Municipality
of Narra, Province of Palawan. SMMI subsequently
conveyed, transferred and assigned its rights and
interest over the said MPSA application to Tesoro. On
January 2, 2007, Redmont filed before the Panel of
Arbitrators (POA) of the DENR three (3) separate
petitions for the denial of petitioners’ applications for
MPSA designated as AMA-IVB-153, AMA-IVB-154 and
MPSA IV-1-12. In the petitions, Redmont alleged that
at least 60% of the capital stock of McArthur, Tesoro
and Narra are owned and controlled by MBMI
Resources, Inc. (MBMI), a 100% Canadian
corporation. Redmont reasoned that since MBMI is a
driving force behind petitioners’ filing of the MPSAs
over the areas covered by applications since it knows
that it can only participate in mining activities through
corporations which are deemed Filipino citizens.
Redmont argued that given that petitioners’ capital
stocks were mostly owned by MBMI, they were
likewise disqualified from engaging in mining activities
through MPSAs, which are reserved only for Filipino
citizens.
Issue: W/N the petitioner corporations are Filipino and
can validly be issued MPSA and EP.
Ruling: NO
The SEC Rules provide for the manner of calculating
the Filipino interest in a corporation for purposes,
among others, of determining compliance with
nationality requirements (the ‘Investee Corporation’).
Such manner of computation is necessary since the
shares in the Investee Corporation may be owned both
by individual stockholders (‘Investing Individuals’) and
by corporations and partnerships (‘Investing
Corporation’). The said rules thus provide for the
determination of nationality depending on the
ownership of the Investee Corporation and, in certain
instances, the Investing Corporation.
Under the SEC Rules, there are two cases in
determining the nationality of the Investee Corporation.
The first case is the ‘liberal rule’, later coined by the
SEC as the Control Test in its 30 May 1990 Opinion,
and pertains to the portion in said Paragraph 7 of the
1967 SEC Rules which states, 'shares belonging to
corporations or partnerships at least 60% of the capital
of which is owned by Filipino citizens shall be
considered as of Philippine nationality.’ Under the
liberal Control Test, there is no need to further trace the
ownership of the 60% (or more) Filipino stockholdings
of the Investing Corporation since a corporation which
is at least 60% Filipino-owned is considered as
Filipino.
The second case is the Strict Rule or the Grandfather
Rule Proper and pertains to the portion in said
Paragraph 7 of the 1967 SEC Rules which states, “but
if the percentage of Filipino ownership in the
corporation or partnership is less than 60%, only the
number of shares corresponding to such percentage
shall be counted as of Philippine nationality.” Under the
Strict Rule or Grandfather Rule Proper, the combined
totals in the Investing Corporation and the Investee
Corporation must be traced (i.e., “grandfathered”) to
determine the total percentage of Filipino ownership.
Moreover, the ultimate Filipino ownership of the shares
must first be traced to the level of the Investing
Corporation and added to the shares directly owned in
the Investee Corporation.
In other words, based on the said SEC Rule and DOJ
Opinion, the Grandfather Rule or the second part of the
SEC Rule applies only when the 60-40 Filipino-foreign
equity ownership is in doubt (i.e., in cases where the
joint venture corporation with Filipino and foreign
stockholders with less than 60% Filipino stockholdings
[or 59%] invests in other joint venture corporation
which is either 60-40% Filipino-alien or the 59% less
Filipino). Stated differently, where the 60-40 Filipino-
foreign equity ownership is not in doubt, the
Grandfather Rule will not apply.
JOSE M. ROY III v. CHAIRPERSON TERESITA
HERBOSA G.R. 207246
Facts:
On June 28, 2011, the Court issued the Gamboa
Decision,... that the term "capital" in Section 11, Article
XII of the 1987 Constitution refers only to shares of
stock entitled to vote in the election of directors, and
thus in the present case only to common shares, and
not to the total outstanding capital stock (common and
non-voting preferred shares).
The Gamboa Decision attained finality on October 18,
2012, and Entry of Judgment was thereafter issued on
December 11, 2012
On May 20, 2013, the SEC, through respondent
Chairperson Teresita J. Herbosa, issued SEC-MC No.
8
Section 2. All covered corporations shall, at all times,
observe the constitutional or statutory ownership
requirement. For purposes of determining compliance
therewith, the required percentage of Filipino
ownership shall be applied to BOTH (a) the total
number of outstanding shares of stock entitled to vote
in the election of directors; AND (b) the total number of
outstanding shares of stock, whether or not entitled to
vote in the election of directors.
On June 10, 2013, petitioner Roy, as a lawyer and
taxpayer, filed the Petition, assailing the validity of
SEC-MC No. 8 for not conforming to the letter and spirit
of the Gamboa Decision and Resolution and for having
been issued by the SEC with grave abuse of discretion.
Issue:
W/N the SEC gravely abused its discretion in issuing
SEC-MC No. 8 in light of the Gamboa Decision and
Gamboa Resolution
Ruling: NO
SEC did not commit grave abuse of discretion
amounting to lack or excess of jurisdiction when it
issued SEC-MC No. 8. To the contrary, the Court finds
SEC-MC No. 8 to have been issued in fealty to the
Gamboa Decision and Resolution.
Gamboa Decision:
"Capital" in Section II, Article XII of the I987
Constitution refers only to shares of stock entitled to
vote in the election of directors, and thus in the present
case only to common shares, and not to the total
outstanding capital stock (common and non-voting
preferred shares).
Gamboa Resolution:
Foreign Investments Act of 1991 ("FIA")
Gamboa Resolution put to rest the Court's
interpretation of the term "capital"
Full beneficial ownership of stocks, coupled with
appropriate voting rights is essential... reiterates and
confirms the interpretation that the term "capital" in
Section 11, Article XII of the 1987 Constitution refers to
shares with voting rights, as well as with full beneficial
ownership.
Section 2 of SEC-MC No. 8 clearly incorporates the
Voting Control Test or the controlling interest
requirement. In fact, Section 2 goes beyond requiring
a 60-40 ratio in favor of Filipino nationals in the voting
stocks; it moreover requires the 60-40 percentage
ownership in the total number of outstanding shares of
stock, whether voting or not. The SEC formulated SEC-
MC No. 8 to adhere to the Court's unambiguous
pronouncement that "[f]ull beneficial ownership of 60
percent of the outstanding capital stock, coupled with
60 percent of the voting rights is required."[79] Clearly,
SEC-MC No. 8 cannot be said to have been issued with
grave abuse of discretion
While SEC-MC No. 8 does not expressly mention the
Beneficial Ownership Test or full beneficial ownership
of stocks requirement in the FIA, this will not, as it does
not, render it invalid meaning, it does not follow that the
SEC will not apply this test in determining whether the
shares claimed to be owned by Philippine nationals are
Filipino, i.e., are held by them by mere title or in full
beneficial ownership. To be sure, the SEC takes its
guiding lights also from the FIA and its implementing
rules, the Securities Regulation Code.
KOREA TECHNOLOGIES CO. LTD VS LERMA GR
NO. 143581 JANUARY 7, 2008
Facts: Petitioner Korea Technologies Co., Ltd.
(KOGIES) is a Korean corporation which is engaged in
the supply and installation of Liquefied Petroleum Gas
(LPG) Cylinder manufacturing plants, while private
respondent Pacific General Steel Manufacturing Corp.
(PGSMC) is a domestic corporation. On March 5,
1997, PGSMC and KOGIES executed a Contract
whereby KOGIES would set up an LPG Cylinder
Manufacturing Plant in Carmona, Cavite. The contract
was executed in the Philippines. On April 7, 1997, the
parties executed, in Korea, an Amendment for Contract
No. KLP-970301 dated March 5, 1997 amending the
terms of payment. The contract and its amendment
stipulated that KOGIES will ship the machinery and
facilities necessary for manufacturing LPG cylinders for
which PGSMC would pay USD 1,224,000. KOGIES
would install and initiate the operation of the plant for
which PGSMC bound itself to pay USD 306,000 upon
the plant’s production of the 11-kg. LPG cylinder
samples. Thus, the total contract price amounted to
USD 1,530,000. On October 14, 1997, PGSMC
entered into a Contract of Lease with Worth Properties,
Inc. (Worth) for use of Worth’s 5,079-square meter
property with a 4,032-square meter warehouse
building to house the LPG manufacturing plant. The
monthly rental was PhP 322,560 commencing on
January 1, 1998 with a 10% annual increment clause.
Subsequently, the machineries, equipment, and
facilities for the manufacture of LPG cylinders were
shipped, delivered, and installed in the Carmona plant.
PGSMC paid KOGIES USD 1,224,000. However,
gleaned from the Certificate executed by the parties on
January 22, 1998, after the installation of the plant, the
initial operation could not be conducted as PGSMC
encountered financial difficulties affecting the supply of
materials, thus forcing the parties to agree that
KOGIES would be deemed to have completely
complied with the terms and conditions of the March 5,
1997 contract. For the remaining balance of
USD306,000 for the installation and initial operation of
the plant, PGSMC issued two postdated checks: (1)
BPI Check No. 0316412 dated January 30, 1998 for
PhP 4,500,000; and (2) BPI Check No. 0316413 dated
March 30, 1998 for PhP 4,500,000. When KOGIES
deposited the checks, these were dishonored for the
reason PAYMENT STOPPED. Thus, on May 8, 1998,
KOGIES sent a demand letter to PGSMC threatening
criminal action for violation of Batas Pambansa Blg. 22
in case of nonpayment. On the same date, the wife of
PGSMCs President faxed a letter dated May 7, 1998
to KOGIES President who was then staying at a Makati
City hotel. She complained that not only did KOGIES
deliver a different brand of hydraulic press from that
agreed upon but it had not delivered several equipment
parts already paid for.
Issue: Whether or not the arbitration clause in the
contract of the parties should govern.
Held: Yes. Established in this jurisdiction is the rule
that the law of the place where the contract is made
governs. Lex loci contractus. The contract in this case
was perfected here in the Philippines. Therefore, our
laws ought to govern. Nonetheless, Art. 2044 of the
Civil Code sanctions the validity of mutually agreed
arbitral clause or the finality and binding effect of an
arbitral award. Art. 2044 provides, Any stipulation that
the arbitrators award or decision shall be final, is valid,
without prejudice to Articles 2038, 2039 and 2040.
The arbitration clause was mutually and voluntarily
agreed upon by the parties. It has not been shown to
be contrary to any law, or against morals, good
customs, public order, or public policy. There has been
no showing that the parties have not dealt with each
other on equal footing. We find no reason why the
arbitration clause should not be respected and
complied with by both parties. In Gonzales v. Climax
Mining Ltd., we held that submission to arbitration is a
contract and that a clause in a contract providing that
all matters in dispute between the parties shall be
referred to arbitration is a contract. Again in Del Monte
Corporation-USA v. Court of Appeals, we likewise
ruled that [t]he provision to submit to arbitration any
dispute arising therefrom and the relationship of the
parties is part of that contract and is itself a contract.
Having said that the instant arbitration clause is not
against public policy, we come to the question on what
governs an arbitration clause specifying that in case of
any dispute arising from the contract, an arbitral panel
will be constituted in a foreign country and the
arbitration rules of the foreign country would govern
and its award shall be final and binding.
Thus, it can be gleaned that the concept of a final and
binding arbitral award is similar to judgments or awards
given by some of our quasi-judicial bodies, like the
National Labor Relations Commission and Mines
Adjudication Board, whose final judgments are
stipulated to be final and binding, but not immediately
executory in the sense that they may still be judicially
reviewed, upon the instance of any party. Therefore,
the final foreign arbitral awards are similarly situated in
that they need first to be confirmed by the RTC.
BAGONG FILIPINAS OVERSEAS CORPORATION
V. NLRC GR. NO. L- 66006
Facts:
The shipboard employment contract was executed
in this country between Pancho andBagong Filipinas
Overseas Corporation, the local agent of Golden Star
Shipping. It wasapproved by the defunct National
Seamen Board. Pancho was hired as an oiler in the
M/V Olivine for 12 months with a gross monthly wage
of US $195.
He had a cerebral stroke. He was rushed to the
hospital while the vessel was docked at Gothenberg,
Sweden. He was repatriated to the Philippines and
confined at the San Juan de Dios Hospital and
thereafter died.
The National Seamen Board awarded his widow,
Proserfina, P20,000 as disability compensation
benefits pursuant to the above-mentioned employment
contract plus P2,000 as attorney's fees. Proserfina
appealed to the National Labor Relations Commission
which awarded her $621 times 36 months or its
equivalent in Philippine currency plus 10% of the
benefits as attorney's fees. Golden Star Shipping
assailed that decision by certiorari.
Issue: whether or not the shipboard employment
contract or Hongkong law should govern the amount of
death compensation due to the wife of Guillermo
Pancho who was employed by Golden Star Shipping,
Ltd., a Hongkong based firm.
Held: The shipboard employment contract is
controlling in this case. The contract provides that the
beneficiaries of the seaman are entitled to P20,000
"over and above the benefits" for which the Philippine
Government is liable under Philippine law. Hongkong
law on workmen's compensation is not the applicable
law. The case of Norse Management Co. vs. National
Seamen Board cannot be a precedent because it was
expressly stipulated in the employment contract in that
case that the workmen's compensation payable to the
employee should be in accordance with Philippine Law
or the Workmen's Insurance Law of the country where
the vessel is registered "whichever is greater".
PAKISTAN INTERNATIONAL AIRLINES V. BLAS
OPLE
GR No. 61594, September 28, 1990
FACTS: Pakistan International Airlines (PIA) entered
into two separate contracts with respondents Farrales
and Mamasig.
The contracts provided that (1) the Duration of
Employment is for a period of 3 years, (2) PIA reserves
the right to terminate this agreement at any time by
giving the EMPLOYEE notice in writing in advance one
month before the intended termination or in lieu
thereof, by paying the EMPLOYEE wages equivalent
to one month’s salary; and (3) the agreement shall be
construed and governed under and by the laws of
Pakistan, and only the Courts of Karachi, Pakistan
shall have the jurisdiction to consider any matter
arising out of or under this agreement.
Farrales and Mamasig then commenced training in
Pakistan and after such, they began discharging their
job functions as flight attendants with base station in
Manila and flying assignments to different parts of the
Middle East and Europe. Roughly one (1) year and four
(4) months prior to the expiration of the contracts of
employment, PIA sent separate letters to private
respondents advising both that their services as flight
stewardesses would be terminated. PIA claimed that
both were habitual absentees, were in the habit of
bringing in from abroad sizeable quantities of “personal
effects”.
Regional Director of MOLE ordered the reinstatement
of private respondents with full backwages, or the
payment to them of the amounts equivalent to their
salaries for the remainder of the fixed three-year period
of their employment contracts having attained the
status of regular employees. On appeal, the Depute
Minister of MOLE adopted the findings of the Regional
Director.
ISSUE: Whether or not Pakistani law is the applicable
law?
RULING: No, Pakistani law cannot be applied as it
violates the labor laws of the Philippines.
Petitioner PIA cannot take refuge in paragraph 10 of its
employment agreement which specifies, firstly, the law
of Pakistan as the applicable law of the agreement and,
secondly, lays the venue for settlement of any dispute
arising out of or in connection with the agreement “only
[in] courts of Karachi Pakistan”.
We have already pointed out that the relationship is
much affected with public interest and that the
otherwise applicable Philippine laws and regulations
cannot be rendered illusory by the parties agreeing
upon some other law to govern their relationship.
The contract was not only executed in the Philippines,
it was also performed here, at least partially; private
respondents are Philippine citizens and respondents,
while petitioner, although a foreign corporation, is
licensed to do business (and actually doing business)
and hence resident in the Philippines; lastly, private
respondents were based in the Philippines in between
their assigned flights to the Middle East and Europe.
All the above contacts point to the Philippine courts and
administrative agencies as a proper forum for the
resolution of contractual disputes between the parties.
Under these circumstances, paragraph 10 of the
employment agreement cannot be given effect so as to
oust Philippine agencies and courts of the jurisdiction
vested upon them by Philippine law. Finally, and in any
event, the petitioner PIA did not undertake to plead and
prove the contents of Pakistan law on the matter; it
must therefore be presumed that the applicable
provisions of the law of Pakistan are the same as the
applicable provisions of Philippine law.
UNITED AIRLINES INC. vs. COURT OF APPEALS
318 SCRA 576
FACTS: Aniceto Fontanilla bought from United Airlines,
through the Philippine Travel Bureau in Manila, three
“Visit the U.S.A.” tickets from himself, his wife and his
minor son, Mychal, to visit the cities of Washington DC,
Chicago and Los Angeles. All All flights had been
confirmed previously by United Airlines. Having used
the first coupon to DC and while at the Washington
Dulles Airport, Aniceto changed their itinerary, paid the
penalty for rewriting their tickets and was issued tickets
with corresponding boarding passes with the words:
“Check-in-required.” They were then set to leave but
were denied boarding because the flight was
overbooked.
The CA ruled that private respondents’ failure to
comply with the check-in requirement will not defeat his
claim as the denied boarding rules were not complied
with applying the laws of the USA, relying on the Code
of Federal Regulation Part on Oversales of the USA.
ISSUE: WON the CA is correct in applying the laws of
USA.
RULING: No. According to the doctrine of “lex loci
contractus”, the law of the place where a contract is
made or entered into governs with respect to its nature
and validity, obligation and interpretation shall govern.
This has been said to be the rule even though the place
where the contract was made is different from the place
where it is to be performed. Hence, the court should
apply the law of the place where the airline ticket was
issued, where the passengers are residents and
nationals of the forum and the ticket is issued in such
State by the defendant airline. Therefore, although, the
contract of carriage was to be performed in the United
States, the tickets were purchased through petitioner’s
agent in Manila. It is true that the tickets were
"rewritten" in D.C., however, such fact did not change
the nature of the original contract of carriage entered
into by the parties in Manila.
BUCHANAN vs DOE 431 S.E.2d 289 (1993)
SUPREME COURT OF VIRGINIA (U.S Case)
FACTS:
State Farm Mutual Automobile Insurance Company
(State Farm) issued an automobile liability policy in
Virginia to David B. Buchanan, a resident of Clifton
Forge, Virginia, USA
The company will pay in accordance with Section 38.1-
381 of the Code of Virginia and all Acts amendatory
thereof or supplementary thereto, all sums which the
insured ... shall be legally entitled to recover as
damages from the owner or operator of an uninsured
motor vehicle because of bodily injury sustained by the
insured or property damage, caused by accident and
arising out of the ownership, maintenance or use of
such uninsured motor vehicle.
Buchanan was injured on June 9, 1989, when a truck
forced his car off
Pursuant to the provisions of his insurance policy and
Code 38.2-2206,
Buchanan filed this action in the court below against
the truck driver as "John Doe," seeking damages for
his injuries and other losses.
Respondent State Farm contended, and the trial court
agreed, that Buchanan could not recover from John
Doe without proof of physical contact between his
vehicle and John Doe's vehicle..
The parties agree that under our conflict of law rules:
(1) the law of the place of the wrong determines the
substantive issues of tort liability and (2) generally, the
law of the place where an insurance contract is written
and delivered controls issues as to its coverage.
ISSUE: WON the West Virginia proof-of-contact
requirement is a matter of tort controlled by West
Virginia law, or one of contract controlled by Virginia
law.
RULING:
PRINCIPLE ON DECAPAGE
The forum state applies its own law to ascertain
whether the issue is one of tort or contract. And, in
doing so, the forum state applies a principle described
as an old technique which has recently acquired the
new name of "depecage".
• This refers to the process whereby different
issues in a single case arising out of a single
set of facts may be decided according to the
laws of different states.
This has always been the process when procedural
matters were held to be governed by forum law and
substantive questions by some other law, even when
matters characterized as procedural had substantial
outcome-determinative effect. It has always been
understood also that different substantive issues could
properly be decided under the laws of different states,
when the choice-influencing considerations differ as
they apply to the different issues. The new
development in this area is the currently increased
discussion and analysis of the old technique.
Thus, we apply the law of the Commonwealth to
determine whether the West Virginia proof-of-contact
requirement is a matter of tort or contract.
We consider West Virginia's proof-of-contact provision.
Substantive tort law in West Virginia, as in Virginia,
requires that the plaintiff prove he was injured by the
negligence of the defendant. But there is nothing in the
tort law of either state which requires that injury be
accompanied by physical contact in order to impose
liability on the defendant. Under West Virginia law,
however, in order to recover from an insurance
company under an uninsured motorist policy, the
injured party must prove in the John Doe tort action that
the injury was accompanied by physical contact. But,
for several reasons, we conclude that this requirement
is a matter of statutory law dealing with insurance
contracts.
We construed the proof-of-contact requirement as
State Farm suggests, the scope of a Virginia insured's
Uninsured Motorist (UM) coverage would depend upon
the UM statutory provisions of each state in which a
Virginia insured traveled, contrary to our understanding
of the purpose of UM insurance.
TRIPLE EIGHT INTEGRATED SERVICES vs NLRC
and ERLINDA OSDANA 1998
FACTS: In August 1992 Osdana was recruited
by Triple Eight Integrated Services Inc. for
employment as "Food Server" for 36 months with Gulf
Catering Company (GCC) based in the Kingdom of
Saudi Arabia for 36 months. She was required to
pay P11,950 placement fees. Subsequently, she was
asked to sign a contract for a salary of $280 which was
approved by POEA.
The employment contract (originally as “food server”
but later changed to “waitress”) was executed in the
Philippines but was to be performed in Riyadh. Once in
Riyadh, however, Osdana was made to perform
strenuous tasks (washing dishes, janitorial work),
which were not included in her designation as a
waitress. Because of the long hours and strenuous
nature of her work, she suffered from Carpal Tunnel
Syndrome, for which she had to undergo surgery. But
during her weeks of confinement at the hospital for her
recovery, she was not given any salary. And after she
was discharged from the hospital, GCC suddenly
dismissed her from work, allegedly on the ground of
illness. She was not given any separation pay nor was
she paid her salaries for the periods when she was not
allowed to work. Thus, upon her return to the
Philippines, she filed a complaint against Triple Eight,
praying for unpaid and underpaid salaries, among
others.
April 27, 1994: She was discharged from work without
separation pay on the ground of illness
NLRC affirmed thus, Triple Eight filed a petition for
certiorari with Supreme Court.
ISSUE: WON her employment was subject to the laws
of the host country Saudi Arabia?
PRINCIPLES:
Lex Loci Contractus: Established is the rule that lex
loci contractus (the law of the place where the contract
is made) governs in this jurisdiction. There is no
question that the contract of employment in this case
was perfected here in the Philippines.
Law of the Forum vis-a-vis Public Policy: Settled is
the rule that the courts of the forum will not enforce any
foreign claim obnoxious to the forum’s public policy.
Here in the Philippines, employment agreements are
more than contractual in nature. The Constitution
itself, in Article XIII Section 3, guarantees the special
protection of workers.
RULING:
Petioner Triple Eight attempts to sidestep the
medical certificate requirement by contending that
since Osdana was working in Saudi Arabia, her
employment was subject to the laws of the host
country. Apparently, petitioner hopes to make it appear
that the labor laws of Saudi Arabia do not require any
certification by a competent public health authority in
the dismissal of employees due to illness.
Again, petitioners argument is without merit.
First, established is the rule that lex loci
contractus (the law of the place where the contract is
made) governs in this jurisdiction. There is no question
that the contract of employment in this case was
perfected here in the Philippines. Therefore, the Labor
Code, its implementing rules and regulations, and
other laws affecting labor apply in this
case. Furthermore, settled is the rule that the courts of
the forum will not enforce any foreign claim obnoxious
to the forums public policy. Here in the Philippines,
employment agreements are more than contractual in
nature. The Constitution itself, in Article XIII Section 3,
guarantees the special protection of workers, to wit:
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.
It shall guarantee the rights of all workers to self-
organization, collective bargaining and negotiations,
and peaceful concerted activities, including the right to
strike in accordance with law. They shall be entitled to
security of tenure, humane conditions of work, and a
living wage. They shall also participate in policy and
decision-making processes affecting their rights and
benefits as may be provided by law.
x x x x x x x x x.
This public policy should be borne in mind in this
case because to allow foreign employers to determine
for and by themselves whether an overseas contract
worker may be dismissed on the ground of illness
would encourage illegal or arbitrary pre-termination of
employment contracts.
As regards the monetary award of salaries for the
unexpired portion of the employment contract, unpaid
salaries and salary differential granted by public
respondents to Osdana, petitioner assails the same for
being contrary to law, evidence and existing
jurisprudence, all of which therefore constitutes grave
abuse of discretion.
HASEGAWA V. KITAMURA, G.R. NO. 149177
NOVEMBER 23, 2007
Facts: Petitioner Nippon Engineering Consultants Co.,
Ltd. entered into an Independent Contractor
Agreement with respondent Minoru Kitamura, a
Japanese national permanently residing in the
Philippines.
The agreement provides that respondent was to
extend professional services to Nippon for a year.
Nippon then assigned respondent to work as the
project manager of the Southern Tagalog Access Road
(STAR) Project in the Philippines, following the
company's consultancy contract with the Philippine
Government.
When the STAR Project was near completion, DPWH
engaged the consultancy services of Nippon, on this
time for the detailed engineering and construction
supervision another road project. Respondent was
named as the project manager. However, Hasegawa,
Nippon's general manager informed Kitamura that the
company had no more intention of renewing his
contract. His services would be engaged by the
company only up to the substantial completion of the
STAR Project. For this Kitamura then sued for specific
performance and damages.
Issue: 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, lex contractus, the
"state of the most significant relationship rule," or forum
non conveniens.
Ruling:
As to procedural matters, in the judicial resolution of
conflicts problems, three consecutive phases are
involved: jurisdiction, choice of law, and recognition
and enforcement of judgments. In this case, only the
first phase is at issue—jurisdiction. For a court to validly
exercise its power to adjudicate a controversy, it must
have jurisdiction over the plaintiff or the petitioner, over
the defendant or the respondent, over the subject
matter, over the issues of the case and, in cases
involving property, over the res or the thing which is the
subject of the litigation. In assailing the trial court's
jurisdiction herein, petitioners are actually referring to
subject matter jurisdiction.
Petitioners raise as grounds to question subject matter
jurisdiction are the principles of lex loci celebrationis
and lex contractus, and the "state of the most
significant relationship rule."
Lex loci celebrationis relates to the "law of the place of
the ceremony" or the law of the place where a contract
is made.
The doctrine of lex contractus or lex loci contractus
means the "law of the place where a contract is
executed or to be performed." It controls the nature,
construction, and validity of the contract and it may
pertain to the law voluntarily agreed upon by the parties
or the law intended by them either expressly or
implicitly.
Under the "state of the most significant relationship
rule," to ascertain what state law to apply to a dispute,
the court should determine which state has the most
substantial connection to the occurrence and the
parties. In a case involving a contract, the court should
consider where the contract was made, was
negotiated, was to be performed, and the domicile,
place of business, or place of incorporation of the
parties. This rule takes into account several contacts
and evaluates them according to their relative
importance with respect to the particular issue to be
resolved.
Since these three principles in conflict of laws make
reference to the law applicable to a dispute, they are
rules proper for the second phase, the choice of law.
They determine which state's law is to be applied in
resolving the substantive issues of a conflicts problem.
Necessarily, as the only issue in this case is that of
jurisdiction, choice-of-law rules are not only
inapplicable but also premature.
SANTOS III VS. NORTHWEST ORIENT AIRLINES,
G.R. NO. 101538, JUNE 23, 1992
Facts: Petitioner is a minor resident of the Philippines.
Private respondent Northwest Orient Airlines (NOA) is
a foreign corporation with principal residence in
Minnesota, USA and licensed to do business and
maintain a branch office in the Philippines. The
petitioner purchased from NOA a round-trip ticket in
San Francisco, USA. On Dec. 19, 1986, the petitioner
checked in at the NOA counter in the San Francisco
airport for his departure to Manila. Despite a previous
confirmation and re-confirmation, he was informed that
he had no reservation for his flight for Tokyo to Manila.
He therefore had to be waitlisted.
On March 12, 1987, the petitioner sued NOA for
damages in RTC Makati. NOA moved to dismiss the
complaint on the ground of lack of jurisdiction.
NOA moved for the dismissal of the complaint and
invoked Art. 28(1) of the Warsaw Convention:
Art. 28(1). An action for damage must be
brought at the option of the plaintiff, in the
territory of one of the High Contracting
Parties, either before the court of the domicile
of the carrier or his principal place of
business, or where he has a place of business
through which the contract has been made, or
before the court at the place of destination.
It contended that the Philippines was not its domicile
nor was this its principal place of business. Neither was
the petitioner's ticket issued in this country nor was his
destination Manila but San Francisco in the United
States.
Issue: Whether or not the case was properly filed in the
Philippines, because Manila was the destination of the
plaintiff.
Ruling:
Since the flight involved in the case at bar is
international, the same being from the United States to
the Philippines and back to the United States, it is
subject to the provisions of the Warsaw Convention,
including Article 28(1), which enumerates the four
places where an action for damages may be brought.
Jurisdiction in the international sense must be
established in accordance with Article 28(1) of the
Warsaw Convention, following which the jurisdiction of
a particular court must be established pursuant to the
applicable domestic law.
The place of destination, within the meaning of the
Warsaw Convention, is determined by the terms of the
contract of carriage or, specifically in this case, the
ticket between the passenger and the carrier.
Examination of the petitioner’s ticket shows that his
ultimate destination is San Francisco. Although the
date of the return flight was left open, the contract of
carriage between the parties indicates that NOA was
bound to transport the petitioner to San Francisco to
Manila. Manila should therefore be considered merely
an agreed stopping place.
The contract is a single undivided operation, beginning
with the place of departure and ending with the
ultimate destination. The use of the singular in this
expression indicates the understanding of the
parties to the Convention that every contract of
carriage has one place of departure and one place of
destination. An intermediate place where the carriage
may be broken is not regarded as a “place of
destination.”
UNITED AIRLINES vs UY
VDA. DE PEREZ vs TOLETE
MICIANO V BRIMO
[G.R. NO. 22595. NOVEMBER 1, 1924.]
Facts:
The partition of the estate left by the deceased Joseph
G. Brimo is in question in this case. The judicial
administrator of this estate filed a scheme of partition.
Andre Brimo, one of the brothers of the deceased,
opposed it. The appellant's opposition is based on the
fact that the partition in question puts into effect the
provisions of Joseph G. Brimo's will which are not in
accordance with the laws of his Turkish nationality, for
which reason they are void as being in violation of
article 10 of the Civil Code.
Issue:
WON the Turkish Law will apply as to the testamentary
disposition of the remained estate.
Ruling:
YES. Art. 10 of Civil Code (Old Civil Code) provides
that: "Nevertheless, legal and testamentary
successions, in respect to the order of succession as
well as to the amount of the successional rights and the
intrinsic validity of their provisions, shall be regulated
by the national law of the person whose succession is
in question, whatever may be the nature of the property
or the country in which it may be situated." But the fact
is that the oppositor did not prove that said
testamentary dispositions are not in accordance with
the Turkish laws, inasmuch as he did not present any
evidence showing what the Turkish laws are on the
matter, and in the absence of evidence on such laws,
they are presumed to be the same as those of the
Philippines.
LAUREL V GARCIA
[G.R. NO. 92013. JULY 25, 1990.]
Facts:
The Philippine Government through an Executive
Order issued by President Corazon Aquino intended to
dispose the 4 properties located in Japan due to
inability to maintain its buildings and additional income
for the Government. Petitioner Laurel asserts that the
Roppongi property and the related lots were acquired
as part of the reparations from the Japanese
government for diplomatic and consular use by the
Philippine government. Vice-President Laurel states
that the Roppongi property is classified as one of public
dominion, and not of private ownership under Article
420 of the Civil Code. The respondents, for their part,
refute the petitioner's contention by saying that the
subject property is not governed by our Civil Code but
by the laws of Japan where the property is located.
They rely upon the rule of lex situs which is used in
determining the applicable law regarding the
acquisition, transfer and devolution of the title to a
property. They also invoke Opinion No. 21, Series of
1988, dated January 27, 1988 of the Secretary of
Justice which used the lex situs in explaining the
inapplicability of Philippine law regarding a property
situated in Japan.
Issue:
WON a conflict of laws arises with regard to real
property.
Ruling:
NO. A conflict of law situation arises only when: (1)
There is a dispute over the title or ownership of an
immovable, such that the capacity to take and transfer
immovables, the formalities of conveyance, the
essential validity and effect of the transfer, or the
interpretation and effect of a conveyance, are to be
determined and (2) A foreign law on land ownership
and its conveyance is asserted to conflict with a
domestic law on the same
matters. Hence, the need to determine which law
should apply.
In the instant case, none of the above elements exists.
The issues are not concerned with validity of ownership
or title. There is no question that the property belongs
to the Philippines. The issue is the authority of the
respondent officials to validly dispose of property
belonging to the State. And the validity of the
procedures adopted to effect its sale. This is governed
by Philippine Law. The rule of lex situs does not apply.
The assertion that the opinion of the Secretary of
Justice sheds light on the relevance of the lex situs rule
is misplaced. The opinion does not tackle the
alienability of the real properties procured through
reparations nor the existence in what body of the
authority to sell them.
In conclusion, the property is inalienable as it is part of
public domain and outside the commerce of men and
no conflict of laws to speak of.
THE HOLY SEE V. ROSARIO, JR.
Facts: A piece of real property was acquired by the
Holy See by way of donation from the Archdiocese of
Manila. The purpose was to construct the official place
of residence of the Papal Nuncio. Later, the Holy See
sold the property on condition that it will evict the
squatters therein. For failure to comply with the
condition, the Holy See was sued. It moved to dismiss
on the ground of state immunity.
Issue: WON respondent trial court has jurisdiction over
petitioner being a foreign state enjoying sovereign
immunity.
Held: The Republic of the Philippines has accorded the
Holy See the status of a foreign sovereign. The Holy
See, through its Ambassador, the Papal Nuncio, has
had diplomatic representations with the Philippine
Government since 1957.
The privilege of sovereign immunity in this case was
sufficiently established by the memorandum and
certification of the Department of Foreign Affairs. The
DFA has formally intervened in this case and officially
certified that the Embassy of the Holy See is a duly
accredited diplomatic mission to the Republic of the
Philippines exempt from local jurisdiction and entitled
to all the rights, privileges and immunities of a
diplomatic mission or embassy in this country. The
determination of the executive arm of government that
a state or instrumentality is entitled to sovereign or
diplomatic immunity is a political question that is
conclusive upon the courts.
Where the plea of immunity is recognized and affirmed
by the executive branch, it is the duty of the courts to
accept this claim so as not to embarrass the executive
arm of the government in conducting the country’s
foreign relations.
TAYAG V. BENGUET CONSOLIDATED
Facts: Idonah Slade Perkin died in New York and left
2 stock certificates evidencing 33,002 shares of
Benguet Consolidated.
County Trust Company of New York was appointed
domiciliary administrator of the estate of the deceased
while Tayag was designated the ancillary administrator
in the Philippines. The CFI ordered the domiciliary
administrator to produce the stock certificates but
County Trust did not obey the order.
Upon petition by the ancillary administrator (Tayag),
the CFI issued an order considering as lost the stock
certificates, cancelling the stock certificates, and
directing the issuance of new stock certificates and
their delivery to the ancillary administrator.
Issue: WON Philippine courts have the power and
authority over the shares of stock held by a domiciliary
administrator
Ruling: Yes, PH courts have the power and authority
over shares of stock held by a domiciliary
administrator.
Appellant Benguet Consolidated, Inc. did not dispute
the power of the appellee ancillary administrator to gain
control and possession of all assets of the decedent
within the jurisdiction of the Philippines. Nor could it.
When a person dies intestate owning property in the
country of his domicile as well as in a foreign country,
administration is had in both countries. That which is
granted in the jurisdiction of decedent’s last domicile is
termed the principal administration, while any other
administration is termed the ancillary administration.
The reason for the latter is because a grant of
administration does not ex proprio vigore have any
effect beyond the limits of the country in which it is
granted. Hence, an administrator appointed in a foreign
state has no authority in the Philippines. The ancillary
administration is proper, whenever a person dies,
leaving in a country other than that of his last domicile,
property to be administered in the nature of assets of
the deceased liable for his individual debts or to be
distributed among his heirs.
It would follow then that the authority of the probate
court to require that ancillary adminstrator’s right to “the
stock certificates covering 33,002 shares standing in
her name in the books of appellant Benguet
Consolidated” be respected is equally beyond
question. For appellant is a Philippine Corporation
owing full allegiance and subject to the unrestricted
jurisdiction of local courts. Its shares of stock cannot
therefore be considered in any wise as immune from
lawful court orders.
The actual situs of the shares of stocks is in the
Philippines, the corporation being domiciled in the
Philippines.
Secondly, a corporation is a creature without any
existence until it has received the imprimatur of the
state according to law. It is logically inconceivable
therefore that it will have rights and privileges of a
higher priority than that of its creator. It cannot
legitimately refuse to yield obedience to acts of its state
organs, certainly not excluding the judiciary, whenever
called upon to do so.
To assert that it can choose which court order to follow
and which to disregard is to confer upon it not
autonomy which may be conceded but license which
cannot be tolerated. It is to argue that it may, when so
minded, overrule the state, the source of its very
existence; it is to contend that what any of its
governmental organs may lawfully require could be
ignored at will.
RAMIREZ VS VDA DE RAMIREZ, G.R. NO. L-27952
FEBRUARY 15, 1982
FACTS:
Jose Ramirez a Filipino, died in Spain leaving only his
widow Marcelle Ramirez, a French. In the project
partition, the property was divided into 2 parts: 1st part
to the widow, and 2nd part to the grandnephews the
naked ownership. Furthermore, as to the usufruct of
the 2nd part, 1/3 was given to the widow and 2/3 to
Wanda de Wrobleski, an Austrian. The grandnephews
opposed on the ground that usufruct to Wanda is void
because it violates the constitutional prohibition against
the acquisition of lands by aliens.
ISSUE:
WON the ground for the opposition is correct.
HELD:
No, it is not correct.
The SC held that the Constitutional provision
which enables aliens to acquire private lands does not
extend to testamentary succession for otherwise the
prohibition will be for naught and meaningless. The SC
upheld the usufruct in favor of Wanda because
although it is a real right, it does not vest title to the land
in the usufructuary and it is the vesting of title to land in
favor of aliens which is proscribed by the Constitution.
MATTHEWS vs. TAYLOR, G.R. No. 164584, June
22, 2009
Facts:
Benjamin A. Taylor, a British subject, married
Joselyn C. Taylor, a 17-year old Filipina. They bought
a property in Boracay. The sale was allegedly financed
by Benjamin. Joselyn and Benjamin, also using the
latter's funds, constructed improvements thereon.
However, Benjamin and Joselyn had a falling out, and
Joselyn ran away with Kim Philippsen.
On July 20, 1992, Joselyn as lessor and
petitioner Philip Matthews as lessee, entered into an
Agreement of Lease (Agreement) involving the
Boracay property for a period of 25 years. Claiming that
the Agreement was null and void since it was entered
into by Joselyn without his (Benjamin's) consent,
Benjamin instituted an action for Declaration of Nullity
of Agreement of Lease with Damages against Joselyn
and the petitioner. Benjamin claimed that his funds
were used in the acquisition and improvement of the
Boracay property, and coupled with the fact that he
was Joselyn's husband, any transaction involving said
property required his consent.
Issue: Whether or not an alien husband can nullify a
lease contract entered into by his Filipina wife to the
property bought during their marriage?
Ruling:
NO. Under Section 7, Article XII of the 1987
Constitution states:
Section 7. Save in cases of hereditary succession, no
private lands shall be transferred or conveyed except
to individuals, corporations, or associations qualified to
acquire or hold lands of the public domain.
The rule is clear and inflexible: aliens are
absolutely not allowed to acquire public or private lands
in the Philippines, save only in constitutionally
recognized exceptions. There is no rule more settled
than this constitutional prohibition, as more aliens
attempt to circumvent the provision by trying to own
lands through another.
In light of the foregoing jurisprudence,
Benjamin, being an alien, is absolutely prohibited from
acquiring private and public lands in the Philippines.
Joselyn appeared to be the designated "vendee" in the
Deed of Sale of said property, she acquired sole
ownership thereto. This is true even if we sustain
Benjamin's claim that he provided the funds for such
acquisition. By entering into such contract knowing that
it was illegal, no implied trust was created in his favor;
no reimbursement for his expenses can be allowed;
and no declaration can be made that the subject
property was part of the conjugal/community property
of the spouses he had and has no capacity or
personality to question the subsequent lease of the
Boracay property by his wife on the theory that in so
doing, he was merely exercising the prerogative of a
husband in respect of conjugal property.
CHEESMAN V IAC
FACTS:
Thomas Cheesman (American) and Criselda (Filipino)
were married in 1970, got separated in 1981. Before
they got separated, Criselda was able to purchase a
land. Although aware of the sale and the fact that the
property was only in the name of his wife, Thomas
never objected to the said transaction. Tax
declarations were issued in the name of Criselda. She
exercised exclusive management over the property. In
1981, Criselda sold the property. Thomas institituted a
complaint and filed for the ANNULMENT OF THE
SALE: Sale executed w/o his knowledge and consent
alleging, (1) that the said property was paraphernal,
having been purchased by Criselda with funds
exclusively belonging to her, (2) Thomas Cheesman,
being an American, was disqualified to have any
interest or right of ownership in the land; and (3)
Estelita Padilla was a buyer in good faith. The trial court
rendered judgment declaring the sale of the property to
be valid, the IAC affirmed such decision.
ISSUE:
Whether or not Thomas can contest the validity of the
Contract?
HELD:
The fundamental law prohibits the sale to aliens of
residential land. Section 14, Article XIV of the 1973
Constitution ordains that, "Save in cases of hereditary
succession, no private land shall be transferred or
conveyed except to individuals, corporations, or
associations qualified to acquire or hold lands of the
public domain."30 Petitioner Thomas Cheesman was,
of course, charged with knowledge of this prohibition.
Thus, assuming that it was his intention that the lot in
question be purchased by him and his wife, he
acquired no right whatever over the property by virtue
of that purchase; and in attempting to acquire a right or
interest in land, vicariously and clandestinely, he
knowingly violated the Constitution; the sale as to him
was null and void.31 In any event, he had and has no
capacity or personality to question the subsequent sale
of the same property by his wife on the theory that in
so doing he is merely exercising the prerogative of a
husband in respect of conjugal property. To sustain
such a theory would permit indirect controversion of the
constitutional prohibition. If the property were to be
declared conjugal, this would accord to the alien
husband a not insubstantial interest and right over
land, as he would then have a decisive vote as to its
transfer or disposition. This is a right that the
Constitution does not permit him to have.
LLANTINO V CO LIONG CHONG
FACTS:
Llantino Sps entered a lease contract over a
commercial-residential land located in Virac,
Catanduanes with Co Liong Chong (a Chinese
national) who later became Juan Molina for a period of
13 years. The lease contract was for a period of 60
years, and Chong later on constructed a commercial
building worh P50,000. The Llantino’s wanted to get
back the property from Molina, saying that it was to
expire soon. In addition to, he cannot own such
property after naturalization in 1954. Molina counters
that the lease was for 60 years thereby making him the
owner thereof, that he already build a commercial
building on it and that in any case, he is already a
Filipino. The spouses filed a complaint for quieting of
title before the CFI. The court ruled in favor of Molina.
ISSUE:
WON the lease contract is invalid because at the time
of execution, he was Chinese.
HELD:
No. It was valid. Lease contracts with aliens allowed
since an alien’s stay in the Philippines is temporary,
they may be granted temporary rights such as a lease
contract which is not prohibited by the Constitution.
The lease contract is valid as long as there are no
circumstances attendant to its execution which are
used to circumvent the constitutional prohibition such
as an option to buy the contract or a lease for more
than 50 years. An exception to this exception is when
the alien subsequently acquires Philippine citizenship.
MULLER VS. MULLER GR NO 149615, AUGUST 29,
2006
Facts:
Petitioner Elena Buenaventura Muller and respondent
Helmut Muller were married
in Hamburg, Germany .The couple resided
in Germany at a house owned by respondent’s parents
but decided to move and reside permanently in
the Philippines. By this time, respondent had
inherited the house in Germany from his parents
which he sold and used the proceeds for the
purchase of a parcel of land in Antipolo, Rizal at the
cost of P528,000.00 and the construction of a house
amounting to P2,300,000.00. The Antipolo property
was registered in the name of petitioner.
Due to incompatibilities and respondents alleged
womanizing, drinking, and maltreatment, the spouses
eventually separated. Respondent filed a petition for
separation of properties before the Regional Trial Court
of Quezon City. The trial court decreed the separation
of properties between them and ordered the equal
partition of personal properties located within the
country, excluding those acquired by gratuitous title
during the marriage. With regard to the Antipolo
property, the court held that it was acquired using
paraphernal funds of the respondent. However, it
ruled that respondent cannot recover his funds
because the property was purchased in violation of
Section 7, Article XII of the Constitution.
CA held that respondent merely prayed for
reimbursement for the purchase of the Antipolo
property, and not acquisition or transfer of ownership
to him. It also considered petitioners ownership over
the property in trust for the respondent. As regards the
house, the Court of Appeals ruled that there is nothing
in the Constitution which prohibits respondent from
acquiring the same.
Issue: Is the respondent entitled to reimbursement of
the amount used to purchase the land and cost for
construction of the house?
Ruling: No.
Section 7, Article XII of the 1987 Constitution states:
Save in cases of hereditary succession, no private
lands shall be transferred or conveyed except to
individuals, corporations, or associations qualified to
acquire or hold lands of the public domain.
Aliens, whether individuals or corporations, are
disqualified from acquiring lands of the public
domain. Hence, they are also disqualified from
acquiring private lands. The primary purpose of the
constitutional provision is the conservation of the
national patrimony.
Respondent was aware of the constitutional prohibition
and expressly admitted his knowledge thereof to this
Court. He declared that he had the Antipolo property
titled in the name of petitioner because of the said
prohibition. His attempt at subsequently asserting or
claiming a right on the said property cannot be
sustained. Save for the exception provided in cases of
hereditary succession, respondents disqualification
from owning lands in the Philippines is absolute. Not
even an ownership in trust is allowed. Besides, where
the purchase is made in violation of an existing statute
and in evasion of its express provision, no trust can
result in favor of the party who is guilty of the fraud. To
hold otherwise would allow circumvention of the
constitutional prohibition.
Thus, in the instant case, respondent cannot seek
reimbursement on the ground of equity where it is
clear that he willingly and knowingly bought the
property despite the constitutional prohibition.
Further, the distinction made between transfer of
ownership as opposed to recovery of funds is a futile
exercise on respondents part. To allow reimbursement
would in effect permit respondent to enjoy the fruits of
a property which he is not allowed to own. Thus, it is
likewise proscribed by law
BORROMEO VS. DESCALLAR GR NO 159310,
FEBRUARY 24, 2009
Facts:
Wilhelm Jambrich, an Austrian, arrived in
the Philippines after he was assigned by his employer
to work at a project in Mindoro. He met respondent
Antonietta Opalla-Descallar, a separated mother of two
boys who was working as a waitress at St. Moritz
Hotel. Jambrich befriended respondent and asked her
to tutor him in English.
Jambrich and respondent fell in love and decided to
live together in a rented house in Hernan
Cortes, Mandaue City. Later, they transferred to their
own house and lots at Agro-Macro Subdivision,
Cabancalan, Mandaue City. In the Contracts to
Sell, Jambrich and respondent were referred to as the
buyers. A Deed of Absolute Sale was likewise issued
in their favor. However, when the Deed of Absolute
Sale was presented for registration before the Register
of Deeds, registration was refused on the ground that
Jambrich was an alien and could not acquire alienable
lands of the public domain. Consequently, Jambrich’s
name was erased from the document. But it could be
noted that his signature remained on the left hand
margin of page 1, beside respondents signature as
buyer on page 3, and at the bottom of page 4 which is
the last page.
However, respondent found a new boyfriend while
Jambrich began to live with another woman
in Danao City.
Jambrich met petitioner Camilo F. Borromeo and
purchased an engine and some accessories for his
boat from petitioner, for which he became indebted to
the latter for about P150,000.00. To pay for his debt,
he sold his rights and interests in the Agro-Macro
properties to petitioner for P250,000, as evidenced by
a Deed of Absolute Sale/Assignment. On July 26,
1991, when petitioner sought to register the deed of
assignment, he discovered that titles to the three lots
have been transferred in the name of respondent, and
that the subject property has already been mortgaged.
Petitioner filed a complaint against respondent for
recovery of real property before the Regional Trial
Court of Mandaue City. Petitioner alleged that the
Contracts to Sell over the properties which identified
both Jambrich and respondent as buyers do not reflect
the true agreement of the parties since respondent did
not pay a single centavo of the purchase price and was
not in fact a buyer; that it was Jambrich alone who paid
for the properties using his exclusive funds; that
Jambrich was the real and absolute owner of the
properties; and, that petitioner acquired absolute
ownership by virtue of the Deed of Absolute
Sale/Assignment which Jambrich executed in his favor.
Issues: Whether Jambrich has no title to the
properties in question and may not therefore transfer
and assign any rights and interests in favor of
petitioner.
Ruling: Jambrich has all authority to transfer all his
rights, interests and participation over the subject
properties to petitioner by virtue of the Deed of
Assignment he executed on July 11, 1991.
While the acquisition and the purchase of Wilhelm
Jambrich of the properties under litigation [were] void
ab initio since [they were] contrary to the Constitution
of the Philippines, he being a foreigner, yet, the
acquisition of these properties by plaintiff who is a
Filipino citizen from him, has cured the flaw in the
original transaction and the title of the transferee is
valid. The court upheld the sale by Jambrich in favor
of petitioner and ordered the cancellation of the TCTs
in the name of respondent.
The rationale behind the Courts ruling is since the ban
on aliens is intended to preserve the nations land for
future generations of Filipinos, that aim is achieved by
making lawful the acquisition of real estate by aliens
who became Filipino citizens by naturalization or those
transfers made by aliens to Filipino citizens. As the
property in dispute is already in the hands of a
qualified person, a Filipino citizen, there would be
no more public policy to be protected. The
objective of the constitutional provision to keep
our lands in Filipino hands has been achieved.

SAUDI ARABIAN AIRLINES VS. COURT OF
APPEALS
Facts: Milagros Morada was working as a
stewardess for Saudia Arabian Airlines. In 1990,
while she and some co-workers were in a lay-over
in Jakarta, Indonesia, an Arab co-worker tried to
rape her in a hotel room. Fortunately, a roomboy
heard her cry for help and two of her Arab co-
workers were arrested and detained in Indonesia.
Later, Saudia Airlines reassigned her to work in
their Manila office. While working in Manila,
Saudia Airlines advised her to meet with a Saudia
Airlines officer in Saudi. She did but to her
surprise, she was brought to a Saudi court where
she was interrogated and eventually sentence to 5
months imprisonment and 189 lashes; she
allegedly violated Muslim customs by partying with
males. The Prince of Makkah got wind of her
conviction and the Prince determined that she was
wrongfully convicted, hence, the Prince absolved
her and sent her back to the Philippines. Saudia
Airlines later on dismissed Morada. Morada then
sued Saudia Airlines for damages under Article 19
and 21 of the Civil Code. Saudia Airlines filed a
motion to dismiss on the ground that the RTC has
no jurisdiction over the case because the
applicable law should be the law of Saudi Arabia.
Saudia Airlines also prayed for other reliefs under
the premises.
Issue: Whether or not Saudia Airlines’ contention
is correct.
Ruling: No. Firstly, the RTC has acquired
jurisdiction over Saudia Airlines when the latter
filed a motion to dismiss with petition for other
reliefs. The asking for other reliefs effectively
asked the court to make a determination of Saudia
Airlines’ rights, hence, a submission to the court’s
jurisdiction.
Secondly, the RTC has acquired jurisdiction over
the case because as alleged in the complaint of
Morada, she is bringing the suit for damages
under the provisions of our Civil Law and not of the
Arabian Law. Morada then has the right to file it in
the QC RTC because under the Rules of Court, a
plaintiff may elect whether to file an action in
personam (case at bar) in the place where she
resides or where the defendant resides.
Obviously, it is well within her right to file the case
here because if she will file it in Saudi Arabia, it will
be very disadvantageous for her (and of course,
again, Philippine Civil Law is invoked). Thirdly, one
important test factor to determine where to file a
case, if there is a foreign element involved, is the
so- called “locus actus” or where an act has been
done. In the case at bar, Morada was already
working in Manila when she was summoned by
her superior to go to Saudi Arabia to meet with a
Saudia Airlines Officer. She was not informed that
she was going to appear in a court trial. Clearly,
she was defrauded into appearing before a court
trial, which led to her wrongful conviction. The act
of defrauding, which is tortuous, was committed in
Manila and this led to her humiliation, misery, and
suffering. And applying the torts principle in a
conflicts case, the Supreme Court finds that the
Philippines could be said as a situs of the tort (the
place where the alleged tortious conduct took
place).
WILDVALLEY SHIPPING CO., LTD VS. COURT
OF APPEALS
Facts: In the Orinoco River in Venezuela, it is a
rule that ships passing through it must be piloted
by pilots familiar to the river. Hence, in 1988
Captain Nicandro Colon, master of Philippine
Roxas, a ship owned by Philippine President
Lines, INC (PPL), obtained the services of Ezzar
Vasquez, a duly accredited pilot in Venezuela to
pilot the ship in the Orinico River. Unfortunately,
Philippine Roxas ran aground in the Orinoco River
while being piloted by Vasquez. As a result, the
stranded ship blocked other vessels. One such
vessel was owned by Wildvalley Shipping Co., Ltd.
(WSC). The blockade caused $400K worth of
losses to WSC as its ship was not able to make its
delivery. Subsequently, WSC sued PPL in the
RTC of Manila. It averred that PPL is liable for the
losses it incurred under the law of Venezuela, to
wit: Reglamento General de la Ley de Pilotaje and
Reglamento Parala Zona de Pilotaje No. 1 del
Orinoco. These two laws provide that the master
and owner of the ship is liable for the negligence
of the pilot of the ship. Vasquez was proven to be
negligent when he failed to check on certain
vibrations that the ship was experiencing while
traversing the river.
Issue: Whether or not Philippine President Lines,
Inc. is liable under the said Venezuelan
laws.
Ruling: No. The two Venezuelan Laws were not
duly proven as fact before the court. Only mere
photocopies of the laws were presented as
evidence.
For a copy of a foreign public document to be
admissible, the following requisites are
mandatory:
1. It must be attested by the officer having legal
custody of the records or by his deputy; and

2. It must be accompanied by a certificateby a
secretary of the embassy or legation, consul
general, consul, vice consular or consular
agent or Foreign Service officer, and with the
seal of his office.
And in case of unwritten foreign laws, the oral
testimony of expert witnesses is admissible, as are
printed and published books of reports of decision
of the courts of the country concerned if proved to
be commonly admitted in such courts. Failure to
prove the foreign law is deemed to be the same as
Philippine laws. Under Philippine laws, PPL or
Captain Colon cannot be held liable for the
negligence of Vasquez. PPL and Colon had
shown due diligence in selecting Vasquez to pilot
the vessel. Vasquez is competent and was a duly
accredited pilot in Venezuela in good standing
when he was engaged.
NORSE MANAGEMENT CO. VS. NATIONAL
SEAMEN BOARD
GR. NO. L-54204, SEPTEMBER 30, 1982
Facts:
Abordo was employed by Norse Management as
Second Engineer of MT Cherry Earl. He died from a
stroke while in the course of his employment. Abordo’s
surviving spouse, Restituta, filed a complaint for death
compensation benefits, accrued leave pay and time-off
allowances, funeral expenses, and attorney’s fees in
connection with the death of her husband. She
contended that the law of Singapore should govern the
grant of benefits to her husband. Both the National
Seamen Board and the Ministry of Labor upheld her
contention that Singapore law governs the grant of
benefits to her deceased husband.
Issue:
Whether Singapore law or Philippine law governs the
grant of benefits to Abordo’s wife?
Ruling:
In the aforementioned “Employment Agreement”
between petitioners and the late Napoleon B. Abordo,
it is clear that compensation shall be paid under
Philippine Law or the law of registry of petitioners;
vessel whichever is greater. Since private respondent
Restituta C. Abordo was offered Php 30,000.00 only by
the petitioners, Singapore law was property applied in
this case.
SUZARA VS. BENIPAYO
Facts:
Suzara et al. entered into employment contracts with
Magsaysay lines to work abroad vessels
owned/operated/manned by the latter for a period of 12
calendar months and with different rating/positions,
salary, overtime pay and allowance. The contracts
were approved by the NSB. Upon arrival at the port of
Vancouver, Canada, Demands for increase in wages
were made through the help of the International
Transport Worker’s Federation, a militant worldwide
especially in Canada, Australia, Scandinavia, and
various European countries, interdicting foreign
vessels and demanding wage increases for third world
seamen.
Wages were increased but complaints were filed by
Magsaysay before the NSB. NSB ordered the return of
the additional wages paid for being obtained through
violent means and for laking NSB approval. NLRC
affirmed the order. Meanwhile, Magsaysay filed estate
charges against the seamen.
In this petition, the seamen seeks for the reversal of the
NLRC decision and the quashes of the complaints for
estate.
Issue:
Whether or not the increase in wages needed the
approval of the NSB to be legal.
Ratio:
No. There is nothing in the record supporting the
finding that the workers resorted to violent means to
obtain an increase in their wages. It is impractical for
the NSB to required the petitioners, caught in the
middle of a labor struggle between the ITF and owners
of ocean going vessels halfway around the world in
Vancouver, British Columbia to first secure the
approval of the NSB in Manila before signing an
agreement which the employer was willing to sign.
According to the case of Vir-jen: The form contracts
approved by the National Sea men Board are designed
to protect Filipino seamen not foreign shipowners who
can take care of themselves. The standard forms
embody the basic minimums which must be
incorporated as parts of the employment contract.
They are not collective bargaining agreements or
immutable contracts which the parties cannot improve
upon or modify in the course of the agreed period of
time. The NSB, the DOLE and all its agencies exists
primarily for the workingman’s interest and the nation’s
as a whole.