CONFLICT OF LAW DIGESTED BOOK.pdf

individuals and juridical entities, naturalization law, laws on domicile and residence, family relations, contracts, torts, crimes, corporation law and property law. Principally governs states in their relationships amongst themselves

PRIL: that part of municipal law which covers cases with a foreign element.

FACTS: Defendants were sued in France, and the French court rendered judgment against them. Plaintiffs sued defendants on the French judgment in the US. The US court held the French judgment conclusive. HELD: No law has any effect, of its own force, beyond the limits of the sovereignty form which its authority is derived. The extent to which the law of one nation, as put in force  within its te rritory xxx shall be allowed to operate within the dominion of another nation, depends upon xxx ―the comity of nations.‖  is the recognition which one nation allows  within its territory to the legislative, e xecutive or j udicial acts of another nation, having due regard both to  and , and to the rights of its own citizens or of other persons who are under the protection of its laws. The reasonable, if not necessary conclusion appears to us to be that judgments rendered in France, or in any other foreign country, by the laws of which our own judgments are reviewable upon the merits, are not entitled to full credit and conclusive effect when sued upon in this country, but are  prima facie evidence only of the justice of the plaintiff‘s claim.

  private international law is Second Edition of Jurisprudence:  private that part of the law of each state or nation which determines  whether, in dealing with a legal situation, the law of some other state or nation will be recognized, given effect or applied.

Distinguished from Public International Law and other disciplines:

Codified in Art. 38 of the Statute of International Court of Justice

Principally governs individuals in their private transactions which involves a foreign element Generally derived from the internal law of each state and not from any ―international‖ law extraneous to municipal law

Governs only states and internationally-recognized organizations

Governs individuals corporations

Involves state-to-state or government-togovernment matters

Relates to transactions individuals

or

1) Issue of adjudicatory JD: determines the circumstances that allow for a legal order to impose upon its judiciary the task of deciding multi-state and multinational disputes 2) Issue of choice-of-law: refers to the probable sources from  which the applicable law of the controversy may be derived 3) Recognition and enforcement of foreign judgments: study of situations which justify recognition by the forum court of a  judgment rendered by a f oreign court or the enforcement of such within the forum

private between

In case of violation, a state  All the remedies are may resort to provided by municipal 1) diplomatic protest laws of the state, such as 2) peaceful means of resort to courts or settlement (diplomatic administrative tribunals negotiations, arbitration or conciliation) 3) adjudication by filing a case before international tribunals 4) use force short of war, or eventually go to war

Object and Function of Conflict of Laws:  to provide rational and valid rules or guidelines in deciding cases where the parties, events or transactions are linked to more than one  JD.

Conflict of law rules aim to promote stability and uniformity of solutions provided by the laws and courts of each state called upon to decide conflicts cases. Scope:   covers the entire range of laws as it cuts across the subjects of JD of local courts or tribunals, the law on evidence or proof of foreign law, the personal law of 1

3 Issues in Conflict of Laws:

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In PIL, it means the law of nations It is used in the early Roman empire to mean the body of rules developed by the praetor peregrinus to resolve disputes between foreigners or between foreigners and Roman citizens It includes Greek legal doctrines and concept of bona fides as ius civile only applies t Roman citizens 

The rise of this city states prompted intensive study of conflict of laws Bartolus: Father of Conflict of Laws ; formulated Theory of Statutes Because Northern Italy was divided into several city states each having their own laws on private matters, the ―Statute‖ was applied to problems of choice of law. Statute is classified into: a. real –  applied to immovable property within the state b. personal – followed the person even outside the domicile and governed questions on personal status, capacity and movables c. mixed –  contracts, if entered into by the different nationals

-application of foreign law was not due to comity but the resultant benefits for everyone concerned - advocated situs theory (seat of legal relationship): every element of transaction be governed by the law of the place with which said element has the most substantive connection

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Charles Dumoulin  – advocated a method to determine  what law would govern contracts between different nationals Bertrand D‘Argentre –  formulated the principle of universal succession followed in the Spanish Civil Code and adopted in the Phil. Civil Code

Pascuale Mancini advanced nationality theory in matters concerning status, capacity and private interests of the individual

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Ulrich Huber – first used the term, conflict of laws

Dutch jurists asserted that State has no obligation to apply a foreign law unless imposed by treaty, by comitas  gentium or on consideration of courtesy and expediency.

followed Italian theory: when 2 or more independent laws are applicable to a Conflict problem, the method so devised determines what law shall prevail

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there should be a single body of rules that can solve problems involving a foreign element

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Comitas Gentium  was readily accepted because of increasing international transactions.

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Ius Commune , applied by Italian and French jurists,  was a supranational law based on Roman law and which became the continental European common law.

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Nations codified their national laws which included conflict of laws provisions. Ex. French Civil Code of 1804  became the pattern for Civil Codes of Spain, Belgium and Romania nationality law principle (contained in Art. 15 of our CC) was provided in Art. 3 of the French Code 

 Justice Joseph Story –  relied on the European continental theorists‘ concept of territorial sovereignty and founded conflict of laws on the principle of comity of nations.

In the Bar, it used to be a separate subject along with PIL but when it was revised, PIL was included in Pol Law while PRIL was merged with Civil Law. But, this does not mean that PRIL is a part of civil law as this mindview tends to limit the perspective and scope of analysis required for conflicts problems. Now, more problems in Conflict have arisen esp. with Filipinos engaging in foreign business transactions, and in international air transport and foreign tort claims and labor contracts for OFWs.

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Dutch jurists led by Huber developed territorial principle where the laws of every state may operate only  within its territorial limit but such sovereign state may recognize that a law, which operated in the country of its origin, shall retain force everywhere provided that it  will not prejudice its subjects.

Conflict of Laws was included in law curriculum by UP College of Law in 1911 (no less!). Until 1950s, law teachers predominantly used foreign law books and decisions by  American courts.

law of the State applies to persons and things  within the State, therefore, no foreign law is applied. Branch: only rights vested or acquired under foreign law are recognized in the forum but not foreign law itself

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2   Restatement of Conflict of Laws, adopted by  American Law Institute under Prof. William Reese, proposed that in the absence of statutory law, law to be applied in Conflict case, is the law of the most significant relationship. nd

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Conflict of Laws in the Philippines

Spanish Civil Code enforced in the Philippines until 1950 contained the principles adopted from the French Civil Code (Code of Napoleon) particularly the nationality law principle. Art 16, par. 1, which applies lex situs   rule was adopted from Art. 10 of Spanish CC while par. 2 represents the system of universal succession. Art. 17, par. 1 follows lex loci contractus . But there was no significant jurisprudence on the subject.

Frederich Carl Von Savigny - founder of modern private IL 2

Conflict of Laws (CL) originated in continental Europe was most laws were codified. Primary sources of law are found in the civil codes of different countries: 1. 2.

3. 4. 5. 6.

Roman code codified principles of ius gentium . Code of Napoleon contained specific rule on personal law of individual, this was followed by several codes (Netherlands, Romania, Italy, Portugal, Spain) The German civil Code contained many provisions on Conflict of Laws. Switzerland also enacted Laws on cases involving foreign elements. Greece enacted a Civil Code with CL rules which became a model in other countries The Code of Bustamante (in South America) was patterned after the Code of Napoleon

Conflict Laws of the Philippines Spanish Civil Code   was enforced in the Philippines on December 7, 1889 until the Philippine Civil Code‘s effectivity on August 30, 1950 which contained the provisions on conflict of laws of the earlier code.

Spain‘s Code of Commerce, having some provisions on foreign transactions, were also enforced in the Philippines on Dec 1, 1888.

One basic source of law is the 1987 Constitution  which contains principles on nationality nationality and comity. Special statutes were also enacted to govern cases with foreign elements, to wit: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19.

Corporation Code General Banking Act Foreign Currency System Act Phil Foreign Law Guarantee Corp Retail Business Regulation Act  Anti-Dummy Law Nationalization of Rice and Corn Industry Act Insurance Code IP Code Patent Law Trademark Law COGSA Salvage Law Public Service Act Civil Aeronautics Act Phil Overseas Shipping Act Investment Incentives Act Export Incentives Act RA 7722

12. Convention on World Intellectual Property Organization 13. Berne Convention on Protection of Literary and  Artistic Works 14. Paris Convention on Protection of Industrial Property.  Although many Hague Conventions on Private International Law were concluded since 1951, which dealt with issues on:  Personal status  Patrimonial family status  Patrimonial status such as agency and trusts The Philippines is a signatory to the Convention on Recognition of Foreign Judgment on Civil and Commercial Matters and has ratified the 1993 Convention in Respect of Inter-Country Adoption only.

In interpreting statutes and codes involving CL, courts resort to works of distinguished jurists and studies of learned societies. Distinguished writers in continental Europe include Huber Manreas, Savigny (whose work was translated into English by Guthrie), and Weiss.

 Jurisdiction may mean either a) judicial or b) legislative  jurisdiction. (This part talks of judicial jurisdiction  jurisdiction )  Judicial JD – the power or authority of a court to try a case, render judgment and execute it in accordance with law. Legislative JD –  the ability of the state to promulgate laws and enforce them on all persons and property within its territory.

4 Major Questions in Analyzing a Conflict of Laws Problem:

1)

Has the court JD over the person of the defendant or over his property?

2)

Has the court JD over the subject matter (―competency‖)?

3)

Has the suit been brought in the proper venue in cases where a foreign element is involved?

4)

Is there a statute or doctrine under which a court otherwise qualified to try the case may or may not refuse to entertain it?

Distinguished American and English writers, on the other hand, include Beale, Cavers, Cheatham, Currie, Ehrenzweig, Goodrich, Gussbaum, Story, Wharton, Cheshire, Graveson. The Philippines has entered into a number of treaties and international conventions which deal with private international law since it became a Republic.

The American Law Institute published 2 studies on CL: Restatement of the Conflict of Laws and a Second Restatement with William Reese as Reporter.

Bases of Judicial Jurisdiction (3 groups):

1)

 JD over the person (based on forum-defendant contacts)

2)

 JD over the res   (based on forum-property contacts)

3)

 JD over the subject matter

Some of these treaties/conventions are: 1. Convention on Intl Civil Aviation, 2.  Warsaw Convention, 3. Convention on Offenses Committed on Board Aircraft 4. Convention on the Suppression of Unlawful 5.  Acts against Civil Aviation 6. UN Convention COGSA 7. Convention on Consent to Marriage, etc 8. Convention on Traffic of Persons 9. Convention on Elimination of Discrimination against  Women 10. Convention on Political Rights of Women 11. IC on the Suppression of Traffic of Women and Children

Decisions of courts are the most important source of CL rules and form the main bulk of source of conflict rules.  According to Graveson: ―This branch of law is more completely judge-made than almost any other. In its application, judges have to deal with ―All Manner of People‖ more than any other branch. The claim of justice for right as a basis for conflict of laws is supported not only by the terms of the judicial oath but by judicial dicta in judgments‖.

This is acquired by the voluntary appearance of a party and his submission to authority. Over the person of the plaintiff: acquired the moment he invokes the aid of the court by filing a suit .

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 presence of the property within the territory basis of JD:  presence Over the person of the defendant: acquired when he enters his appearance or is served with the legal process within the state .  When he or his lawyer appears in court, he gives c onsent to the forum‘s exercise of JD over him, except where the appearance is for the purpose of protesting the JD over him.  A non-resident plaintiff who files a suit i s deemed to consent to the court‘s exercise of JD over subsequent proceedings arising out of his original cause of action (counterclaims).  JD over the defendant may be had by personal or substituted service of summons.

FACTS: Paul Schenker (Swiss citizen and resident) filed a complaint against Gemperle through his wife Helen Schenker, for enforcement of subscription to shares of stock. Gemperle filed a suit against Paul for damages, saying that Paul caused allegations to be published attacking his reputation and bringing him into public hatred and discredit as a businessma n. n. Schenker‘s defense: court has no JD over the person of Paul. HELD: Jurisdiction was acquired by the lower court over t he person of Paul through service of summons addressed to him upon Helen, it appearing from the answer that she is the representative and attorney-in-fact of her husband in the civil case.

 Jurisdiction: 1) over the person a)  voluntary appearance b) submission to authority rule : in substituted service, the premise is that the defendant is within the territorial JD of the court exception : Gemperle case –  because Helen is legally authorized to file a case in behalf of Paul, she is also authorized to receive summons

2)

over the property a) in rem – the situs could ―bind the  world‖ b) quasi in rem

over the subject-matter - WON the court has competence to hear the case and render  judgment; the court‘s JD must be properly invoked (provided for by statute) _______________

the suit is merely in personam , constructive service in this form upon a non-resident is ineffectual for any purpose.

3)

The important thing to prove is what kind of action is involved (to determine sufficiency of form of service to be used)

 JD over the property results from: a)

seizure of the property under a legal process

b)

the institution of legal proceedings wherein the court‘s power over the property is recognized and made effective

This kind of JD is referred to as in rem  JD;   JD; the situs could ―bind the world‖ and not just the interest of specific persons. Basis of exercise of JD: the presence of the property within the territorial JD of the forum. Quasi in rem  JD: affects only the interests of particular persons in that thing (ex. Quieting of title). (actions against a person in respect of the res)

In these 2 proceedings, all that due process requires is that the defendant be given adequate notice and opportunity to be heard (which are both met by service of summons by publication).

FACTS: The state of Washington sued International Shoe Co. (a Delaware corporation with principal place of business in Missouri) to collect the tax laid upon the exercise of the privilege of employing salesmen within the state. ense is that its activities within the International Shoe‘s def ense state, consisting merely of exhibiting samples and soliciting orders and nothing more, were not sufficient to manifest its ―presence‖ there; hence the state courts had no JD over it. HELD: The SC of Washington has JD over International Shoe. Due process requires only that in order to subject a defendant to a judgment in personam , if he be not present  within the territory of the forum, he should have certain   with it, such that the maintenance of the minimum contacts  with suit does not offend ―traditional notions of fair play and substantial justice‖. (

The demands of due process regarding the corporation‘s ―presence‖ may be met by such contacts of the corporation with the state of the forum as to make it reasonable xxx to require the corporation with defend the particular suit which is brought there.

FACTS: Neff, a California resident, owned land in Oregon  which was sold under a Sheriff‘s deed to satisfy a money  judgment against him. The service of summons was made by publication. He is suing for recovery of said land, alleging that the sale was invalid for lack of JD of the Oregon court over him.

Its ―presence‖ can be manifested only by such activities carried on in its behalf by those who are authorized to act for it.

HELD: Substituted services by publication, or in any other authorized form, may be sufficient to inform parties of the object of the proceedings taken where property is once brought under the control of the court by seizure or some equivalent act to any proceedings authorized by law upon such seizure for its condemnation and sale.

FACTS: In an action for judicial settlement of accounts of Central Hanover Bank as trustee of a common trust fund, some of the beneficiaries who are non-residents of NY were notified only by publication in a local newspaper.

But where the entire object of the action is to determine the personal rights and obligations of defendants, that is, where 4

HELD: When notice is a person‘s due, process which is a mere gesture is NOT due process. The means employed must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it. Within

the limits of practicability, notice must be such as is reasonably calculated to reach interested parties.

contacts exist among the forum, defendant and the cause of action.

In Mullane, the manner notice was given should reasonably result in informing the affected partner; when conditions do not allow such notice, the form chosen should not substantially be ―less likely to bring home notice than other of the feasible and customary substitutes.‖

The change in the conceptual foundation of JD from territorial power to fairness does not significantly affect proceedings in rem, which are suits where the property itself is the object of the controversy. The physical presence of the property within the state establishes the state‘s paramount interest in adjudicating a claim over it and provides the necessary minimum contacts.

power to enter upon the inquiry, not whether its conclusion in the course of it is right or wrong.

―Presence‖/Jurisdiction: 1) Traditional Views a) Pennoyer – actual physical presence 2) Modern Views

Long-Arm Statutes

FACTS: Heitner, a non-resident of Delaware with 1 share of stock in the Delaware corporation Greyhound, sued Greyhound and its officers for allegedly violating its duties. Pursuant to the case, Heitner filed a motion for sequestration of the defendants‘ stocks in Greyhound. The stocks, while not physically present in Delaware, are considered to be there in view of it being the place of incorporation. HELD: The Delaware court cannot exercise JD just because the stocks are statutorily present in Delaware. The property (stocks) is not the subject matter of the litigation nor is the underlying cause of action related to the property.  Also, the facts in CAB does not demonstrate that defendants have purposefully availed themselves of the privilege of conducting activities within the forum state in a way that  would justify bringing them before a Delaware court. In Shaffer, the minimum contacts and fundamental fairness test should be satisfied regardless of whether the proceedings are in rem, quasi in rem or in personam.

Traditional basis for the exercise of judicial JD is the state‘s physical power over persons and property within its territory; this is why in in rem proceedings, it can exercise JD over property situated in the state regardless of whether it could otherwise exercise JD over the persons whose interest would be affected by the decision.

In the US, there is a shifting trend from theory of territorial power to considerations of minimum contacts   and fundamental fairness . This approach demands that there be forum-transaction contacts   that will make it fundamentally fair to require the defendant to defend a suit in the forum regardless of his non-resident status. Distinction, Shaffer and International Shoe:  while International Shoe requires minimum contacts between the defendant and the forum, Shaffer demands that minimum

Long-arm statutes specify the kinds of contacts upon which  JD will be asserted. Some long-arm statutes broadly authorize courts to assert JD in any case not inconsistent  with the Constitution, leaving it to the court to define its limitations on a case-by-case basis.

a)

Int‘l. Shoe –  contact between the forum and the corporation (even in the absence of an actual office, etc.)

b)

Mullane –  disregards strict distinction between in rem  and  and in personam

c)

Shaffer –  minimum contacts between the properties and forum; fundamental fairness test

Long-arm statutes: already identify what are the bases of JD.

Subject-matter JD is allocated among the courts by constitutional and statutory laws, according to the nature of the controversy, thereby determining the competence of the court to try and decide a case.

 Jurisdiction and choice of law do not mean the same thing. _______________

It is not enough that a court has a power in abstract to try and decide the case; it is necessary that said power be properly invoked xxx by filing a petition. Subject-matter JD cannot be conferred by consent of the parties.

The court may deal with a conflicts problem, by:

FACTS: Eugene Perkins filed a complaint against Benguet Consolidated for the recovery of declared dividends, but Benguet withheld payment upon the opposing claim of Idonah Perkins, wife of Eugene. Idonah sets up a NY  judgment declaring her to be the sole owner of the Benguet shares and allege that such  judgment is res judicata. HELD: The CFI has jurisdiction over the case, despite the presence of the NY judgment. Whether or not the trial  judge in the course of the proceedings will give validity and efficacy to the NY judgment set up by Idonah in her crosscomplaint is a question that goes to the merits of the controversy and relates to the rights of the parties as between each other, and not to the jurisdiction of the court. The fear that the trial judge may render judgment annulling the final  judgment of the NY court is not a ground to deny the lower court of JD. The test of JD is whether or not the tribunal has 5

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1)

dismissing the case for lack of jurisdiction or on the ground of forum non conveniens 

2)

assuming jurisdiction and applying either forum or foreign law

Doctrine of Forum non Conveniens This doctrine requires the court to dismiss the case on the ground that the controversy may be more suitably tried elsewhere. This phrase literally means ―the forum is inconvenient.‖

Reasons for applying forum non conveniens: 1)

to prevent abuse of the court‘s processes (prevent harassment of defendant, dissuade a non-resident

plaintiff from choosing the forum because of larger jury verdicts, etc.)

in NY in behalf of the victims. Union carbide moved to dismiss on the ground of forum non conveniens.

2)

burdensome on the court or taxpayers (severe backlog of cases)

3)

local machinery is inadequate to effectuate a right (no way for court to secure evidence and attendance of witnesses)

HELD: Indian courts have JD, not US courts. Even if UCC has domicile in the US, this loses significance because it gave its consent to Indian JD. Moreover, the findings of the court show that the proof bearing on the issues to be tried is almost entirely located in India (principal witnesses and documents, detailed designs, implementation of plans, safety precautions, etc.).

4)

avoid global forum shopping

English and Scottish courts have applied FNC when there  was ―another av ailable and more appropriate forum, in  which the ends of justice would be better served in view of the interests of all parties, by eliminating the vexatious or oppressive character of the pending proceedings and by removing any unfairness to either party which would result from trial in the forum seized of the case.‖

FACTS: Syyap failed pay Wing On, a NY-based partnership, its obligation for a contract of purchase of clothing material. Wing On filed an action in the Philippines against Syyap, but Syyap contends that the trial court should have declined JD on the ground of forum non conveniens.

FACTS: An action for recovery on life insurance policies made and issued in Germany was filed by German citizens in Oregon against a NY corporation.

HELD: Forum non conveniens is inapplicable. Unless the balance is strongly in favor of the defendant, the plaintiff‘s choice of forum should be rarely disturbed, and furthermore, the consideration of inadequacy to enforce the  judgment, which is one of the important factors to be considered in the application of said principle, would precisely constitute a problem to the plaintiff if the local courts decline to assume JD on the basis of said principle, considering that defendant is a resident of the Philippines.

HELD: The Oregon court may refuse to exercise JD. The courts of Germany and New York are open and functioning and competent to take JD of the controversies, and service can be made upon the defendants in either of such JDs. To require the defendants to defend the actions in Oregon  would impose upon them great and unnecessary inconvenience and expense. The courts of this country are established and maintained primarily to determine controversies between its citizens and those having business there, and manifestly the court may protect itself against a flood of litigation over contracts made and to be performed in a foreign country, where the parties and witnesses are nonresidents of the forum, and no reason exists why the liability, if any, cannot be enforced in the courts of the country where the cause of action arose, or in the state  where the defendant was organized and has its principal offices.

FACTS: An industrial disaster in a chemical plant of Union Carbide in Bhopal, India caused deaths and injuries to a number of residents. India enacted the Bhopal Gas Leak Disaster Act, which authorized the government (Union of India) to represent the victims. The UOI filed a complaint

There is no existing catalogue of circumstances that will  justify sustaining a plea of forum non conveniens   but, in general, both public and private interests should be weighed.  When the forum is the only state where JD can be obtained over the defendant and, in addition, some relation with the parties exists or when the forum provides procedural remedies not available in another state, the forum court may not resist imposition upon its JD.

HELD: While it is within the discretion of the trial court to abstain from assuming JD on the ground of forum non conveniens, it should do so only after vital facts are established, to determine whether special circumstances require the court‘s desistance; and the propriety of dismissing a case based on this principle of forum non conveniens  requires a factual determination, hence it is more properly considered a matter of defense. The SC also held in Philsec. Investment vs. CA that the doctrine of FNC should not be used as a ground for a motion to dismiss because Sec. 1 Rule 16 of ROC does not include said doctrine as a ground.

Forum non conveniens: 1) prevent abuse of court processes 2) burdensome on the court/taxpayers 3) prevent global forum shopping 

FNC is not something that automatically applies; its application rests in the sound discretion of the court

in Wing On vs. Syyap. Prof. Pangalangan does not agree with the holding that ―unless the balance is strongly in favor of the defendant, the plaintiff‘s choice of f orum should rarely be disturbed‖, because in the first place, it was the  who chose that forum.  plaintiff   _______________ 

 When the court assumes JD, it may apply forum law or foreign law, although forum law should be applied whenever there is good reason to do so because the forum law is the basic law.

Factors which justify the application of internal law: FACTS: The spouses Litonjua are engaged in the shipping business; they executed a contract where Bank of America  was made the trustee of their businesses. But the bus inesses suffered losses in the hands of the bank, so the spouses filed a case for damages for breach of trust and accounting of revenues in the Philippines. Bank of America filed a Motion to Dismiss on the ground of forum non conveniens.

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1)   A specific law of the forum decrees that internal law should apply

Examples of this are Art. 16 of Civil Code ( lex nationale governs testate and intestate succession of the person whose succession is under consideration); Art. 829 of the Civil Code (revocation of wills outside RP); and Art. 819 (prohibition on joint wills by Filipinos).

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Example: prohibitory or mandatory laws of the forum

2) 

The proper foreign law was not properly  pleaded and proved

Our courts may not take judicial cognizance of any foreign law; hence, failure to plead and prove foreign law leads to the presumption that it is the same as forum law. 

a) b)

her counsel. In addition, the other heirs do not dispute the provisions of the Nevada law. Under these circumstances, the pertinent laws of Nevada can be taken judicial notice of by the court, without proof of such law having been offered at the hearing of the project of partition.  As the validity of the testamentary dispositions are to be governed by the national law of the testator, the order of the court approving the project of partition in accordance with Nevada law must be affirmed.

Under the Rules of Court, the foreign law may be proved by: official publication certification form the officer with official custody, under seal, and the Phil. Embassy must certify that such officer has official custody, etc.: that it is the law in force at the time etc., etc.

3) 

The case falls under any of the exceptions to the application of foreign law

a)

The foreign law is contrary to an important public policy of the forum The foreign law is penal in nature The foreign law is procedural in nature The foreign law purely fiscal or administrative in nature The application of the foreign law will work undeniable injustice to the citizens of the forum The case involves real or personal property situated in the forum The application of the foreign law might endanger the vital interest of the state The foreign law is contrary to good morals

b) c) d)

FACTS: Fleumer, the special administrator of the estate of Hix, appealed the denial of the probate of Hix‘s will, alleging that since the will was executed in West Virginia by a resident therein, West Virginia law should govern.

f) g) h)

HELD: The courts of the Philippines are not authorized to take judicial notice of the laws of the various States of the  American Union. Such laws must be proved as f acts. Here the requirements of law were not met. There was no showing that the book from which an extract was taken was printed or published under the authority of the state of West  Va. as provided in the Code of Civi l Procedure; nor was the extract from the law attested by the certificate of the officer having charge of the original.

theories that emphasize simplicity, convenience and uniformity a.

vested rights theory

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advanced by Prof. Beale (1  Restatement) an act done in a foreign jurisdiction gives rise to a right if the laws of that state provides so. The right  vests and he can bring suit in any forum he chooses. The forum refers law of the place of the ―last act‖  necessary to complete the cause of action. (place of injury) If place of the last act creates no legal right, although forum court creates such right if act is done within its territory, it will not enforce the right.

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FACTS: Wife (W) sued husband (H) for damages in New Hampshire where they are residents. Accident happened in Maine. Maine bars suit between spouses.

1)

The factors that justify exercise of judicial  jurisdiction maybe the same factors used to determine choice of law

2)

HELD: The law of Nevada, being a foreign law, can only be proved in our courts in the form and manner provided for by our Rules. However, it has been found that during the hearing for the motion of the widow Bohanan for withdrawal of her share, the foreign law was introduced in evidence by

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st 

e)

FACTS: The will of Bohanan was admitted to probate; in the probate he was declared to be a citizen of Nevada. In the hearing for the proposed project of partition, Nevada law  was not introduced. Bohanan‘s widow questioned the  validity of the will under Philippine law; however, if Nevada law was to be applied, the will would be valid.

Ideally, the object of all choice of law theories must be  justice and predictability.

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if the forum applies its internal law because it has a real interest, the outcome of the case  will be foreordained by the forum plaintiff will choose forum who has real interest in applying its internal law 3)

generally, forum will apply its internal law so plaintiff will bring suit where internal law is favorable to him

BUT these are 2 diff. concepts. A court may exercise  jurisdiction but apply foreign law or not exercise jurisdiction but the state‘s internal law will be applied. 7

HELD: The effect of the prohibition in Maine is to divest the W of any cause of action against H. If there is a conflict between lex fori and lex loci, lex loci governs in torts in respect to the legal effect and incidents of the act. The status as spouses is determined by New Hampshire law but the incidents of that status is governed by the law of the place of the transaction (Maine).

FACTS: Carroll is an employee of Alabama RR. Both are residents of Alabama. C was injured in the course of work bec. of negligence of co-EE in Mississippi. Mississippi bars recovery. Alabama makes employer liable. Suit is filed in  Alabama.

HELD: There can be no recovery in one sate for injuries to the person sustained in another unless the infliction of the injuries is actionable under the law of the state in which the injuries were received.  Although it is claimed that the negligent conduct was done in  Alabama, the injury sustained creates the cause of action and not the negligence. (law of the place of injury) Criticisms to the Approach: failure to resolve conflicts cases  with considerations of policy and fairness.

i. ii. iii. iv.  v.  vi.  vii.

b.

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needs of the interstate and intl system relevant policies of the concerned states relevant policies of other interested states protection of justified expectations of the parties basic policies underlying the particular field of law certainty, predictability and uniformity of result ease in the determination and application of law to be applied

Cook‘s Local Law Theory

treat conflicts cases as a purely domestic case that does not involve a foreign element power of a state to regulate within its territory has no limitation except as imposed by its own positive law criticism: appeals to narrow-mined who favors an exaggerated local policy bec a sovereign can do as they please, depreciating the practical and equitable considerations that should control the case.

Examples of application: i.

ii.

torts –  place of injury, place of tortious conduct, domicile, residence or nationality of parties, place where relationship is entered contracts –  choice of law of the parties, place of contracting, place of performance, domicile, residence, nationailty, place of incorporation and place of business

FACTS: Barnes & Haag had an affair in NY. H became pregnant. After giving birth, H went to Chicago. Parties entered into a support agreement in Chicago. The agreement contained a choice of law clause (Illinois). H & child went back to live in NY. H filed support action in NY against B. Under NY law, agreement is not binding. B‘s defense: Illinois agreement bars suit. HELD: Suit is barred by the prior support agreement. Court found that Illinois has the most significant contacts. It is what the parties intended to apply, the place of performance, the place of business of B & the agents and the place where support are being made compared to NY whose contacts are of less weight & significance. (place of liaison & residence of H & child) Criticisms to approach: no standard to evaluate the relative significance/importance of each contact such that court may use approach to support any preconceived result without explaining its real motives. b.

c. Caver‘s Principles of Preference

-

-

-

choice-of-law decisions should be made with reference to principles of preference which are conceived to provide a fair accommodation of conflicting state policies and afford fair treatment to the parties. Caver‘s principles have a territorialist bias; it looks to the place where the significant events occurred or where the legal relationship is centered. Court should: 1) scrutinize the event/ transaction giving rise to the issue 2) compare carefully the proffered rule of law & the result of its application with the rule of the forum & its effect 3) appraise these results from the standpoint of  justice between the litigants or of considerations of social policy

a. Place Relationship

of

the

Most

Significant

FACTS: Spouses were married and lived in England. H left and went to NY. Spouses executed support agreement in NY. H failed to pay support. W sued H for legal separation.  W s ued in NY to enforce agreement. H claimed that l egal separation suit, extinguished liability under NY law. HELD: English law should govern the parties. England has all the truly significant contacts while the nexus to NY is entirely fortuitous. England is the seat of marital domicile and the place where  W & children were to be, it has the greatest concern in defining and regulating the rights and duties existing under the agreement and the circumstances that affect it. Whereas NY is only the place of the agreement and where the trustee,  where moneys will be paid for the account the W & children, had his office. In applying the ―grouping of contacts‖ theory, courts, instead of regarding as conclusive the intention of the parties or the place of making or performance, lay emphasis rather on the law of the place which has the most significant contacts with the matter in dispute.

-identifies a plurality of factors: 8

-

Interest Analysis

resolve conflicts cases by looking at the policy behind the laws of the involved states and the interest each state has in applying its own law. Tasks of the court: 1 : determine whether the case involves a true, false or apparent conflict   (false conflict: only one state has an actual interest in having the law applied and the failure to apply the other state law  will not impair its policy) 2  : if there is apparent or true conflict, court should take a second look on the policies and interests of the states.  If only one has a real interest, the other is insubstantial, then there is false conflict. If both have real interests in applying their law, then the apparent conflict is a true conflict. st 

nd 

FACTS: Babcock & Jackson, NY residents, met a car accident in Ontario thru J‘s fault. B sued J in NY for damages. Ontario bars recovery under a guest statute. NY does not have a similar rule.

HELD: B should be allowed to recover. NY had a greater & more direct interest than Ontario. NY‘s policy is to afford compensation to a guest against tortfeasor host while Ontario‘s policy is to prevent fraudulent collusion to the prejudice of Ontario defendants-insurance companies. Thus, Ontario had no interest in denying a remedy to a NY guest against a NY host. The rule on tort claim is:  Where the issue involves standard of conduct, law of the place of the tort is controlling, but as to other issues, court must apply the law of the state which has the strongest interest in the resolution of the issue presented. Criticisms to Approach:   not all state legislatures publish reports that explain the background and purpose of the laws, thus court is left to speculate on the purpose of the law and not all reflected policy or had a purpose other than to decide cases.



Pangalangan on Interest analysis: why consider  what the state wants when interes ts of individuals are in issue?

c.

-

-

-

HOW? Court should consider whether the law of a state reflects an ―emerging‖ or ―regressing‖ policy. e.

Leflar‘s Considerations

Choice-Influencing

5 major choice-influencing considerations 1)  of results 2) maintenance of interstate and int ‘l 3)  of the judicial task 4) application of the 5) advancement of the forum‘s

-

-

court should prefer a law that make good socioeconomic sense and are sound in view of present day conditions Criticism: no principled or objective standard to determine ―better rule‖.

Traditional approaches do not consider policy; all modern approaches look at policy. ______________

Trautman‘s Functional Analysis

this approach looks into: 1) the general policies of the state beyond those reflected in substantive law 2) policies and values reflecting effective and harmonious relationship between states ex. Reciprocity, advancement of multistate activity, protecting justifiable expectations, evenhandedness and effectiveness. after determining these policies, court should then  weigh the relative strength of a state policy

 Art 16: Real property as well as personal property is subject to the law of the country where it is situated.

However, intestate and testamentary succession, both with respect to the order of succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions shall be regulated by the National law of the person whose succession is under consideration,  whatever may be the nature of the property and regardless of the country wherein said property may be found. (  Art 17: The forms and solemnities of contracts, wills, and other public instruments shall be governed by the laws of the country in which they are executed.

 When the acts referred to are executed before the diplomatic or consular officials of the Republic of the Philippines in a foreign country, the solemnities established by Philippine laws shall be observed in their execution. Prohibitive laws concerning persons, their acts or property, and those which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country. The rules specify geographical location in accordance with traditional approach. The problem with this: inherent rigidity, unjust decisions.

Comparative Impairment

subordination of the state objective which would be least impaired How? Court should weigh conflicting interests and apply the law of the state whose interest would be more impaired if its laws were not followed

d.

-

Solution: Characterization, Renvoi , Escape devices Single-aspect method: choice of law theories traditionally concentrated on one element of a situation to connect case to particular legal community. Goal: simplicity, convenience, uniformity Multi-aspect method: modern approach by which all important factors (non/territorial) are analyzed.

The applicable law is arrived at by elaborating policies & purposes underlying rules, and the needs of international intercourse. Goal: just resolution of case The Philippines follows single-aspect method. Our conflicts rules are mostly found in the Civil Code.  Art 15: Laws relating to family rights & duties, or to the status, condition and legal capacity of persons are binding upon citizens of the Philippines, even though living abroad. 9

Characterization: the process by which a court assigns a disputed question to an area in substantive law. It is a part of legal analysis and a pervasive problem since at least 2  jurisdictions with divergent laws are involved.

Two Types of Characterization:

This calls for classification of a factual situation into a legal category. It is significant in a single-aspect method because the legal category to which an issue is assigned determines governing law

FACTS: Spouses Allison & Eva were residents & citizens of California owning parcels of land in Manila. Eva died.

 Allison, as administrator files petition to declare lands in his favor pursuant to California law. California Civil Code provides that upon wife‘s death previous to husband , community property belongs absolutely to husband. HELD: California Civil Code will not apply. The law of the place where land is situated governs its descent, alienation &transfer & for the effect & construction of wills & other conveyances.  As mandated by Philippine law, the lands were acquired as community property in the conjugal partnership. The wife  was vested with a title equal to that of her husband. Upon her death, if there are no obligations of the decedent, her share in the conjugal property is transmitted to the heirs by succession.

Though the court was silent on the matter of characterization, it had the task of categorizing the issue as one involving: b) property to be governed by lex situs , or c) succession to be governed by decedent‘s national law (California) Characterization problems are considered a threat to traditional choice-of-law theories whose aims are uniformity & predictability of results. Problems:  A) C, is adopted in the Philippines by a former Filipino citizen and moves to the US with her adoptive mother, M. By M‘s laws, C will not be an heir. Will C be entitled to an intestate share in M‘s estate?

2. Tortious: law of the place where tortuous conduct or injury occurred

Directs the court to the extent it will apply foreign law. If issue substantive : court may apply foreign law If issue procedural : follow forum law

B) Principal authorizes a person to act as his agent in another country. Agent commits a negligent act. What law  will determine the principal‘s liability? It depends on the court‘s characterization of the case as: 1. Contractual: law of the place where the contract of agency was entered into; or

The reaction to Grant was generally negative. It was criticized as being based on an erroneous characterization greatly influenced by ―sympathy‖. Other view: Correct result but arrived at using dubious method.

Why apply forum law to matters of procedure?

One of the main goals of a rational system of CL rules: Rights & Duties of parties arising from a legal situation shall not be substantially varied because the forum in w/c action is brought. Courts of all civilized states now seek to protect parties, by referring to foreign law, against a substantial change of position because of fortuitous circumstance that suit was brought in that forum. The means provided for compulsion, or the limitation upon compulsion are in most cases of equal practical importance to the declaration of the validity of the plaintiff‘s claim. Such all inclusive reference to foreign law is never made. It  would be too burdensome on the part of the forum and administration of justice will be delayed. Thus, it is necessary to limit the scope of reference to foreign law. This limitation excludes phases of the case which make the administration of foreign law inconvenient or violative of local policy. In such instances, local rules of the forum are applied & are classified as matters of procedure.

The court would have to decide whether it is a Q relating to 1. Legality & effects of adoption: law of state where legal relationship of adoption was established or where the adoption decree was granted shall govern; or 2. Succession: adopter‘s personal law shall prevail

 wrong resulting to a physical injury shall not abate because of the death of the wrongdoer. Plaintiff‘s cause of action survives Pullen‘s death.

FACTS: Plaintiffs, Grant, et al., (California residents) were injured in Arizona when their vehicle collided with that of The Pullen‘s (California resident), who died of accident. suit against estate of Pullen filed by Grant to recover damages was dismissed because under Arizona law- ―a tort action not commenced before the death of the tortfeasor must be abated‖. But under California law, an action for tort survives the death of tortfeasor. HELD: Survival statutes are procedural. Thus, California (forum) law applies. Forum law governs if issue is procedural. Under California Civil Code the action out of a 10

Currie: The court availed of one of several escape devices characterization. It characterized the problem differently, such producing the result previously recognized as the sound result. This device is not ideal. It is better if courts could expressly state the considerations that helped them determine the results and indicate clearly how these considerations will be used in other cases. No objective standard has been suggested. An attempt to explain the court decision in terms of ―demands of justice‖ or ―social policy‖ would   create uncertainty & arouse criticism. Procedural issues are governed by forum law so that the court will not be unduly burdened by task of studying peculiarities of another legal system. It must be noted, though, that some matters cannot be clearly defined as procedural or substantive.

Two Issues whose classification substantive) is debatable:

(as

procedural

or

1) Statute of Frauds It is considered substantive if words of law relate to forbidding the creation of obligation. One that forbids the enforcement of the obligation is characterized as procedural Marie vs. Garrison:  Defendant maintains that the NY Statute of Frauds affects the remedy upon a contract w/in its terms—a rule prescribing evidence & deemed a rule of procedure. Garrison claims that rules of the forum must be followed. Marie claims that NY law was constructed as a rule of substance going into existence of contract; determined by lex loci contractus .

Issue: Whether a contract declared ‗void‘ by a stature still subsists as a contract w/ the only effect of depriving party of a remedy or mere evidence. Held: It was a word of substance because the statute provided that the contract of sale of any interest in land shall be void unless it was in writing ex contrario to a law stating that ‗no action shall be brought‘ of the requirement was not complied with.

of treating the foreign statute of limitation as one of substance. Under the ROC of the Philippines, it is provided that ―if  by the laws of the state or country where the cause of action arose, the action is barred, it is also barred in the Philippines.‖ The Bahrain law on prescription should apply. However, it cannot be enforced as it would contravene the public policy on the protection to labor. Philippine law will then be applied.

HELD: The law of the domicile ought to be applied in any issue of incapacity to sue based upon family relationship. The policy reason for denying the capacity to sue (preventing family discord) more properly lies within the sphere of family law, where domicile usually controls the law to be applied, than it does tort law, where the place of the injury generally determines the substantive law which will govern.

2) Statutes of Limitations (SL) & Borrowing Statutes

Statutes of limitations are traditionally classified as ‗procedural‘ because they only barred the legal remedy  w/out impairing the substantive right involved. Thus, a suit can still be maintained in another JD w/c has a longer SL. However, certain SL‘s have been classified as substantive for conflicts purposes if providing a shorter period for certain claim types falling w/in wider class covered by the general SL. Specificity test:  to determine whether an SL is substantive or procedural.

 An SL of a foreign country is treated as ―substantive‖ when limitation was directed to newly created liability so specifically  as to warrant saying that it qualified the right

Borrowing statutes Purpose: Many states, the Philippines among others, have passed borrowing statutes to eliminate forum-shopping.

However, in the case of Cadalin , the court said that to enforce the borrowed statute would contravene public policy on protection of labor.

FACTS: Cadalin et al. instituted a class suit with the POEA for money claims arising from their recruitment by AIBC and BRII for pretermination of employment contracts. Under Bahrain law where some of the complainants were deployed, the prescriptive period for claims arising out of a contract of employment is one year. HELD: Even though a law on prescription may be considered as substantial or procedural, its characterization as either becomes irrelevant when the country of the forum has a ―borrowing statute.‖ Said statute has the practical effect

From depecer, which means ―to dissect .‖ Different aspects of a case involving a foreign element may be governed by different systems of laws.  Von Mehren & Trautman: A man dies intestate domiciled in state A & w/ movable properties in State B. How will the man‘s estate be divided? State A conflict rules refer to laws of domicile. Intestate law of State B gives the widow a definite share in the estate of deceased. But the determination of WON the woman claiming the share is a ―wife‖   is referred to family law, not laws on succession.

The court decided that the law of the place of accident (California) governed the issue of negligence while  Wisconsin law governed the issue of interspousal immunity. The characterization process was taken one step further by not limiting the classification to the case itself but likewise, to the issue arising from the case. The 1969 Restatement 2d adopted depecage   & set out a number of factors to be considered in choosing the applicable law: a.

needs of interstate & international system

b.

relevant policies of the forum

c. Issues of law governing movable properties & successional rights of spouse are of primary importance, embodying substance of claim. Validity of marriage ‗affects solution because it answers a preliminary or incidental Q.

relevant policies of other interested states & the relative interests of those states in the determination of a particular issue

d.

protection of the justified expectations of the parties

The presence of an incidental Q is one instance which calls for the employment of depecage .

e.

the basic policies underlying the particular field of law

f.

certainty, predictability, uniformity of results, and

g.

ease in determination & application of law to be applied

Merits of Depecage:  This technique allows other relevant interests of parties to be addressed. Thus, it permits courts to arrive at a functionally sound result w/out rejecting the methodology of the traditional approach. This nuanced single-aspect method employs depecage  by choice.

The consideration of any elements & acceptance by courts of depecage  help ease restrictions of single aspect method.

FACTS: Haumschild and Gleason were married in  Wisconsin, their domicile. Haumschild was injured in California while riding a motor truck driven by Gleason. Their marriage was later annulled. An action for recovery of damages was filed by Haumschild in Wisconsin. Continental alleges that under California law, a spouse is immune from suit by the other spouse. 11

Courts not compelled to apply entire law to all aspects of case…that might produce egregious results.  Cutting up the case issue by issue is fair & reasonable. But even if a useful tool in modern choice-of-law analysis, the express reference to depecage   in case law, both in US & the Phil still uncommon.

2)

Renvoi  –  a procedure whereby a jural matter presented is referred by the conflict of laws rules of the forum to a foreign state, the conflict of laws rule of which, in turn, refers the matter to the law of the forum or a third state. Remission: reference is made back to the law of the forum Transmission:  reference to a third state Renvoi has been employed in cases where the domiciliary and nationality laws are applied to the same individual in issues involving succession, domestic relations and real properties. Renvoi:

State A (RP)

State B

 Art. 16 CC

Internal law Conflict-oflaws rule

4 Ways of Dealing with the Problem of Renvoi (Prof. Griswold):

1)

if the conflicts rules of the forum court refer the case to the law of another state, it is deemed to mean only the ―internal‖ law of that state (internal law: that which would be applied to a domestic case that has no conflict-of-laws complications) – rejects the renvoi 

the court may accept the renvoi   and refer not just to another state‘s ―internal‖ law but to the ―whole‖ law (includes choice-of-law rules applicable in multi-state cases)

FACTS: The will of Edward Christensen, a domiciliary of the Philippines, was admitted to probate, and a project of partition was proposed. Edward‘s illegitimate child opposed the project of partition on the ground that the distribution of the estate should be governed by Philippine law. The lower court found that Edward was a US citizen; hence the successional rights and intrinsic validity of the will should be governed by California. HELD: Philippine law should apply. Art. 16 of the Phil. Civil Code provide that the national law of the decedent governs the validity of his testamentary dispositions. Such national law means the law on conflict of laws of the California code, which authorizes the reference or return of the question to the law of the testator‘s domicile.  The conflict of laws rule in California precisely refers back the case, when a decedent is not domiciled in California, to the law of his domicile (the Philippines in the CAB). The Phil. court must apply its own law as directed in the conflict of laws rule of the state of the decedent.

3)

by desistance or mutual disclaimer of JD –  the same result as the acceptance of the renvoi doctrine but the process used by the forum court is to desist applying the foreign l aw.

4)

―foreign court‖ theory –  the forum court would assume the same position the foreign court would take were it litigated in the foreign state

Disadvantage to renvoi:   if both courts follow the same theory, there would be no end to the case since the courts  would be referring it back to each other. It gives rise to situations that have been invariably described as resembling ―revolving doors,‖ a ―game of lawn tennis,‖ a ―logical cabinet of mirrors‖ or a ―circulus inextricabilis.‖ 

FACTS: The testatrix, a British subject, was a domiciliary of France according to British law, but not according to French law. She made a will in English form. In the will she 12

disposed of all her property in favor of her daughter, and stipulated that she had no intention of abandoning her domicile in England. If she was a domiciliary of France, she could only dispose of 1/3 of her personal property. HELD: The domicile of the testatrix at the time of her death  was French. Applying English law, the fact of her residence in France coupled with animus manendi   showed her intention to abandon her English domicile even if she had not complied with the formalities required under French law to become a French domicile.  According to French municipal law, the law applicable in the case of a foreigner not legally domiciled in France is the law of that person‘s nationality, which is British. But British law refers the question back to French law, the law of the domicile. And according to French law, the French courts, in administering the movable property of a deceased foreigner who, according to the law of his country is domiciled in France, and whose property must, according to that law, be applied in accordance with the law of the country in which he was domiciled, will apply French municipal law, even if he had not complied with the French requirements for acquisition of domicile.

Options which the forum court may do: a) accept the renvoi (apply forum law) b) reject the renvoi (apply the internal law of the foreign state) c) desistance/mutual disclaimer d) ―foreign court‖ theory  the difficulty with the foreign court theory is that the forum court will have to anticipate or guess how the foreign court will act.  Renvoi is optional , based on the discretion of the court and the facts of the case. _______________

Renvoi has been used to avoid unjust results.

FACTS: Mr. and Mrs. Price executed a trust deed and promissory notes in favor of University of Chicago, for a loan secured by Mr. Price and Mr. Dater. They were residents of Michigan; the mortgage and the notes were also

signed there and sent by mail to Chicago. In a suit filed by the University in Michigan against the spouses Dater and Mrs. Price (Mr. Price having died earlier), the court ruled that there was no cause of action against Mrs. Price, because under Michigan law a married woman has no capacity to enter into an obligation such as this, hence the note and trust deed were void. The question is which law should be applied, Michigan or Illinois law. HELD: Under the law of Illinois, the capacity of Mrs. Price is governed by Michigan law (as held in the similar case of Burr vs. Beckler , where the court said that since the contract  was completed in Florida, that stat e governed her capacity to contract). In this case, the contract was complete in Michigan, and it governs her capacity to contract. Since she  was not competent to contract un der Michigan law, her note and trust deed were void.

In the Dater decision, Michigan protected the interest of a Michigan wife especially since Illinois disclaimed any desire in applying its law. Also, uniformity of results was promoted in spite of discrepancies in the choice-of-law rules of the involved states. With renvoi , the Dater decision was made dependent on substantive law and not on the incidental law of the forum.

Objections to Renvoi

Critics: 1)

renvoi  would place the court in a ―perpetually enclosed circle form which it would never emerge and that it would never find a suitable body of substantive rules to apply to a particular case.‖ The theoretical problem presented is that renvoi  is  workable only if one of the states rejects it and that it achieves harmony of decisions only if the states concerned do not agree on applying it the same  way.

Griswold: the objection is based on a false premise; as long as remission is to the state‘s internal law alone there will be a stop to the ―endless chain of reference.‖ 2)

Courts may be unnecessarily burdened with the task of identifying the choice-of-law rules of another state.

Pangalangan: from a practical perspective, the forum court  will not use renvoi   if, in the first place, it cannot ascertain  what the conflict-of-law rules of the foreign state are.

reference back (renvoi ) to Philippine law, but would still refer to Texas law. Inapplicability of Renvoi in a False Conflict

US Restatement (Second) of Conflict of Laws: renvoi   to be used when there is a disinterested forum, to ensure that only the laws advancing the policies of the interested states will be applied. If the choice-of-law rules of the state to which reference is made refers the case back to the forum state, the court may use this situation to determine if both states have an interest in having their laws applied or if there is merely a false conflict.

It is the party whose cause of action or defense depended upon the foreign law who has the burden of proving the foreign law. Foreign law is treated as a question of fact that should be properly pleaded and proved

FACTS: Trent (a New Jersey domiciliary) agreed to drive Pfau (a Connecticut domiciliary) to Missouri. While in Iowa, they had a vehicular accident causing injuries to Pfau. Pfau filed suit in New Jersey against Trent Aluminum Co. (registered owner of the car) for the damages he sustained  while a passenger in Trent‘s car. The defense of Trent  Aluminum was that Iowa law is applicable, which provides that the host-driver is not liable to his passenger-guest for ordinary negligence. HELD: Connecticut and New Jersey law both allow passenger-guest recovery. It appears that Connecticut‘s substantive law allowing a guest to recover form his host‘s ordinary negligence would give it a significant interest in having that law applied to this case. Since Iowa has no interest in this litigation, and since the substantive laws of Connecticut and New Jersey are the same, this case presents a false conflict   and the Connecticut plaintiff should have the right to maintain an action for ordinary negligence in New  Jersey.

FACTS: The probate of the will of Texas citizen and domiciliary Amos Bellis was opposed by his 3 illegitimate children in the Philippines for depriving them of their compulsory legitime. However, the trial court ruled that under Art. 16 of the Phil. Civil Code, the national law of the decedent is to be applied in testamentary succession. The law of Texas did not provide for legitimes. HELD: Texas law should apply. The decedent was both a national and a domiciliary of Texas, so that even assuming Texas has a conflict of law rule providing that the law of the domicile should govern, the rule would not result in a 13

In the Phils., judicial notice may be taken of a foreign law  with which the court is evidently familiar. (Delgado vs. Republic)  Such familiarity may be because the law is generally known such as American or Spanish Law from  which Phil law was derived or the judge had previousl y ruled upon it in other cases. In US, courts are allowed to take judicial knowledge of the law of sister states.

Foreign law may be proved by presenting either of the ff: 1. an official publication of the law 2. a copy of the law attested by the officer having legal custody of the record or by his deputy. If the record is not kept in the Philippines, it must be accompanied with a certificate that such officer has the custody (by the consular officer of the Phil embassy in said state and authenticated by his seal of office)

Proof of documents executed abroad: any public document executed abroad to be used in the Phils must be duly authenticated by the Phil. consul attaching his consular seal Depositions of non-residents in a foreign country: they may be taken— 1)

on notice before a secretary of embassy or legation, consul general, consul, vice-consul, or consular agent of the Phils.

2)

before such person or officer as may be appointed by commission or under letters rogatory.

3)

before such person which the parties have stipulated in writing

2.

apply law of the forum (courts conclude that by failing to adduce proof, parties acquiesce to the application of the forum law since it is the basic law)

3.

assume foreign law is the same as law of the forum (processual presumption)

First approach: Dismiss the case

FACTS: Case bet. the administrators of the estates of Hodges spouses. W‘s administrator sought the application of Texas law. H‘s administrator also used the Texas law but arrived at a different conclusion. HELD: Case remanded for parties to present proof of the applicable Texas law. The question of what are the applicable laws of Texas is one of fact and not of law. Foreign laws may not be taken judicial notice of & have to be proven like any other fact in dispute between the parties in any proceeding with the rare exception in instances when the laws are within the actual knowledge of the courts, such as  when: a. they are well and generally known b. they have been actually ruled upon in other cases before it and none of the parties claim otherwise

FACTS: In the hearing for the probate of the will of J, alleged to be made in accordance with the laws of Illinois, TC judge took judicial notice of the said foreign law. HELD: Trial court judge erred in taking judicial notice. 





The judge cannot take judicial notice of the acts of the Legislative Department of US particularly the various laws of the American states. Likewise, Phil. courts cannot take judicial notice of the same under ―matters of public knowledge‖. The proper rule is to require proof of the Statute  whenever it is determinative of the issue/s in Phil. courts.

Effects of Failure to Plead and Prove Foreign Law

Forum court may: 1. dismiss the case for inability to establish cause of action

FACTS: Walton, US citizen, was injured in Saudi Arabia. His complaint did not allege the Saudi Arabia law nor did he proved the same during the trial. TC ruled in favor of defendant as he did not take judicial notice of S. Arabian law. HELD: Because of failure to prove the foreign law, plaintiff loses. Plaintiff has the burden of proving the law of Saudi Arabia from which he shall base his claim because under NewYork law, where action was instituted, lex loci delicti   is the substantive la applied in tort cases.  A court abuses its discretion under the New York Civil Practice Act if it takes judicial notice of the foreign law when it is not pleaded esp. when the party who had the burden to  prove the same has not assisted the court in judicially learning it. 

The applicable tort principles necessary to establish plaintiff‘s claim are not rudimentary. In countries where common law does not prevail, these principles may not exist or maybe vastly different.

Second approach : apply forum law, conclude that parties acquiesce to its application.

FACTS Leary instituted this action in New Jersey to recover the loan contracted in France against G. G moved to dismiss on the ground that L‘s proof were insufficient as there is no pleading or proof of the law of France where the transaction occurred. HELD: L can recover despite failure to prove French law.  Altho the court recognizes the fact that France adopts civil law rather than common law principles, the cause of action 14

of L may still be pursued, as there are 3 presumptions that the court may apply in the CAB. These are: 1, French law is the same as law of the forum 2. French law, like all civilized countries, recognizes certain fundamental principles (taking of a loan creates obligation to repay) 3. By failing to prove French law, parties acquiesce to apply forum law The third presumption does not present any difficulties for it to be universally applied regardless of the nature of the controversy. This is more favored by the authorities and has been followed in Sturm v. Sturm. In CAB, Rights of the parties are to be determined by New  Jersey laws which permit recovery on the facts proven.

FACTS: Zalamea filed action for damages against TWA. RTC awarded actual and moral damages. CA denied award of moral damages because there was no fining of bad faith and because overbooking was an allowed practice in US airlines. HELD: CA was wrong. The US law or regulation authorizing overbooking was not proved in accordance with our laws.  TWA relied solely on the statement of its agent that the Code of Fed. Regulations of Civil Aeronautics Board allows overbooking. No official publication of the said code was presented  as evidence.

 Written law maybe evidenced by an official publication thereof or by a copy attested by the officer having legal custody of the record or by his deputy, accompanied by a certificate (made by a Phil. consular officer and authenticated by his seal of office) that such officer has legal custody. Third approach : processual presumption

FACTS: Action for partition of estate of Brimo, a Turkish citizen. Oppositor claims that proposed partition is contrary to Turkish law but he failed to prove & present evidence on the said Turkish law.

HELD: In the absence of evidence on foreign law, they are to be presumed the same as those of the Phils. Oppositor, himself, acknowledges that the foreign law was not proven  when he asked for opportunity to present evidence. He was granted ample opportunity to present competent evidence and there was no GAOD when the court refused to grant him another opportunity.

FACTS: Board sought the deportation of G who is alleged to be an alien. Marriages of G‘s grandfather and of G‘s father all performed in China were not properly proven.

FACTS: A will executed in Amoy by the deceased is sought to be allowed in the Phils. The will was allegedly recorded and probated by a district court in Amoy.

HELD: In the absence of evidence to the contrary, foreign laws are presumed to be the same as those of the Phils. In CAB, there being no proof of Chinese law on marriage, the presumption arises. The Phils. adhere to the presumption of  validity of marriage (A.220 FC) He who asserts the marriage is not valid under our laws bears the burden of proof to present the foreign law.

HELD: Will cannot be allowed. Silvino was unable to adduce the necessary proof under Secs. 1-3 of Rule 78 in order to probate the will in the Philippines, specifically: a. the fact that the municipal court of Amoy is a probate court b. the procedural law of China regarding probate of wills c. the legal requirements for the execution of a valid will  Although there were unverified answers of the Consul General of China, his answers are inadmissible because: a. he does not qualify as an expert on Chinese law on probate procedure (usu. attend to trade matters), and b. if admitted, the adverse party will be deprived of their right to cross-examine him Thus, in the absence of proof, it may be presumed that the probate laws of China are the same as ours and the will in question does not comply with our probate laws.

1.

Only self-serving testimonies were allegedly presented. Also, marriages are claimed to be void according to Chinese law.

HELD: English law cannot be applied. The pertinent English law that allegedly vests in husband full ownership of properties acquired during the marriage was not proved by CIR (petitioner). In the absence of proof, the Court is  justified in indulging in ―processual presumption‖ in presuming that the law of England on the matter is the same as our law.

―public policy‖ : no subject or citizen can lawfully commit any act which has a tendency to be injurious to the public or against the public good. ―public policy technique‖ : court declines to give due course to a claim existing under a foreign law because it considers the nature of the claim unconscionable or its enforcement  will violate a fundamental principle of justice, good morals or some deep-rooted tradition.

dismissal on the ground of public policy is not dismissal on the merits and plaintiff can go elsewhere to file his claim.

In deciding whether to apply forum law or to dismiss the case/rule against the party who failed to prove the foreign law , court must consider the ff: factors

a. b. c. d.

degree of public interest involved accessibility of foreign law materials to the parties possibility that plaintiff is merely forum shopping similarities between forum law and foreign law on the issue involved

1) 2) 3) 4)

FACTS: Spouses Stevenson are British subjects. H dies leaving W as sole heir. CIR assessed estate tax on the whole properties of the spouses because English law does not recognize conjugal partnership.

The foreign law is contrary to an important public policy of the forum

5) 6) 7) 8)

The foreign law is contrary to an important public policy of the forum The foreign law is procedural in nature Issues are related to property ( lex situs ) The issue involved in the enforcement of foreign claim is fiscal or administrative Foreign law or judgment is contrary to Good Morals The application of Foreign law will work Undeniable Injustice to the Citizens of the Forum The Foreign law is Penal in Character The application of the Foreign law might endanger the Vital Interests of the State

FACTS: 2 Filipino stewardess-employees of PIA filed a case for illegal dismissal against their employer in DOLE. PIA‘s defense is that under the contract of employment, the parties agreed that the EE-ER relationship shall be governed by the contract (which provided that Pakistan law shall apply) and not the Labor Code. HELD: Public Interest standard was applied. Pakistan law cannot be invoked to prevent the application of Phil labor laws and regulations to the subject matter of the case. The ER-EE relationship is much affected with public interest, such that otherwise applicable Phil laws and regulations cannot be rendered illusory by the parties agreeing upon some other law to govern their relationship.  Also, PIA did not undertake to plead and prove the contents of the Pakistan law on the matter; it must therefore be presumed to be the same as applicable provisions of Phil law. Criticisms:  courts using public policy exception can disregard the applicable law reached and replace it with forum law to arrive at its desired result without having to provide the rigorous legal analysis required to explain the shift. Courts engage in ―intolerable affectation of superior virtue‖.

These exceptions fall under 3 main categories: 1: when local law expressly so provides 2: when there is failure to plead and prove the foreign law or judgment 3: when the case falls under the exceptions to the rule of comity 15

2.

The foreign law is procedural in nature

Procedural or remedial laws are purely internal matters peculiar only to the State. It would be impractical for the court to adopt the procedural machinery of another state such as rules on venue, forms and pleadings. Any individual

 who submits himself to the jurisdiction of the law of the forum must follow the forum‘s rules of procedure. Problem: courts are tasked to characterize the problem as to  whether it is substantive or procedural law which can be difficult at times, ex. If issue involves statute of limitations or statute of frauds

ex. Hiring for killing, bribery of public officials, marriage between ascendants and descendants

6.

The application of Foreign law will work Undeniable Injustice to the Citizens of the Forum

Law of nationality first used in Napoleon Code, then in  Austrian Code, which said that laws concerning states & capacity govern all cities irrespective of residence.

Merits & Demerits of Nationality as Personal Law Merits:

3.

Issues are related to property (lex situs)

7.

The universally-accepted rule is that as to immovable property, it is governed by the law of the place where it is located.

Statute is not ―penal‖ not by what the statute is called by the legislature but whether it appears, in its essential character and effect, a punishment of an offense against the public.

Phil Civil Code also applies lex situs  to personal property. It also applies to cases of sale, exchange, barter, mortgage or any other form of alienation of property.

Penal statutes are all statutes which command or prohibit certain acts, and establish penalties for their violation and even those which, without expressly prohibiting certain acts, impose a penalty upon their commission. Revenue laws are not classed as penal laws although there are authorities to the contrary.

 WHY? 3 reasons: a. land & its improvements are within the exclusive control of the State & its officials are the ones who can physically deal with them b. following a policy-centered approach, immovables are of greatest concern to the state in which they are situated c. demands of certainty & convenience

This exception is partly remedied under the international law of extradition on the basis of jurisdictional cooperation and assistance.

8. 4.

The issue involved in the enforcement of foreign claim is fiscal or administrative

1) used to establish link b/w individual & state, because laws of each state presumed to be made for an ―ascertained population‖ .

The Foreign law is Penal in Character

The application of the Foreign law might endanger the Vital Interests of the State

-since laws considered physical, moral qualities of citizens, laws should apply to citizens wherever they are 2) an individual‘s nationality is easily verifiable from documents.

Demerits: 1) Problems arise with regard to: a. stateless persons b. persons with multiple nationalities c. states w/ diverse legal systems having no single national law

2)

a person‘s ties to his nation may be so attenuated if he has lived in another country. - unreasonable for his national law to govern him if he has no shared sense of identity.

State is not obliged to enforce the revenue law of another. Revenue laws affect a state in matters as vital to its interests as penal laws. No court ought to hear a case which it cannot prosecute without determining whether these laws are consonant with its own notions of what is proper. Opposition to exception: person should not be permitted to escape his obligations in maintaining the government by crossing state lines.

5.

Foreign law or judgment is contrary to Good Morals

―contra bonos mores ‖ - acts having mischievous or pernicious consequences or against true principles of morality.

Importance of Nationality in the Philippines

Most civil law countries follow the national law theory.

The individual‘s nationality or domicile serves as permanent connection b/w individual & state. Thus, what is assigned him is a personal law allowing courts to exercise jd or determine the governing choice-of-law rule on a specific situation or transaction involving him.

Personal law follows the individual. It governs transactions affecting him most (marriage, divorce, legitimacy, capacity to contract). The need for personal law arose w/ Italian Medieval city states. Domicile was the only relevant basis for personal law. 16

Phil SC: Nationality law theory is a conflict of laws theory by  virtue of which JD over the particular subject matter affecting a person, such as status of a natural born person, is determined by the latter‘s nationality.  Art 15 CC expresses the nationality principle.  Art 15:  ―Laws relating to family rights & duties, or to status, condition & capacity of persons are binding upon citizens of the Philippines even though living abroad.‖ This notion that a person‘s private rights should be determined by his political allegiance & not by his physical

location, owes its origin to the awareness of national identity born in the French revolution, Qualifications for Applicants for Naturalization

Each state has prerogative to determine who are its nationals or citizens by its own municipal law. The Hague Convention on Conflict of National laws: ―It is for each state to determine who are its nationals. This shall be recognized insofar as consistent w/ int ‘l. convention, int ‘l. customs, & the principles of law generally recognized w/ regard to nationality‖.  Art 2. Hague Convention: Question on possession of nationality of a particular state ―shall be determined in accordance w/ the law of that state.

FACTS: Uy was elected mayor of Manticao, but one of the defeated candidates filed a petition for quo warranto, alleging that Uy was a Chinese citizen and therefore ineligible for the office. HELD: Uy is a Filipino citizen, following the citizenship of his mother, who reacquired her Filipino citizenship upon the death of her Spanish husband. A wife reverts to her former status upon dissolution of the marriage by the death of her husband, and where the widowed mother herself thus reacquired her former nationality, her children (she being their natural guardian) should follow her nationality with the proviso that they may elect for themselves upon reaching majority.

1) 

Petitioner must not be less than 21 years of age on date of hearing of petition

2) 

He must have, as a rule, resided in the Philippines for a continuous period of not less than 10 years o

o

a) Who are Filipino citizens? ( Philippine Constitution, Art IV)

1) Those who are citizens of Philippines at time of the adoption of this Constitution 2) Those whose fathers or mothers are citizens of the Philippines 3) Those born before January 17, 1973, of Filipino mothers, who elect Philippine citizenship upon reaching the age of majority; and 4) Those who are naturalized in accordance w/ law

Two principles w/c may be followed:

FACTS: Ong Jr. ran as representative of the 2   district of Samar and was proclaimed the winner. The losing candidates filed election protests, claiming that Ong Jr. was not a natural-born citizen. nd

HELD: Ong Jr. is a natural-born Filipino. He could not have been expected to have formally or in writing elected citizenship upon reaching majority, because he was already a citizen. His mother was a natural-born citizen, and his father  was naturalized when Ong Jr. was only 9 years old. The filing of a sworn statement or formal declaration is a requirement for those who still have to elect citizenship. For those already Filipinos when the time to elect came up, there are acts of deliberate choice which cannot be less binding. Election is both a formal and an informal process, and it has been held that participation in election exercises constitute a positive act of election of Philippine citizenship.

 jus soli:  looks to the law of the place of one‘s birth to determine one‘s nationality (followed in many common law countries).

b) c) d)

e)

Naturalization confers to an alien a nationality after birth by any means provided by the law.

Natural born citizens:   citizens of the Philippines from birth  w/out having to perform any act to acquire or perfect citizenship.

In the Philippines, naturalization is by judicial method, under CA 473, as amended RA 530.

Concept broadened by the Constitution to include ―those born before January 17, 1973, of Filipino mothers, who elect Philippine citizenship upon reaching the age of majority‖.

The naturalization process was relaxed under Marcos‘ regime. Liberal method, summary inquiry. This, however, is no longer in force. 17

When may period be reduced to 5  years?

applicant honorably held office under the Phil gov ‘t. or under any of its political subdivisions applicant has established a new industry or introduced a useful invention in the Phil Married to a Filipino woman Engaged as teacher in a public or recognized private school not for exclusive instruction of children of persons w/ particular nationality in any of the branches of education for a period of 2 years Born in the Philippines

3)  Must be of good moral character, & believe in the principles underlying the Phil Constitution & must have conducted himself in a proper & irreproachable manner during entire period of residence here in his relations w/ the constituted  government as well as w/ the community in w/c he is living o

 jus sanguinis: rule of descent or blood. Followed in the Philippines, articulated in the Constitution.

Why the 10 yr residence requirement? So government can observe applicant‘s conduct & ensure he imbibes principles & spirit of our Constitution.

o

―Proper & irreproachable‖ imposes a higher standard of morality than ―good moral character‖ How to  prove ― irreproachable conduct‖?   By competent evidence such as testimony of 2 character witnesses  well known in community w/ high reputation for probity.

The law requires moral character of highest degree. Being merely a ―law -abiding citizen is inadequate.

4) 

Must own real estate in the Phil worth not less than P5,000, Phil currency, or must have lucrative trade., profession, or lawful occupation

FACTS: Yu Kian Chie, a Chinese national, applied for naturalization, but the Solicitor General opposed the petition on the ground that Yu failed to prove that he had a lucrative income.

excluding from the ban the alien vendee who later becomes a naturalized Filipino o

5) 

Must be able to speak & write English or Spanish & any one of the principal Philippine languages

6) 

Must have enrolled his minor children of school age in any of the public schools or recognized  private schools where Phil history, government & civics are taught or prescribed as part of curriculum during entire period of residence required of him, prior to hearing of his petition for naturalization as citizen.

HELD: The petition should be denied. His true income (outside of allowances and bonuses which are merely contingent) is only P150 a month, which amount does not come up to the category of lucrative, especially considering that he is a married man. What does ―lucrative trade, profession, or lawful occupation‖ mean?  Substantial gainful employment or the obtaining of tangible receipts

 Additional exceptions thru judicia l decis ions have been criticized for inviting violation of the Constitution & disregarding a fundamental policy of allowing no one to reap benefits from an unlawful act.

o

lucrative employment:   appreciable margin of income over expenses in order to provide for adequate support for himself & his family in case of sickness, unemployment, disability to work. o

Requirement of ownership of real property:   At odds w/ Art XII, Sec. 7 Phil Constitution: ―Save in cases of hereditar y succession, no private lands shall be transferred or conveyed except to individuals qualified to acquire or hold lands of the public domain.‖

Exceptions to prohibition on ownership of land : a) Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals qualified to acquire or hold lands of the public domain - Testamentary succession is not covered by the exception provided in the Constitution. b) Sec. 2, BP 185 allowing a naturalborn citizen who lost his Filipino citizenship to be a transferee of a private land for residential purposes (not in excess of 1,000 sq. m. urban or 1 ha rural land) c) SC broadened exception to prohibition by applying In Pari Delicto   doctrine, o

o

o

o

Children must learn & imbibe customs, traditions & ideals of Filipinos so they‘ll become law -abiding citizenship.

3) applicant‘s conduct of keeping wife and children in a neighboring country and only visiting them (lack of sincere desire to embrace Filipino customs and traditions) 4) if it is not fully established that applicant‘s nation grants reciprocal rights to Filipino citizens

The following are the steps for naturalization: a)

a declaration of intention  to become a citizen must first be filed, unless the applicant is exempted from this requirement (Secs. 5 and 6, Com. Act No. 473).

b)

The petition for naturalization must then be filed  (Sec. 8, Com Act No. 473)

c)

 After  publication   in the Official Gazette or newspaper of general publication the petition will be heard  (Sec. 9, Com. Act No. 473 as amended)

d)

If the petition is approved, there will be a rehearing   two years after the promulgation of the  judgment awarding naturalization (Sec. 1, Rep.,  Act No. 530)

e)

The last step will be the taking of the oath of allegiance   to support and defend the Constitution and the laws of the Philippines (Sec. 11, Com. Act No. 473, amended)

Compliance & affirmative showing…otherwise, denied.

Non-compliance because of insufficient finances: denied

Disqualification for Naturalization General Rule: Burden of proving disqualification is upon the state.

But SC held that petitioner must prove he has none of disqualifications. The law must be strictly construed against applicant because naturalization is a privilege, not a right.

Possible causes for Disqualification: 1) crime involving moral turpitude (act of bareness,  vileness, depravity in private and social life in general; contrary to conduct of honesty, modesty or good morals) 2) if applicant does not deal with and receive Filipinos in his home and visit Filipino homes in a spirit of friendship and equality without discrimination 18

Declaration of Intention

 When: One year before petition is filed  With whom: File with office of the Solicitor General How: Declaration under oath of bona fide intention to become Philippine citizen

Exemptions to Filing of Declaration of Intention: 1)

persons born in the Philippines and who have received their primary and secondary education in public or private schools recognized by the Government, and not limited to any race or nationality

2)

3)

those who have resided continuously in the Philippines for a period of thirty years or more before filing their application the widow and minor children of an alien who declared his intention to become a citizen of the Philippines and dies before he is actually naturalized.

Requirement is mandatory, absolute prerequisite to naturalization. Failure is fatal. Void for noncompliance with law. Watt vs. Republic: In cases where petition is exempt, statement to his exemption and reasons should appear on the petition so the public maybe prepared to object to any evidence on this regard.

 Which court has jurisdiction? RTC of province has exclusive jurisdiction on which petitioner has resided for at least one year immediately preceding filing of person.

Effect of Naturalization on Wife and Children

Section 15, C.A. 473 states that:: ―Any woman  who is now or may hereafter be married to a citizen of the Philippines, and who might herself be lawfully naturalized shall be deemed a citizen of the Philippines. Minor children of persons naturalized under this law who have been born In the Philippines shall be considered citizens thereof.  A foreign-born minor child, if in the Philippines at the time of naturalization of the parent, shall automatically become a Philippine citizen, and a foreign-born minor child, who is not in the Philippines at the time the parent is naturalized, shall be deemed a Philippines citizen only during his minority, unless he begins to reside permanently in the Philippines when still a minor, in which case, he will continue to be a Philippine citizen even after becoming of age.  A child born outside of the Philippines after the naturalization of his parent shall be considered a Philippine citizen, unless within one year after reaching the age of majority, he fails to register himself as a Philippine citizen at the American Consulate of the country where he resides, and to take the necessary oath of allegiance.‖

FACTS: Chinese wife, Chua and her minor children arrived in the Phils from Hkong. Her husband applied for naturalization in the Phils. Wife and children applied for indefinite extension of stay. Sec of Foreign Affairs allowed the change of their status from temporary visitors to special non-immigrants for 2 years. Commissioner of Immigration refused their extension. The Foreign Affairs Sec. denied their appeal and they were advised to leave the Phils. Chua filed action for mandamus to implement the first ruling of the Secretary but this was denied. Chua efilled alleging that her husband will be granted Filipino citizenship so they were also due for eventual conversion.

HELD: The wife, under Sec. 15 of the Revised Naturalization Law, will not automatically become a Filipino citizen upon her husband‘s naturalization as she must still show that she possesses all the qualifications and none of the disqualifications for naturalization. But her having misrepresented that she will stay for a brief period but her intention was really to stay for a long time, demonstrated her incapacity to satisfy the qualifications under Sec. 2 which provides that she must be of good moral character and must have conducted herself in a proper and irreproachable manner during the entire period of her stay. She also failed to satisfy the requirement of continuous residence for 10  years in the Philippines (actual stay: Oct. 16 ‘60 – June ‘62)  As to the children: The law requires that they must be dwelling in the Philippines at the time of the naturalization of the parent. Since prior to their father‘s naturalization, they  were already required to leave the country, they cannot be said to be lawfully residing here.  Also, they cannot be allowed to extend their stay. The period of stay of temporary visitors cannot be extended  without first departing form the Islands. They cannot also claim that they should be allowed extension until the father‘s oath taking because their allowed stay was for a definite period up to a fixed day.

FACTS: In 1961, Lau, a Chinese, was permitted to stay in the Philippines for 1 month to visit her grandfather. After repeated extensions, she was allowed to stay until Feb. 1962. However, on Jan. 1962 she married a Filipino. Commissioner ordered her to leave and sought her deportation. Spouses filed appeal in SC. 19

HELD: Under Sec. 15 of CA 473, an alien woman marrying a Filipino, native born or naturalized, becomes ipso facto a Filipina provided she is not disqualified to be a citizen of the Phils under Sec. of the same law. Likewise, an alien woman married to an alien who is subsequently naturalized here follows the Philippine citizenship of her husband the moment he takes his oath as Filipino, provided, that she does not suffer from any of the disqualifications under Sec. 4. This ruling reversed a prior decision of the SC ( Burca vs. Republic ) which held that the alien woman married to a Filipino must first file a petition for citizenship alleging that she possesses all the qualifications and none of the disqualifications mandated by law. No Judicial Declaration of Philippine Citizenship

 A declaration of Phil citizenship may not be granted in an action for declaratory relief nor under the Civil Code provision (Art. 412) on correction of entry in the Civil Registry. But the rule was relaxed in later decisions. A petition for correction of errors in the entry of the Civil Registry even for a change of citizenship or status may be granted provided that an appropriate action is made wherein all parties who may be affected by the entries are notified and represented and there is a full blown adversary proceeding. Tan Yu vs. Republic: There can be no action or proceeding for the judicial declaration of the citizenship of an individual.

CA 63, as amended by RA 106, provides that a Filipino citizen may lose his citizenship in any of the following ways: 1) Naturalization in foreign countries

FACTS: Frivaldo was elected governor of Sorsogon and assumed office. The League of Municipalities of Sorsogon filed for annulment of his election on the ground that he is a US citizen and therefor incapable of holding public office. Frivaldo admitted that he was a naturalized US citizen in 1983 but he underwent naturalization only to protect himself from then Pres. Marcos. Sol Gen supported respondent‘s contention that he is a US citizen because he did not repatriate himself after his naturalization in the US

HELD: Frivaldo lost his Filipino citizenship. If Frivaldo really wanted to disavow his US citizen citizenship & reacquire Phil. citizenship, he must do so under our laws. Under CA 63, Phil. citizenship may be reacquired through: 1. 2. 3.

direct act of Congress naturalization repatriation

The alleged forfeiture of US citizenship because of his active participation in the elections is between him and the US; it could not have resulted to automatically restoring his Filipino citizenship which he earlier renounced. At most, he could be said to be a stateless individual. Also, although the Special Committee to hear repatriation cases under LOI 270 has not yet been convened, F should have waited for such or seek naturalization by legislative or judicial process.

FACTS: Frivaldo took his oath of allegiance under PD 725 on June 30 ‘95, much later than he filed his certificate of candidacy. He now claims Filipino citizenship through a  valid repatriation HELD: Frivaldo reacquired his Filipino citizenship and is now eligible to assume the office as governor. Law does not specify any particular date or time when candidate must possess citizenship unlike that of residence and age. It can also be said that Frivaldo‘s repatriation retroacted to the date of his filing his application in Aug. 1994.

FACTS: Labo was elected mayor of Baguio. Lardizabal filed a petition for quo warranto alleging that Labo is not a citizen.COMELEC declared that he was a citizen but the CID ruled that he is not since the Australian Govt said that he is still a naturalized Australian citizen. HELD: Labo is not a citizen of the Phils because he lost the same by performing the ff acts under CA 63: 1. naturalization in a foreign country 2. express renunciation of citizenship 3. subscribing to an oath of allegiance to support the Consti and laws of a foreign country. Even if it is to be assumed that his naturalization was annulled because his marriage to an Australian was found to be bigamous, this does not automatically restore his citizenship. He must reacquire it by direct act of Congress,

by repatriation or by naturalization. None of these methods  were done. Under PD 725, repatriation may be done by applying with the Special Committee on Naturalization and if the application is approved, applicant must make an oath of allegiance to the Republic of the Phils before a certificate of registration is issued by the CID.

a)

if it shown that said naturalization certificate was obtained fraudulently or illegally;

b)

if the person naturalized shall, w/in the 5 yrs next following the issuance of said certificate, return to his native country or to some foreign country & establish his permanent residence there;

2) Express renunciation of citizenship

FACTS: Osmeña filed a COC for provincial governor of Cebu but was declared ineligible (upon petition of Aznar) for being a US citizen, as shown by an Alien Certificate of Registration. Osmeña alleges that he is a Filipino citizen being the child of a Filipino, holder of a Phil. passport, a resident of the Phils. since birth, and a registered voter. HELD: Osmeña is a Filipino citizen. Aznar failed to present proof that O lost his citizenship by any of the modes under CA 63; he merely relied in the Alien Certificate of Registration in concluding that O has been a naturalized US citizen. Phil. courts are only allowed to determine who are Filipino citizens, but have no power to determine who are persons considered as American citizens under US laws.  Also, the mere fact that he has an ACR does not mean that he is no longer a Filipino; the renunciation needed to lose Phil. citizenship must be ―express.‖ 3) By subscribing to an oath of allegiance to support the constitution or laws of a foreign country upon attaining twenty one years of age or more, subject to certain exceptions 4) by rendering service to, or accepting commission in, the armed forces of a foreign country, subject to certain exceptions

Provided that the fact that person naturalized remain for 1 year in his native country of former nationality, or 2 years in any country, shall be considered as prima facie evidence of his intention of taking up his permanent residence therein c)

If the petition was made on an invalid declaration of intention

d)

If it is shown that the minor children of the person failed to graduate from recognized public or private high school where the required subjects are taught, through the fault of the parents either by neglecting to support or by transferring them to another school.

Certified copy of decree canceling certificate forwarded to the Office of the President & the Solicitor General. e)

If it is shown that the naturalized citizen allowed himself to be used as dummy in violation of the Constitution or law requiring Philippine citizenship as a requisite for exercise, use or enjoyment of a right, franchise or privilege.

Only a Grant of Political Privilege:

5) by having been declared by competent authority, a deserter of the Philippine armed forces in time of war, unless subsequently, a  plenary pardon or amnesty has been granted

 Judgment directing issuance of certificate of naturalization is a mere grant of political privilege. Neither estoppel nor res  judicata   may be invoked to bar the state from initiating an action for cancellation or nullification of certificate of naturalization issued.

6) in the case of a woman, upon her marriage to a foreigner, if by virtue of the laws in force in her husband‘s country, she acquires his nationality

If shown to have been obtained by fraud or illegal means, the certificate may be cancelled. Decision in naturalization case does not constitute res judicata .

7) cancellation of the certificate of naturalization

The Judge may cancel the naturalization certificate issued and the registration in the Civil Registry, upon motion made in proper proceedings by Sol Gen, on any of the following grounds: 20

FACTS: Li Yao was a naturalized Filipino citizen, but the Sol Gen filed a petition to cancel his certificate of naturalization on the ground that he obtained such certificate

through fraudulent means. One of the grounds was tax evasion. HELD: A certification of naturalization may be cancelled if it was subsequently discovered to have been obtained by misleading the court upon any material fact. And a naturalization proceeding is not a judicial adversary proceeding, such that a decision therein is not res judicata  as to any matter that would support a judgment canceling a certificate of naturalization on the ground of illegal or fraudulent procurement thereof.

Each state determines who its nationals are in accordance w/ the rule in the Hague Convention on Conflict of National Laws. Questions on WON a person possesses the nationality of a certain state are to be determined in accordance w/ the state‘s internal law. It is possible that a person can be claimed as national of 2 or more states. Situations w/c may result to dual nationality:  Application of jus soli  & jus sanguinis 

In determining rights of an individual who may claim multiple nationality in a third state, the ICJ applied principle of ―effective nationality.‖

Understood in two senses: a)

FACTS: Liechtenstein brought a case against Guatemala in the ICJ for breach of its obligations under international law and asking for reparations in behalf of Nottebohm. It is the position of Liechtenstein that Nottebohm acquired Liechtenstein citizenship which would entitle him to its diplomatic protection. HELD: Liechtenstein is not entitled to extend protection to Nottebohm, because when N applied for naturalization, there is nothing to indicate that such application was motivated by any desire to dissociate himself from the Government of his country, Germany. He had been settled in Guatemala for 34 years, and it was the main seat of his interests and business activities. In contrast, his actual connections with Liechtenstein were extremely tenuous. No settled abode and no prolonged residence at the time of application; the application shows that he was a mere visitor and his visit is of a transient character. There is an absence of any bond of attachment between N and L and, on the other hand, the existence of a long-standing and close connection between him and G, a link which his naturalization in no way weakened.

De jure stateless person: refers to an individual  who has been stripped of his nationality by his own former government w/out having opportunity to acquire another.

Problem of statelessness began during WW II &  worsened under Nazi regime in Germany & in USSR. b)

De facto stateless person: individual possessed of a nationality but whose country does not give them protection outside their own territory.

- commonly called ―refugees‖.  Vietnam War: Masses of people escaped from Vietnam, Cambodia, and Laos without any travel documents, identity papers or any form of identification normally granted by government.

Conventions to Alleviate Problems of Stateless Persons:

1) 1951 Geneva Convention on Status Refugees -provided some basic rights of stateless persons

1) Child born of parents who are nationals of country o applying jus sanguinis  in a country applying jus soli  o has dual nationality 2) Filipino citizen who marries an alien may acquire citizenship of his or her spouse if the spouse‘s national law so allows. But a Filipino citizen who marries an alien shall retain Philippine citizenship, unless by his or her act or omission, he is deemed under the law, to have renounced it by taking an oath of allegiance to the spouse‘s country or by express renunciation. 3) Another instance of dual or multiple nationality is the case of an individual who is naturalized citizen of another state but has not effectively renounced his former nationality.

FACTS: Oh Hek How, a Chinese citizen, applied for naturalization in the Philippines which was granted. A certificate of naturalization was issue in his favor but the Government appealed, claiming that it was issued before the Minister of the Interior of Nationalist China issued the permission for a valid renunciation of Chinese citizenship. Oh Hek How argues that such permission is not among the requirements under our law for the naturalization of an alien. HELD: The permission of the Minister of the Interior of China is required before a certificate of naturalization can be issued in favor of Oh Hek How. The question of how a Chinese citizen may strip himself of that status is necessarily governed by the laws of China, not that of the Philippines.  As a consequence, a Chinese national cannot be naturalized as a citizen of the Philippines, unless he has complied with the laws of China requiring previous permission of its Minister of the Interior for renunciation of nationality. 21

2) 1954 UN Conference on the Elimination or Reduction of Future Statelessness 3) Convention on the Reduction of Statelessness - enumerates conditions under w/c an individual would not lose his or her nationality upon the risk of becoming stateless should a new nationality not be proved: i.e. divorce, adoption, naturalization, expatriation. Convention also  prohibits states from depriving nationals of identity:  1) 2)

as punishment or as discriminatory instrument for political, religious or ethnic reasons

Major objective:   Remedy situation of children born w/out acquiring any nationality, i.e. when a child is born in a country following  jus sanguinis   principle of parents who are citizens of a jus soli  country.

Convention mandates that: * jus sanguinis   country grant its nationality to a person born  w/in its territory if he would otherwise be stateless. * jus soli   country to extend its nationality to a person who  would otherwise be considered stateless when one of his parents is a citizen of the contracting state.

FACTS; Kookooritchkin, a native-born Russian who claims to be a stateless refugee, filed a petition for naturalization. The petition was granted, for which the SolGen appealed, saying that Kookooritchkin is not a stateless person. HELD: K is a stateless person. His testimony, aside from being uncontradicted, is supported by the well-known fact that the ruthlessness of modern dictatorships has scattered throughout the world a large number of stateless refugees or displaced persons, without country and without flag. Knowing the history, nature and character of the Soviet dictatorship, it would be technically fastidious to require further evidence of K‘s claim that he is stateless than his testimony that he owes no allegiance to the Russian Communist government and, because he has been at war  with it, he fled from Russia to permanently reside in the Philippines.

 A person may live in a place w here he is not domiciled. To acquire a domicile, there must be concurrence of 1) intention to make it one‘s domicile and 2) physical presence. ―Residence‖ simply requires bodily presence. It is a relatively more permanent abode of a person, while residence applies to a temporary stay of a person in a given place (Koh vs. CA ).

Domicile is permanent in nature; it is not as transient and temporary as residence. 2 Requisites for domicile: 1) physical presence 2) intent – actual  intent, not merely floating intent  In order to establish new domicile, it is not necessary to prove intent to stay indefinitely, as long as the intent to abandon the old domicile is apparent. 

In domicile of choice, intent is important



In constructive domicile, there is no intent because the domicile is chosen by the law for the person



The motive for leaving and the length of stay in the new domicile is not relevant in the determination of domicile of choice

Habitual residence: ―bridge‖ between residence and domicile _______________

the Philippines. In this case, there is no proof that he had  waived his status as a permanent resident or immigrant of the US before he ran for election as mayor of Bolinao; hence he was disqualified to run for that office.

FACTS: Uytengsu was born in the Philippines of Chinese parents. He went to the US to study; but in one of his  vacations in the Philippines he applied for naturalization, during the pendency of which he returned to the US to finish his studies. Upon his return, his application was granted; the Government appealed the grant because under the law an applicant for naturalization is required to reside continuously in the Phils. from the date of filing of the petition up to the time of his admission to Philippine citizenship. Uytengsu‘s defense is that since he has been domiciled in the Philippines during the period of his application, he was also a resident for that period. HELD: ―Residence‖ and ―domicile‖ each has, in strict legal parlance, a meaning distinct and different from each other. The essential distinction between resident and domicile is this: the first involves the intent to leave when the purpose for which he has taken up abode ceases, while the other has no such intent, the abiding is animo manendi. They are not to be held synonymous; residence is an act, while domicile is an act coupled with intent. The question of domicile is not involved in determining whether a person is a resident of a state or country.



Municipal law concept of domicile (Art. 50, CC): natural persons:  the place of habitual residence  juridical persons:   determined by the law creating or recognizing it; and in its absence shall be understood as the place where their legal representation or place of business is.

Conflict-of-laws definition of domicile (Restatement): the place with which a person has a   for certain legal purposes, either because his home is there or because that place is assigned to him by law.  Justice Story: the place of true, fixed permanent home and principal establishment, and to which, whenever he is absent,

Merits:

1)

preferred primary connection between a person and a state because it satisfies the very purpose for having a personal law (in common law countries) – it provides an adequate basis for him to exercise rights therein and the state to impose duties on him

2)

also suitable for countries with a federal system of government – the law of the domicile is the law of the place where the individual lives

FACTS: Miguel ran for mayor of Bolinao and won. His opponent filed a petition for disqualification, alleging that Miguel is a green card holder and hence, a permanent resident of the US and not of Bolinao. HELD: Miguel‘s possession of a green card disqualified him from running for mayor. His application for immigrant status and his possession of a green card are conclusive proof that he is a permanent resident of the US despite his occasional visits to the Philippines.

 A candidate who is a green card holder must have waived his status as a permanent resident or immigrant of a foreign country in order to be qualified to run for elective office in 22

one‘s domicile is not ascertainable without first resorting to the courts to establish whether or not there is animo manendi 

FACTS: Imelda Marcos filed her Certificate of Candidacy for representative of 1   District of Leyte. A petition to disqualify her was filed on the ground that she lacked the 1 yr resident requirement as provided for in the Constitution. In her COC, she placed ―7 months‖ as length of residence.

the notion of domicile differs widely in different states (some distinguish between domicile and residence; others attribute different meanings of domicile for different purposes)

HELD: For purposes of election law, residence is synonymous with domicile. Mere absence of an individual from his permanent residence without the intention to abandon it does not result in a loss or change of domicile.

if the law of domicile of origin is given overriding significance, it may create the problem of attenuated connection (similar to the use of nationality as personal law)

 While Marcos held various residences for different purposes during the past four decades, none of these purposes unequivocally point to an intention to abandon her domicile of origin in Tacloban, Leyte. She did not lose her domicile of origin upon her marriage to Pres. Marcos; what she gained was actual residence.

Demerits:

st 

1)

2)

3)

The Philippines follow the nationality law theory, but there are instances when our courts refer to the domicile of an individual in order to determine his rights or obligations. Example is 1) when the litigant is an alien whose country of origin follows the domiciliary principle; or 2) where the situation concerns stateless persons, or those with dual or multiple nationalities; or 3) when an alien domiciled in the Philippines executes a will abroad.

1)

No person shall be without a domicile; his domicile of origin prevails until the acquisition of a new one.

2)

 A person cannot have two simultaneous domiciles (a person can have only one domicile for a given purpose or a given time under the law of a particular state, but it should not be assumed that that determination will be binding on other states or on the same state for other purposes).

3)

Domicile establishes a connection between a person and a particular territorial unit.

4)

The burden of proving a change of domicile is upon whoever alleges that a change has been secured.

3 Kinds of Domicile: 1)

Domicile of origin: a person‘s domicile at birth. A legitimate child‘s domicile is that of his father,  while an illegitimate child‘s is that of his mother.

2)

Domicile of choice: also called voluntary domicile, is the place freely chosen by a person sui juris. There must be concurrence of physical presence in the new place and unqualified intention to make that place one‘s home.

 A problem deciding the issue of domicile of choice is the degree of permanence of abode. Difference between domicile of origin and domicile of choice: lies in a) conditions necessary for abandonment and b) capacity for revival.

FACTS: Ujano was a naturalized US citizen who returned to the Philippines as a visitor and petitioned to reacquire Philippine citizenship. The petition was denied because he did not have the required residence. HELD: Residence, for naturalization purposes, has been interpreted to mean the actual or constructive permanent home or domicile. He cannot be said to have established his domicile here although he is actually present because his allowed stay as a visitor is only temporary and he must leave  when the purpose of his coming is done.

FACTS: Dorrance was born in Pennsylvania. He worked and resided in New Jersey, transferred to Philadelphia and then returned to New Jersey. Later he was able to buy an estate in Pennsylvania, where he stayed with his family until his death. During his lifetime he expressed that he intends to remain a domiciliary of New Jersey. Pennsylvania assessed inheritance tax on his estate. HELD: He was domiciled in Pennsylvania at the time of his death. A man cannot retain a domicile in one place when he has moved to another, and intends to reside there for the rest of his life, by any wish, declaration or intent inconsistent  with the facts of where he actually lives and what he means to do.

23

Reverter or revival doctrine : presumption that domicile of origin revived once the domicile of choice is given up, before a new one is required.

FACTS: Velilla, the administrator of the estate of Moody, appealed the inheritance tax assessed against the estate on the ground that the decedent was not domiciled in the Philippines. Moody went to Calcutta and Paris before his death, and he died in India. HELD: He was a domiciliary of Manila. Domicile in the Civil Code is defined as the place of habitual residence,  which was Manila in the CAB. There was no statement from Moody, oral or written that he adopted a new domicile while he was absent from Manila. To establish abandonment, he must show his deliberate and provable choice of new domicile coupled with actual residence and declared or proved intent that it should be his permanent abode. This  was not proven.

FACTS: White and his wife lived in West Virginia, but agreed to sell their house there with the declaration, intent and purpose of making Pennsylvania their home. Upon reaching Penn., they had to go back to West Va. on account of the wife‘s illness but White  went to Penn. everyday to

look after his stock. Upon his death, the administrator paid the whole of the estate to the widow according to West Va. law. However, if Penn. law was applied, ½ of the estate  would go to White‘s siblings. The law of his domicile governs the distribution of his estate. HELD: Pennsylvania was his domicile at the time of his death. Two things must concur to establish domicile—the fact of residence, and the intention of remaining. These two must exist in combination. When one domicile is definitely abandoned, and a new one selected and entered upon, length of time is not important; one day will be sufficient, provided the animus  exists.

3)

Constructive domicile:   domicile assigned to persons incapable of choosing their own domicile by operation of law. Includes minors, mentally disabled, married women.

Minors or infants are indubitably incapable of choosing their own domicile. Their domicile automatically changes when their father‘s domicile changes. Minors take the domicile of their mother upon the death of their father.  A person who has a mental disability is also assigned a constructive domicile. It is presumed that a person with a mental disability cannot acquire a domicile of choice because of his inherent inability to decide where to make his home.

Special Problems in Constructive Domicile

Domicile

of

Choice

vis-à-vis

1)

domicile of people kept under physical or legal compulsion

2)

domicile of married women seeking to acquire separate domicile from their husbands

People under Compulsion:   traditional view is that he is in that place not as a result of his volition. Examples are military personnel, prisoners and people with disabilities  who are confined in institutions.

FACTS: Caraballo, an American staff sergeant in the US Air Force stationed in Clark Air Base, filed a petition for adoption of a Filipino child. The petition was denied on the

ground that he was not qualified to adopt, him being a nonresident alien. HELD: Actual or physical presence or stay of a person in a place, not of his free and voluntary choice and without intent to remain there indefinitely, does not make him a resident of the place. Caraballo is disqualified to adopt because he is a non-resident alien. His stay in the Philippines is only temporary, and is merely the result of his assignment as staff sergeant.

In recent decisions, courts have held that a person under compulsion should not be barred from proving that he has developed the required unqualified intention to establish his permanent abode in such place. The fact of compulsion is reduced to just one of the factors in determining whether intent, in fact, exists. Married Women: based on the concept of unity of identity of spouses, the wife was presumed to take the domicile of the husband.

HELD: CFI Iloilo has JD. Where the husband has given cause for divorce, the wife may acquire another and separate domicile from that of her husband. *There are exceptions   to the rule that the domicile of the  wife is determined by that of her husband, one of which is that the wife may acquire another and separate domicile from that of her husband where the theoretical unity of husband and wife is dissolved, as it is by the institution of divorce proceedings; or where the husband has given cause for divorce; or where there is a separation of the parties by agreement, or a permanent separation due to desertion of the wife by the husband or attributable to cruel treatment on the part of the husband; or where there is a forfeiture by the  wife of the benefit of the husband‘s domicile.

Modern view (married women): dispenses with the presumption that the wife‘s domicile is the same as her husband‘s. Each party establishes his or her own domicile completely independent of each other. As a result, the wife need not show that her husband has given cause for divorce or legal separation to have a separate domicile.

FACTS: Tan Bon, a Chinese citizen, entered the Philippines as the wife of a Chinese merchant. She asked her minor children from a previous marriage to join her here, but they were not allowed entry. HELD: The minor children cannot enter the Philippines. A Chinaman‘s Chinese wife and her minor children do not enter the Philippine Islands through their own right, but by  virtue of the right of the husband and father. Since Tan Bon did not enter the Philippines by her own right but by virtue of her husband, she is not entitled to bring in her minor children by another Chinaman who never had legal residence in the Archipelago. The mere fact of their being children of Tan Bon confers on them no right of entry, inasmuch as she herself did not enter of her own right, and they cannot base their right on hers.

Personal capacity  

Includes both condition and capacity  Embraces matters as the beginning and end of personality, capacity to have rights, capacity to engage in legal transactions, protection of personal interests, family relations, also transactions of family law such as marriage, divorce, separation, adoption, legitimation and emancipation, and succession.

 Juridical capacity : fitness of a man to be the subject of legal relations

FACTS: Geopano filed a complaint in CFI Iloilo against de la Vina, her husband, for divorce on the ground of infidelity. De la Vina opposed, saying that CFI Iloilo has no JD over the case considering that he resides in Negros, such that Geopano must also be considered a Negros resident, because the domicile of the wife follows that of the husband. 24

Capacity to Act:  power to do acts with legal effects  ART. 37, Civil Code:  Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person and is lost

only through death. Capacity to act, which is the power to do acts with legal effect, is acquired and may be lost.

persons but of the public or political law of the nation. The  jurisdiction of courts and other matters of procedure are of public nature and are submitted to the territorial principle.

In case of Filipinos,  Art. 15 of the CC states that  personal status and capacity follows the nationality principle. In case of aliens, courts may refer to their national law or domiciliary law.

Note: The doctrine is no longer controlling. Divorce is considered a violation of public policy so that courts cannot issue the same.

1.

there is a rebuttable presumption that a person is dead after he has been absent for a number of years

2.

a person‘s unexplained absence is judicially investigated and established which results in legal effects similar to those of death a judicial decree shall have to be issued declaring a person dead before legal effects of death can take place

3.

*Phil law follows the rebuttable presumption (1). FACTS: H engaged the services of R, as counsel in her suit against her husband for support and for preservation of her rights in the conjugal partnership in contemplation of a divorce suit. However, the spouses entered into a compromise agreement to defeat the claim of R in attorney ‘s fees. H moved to dismiss on the ground of invalidity of the contract of service because divorce is contrary to Phil law. HELD: R should be paid his fees. H spouses are US citizens and their status and the dissolution thereof are governed by the laws of the United States, which sanction divorce. Therefore, contract is not contrary to public policy.

Status once established by the personal law of the party, is given universal recognition. Status, capacity, and rights and duties, brought into existence by State A and conferred in a natural or juridical person under its jurisdiction, should be recognized by State B,  without any exception or qualification imposed by the latter, except by some definite or protected rule of municipal law.

-

 Aliens can sue and be sued in our courts even on issues relating to status and capacity. However, the applicable law is their personal law.

The determination of the exact moment personality begins is referred to the individual‘s personal law.  Art. 40, CC Birth determines personality; but the conceived child shall be considered born for all purposes that are favorable to it, provided it be born later with the conditions specified in the following article.  Art. 41, CC For civil purposes, the fetus is considered born if it is alive at the time it is completely delivered from the mother‘s womb. However, if the fetus had an intra-uterine life of less than 7 months, it is not deemed born if it dies within 24 hours after its complete delivery from the maternal womb Geluz vs. CA: SC did not allow for recovery of damages for the injury and death of a conceived child which is still in the mother‘s womb. Art. 40 cannot be invoked since it expressly limits the provisional personality by imposing the condition that the child should be subsequently born alive. Civil personality is commenced at birth and is extinguished by death. A declaration of death issued by a competent court is considered valid for all purposes.

Limjoco vs. Intestate Estate of Fragante: HELD: SC ruled that the estate of a deceased applicant can be granted a CPC to avoid injustice or prejudice resulting from the impossibility of exercising such legal rights & fulfilling such legal obligations of the decedent as survived after his death unless the legal fiction, that the estate is considered a person, is indulged.

FACTS: Fuster and Yanez separated. After 10 years, Y filed for divorce on the ground of F‘s adu ltery. Court granted decree of divorce. Fuster contests jurisdiction of the court to issue the said decree. The domestic laws of states do not treat absentees alike. HELD: Phil court has jurisdiction. The authority and  jurisdiction of courts are not a matter of private law of

Three ways of dealing with the problem: 25

 Art. 390, CC  After the absence of 7 years, it being unknown whether or not the absentee still lives, he shall be presumed dead for all purposes, except for those of succession.

The absentee shall not be presumed dead for the purpose of opening his succession till after the absence of 10 years. If he disappeared after the age of 75 years, an absence of 5 years shall be sufficient in order that his succession may be opened.  Art. 391, CC

The ff. shall be presumed dead for all purposes, including the division of estate among the heirs: (1) a person on board a vessel lost during sea voyage, or an airplane which is missing, who has not been heard of for 4 years since the loss of the vessel or airplane. (2)  A person in the armed forces who has taken part in war and has been missing for 4 years (3)  A person who has been in the danger of death under other circumstances and his existence has not been known for 4 years However, for specific purposes, our laws require that a declaration of death be issued before certain legal effects of death arise ex. Contracting a subsequent marriage but the periods are reduced to 2 years. The legal effects of absence and restrictions on his capacity are determined by his personal law.

 A person‘s name is determined by law and  cannot be changed without judicial intervention.(Art. 376, CC) Case law shows that courts have allowed petitions on grounds that the name—

1. 2. 3. 4.

is ridiculous or tainted with dishonor or extremely difficult to pronounce  when the change is necessary to avoid confusion  when the right to a new name is a consequence of change in status a sincere desire to adopt a Filipino name to erase signs of a former alien nationality which unduly hamper social and business life

determined by the law of the place where the contract is made.

5) 6)

This case should have been resolved as a capacity case instead of as a contract case (characterization).

7)

cannot be abrogated, amended or terminated by one or both parties at will nature & consequences as well as incidents are governed by law & not subject to stipulation by parties unlike ordinary contracts  violation of marital obligations may give rise to penal or civil sanctions while breach of conditions of ordinary contract can be ground for an action for damages

Confusion as to one‘s paternity has been held   to justify the court‘s denial of a petition for change of name.  Whether an alien‘s change of name is valid depends s olely on his personal law.

The legal disability and rights attached to minority are aspects of personal status. It is the individual‘s personal la  w  which determines whether he has reached the age of majority. RA 6809 lowered the age of majority from 21 – 18 years but parental consent for contracting marriage is still required until the age of 21.

 A person‘s ability to act is governed by   his personal law. Rules on capacity of an individual to bind himself by contract with other persons or by unilateral acts are the very core of the rules that identify his legal position. The incapacities attached to his legal status go with him wherever he is.

The general rule on capacity is subject to several exceptions. These include liability in tort, which is subject to the law of the place of the tort and the restrictions on the contracting capacity of a married woman.

Man & woman may decide to marry in a country other than that of their nationality & come home. Issue of validity of marriage & legal consequences may be raised (Legal consequences such as personal & property relations, status & rights of children, use of surname & right to inherit). Family law is an area of substantive law which reflects strong policies of state often based on values highly held by society. Family relations give rise to grave individual & societal concerns.

Family Code Definition:  Art 1. ―Marriage is a special contract of permanent union b/w man & woman entered into in accordance w/ law for the establishment of conjugal & family life.

It is the foundation of the family & an inviolable social institution whose nature, consequences & incidents are governed by law & not subject to stipulation except that marriage settlements may fix property relations during the marriage w/in limits provided by this Code.‖  Juxtaposed w/ Art15 CC, w/c states that questions on family rights, duties, status, conditions & capacity are governed by lex nationalii , the importance of such definition is realized. Marriage is a special contract as distinguished from an ordinary contract:

FACTS: Insular Govt entered into an employment contract  with Frank in Illinois when he was still a minor under Phil law but not under Illinois law. Frank breached the contract so IG sued him. HELD: Illinois law should apply. Matters bearing upon the execution, interpretation and validity of a contract are

1) 2) 3) 4)

entered into by a man & a woman both at least 18 years of age solemnized by a person specifically authorized by law a permanent union unless one party dies, or marriage is annulled or declared void in special circumstances 26

 Art XV. Sec. 2: Marriage as an inviolable social institu tion, is the foundation of the family & shall be protected by the state. Presumption of validity: The Philippines establishes a presumption of validity to give stability to marriage especially in Conflicts of Law problems.  Art 220. CC. In case of doubt, all presumptions favor the solidarity of the family. Thus every intendment of law or facts lean toward the validity of marriage, the indissolubility of marriage bonds, legitimacy of children, the community of property during marriage… Goal:   Guide courts, strengthen family, & emphasize state interest in its preservation

This is governed by lex loci celebrationis . Extrinsic validity covers questions on formalities or external conduct required of parties for legally valid marriage.  Art 2. Hague Convention on Cel ebration & Recognition of  Validity of Marriages: Formal requirements governed by law of state of celebration. General rule: All states recognize as valid marriages celebrated in foreign countries if the formalities prescribed there were complied with. PHILIPPINES, Formal Requirements of Marriage  Art 3. FC sets the ff requirements: 1) 2)

 Authority of solemnizing officer  Valid marriage l icense except in cases provided in Ch 2 of this title

3)

Mariage ceremony w/c takes place w/ the appearance of contracting parties before the solemnizing officer & their personal declaration that they take each other as husband & wife in the presence of not less than 2 witnesses of legal age

Lex Loci Celebrationis (expressed in Art 26 FC): ―All marriages solemnized outside the Philippines in accordance w/ the laws in force in the country where they  were solemnized, and valid there as such, shall also be valid in this country…‖

FACTS: The late Cheong Boo‘s estate is being claimed by Cheong Seng Gee, who says that he is the legitimate child of the decedent with Tan Dit, whom the decedent allegedly married in China.

HELD: The validity of the Chinese marriage cannot be recognized. There is no competent testimony what the laws of China in the Province of Amoy concerning marriage were in 1895. There is lacking proof so clear, strong and unequivocal to produce a moral conviction of the existence of the alleged Chinese marriage.

FACTS: Dumpo married Hassan, and then married Sabdapal without having her previous marriage annulled. As a defense to an allegation of bigamy, Dumpo claimed that her 2  marriage was void because her father did not consent thereto.

 Wong to be excluded from the country, on the ground that her marriage to Blas was bereft of substantial proof. 4) HELD: Wong should be excluded. Art.15 of our Civil Code provides that the laws relating to family rights or to the status of persons are binding upon Philippine citizens, though living abroad. Even if the marriage of Wong to Blas before a  village leader is valid in China, the same is not one of those authorized in our country. Under Sec. 4 of Gen. Orders 68 (now Art. 71 CC), a marriage contracted outside the Philippines which is valid under the law of the country in  which it was cel ebrated is also v alid here; bu t there was no proof presented on the applicable law of China. Therefore it may be presumed to be the same as our law.

5)

6) 7)

o& distribution of the properties of the spouses & the delivery of presumptive legitimes there was a mistake as to identity of the contracting party one of the contracting parties was psychologically incapacitated to comply with the essential marital obligations the marriage is incestuous marriage is void by reason of public policy

Note that the exceptions put in issue the parties‘ ca pacity to enter into marrriage, thus, relating to a substantive requirement. Since the personal law of the parties governs questions of intrinsic validity of marriages b/w Filipinos abroad, the above enumerations are exceptions to the lex loci celebrationis  precisely because they are controlled by lex nationalii .

FACTS: The marriage of the Apts (both Germans) was celebrated in Argentina by proxy. The wife, a domiciliary of England, filed a petition for the nullification of their marriage on the ground that proxy marriages are not valid in England. It is, however, valid in Argentina. HELD: The marriage is valid. The English law on marriage is locus regis actum. If a marriage is good by the laws of the country where it is effected, it is good all the world over, no matter whether the proceeding or ceremony which constituted marriage according to the law of the place would or would not constitute marriage in the country of domicile of one or other of the spouses. Since the marriage was performed in Buenos Aires and in accordance with its laws, and since proxy marriage is only a form of the ceremony and not an essential requisite, the marriage should be upheld.

Intrinsic requirements refer to capacity or general ability of a person to marry, for instances defined by requirements of age & parental consent, but it does not refer clearly to an individual‘s being permitted to marry a specific person or person of a determinate class. What law controls intrinsic requirements? The parties‘ personal laws—either domicile or nationality.

Municipal laws of each requirements of marriage.

state

provides

substantive

nd

HELD: Dumpo is not guilty of bi gamy. The 2  marriage was null and void because the consent of her father was not obtained. It is an essential element of bigamy that the alleged 2  marriage, having all the essential requisites, would be valid  were it not for the existence of the first. nd

nd

Exceptions to Lex Loci celebrationis : The Civil Code (Art 71) enumerates bigamous, polygamous or incestuous marriages as exceptions to the lex loci celebrationis  rule.

1)

Legal capacity: must be 18 years of age & not barred by any impediment to marry each other

2)

Consent freely given:   in the presence of an authorized solemnizing officer

The Family Code (Art 26) widens these e xceptions.  A foreign marriage although valid in the foreign country  where it was entered into will be void in the Philippines if: 1) 2) 3)

FACTS: Wong Woo Yu alleged before the Board of Special Inquiry that she was allegedly married to a Filipino, Blas, in a ceremony in China. The new Board ordered

Philippine Law sets the following substantive or essential requisites:

either or both parties are below 18 it is bigamous or polygamous a subsequent marriage is performed w/out recording in the Civil Registry & registry of Properties the judgment of annulment or declaration of nullity of first marriage, the partition 27

Matrimonial consent: Parties are, at least, not ignorant that the marriage is a permanent union. Mixed marriages: the law that governs substantive validity is national law of parties.

 Art 38. FC.: Though valid in a foreign country certain marriages may be void in the Philippines on grounds of public policy, such as the ff: 1)

b/w collateral blood relatives, whether legitimate or illegitimate up to the 4  civil degree b/w step-parents & stepchildren b/w parents-in-law & children-in-law b/w adopting parent & adopted child b/w surviving spouse of adopting parent & adopted child b/w surviving spouse of adopted child & adopter b/w adopted child & legitimate child of adopter b/w adopted children of same adopter b/w parties where one, w/ intention to marry the other, killed the person‘s spouse or his or her own spouse

5)

one of the spouses did not freely consent to the marriage

th

2) 3) 4) 5) 6) 7) 8) 9)

Marriages Between First Cousins: Marriage of 1 cousins is no longer incestuous but still void ab initio  on the ground of public policy. st

FACTS: Sottomayor and de Barros are both Portuguese and first cousins. Under Portuguese law they are incapable of contracting marriage. They were married in London. Sottomayor filed a petition to have the marriage declared invalid. HELD: The marriage is invalid. The law of a country where marriage is solemnized must decide all questions relating to the validity of the ceremony by which the marriage is alleged to have been constituted; but as regards questions on personal capacity, it must depend on the law of the domicile, and if the laws of any country prohibit its subjects within certain degrees of consanguinity from contracting marriage and treats such as incestuous, this imposes on the subjects a personal incapacity which continues to affect them so long as they are domiciled in said country and renders such marriage invalid wherever it may have been solemnized.

It is submitted that our prohibition against marriage of 1 cousins be limited only to Filipino nationals because many countries allow such marriages.

st 

Marriages b/w foreigners whose national laws allow marriage of 1  cousins should be considered as valid in the Phil under the principle that the lex nationalii   controls capacity & presumption in favor of validity of marriage, as expressed in  Art 220. st 

Hague Convention on validity of Marriages allows a contracting state to refuse recognition of the marriage if: 1)

one of spouses was already married (unless marriage has subsequently become valid by virtue of dissolution or annulment of previous marriage)

2)

spouses were related to one another by blood or by adoption, in the direct line or as brother or sister

3)

4)

one of spouses had not attained the minimum age required for marriage nor acquired the necessary dispensation

Christianity prohibits polygamous & incestuous marriages but care must be taken to confine doctrine to cases deemed incestuous by general consent of all Christendom. The state may resort to ultimate escape devicecontravention of a public policy to w/hold recognition of  validity of a foreign marriage. Rule: Marriages manifestly incompatible with the ordre  public of the state of nationality of parties may be refused recognition. However, commentators argue that when the non/existence of marriage is merely a preliminary Q arising incidentally in a case involving an issue not profaning mores of forum (such as tax, property or succession law) the rule above should not be applied. In ReDalip Singh: two women claimed that they were lawfully wedded wives of Singh, a native of India who died intestate in California. They claim to have been lawfully married to him in India over 50 yrs ago while domiciled there in accordance w/ law of the Jat community.

Under California laws, only 1 wife recognized as legal  widow. Wives argue that the polygamous marriages should be held valid on strength of Art 63 CC: ―All marriages contracted w//out the state, w/c would be valid by the laws of the country in w/c the same were contracted are valid in this state‖. st 

FACTS: Fannie is Sam‘s niece by half blood; they are both  Jewish and NY residents. NY prohibits marriage between uncle and niece, so they went to Rhode Island, where such marriage is also prohibited except where the parties are  Jewish (the Jewish faith allow such marriages). After the ceremony they went back to NY to live there. HELD: The marriage is valid. The legality of a marriage between persons sui juris   is to be determined by the law of the place where it is celebrated. The general principle is that the rights dependent upon nuptial contracts are to be determined by the lex loci , subject to 2 exceptions: 1) cases  within the prohibition of positiv e law, and 2) cases involving polygamy or incest in a degree regarded generally as within the prohibition of natural law. As to the first exception, there is no ―positive law‖ in New York which serves to interdict the marriage in Rhode Island of Sam and Fannie, and as to the second exception, their marriage was not offensive to the public sense of morality, it being allowed by the Jewish faith. Instances Where Recognition of Validity of Marriage May be Withheld:

one of the spouses did not have the mental capacity to consent

Court, citing English & American cases: Polygamous marriages can be recognized in English law ―so as to confer on the ‗wives‘ t he status of a wife for the purposes of Sec. 10 of British Nationality & Status of Aliens Act or for purposes of succession, & upon the children the status of legitimacy. Marriages Celebrated by a Consular Official  Art. 9 of the relevant Hague convention: Marriage celebrated by a diplomatic agent or consular official in accordance with his state law shall be considered valid as long as it is not prohibited by the state of celebration

Philippine law: Marriage of Filipino nationals shall be officiated by Philippine consul general, consul or vice consul (in w/c case the formal & extrinsic requirements of a valid marriage license & due publication & registration under Philippine law have to be complied with). This is said to apply to marriage b/w Filipino national & an alien provided the alien complies with marriage requisites under his/her national law.

28

 Additional requirements for: 1)

2)

But, in Ch VIII on Domicile, some legal authorities consider the assignment of constructive domicile to the wife as invidious discrimination on basis of gender.

aliens - submission of a certificate of legal capacity to contract marriage issued by diplomatic/consular office

Property Relations of Spouses

stateless persons or refugees- submission of affidavit stating circumstances showing legal capacity to contract marriage

Hague Conventions on law Applicable to Matrimonial Property : The internal law designated by spouses before marriage or in absence thereof the internal law of state in w/c both spouses fix their habitual residence is the governing law on matrimonial property regimes.

Personal Relations between the Spouses

 Art 80. Family Code: In the absence of a contrary stipulation in a marriage settlement,  property relations of spouses shall be governed by Philippine laws, regardless of the place of the celebration of the marriage & their residence.

These include mutual support, fidelity, respect, cohabitation & right of wife to use husband‘s family name)

This rule shall not apply :

 What is the governing law? National law of parties

1)

If both spouses are aliens

If spouses are of different nationalities, generally, the husband‘s national law may prevail as long as it is not contrary to law, customs, & good morals of the forum.

2)

 With respect to the extrinsic validity of contracts affecting property not situated in the Philippines & executed in the country where the property is located

 Art 69 Family Code: Husban d & wife have the right to f ix family domicile. Court, for compelling reasons, may exempt spouse  from living with the other.

3)

Djumantan vs. Domingo: Filipino marries Indonesian. They go to Philippines w/ intention of staying here permanently. Subject of petition: Effect of marriage on wife‘s right to stay in the Philippines.

There is no law guaranteeing aliens married to Filipino citizens the right to be admitted, much less to be given permanent residency, in the Philippines. ―The fa ct of marriage by an alien to a citizen does not  withdraw her f rom operation of immigration laws governing admission & exclusion of aliens. Marriage of an alien woman to Filipino citizen does not ipso facto make her a Filipino citizen & does not excuse her from her failure to depart from the country upon expiration of her extended stay here as alien‖.

Restatement 2 The wife who lives w/ her husband has the same domicile as his unless special circumstances of wife make such result unreasonable. nd:

 With respect to the extrinsic validity of contracts entered into in the Phil but affecting property situated in a foreign country whose laws require different formalities for its extrinsic validity

 Art 80 generally follows lex rei sitae. What law will govern the property relations of spouses where one is a Filipino citizen 7 the other a foreigner? It  would still be governed by Philippine law.

In  Adong and Wong Woo Yu, the Court did not apply the Philippine policy of presumption of  validity of marriage.  Question: is a proxy marriage between Filipinos in a state allowing such marriages valid? Pangalangan:  Yes, because it is merely a formal requisite (lex loci celebrationis apply) ________________ 

Divorce: Absolute or Limited

 Absolute: termination of legal relationship b/w spouses by an act of law. Limited: (Legal separation) separation form bed & board w/c does not effect the dissolution of marital ties. But it modifies the incidents of marriage by relieving spouses of duty of living w// each other. This does not necessarily affect economic rights & duties since the court may order one to provide for support. For such purpose, it is essential that court has JD over respondent spouse & the property sought to be affected by decree.

Local law governs legal consequences of divorce of spouses, nationals of same country, who marry, are domiciled & divorce. If any of above factors connected to another state… conflicts problem arises.

Change of nationality after Marriage If one or both spouses change nationality subsequent to marriage, property regime remains unchanged because of principle of immutability.

Divorce jurisdiction:

Hague Convention on Matrimonial Property Regimes. Art 7 : The applicable law continues notwithstanding any change of their nationality or habitual residence.

Ratio: Divorce, being a matter of state concern, should be controlled by ―law of place w/ w/c person is most intimately concerned, place where he dwells.

extrinsic validity: refers to formal requisites, apply lex loci celebrationis intrinsic validity: refers to essential requisites, apply personal law of the parties 29

Basis of JD of some countries: Domicile of one of the parties or matrimonial domicile

Due process requires that forum court have a substantive contact w/ the relationship w/c it will decide won to dissolve. Hague Convention Relating to Divorce & Separation: The granting of divorce or separation must comply w/ the national law of spouses & the law of the place where the application for divorce is made.

Some laws in PRiL have made 1)

the right to separation or divorce depend on the national law of the spouses &

HELD: The divorce decree obtained in the US is not valid, because at the time it was issued, Vicenta, like Pastor, was still a Filipino citizen. She was then subject to Philippine law. Philippine law cannot recognize a foreign decree of absolute divorce between Filipino citizens, for this would violate declared public policy.

2) grounds for divorce subject to law of forum provided the parties were domiciled there. Grounds for divorce are dictated by lex fori . Thus, many states refuse to recognize foreign grounds for divorce unless it corresponds w/ a ground justified by forum law. This is followed whether the traditional or policy centered choice of law approach is used.

Divorce decrees obtained abroad have no validity, not recognized in Philippine jurisdiction. BUT a marriage b/w a Filipino & a foreigner is susceptible to divorce if the divorce was validly obtained by the alien spouse (Art 26 par 2). Effects: 1. 2.

alien is capacitated to remarry Filipino spouse shall likewise have the capacity to remarry under Philippine law

Effect of Provision (Art 26): partial recognition in the Phil of absolute divorce. note: Divorce should be obtained only by alien o spouse. Otherwise, Art 26 is inapplicable. o

Provision is to remedy the uneven status of Filipino nationals whose alien spouses obtained divorce abroad & remarried while the Filipino spouse remained married to them in eyes of Philippine law.

FACTS: Van Dorn, a Filipina, married American Upton. Ten years later they were divorced in the US; subsequently,  van Dorn remarried. Upton filed an action against Van Dorn in the Philippines, asking for an accounting of certain alleged conjugal properties. HELD: The divorce decree is valid and binding upon Upton. Even if divorce is not valid in the Philippines for being contrary to public policy, only Philippine nationals are covered by the policy against absolute divorces. Aliens may obtain divorces abroad, which may be recognized in the Philippines provided valid according to their national law.

FACTS: Pilapil and Geiling were married in Germany, but  were later divorced. A few months later, Geiling filed a complaint for adultery which was dismissed; it was refiled by the fiscal. HELD: Geiling has no legal standing to commence the adultery case because the person who initiates the adultery case must be an offended spouse, meaning he must still be married to the accused spouse at the time of the filing of the complaint. Because of the divorce decree, Geiling is no longer the husband of Pilapil; hence he had no more legal standing to commence the adultery case (no longer an offended ―spouse‖).

longer a Filipino citizen at the time of their divorce, the divorce would be valid as to her and will be recognized in the Philippines, and she would lose her right to inherit.

Tenchavez: 2 Filipinos, divorced abroad –  not recognized in the Philippines (Art. 15 CC, nationality principle)   Van Dorn: 1 Filipino, 1 foreigner, divorced abroad – recognized (Art. 15 CC, estoppel)  Pilapil: 1 Filipino, 1 foreigner –  recognized (nationality principle) ________________ 

Hague Convention on Recognition of Divorce & Legal Separation:

 A foreign divorce will be recognized in all contracting states if at the date of institution of proceedings: a)

Respondent or petitioner residence there, or

had

his

habitual

b)

Both spouses were nationals of this state, or

c)

If only the petitioner was a national, he should have his habitual residence there

US Full Faith & Credit Clause of Constitution:  A sister state has the duty to recognize a divorce pronounced in a sister state, when both spouses are domiciled there.

If only the plaintiff is domiciled there: Other conditions (i.e. service of process to defendant) must be fulfilled Effect of Divorce Rendered by a Foreign Country: not covered by Full faith & credit clause

FACTS: Vicenta and Pastor were married without the knowledge of her parents. Vicenta went to the US to obtain a divorce, which was granted by the Nevada Court; she married an American and subsequently acquired American citizenship. Pastor sued Vicenta for legal separation and damages. Vicenta‘s defense is that there was a valid divorce issued by the Nevada court.

FACTS: Quita and Padlan were married in the Philippines, but Quita filed for divorce in California which was granted. She remarried twice aft er the divorce. Upon Padlan‘s death, Quita made claims upon his estate as the surviving spouse and heir of Padlan, alleging that since Padlan was a Filipino citizen, he remained married to her in spite of the divorce decree. HELD: Quita‘s right to inherit  from Padlan depends on her citizenship at the time the divorce was decreed. If she was no 30

o

but would be recognized under the same circumstance that a sister state‘s divorce  decree is given recognition.

paramount consideration: jurisdiction of foreign court based on parties‘ domicile .

Philippine Law on Recognition of Foreign Divorce Decree: No provision on recognition of divorce decree b/w nonFilipinos; but such will be recognized under international o comity, provided it does not violate a strongly held policy of the Philippines

o

o

o

o

Effect: Affects status & domestic relations of parties.

M&F, domiciliaries of STATE A, both 18  years old marry in STATE B w/out knowledge of their parents suit for annulment was brought in STATE C (place of M‘s residence)

State C can exercise JD over the case but what is the  governing law?

o

o

Personal law of the child is the national law of the father if the child is legitimate or legitimated. Personal law of the child is the national law of the mother if the child is illegitimate. Legitimacy of the child determined by the national law of the father if both parents are not Filipino.

In the UNITED STATES: as per Second Restatement On Legitimacy of the American Law Institute

Distinction from Divorce

The ground occurs after marriage celebration

o

Traditional choice-of-Law rules: will find sufficient ground for the challenge If the lex loci celebrationis (STATE B) requires parental consent for a  valid marriage



Most Significant Relationship Approach: will not  yield a ground for annulment. State C can conclude that since law of STATE A (state of marital domicile) gives people their age full capacity to marry, no ground for annulment

Based on defects present at time of celebration

Grounds for Annulment & Nullity: o



States w/ traditional choice-of-law approach: follow the lex loci celebrationis  States w/ policy-centered approach: follow the law of state of marital domicile (considered to have the most significant interest in status of persons)

o

 Art. 211 FC: Reference to father‘s personal law may result in joint exercise of parental authority  Art. 176 FC: Personal law could grant parental authority to mother of illegitimate children

Scope of Parental Authority:

 What law determines legiti macy of a child? Personal law of parents - either domicile or nationality.

Both lex loci celebrationis and law of marital domicile can provide jurisdictional basis, but only one can be a choice-oflaw in the determination of the annulment decree.

Most countries: f ather‘s personal law  German law: law of head of family

 Which states can claim adequate jurisdicti onal basis to hear a conflicts annulment or nullity case?

Law on parental relations include: Paternity o Filiation o

Wheaton vs. Wheaton:   Even a court which acquires personal JD over parties can grant an annulment case (US case).

What law controls?  Father‘s personal law controls rights & duties of parents & children.

o

Note that in either traditional or policy-centered approaches, lex fori  is not used; recall that lex fori  can be used in divorce.

state where marriage was celebrated place of marital domicile

Child is legitimate if this is his status under the local law where the parent is domiciled when the child‘s legitimacy is claimed OR when the parent acknowledged the child as his own.

Parental Authority over the Child -from concept of patria potestas of Roman law

The Choice of Law rule of STATE C will be irrelevant

In both approaches, lex fori   (which is crucial in divorce) does not play substantial role because the action turns on the  validity of the marriage.

a) b)

o

 What law governs legitimacy of child in the Philippines? National law of the parents.

1)

care & rearing

2)

action a parent may file against another for child custody

3)

requirements for parental consent of child‘s marriage

Definition: The act by which relations of paternity & affiliation as legally existing b/w persons not so related by nature.

If parents are of different nationality: national law of father is controlling.

It is a judicial act w/c creates b/w 2 persons a relationship similar to that w/c results from legitimate paternity & affiliation.

In the PHILIPPINES:

Early societies considered it as a means of perpetuating a house or cult threatened by extinction. 31

1) Original purpose: solace for childless or people who lost children

 Aliens who have resided in the Philippines for 3  years prior to the date of filing the applicati on for adoption, and maintains residency until decree of adoption is granted QUALIFIED TO ADOPT

Effects Of Adoption

 What law governs rights of adopted child & other effects of legal adption? ( law that governed the creation of adoption)

Recent time: broader, more humane aim Social & moral purpose: extend protection of society (in the person of adopter) to the orphan. Thus, persons eligible to adopt expanded What law governs? lex domicilii The adoption process affects status of parties, necessarily governed by lex domicilii . What if prospective adoptive parent is domiciled in one state Twin problems of & the child is domiciled in another?   jurisdiction and choice-of-law.

2)

Other requirements: a) certification of legal capacity b) certification that the State law would allow entry of the adoptee as an adopted child of the adopter.

These other requirements may be waived if the adoptee is related by consanguinity or affinity to the adopter, or o his/ her spouse as specified by law. o

If the main object of adoption is the welfare of the child, the personal law of the child is the best choice-of-law to govern his rights

RA 8043: Before this, adoption of Filipino children by foreigners was done pursuant to Rules & Regulations on Foreign Adoption & bilateral agreements.

But the personal law of the child cannot be successfully used to invoke jurisdiction if his domicile is merely constructive or if he is a citizen of a state but he doesn‘t reside there.

RA 8043 regulate the adoption of Filipino children by aliens, or o Filipino citizens permanently residing o abroad.

Child‘s personal law as basis for exercise of jurisdiction  weakened in situations where child‘s domicile is: merely constructive, or o o if he is a citizen of a state but he doesn‘t reside there (there is little basis for court to protect child interest competently)

RA 8043 was passed in compliance with our treaty obligation as a signatory to the Hague Convention on Protection of Children & Cooperation In Respect of Intercountry  Adoption.

o

o

The continuous movement of people in & out of countries should also be factored in. Can an alien adopt a child in the Philippines? General Rule: not allowed Reason: Different family orientation, cultures, customs & traditions could pose problems of adaptation for child. Exceptions:  Art 184 . Aliens who have some relationship with o the child by consanguinity or affinity o

RA 8552 (Domestic Adoption Act Of 1998)

These two introduced significant changes in adoption law. Change Pertinent to Conflict Law 

Convention pursues modern concept of adoption:  After possibilities of adoption for placement of child within state of origin have been exhausted, intercountry adoptions may be placed in the best interest of the child.

2   different legal orders depending on which law governed the creation of adoption:

1)

If Personal law of adopter applied—same governs effects of adoption.

law

2)

If personal law of child applied —such law will cease to regulate the resulting parent-child relations; it will yield to the personal law of adopting parents.

Philippine courts:  Adoption relates to a civil rights of adopted o child Does not effect changes in political rights, o including eligibility to acquire adopter‘s citizenship In the Philippines, principles of enforcement & recognition of a foreign judgment governs, because the decree granting an adoption is in the form of a foreign judgment.

FACTS: Therkelsen (a German) and his wife Erlinda (a Filipino), filed a petition to adopt Erlinda‘s natural child. The application was denied on the ground that an alien cannot adopt a Filipino unless the adoption would make the Filipino minor a citizen of the alien‘s country.

FACTS: Hughes is married to Lenita, a Filipina who was later naturalized as an American citizen. They filed a petition to adopt the 3 nephews and niece of Lenita, which was granted.

HELD: The application should be granted. Being a permanent resident here, Therkelsen is not disqualified to adopt under our laws; to deny the application on the above stated ground would be to impose a further requisite on adoptions by aliens beyond those required by law. The citizenship of the adopter is a matter political, not civil in nature, and the ways in which it should be conferred lay outside the ambit of the Civil Code.

HELD: Hughes is not qualified to adopt since he does not fall under the exceptions in Art. 184 of the Family Code.  While Lenita, as a former Filipino, is qualified to adopt under that provision, the adoption decree still cannot be granted because of the requirement in Art. 185 that spouses must jointly adopt. They cannot do this in CAB because Hughes is not qualified under the law.

FACTS: Marcosa married Ng Chion Te. She adopted his 2 children by a previous marriage and brought one of them to the Philippines to study. The child, Ng Hian, was refused entry into the Philippines.

32

HELD: Ng Hian may enter the Philippines by virtue of being adopted by one who has a right to do so. In the case of Ex Parte Fong Yim, it was held that a Chinese merchant domiciled in the US has the right to bring into this country  with his wife minor children legally adopted by him in China, where it is shown that the adoption was bona fide, and that the children have lived as members of his family and have been supported by him for several years.

In the Philippines, rea l and personal property are ―subject to the law of the country where it is situated‖ (Art. 16 CC). a problem regarding classification will arise only when the property is located in a foreign country which has a law that distinguishes between real and personal property.

For real property, there is very little room for choice of law, because of the emphasis on lex situs .

Property physically a part of the particular state, and that state can exercise JD over it (traditional approach) 2) There is need for reliable records (to protect the sanctity of records) ________________

HELD: The sale was valid. He has no capacity to question the sale of the property by his wife on the theory that in doing so he is merely exercising the prerogative of a husband in respect of conjugal property. This would permit indirect controversion of the constitutional prohibition. If the property were to be declared conjugal, this would accord to the alien husband an interest and right over the land, which is not granted to him under the Constitution.

This is governed by the law of the place where the property is located.

The lex situs law applies to the following:

 Why? 1)

The first issue to resolve in conflicts cases involving property is whether it is a movable or an immovable, because upon this determination will depend the controlling legal system. Immovables: regulated by lex situs ; underlying this is the characterization of immovable property as an isolated object of rights so that the interests of various persons are determined by the law of the place where the land is situated.

The connecting factor is the immovable itself and not the parties concerned. Movables: not necessarily governed by the lex situs ; its transfer may be controlled by the a) lex domicilii , b) lex situs, or c) lex loci actus (the proper law of transfer). Lex domicilii : the rights over the movables are governed by the law of the owner‘s domicile. Lex situs:  the state where the property is situated has the sole power to decide the validity and effects of the transfer of property. Also, the parties‘ legitimate expectations are protected. The rationale for this is that being physically part of the country, it should be subject to the laws thereof. The situs is the place most closely and significantly related to the issue in question.

 Alternatives to lex domicilii  and lex situs : a)

Lex loci actus : law of the place where the transaction was completed

b)

the proper law of the forum: law of the state which has the most real connection with the transfer

FACTS: Thomas Cheesman (an American) was married to a Filipina, Criselda. The spouses later separated; but Thomas brought this action to annul the sale of real property made by Criselda in favor of Padilla. He alleged that the sale is void for lack of his consent. The property sold was bought by Criselda using her personal funds, and  was registered in her name only.

FACTS: The Llantinos leased real property to Chong, a Chinese national (but subsequently naturalized as a Filipino), for 60 years. The Llantinos filed an action to quiet title, claiming that the lease contract was invalid for circumventing the constitutional prohibition on the acquisition of land by aliens. HELD: The lease contract was valid, and Chong had the right to hold by lease the property involved although at the time of execution of the contract, he was still a Chinese national. In CAB there was no option to buy the leased property in favor of Chong. There is nothing in the record to indicate any scheme to circumvent the constitutional prohibition.  Aliens are not completely excluded by the Constitution from use of lands for residential purposes. Since their residence in the Philippines is temporary, they may be granted temporary rights, such as a lease contract which is not forbidden in the Constitution. The only instance where a lease contract may be considered invalid is where there are circumstances attendant to its execution which are used as a scheme to circumvent the constitutional prohibition. 33

1)

formalities of a contract to convey property

2)

the essential validity of the transfer (unless the lex intentionis  is clearly established)

3)

the effects of the conveyance or properties

3 Exceptions to the Lex Situs rule: 1)

 where the transaction does not affect transfer of title to or ownership   of the land (proper law: lex intentionis or lex voluntatis )

FACTS: Bailey secured a debt payable in Iowa to Liljedahl; as security, he mortgaged his land in Colorado. Bailey sold this land to Glassgow, with the provision in the deed of sale that the grantee agrees to pay the mortgagee. Glassgow sold the land to a third party. Under Iowa law, Glassgow became bound to pay the mortgage, but not under Colorado law. HELD: Iowa law should apply, and Glassgow should pay Liljedahl. Instruments of conveyance, as they relate primarily

to title, are to be construed according to the law of the situs . But personal covenants or agreements in instruments of conveyance will be given effect according to the law of the place where the same is executed and to be performed.

2)

3)

in contracts where real property is offered by way of a security for the performance of an obligation such as loan, where the security is merely an accessory contract   (the principal contract is governed by the rules on ordinary contract, while the accessory contract on the land is governed by the rule of lex situs ) testate or intestate succession and capacity to succeed , which are governed by the national law of the decedent

Under a policy-centered approach, the forum court is not bound to look to the law of the situs when the situs of the movable property at the time of the transfer was insignificant or accidental.  Also, when the iss ue involves considerations other than the  validity and effect of the transfer its elf, the courts may look to the law of another state which has a real interest in applying its law. Rudow vs. Fogel:   since the issue did not relate to land title but to whether the conveyance would result in a constructive trust among family members, the law applicable is the law of the domicile of the trustor and trustee instead of the lex situs  of the property.

Leon vs. Manufacturers Life Insurance: having been endorsed in an annuity in Canada under a contract executed in that country, Canada was the situs of the money, hence the probate court of Manila has no JD over the funds.

2 Kinds of Movable Property: 1)

choses in possession –  embraces all types of tangible physical objects

2)

choses in action – refers to intangible objects a) b)

mere rights of actions rights represented by a document (capable of delivery and susceptible to negotiation as a separate legal entity)

FACTS: Harris and Balk are both North Carolina domiciliaries. Harris owed Balk a sum of money. When he  was in Baltimore he was served a writ of garnishment, it appearing that Balk has a debtor there. He paid pursuant to the writ, but when he returned to N. Carolina, Balk sued him for recovery of his indebtedness. Harris pleaded the recovery of the Maryland judgment. HELD: The attachment of Harris‘ debt is valid, and t he North Carolina court should give credit to the Maryland  judgment. The obligation of the debtor to pay his debt cl ings to and accompanies him wherever he goes. He is as much bound to pay his debt in a foreign state when therein sued upon his obligation by his creditor, as he was in the state  where the debt was contracted.

The maxim mobilia sequuntur personam   cannot be applied to limit the right of the state to tax property within its JD. It  yields to established facts of legal ownership, actual presence, and control elsewhere, and cannot be applied if it  would result in inescapable and patent injustice.

Under the Corporation Code (Sec. 63), shares of stock are personal property and may be transferred by delivery of the certificate or certificates indorsed by the owner or his attorney in fact. But such transfer shall not be valid until recorded in the books of the corporation in the manner provided.

Prof. Beale: this decision did injustice to the creditor, as he has no power to fix the personal presence of his debtor at one place or another. It is unjust to submit the creditor‘s claim to the accident of the debtor‘s presence in one state or another.

FACTS: The Collector of Internal Revenue assessed deficiency income taxes against Calamba Sugar Estates for the capital gains on the sale of Pampanga Sugar Mills shares of stock. The sales were conducted in SF, California, and payments were made there. HELD: CSE not liable for income tax on the capital gains. The government cannot impose income taxes on capital gains where the sale took place outside its territorial JD. Foreign corporations may be levied income taxes only on income derived from sources within the Philippines. With respect to capital gains, the place of the sale (which in CAB is California) is also the place or source of the capital gain.

The Philippines is a party to the Union Convention for the Protection of Industrial Property; said convention states in  Art. 8 that a ―trade name shall be protected in all the countries of the Union without the obligation of filing of registration, whether or not it forms part of the trade name.‖ Western Equipment and Supply Co. vs. Reyes;   although  Western equipment has not done business in the Philippines, it has the right to protect its reputation. The right to the use of the company‘s corporate and trade name is a property right which may be asserted against the whole  world.

RA 8293 (Intellectual Property Code): applicant cannot register marks ―well known internationally and in the Philippines, whether or not it is registered here, xxx and is used for identical or similar goods or services.‖ Under Sec. 3 of the IPC, any foreign corporation which is a national or domiciliary of a country which is a party to a convention, treaty or agreement relating to intellectual

34

property rights to which the Philippines is also a party or extends reciprocal rights to our nationals by law ―shall be entitled to benefits to the extent necessary to give effect to any provision of s uch convention…‖

HELD: A corporation‘s right to use its corporate and trade name is a property right, a right in rem , which it may assert and protect against the world in the same manner as it may protect its tangible property, real or personal, against trespass or conversion. It is regarded, to a certain extent, as a property right and one which cannot be impaired or defeated by subsequent appropriation by another corporation in the same field.

FACTS: H. D. Lee Co., a foreign corporation, filed a petition for cancellation of registration of the trademark ―Stylistic Mr. Lee‖ used on items of clothing by Emerald Garments, alleging that it so closely resembled H. D. Lee‘s trademark as to cause confusion, mistake and deception on the public as to the origin of the goods. HELD: A foreign corporation may have the capacity to sue for infringement irrespective of lack of business activity in the Philippines on account of Section 21-A of the Trademark Law but the question of whether they have an exclusive right over their symbol as to justify issuance of the xxx writ will depend on actual use of their trademarks in the Philippines.

Contract: meeting of the minds between 2 persons whereby one binds himself, with respect to the other, to give something or render some service. Parties are bound not only to those expressly stipulated but also to all the consequences which according to their nature, may be in keeping with good faith, usage and law.  As a gen. rule, unless provided by law or in the agreement, a contract is obligatory in whatever form it may have been entered into provided that all the essential requisites for validity are present.

Principal purposes of contract: 1. protect the reasonable expectations of the parties to the contract

2.

secure stability in commercial transactions

States, in their municipal laws, have different rules on the formalities of a contract, the capacity of parties, and the essential requisites for the intrinsic validity of contracts, interpretation and the law governing execution. Forum court should be aware if there is a law that parties have in mind  when they entered into a contract. Interpretations of contracts are applied only when the lex loci intentionis  cannot be ascertained. Unlike family law, contract law does not reflect strong state policies or values.

Lex loci celebrationis governs the formal or extrinsic validity of contracts. A contract is valid as to form if in accordance  with any form recognized as valid by the law of the country  where made, and that no contract is v alid which is not made in accordance with the local form.  Art 17, CC The forms and solemnities of contracts, wills, and other public instruments shall be governed by the laws of the country in which they are executed.

 As to Contracts entered into by cablegram, telex or fax:  Art. 1319, CC states that acceptance made by letter or telegram does not bind the offeror except from the time it came to his knowledge. The contract is presumed to have been entered into the place where the offer was made.

Intrinsic validity refers to nature, contents and effects of the agreement.

 Art. 1318, CC : requisites of a contract a. consent of the contracting parties b. object certain c. cause of the obligation

There are 3 possible laws that will govern intrinsic validity of contracts: 35

1. 2. 3.

law of the place of the making law of the place of performance law intended by the parties

This refers to the law of the place where the contract is made. This is the place where the last act is done which is necessary to bring the binding agreement into being so far as the acts of the parties are concerned.  Advantages: a)

relative ease in establishing place of contracting

b)

in applying it consistently, certainty and stability are achieved.

Disadvantage: it will lead to unjust results when the place of making is entirely incidental or casual and has no significant relationship with the contract or its performance.

This refers to the law of the place of the performance. All matters relating to time, place, manner of performance, sufficiency of performance and valid excuses for nonperformance are determined by lex loci solutionis   because it is undoubtedly related to the contract in a significant way.

FACTS: Valderama & Sons, thru an n agent, entered into a contract for purchase of railroad equipment with Macmillan in Canada. Valderama failed to get an import license because the Import Control Comm failed to act on his application. Macmillan suffered damages because it had to cancel the freight engagement. HELD: Lex loci solutionis applies. The general rule governing the validity & construction of a contract & the rights and liabilities thereunder is that the law of the place of performance applies. In case of conflict in determining validity, nature and obligation and effect of contract, lex loci solutionis prevails over lex loci contractus .

The laws of Canada, which is the place of performance, should apply. The failure of the Import Control Comm. to act on the application of import license cannot constitute a legal excuse for his failure to perform his obligations under the contract.

This refers to the law intended by the parties. When the parties stipulate that the contract be governed by a specific law, such will be recognized unless there are cogent reasons for not doing so e.g. the choice-of-law provision is contrary to a fundamental policy of the forum.  Also construction and interpretation of contracts may be agreed upon by parties.

The parties may stipulate on the venue of the suit in case of litigation concerning the contract. It is a general rule that plaintiff has the option to choose the  venue where the suit is to be filed in action in personam . However, a case arising from the contract will be litigated only in the forum chosen by the parties if the choice of forum clause specifically identifies it as the only venue. Sec. 80, Sec. 3, Restatement Second. If the parties have agreed in writing that an action shall on a controversy be brought only in another state and it is brought in a court of this state, the court will dismiss or stay the action, unless:

1. 2.

 Art 1306, CC The contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient, provided that they are not contrary to law, morals, good customs, public order or public policy.  Art, 1370, CC If the terms of the contract are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of the stipulations shall control.

The law looks at the acts of the parties and the surrounding circumstances which may possibly have exerted some influence upon their actions and then assumes that their intentions are in harmony with such acts and circumstances. Parties are presumed to contemplate to enter into a valid contract. The court should apply the law that will sustain the contract.

3. 4.

5.

the court is required by statute to entertain the action plaintiff cannot secure effective relief in other state for reasons other than delay the other state would substantially be a less convenient place of trial the agreement as to place of action was obtained by misrepresentation, duress, abuse of economic power or other unconscionable means it would be unfair or unreasonable to enforce the agreement

FACTS: Compagnie (french) and Hamburg (Germany) entered into a charter party to transport C‘s goods from Saigon- Europe. Because of the impending war between France & Germany, the ship went to Manila because Saigon is a French port. C filed for breach of contract. H contested the jurisdiction of Phil courts to try the case because the contract had a clause directing the settlement of disputes first to a Board of Arbitration in England. HELD: Phil. courts have jurisdiction. The parties are free to waive the stipulation if they so desired.

The capacity to enter into contracts is governed by the rule on status and capacity (personal law). In countries that follow the nationality principle, the national law prevails (art. 15, CC). In countries that follow the domiciliary principle, law of their domicile governs.

Phil courts cannot be ousted of their jurisdiction by the contractual stipulation in the absence of averment and proof that under the law of England (place of contracting), compliance with, or an offer to comply with such a stipulation constitutes a condition precedent to the institution of judicial proceeding for the enforcement of the contract. Besides, Hamburg appeared and answered without objecting to the court‘s jurisdiction; it  also sought affirmative relief.

36

FACTS: King Mau entered into an agency agreement with the Sycip in New York. King mau was able to sell 1,000 tons of coconut oil. KM brought an action to collect commission from the sale. Sycip claimed that the Phil court has no  jurisdiction as the contract was entered in New York. HELD: Phil court has jurisdiction. A non-resident may sue a resident in the courts of this country where the defendant may be summoned and his property leviable upon execution in case of a favorable, if final and executory judgment. It is a personal action for the collection of a sum of money  which the CFIs have jurisdiction to try and decide.

FACTS: HSBC granted Eastern Book Supply an overdraft secured by the directors of the latter. Eastern failed to pay. HSBC filed suit in RTC. The defense of the directors is that Phil courts have no jurisdiction because in the Guarantee  Agreement, it was provided that Singapore shall have  jurisdiction over all disputes arising therein. HELD: Phil courts have jurisdiction. The parties did not stipulate that only the courts of Singapore, to the exclusion of all the rest, has jurisdiction. Neither did the clause in question operate to divest Phil. courts of jurisdiction.  Jurisdiction is defined as the right of a State to exercise authority over persons and things within its boundaries subject to certain exceptions. This authority is exclusive  within and throughout the domain of the State.

Pangalangan: HSBC   case is disappointing — why did the courts not recognize the choice of forum clause? Courts are ―turf -conscious‖; for PRIL to progress, there is a need for each country to give up some of its exercise of sovereignty. _______________

forum experienced and capable in the resolution of admiralty litigation.

( FACTS: Puromines and Philip Bros. entered into a contract of sale with an arbitration clause. Puromines filed for complaint in RTC, Manila. Philip Bros. filed a MTD on the basis of an arbitration clause. HELD: Arbitration clause is valid. Puromines derives its right from the bill of lading together with the sales contract & it is bound by the provisions and terms of the bill of lading and of the arbitration clause incorporated in the sales contract. The courts will look with favor upon such amicable settlements (arbitration) and will only interfere with great reluctance to anticipate or nullify t he action of the arbitrator.

FACTS: contract Contract that any courts.

Zapata, a Houston company, entered into a of towage with Unterweser, a German corp. contained a forum selection clause which provides dispute arising must be treated before London

Zapata filed a suit in admiralty against Unterweser for breach of contract and damages in Florida District Court. Unterweser filed motion to dismiss for lack of jurisdiction citing the forum-selection clause. HELD: Florida court has no jurisdiction. As a rule, a forum clause should control absent a strong showing that it should be set aside. Court should enforce the forum clause specifically unless Zapata could clearly show that a. b. c.

d.

enforcement would be unreasonable and unjust or that the clause was invalid for such reasons as fraud or overreaching or if enforcement would contravene a strong public policy of the forum in which suit is brought, whether declared by a statute or by judicial decision or if the chosen forum is seriously inconvenient for the trial of the action. But if the parties contemplated the claimed inconvenience, it should not be heard to render the forum clause unenforceable.

The CAB involves a freely negotiated international commercial contract between the parties. As noted, selection of a London forum was clearly a reasonable effort to bring  vital certainty to this int‘l transaction and to provide a neutral

 Adhesion contract is one that is not negotiated by the parties having been drafted by the dominant party and usually embodied in a standardized form. It is called a contract of adhesion because the participation of 1 party is limited to affixing her signature.

FACTS: Rapadas‘ samsonite was lost and Pan Am offered to settle the claim for $160. Rapadas refused and filed an action in court. The defense of Pan Am is that the claim is subject to the Notice of baggage Liability Limitations contained in the passenger ticket. HELD: The liability is limited by the Notice of Baggage liability. Although the ticket is a contract of adhesion, it does not offend against the policy of the law forbidding one from contracting against his own negligence. The one who adheres to the contract is in reality free to reject it entirely. Court finds the provisions in the plane ticket sufficient to govern the limitations of liabilities of the airline for loss of luggage. The passenger, upon receiving his plane ticket, was expected to be vigilant insofar as his luggage is concerned.

FACTS: Mejia shipped through PAL 1 microwave oven from San Francisco to Manila. Upon arrival, she discovered that the front glass door was broken and the oven could not be used. Mejia filed action against PAL. PAL denied liability and alleged that it acted in conformity with the Warsaw Convention. HELD: Although the airway bill is binding between the parties, the liability of Pal is not limited on the provisions of the airway bill. While the Warsaw Convention is law in the Philippines, the Philippines being a signatory thereto, it does not operate as an exclusive enumeration of the instances  when a carrier shall be liable for breach of contract or as an absolute limit of the extent of liability nor does it preclude the operation of the Civil Code or other pertinent laws.  Also, the willful misconduct and i nsensitivity of the offi cers of PAL in not attempting to explain the damage despite due 37

demand and the unexplained delay in acting on her claim, amounted to bad faith and renders unquestionable its liability for damages.

Specific Instances where court disregarded the adhesion contract: 1)  when the party is not literate in the language of the contract with knowledge of what was intended

2)

 when there is undue advantage made by a dominant party usually a huge corporation or a business monopoly

3)

 when there is ambiguity in the adhes ion contract, it must be resolved contra preferentum and in favor of the party impugning it

4)

 when it is subversive of public policy when the  weaker party is imposed upon in dealing with the dominant bargaining party and is reduced to the alternative of taking it or leaving it, completely deprived of the opportunity to bargain on equal footing

Sweet Lines vs. Teves : Petitioners assail the validity of the tickets issued by Sweet Lines.

HELD: The adhesion contract is void. It is not just and proper to expect that the passengers examined their tickets from the crowded counters esp. if there are a number of conditions in fine print. Also, shipping companies, esp. inter-island vessels, possess a virtual monopoly over the business of transporting the passengers between ports covered by their franchise. Lastly, the court took judicial notice of the fact that these passengers come from lowincome groups and are less literate and who have little or no choice but to avail of petitioner‘s vessels.

Parties may include any stipulation as long as such stipulations do not violate public policy or morals of the forum. Lessons: PanAm: not all contracts of adhesion are against public policy; balancing of interests (airline vs. passenger)  PAL vs. CA:  when there is ambiguity in adhesion contract, construe against the drafter. ________________ 

Liabilities of the Carrier: a. In sales or barter of goods, the law of the place where the property is located will govern ( lex situs ).

b.

 A simple loan granted by financial institutions is governed by the law of the permanent place of business. But if granted by a private individual, it is governed by the law of the place  where the loan was obtained. c. In contracts of pledge, chattel mortgage and antichresis, the extrinsic and intrinsic validity of the contracts are governed by lex situs . d. Carriage of Goods by Sea

e.

FACTS: K shipped on board APL‘s vessel personal effects. Because of damage to the effects, K sued APL. CA affirmed CFI‘s finding of liability but awarded damages o n the basis of the COGSA. HELD: COGSA does not apply but the Civil Code. Article 1753 of the Civil Code provides that the law of the country to which the goods are to be transported shall govern the liability of the common carrier in case of loss, destruction or deterioration. Under Article 1766, "In all matters not regulated by this Code, the rights and obligations of common carriers shall be governed by the Code of Commerce and by special laws," and in the Civil Code there are provisions that govern said rights and obligations.  Although Section 4 (5) of the Carriage of Goods by Sea Act states that the carrier shall not be liable in an amount exceeding $500.00 per package unless the value of the goods had been declared by the shipper and inserted in the bill of lading, this is merely suppletory  to the provisions of the Civil Code.

Contracts for International Air Transportation

The Warsaw Convention and amendments to the same regulate and establish uniform rules and regulations on the liability of international airline carriers in cases of death, injuries of passengers or loss or damage of cargo. The Phils. became a member thereof in 1951.

in case of death or wounding- carrier‘s liability is not more than $75,000. The limits do not apply when the damage is caused by the act or omission of the carrier, his servants or agents, done with the intent to cause damage or recklessly and  with knowledge that damage would probably result, provided that the agent was acting within the scope of his employment. In case of loss or damage to baggage - $20/kilo for checked baggage and $400/passenger for unchecked luggage unless a higher valuation is agreed upon by the parties Prescription. Action must be brought within 2 years from date of arrival at the destination, or from date  which the aircraft ought to have arrived or from the date on which the transportation stopped.  Venue. Any action for damages may be brought either in the court of the 1. domicile of the carrier 2. principal place of business 3. place of business where the contract was made 4. place of destination 5. Successive Carriers. Each of the successive carriers is bound by the rules on the Convention and shall be deemed to be one of the contracting parties insofar as the part of the transportation which is performed under his supervision. But for goods or baggage, the passenger or consignor has a right of action against the first carrier and the consignee  who is entitled to receive the same, against the last carrier. They must take action against the carrier  who performed the transportation during which the loss, damage or delay took place.

FACTS: Despite several confirmations, Sen. Lopez and his family failed to get 1   class seats and were constrained to board as tourist passengers of PanAm. CFI, Rizal awarded damages in their favor. Pan Am admitted the breach of contract but not the finding of bad faith st 

HELD: Pan Am acted in bad faith. Pan Am misled the Lopezes into believing the reservations were valid and was prompted by self-interests in dong the same (precluding the Lopezes to secure other tickets). Also, there was negligence by its employees that were so gross and reckless as to amount to malice and bad faith, e.g. erroneous cancellation of reservation, not confirming reinstatement of reservation, 38

confirming reservation even if EE had knowledge that they  were merely waitlisted and not notifying Lopezes of the cancellation.

FACTS: Mendozas went on a world tour. KLM issued the tickets for the whole trip. Their coupon for Aer Lingus was marked RQ. Thru KLM‘s help, reservations were made in the Aer Lingus flight. Upon arrival, only the minors were allowed to board. Mendoza sued for breach of contract and for damages bec. of the humiliation they suffered. KLM denied liability on the basis of Art. 30 of the Warsaw Convention (successive carriers liability) HELD: Art. 30 does not apply and KLM should be accountable for the tortious act of Aer Lingus.Art. 30 presupposes either an accident or delay and not the situation in CAB. Although the tickets provide that KLM‘s liability for damages is limited to occurrences in its own airlines, this provision was printed in very small letters such that a magnifying glass is needed to read it. It would be unfair to charge Mendozas of automatic knowledge and it is the duty of KLM to inform them of the conditions prescribed in the tickets or at least make sure that they read them before they accepted the tickets. This it failed to do.

FACTS: Mendoza bought conjunction tickets from Singapore Airlines. Although it was not a participating airline, AA exchanged the unused portion of the ticket for a one-way ticket to New York. However, Mendoza was prevented by AA‘s security off icers from boarding until all the other passengers have boarded. He sued action for damages against AA in RTC. AA claimed that the issuance of a new ticket created a separate contract of carriage from the one with SA and therefore, under Art. 28, RTC had no  jurisdiction over the case against AA. HELD: RTC had jurisdiction; the new ticket is not considered as separate from the one issued by SA but the contract of carriage constitutes a single operation. SA & AA are members of the IATA and under the general pool partnership agreement they act as agents of each other in the issuance of tickets to contracted passengers. When AA exchanged the ticket, it entered it in the IATA clearing house and undertook to transport M. It thereby assumed the obligation to take the place of the principal carrier originally

designated and constituted itself as an agent of SA. The number of tickets issued does not detract from the oneness of the contract of carriage as long as the parties regard the contract as a single operation.

FACTS: Chiok purchased ticket from CAL exclusively endorsable to PAL. While in Hkong, his flight was confirmed by both CAL and PAL attaching their respective stickers. On the day of his flight to Manila, he was informed by a PAL employee that he was not in the computer list so he was not allowed to board. Using another CAL ticket, he  was able to return to Manila. C sued CAL. CAL denied liability as the carriage was performed by PAL. HELD: Cal is liable. The ruling in KLM is applicable. The contract was between CAL and C, with the former endorsing to PAL the HK-Mla segment. This can be treated as a single operation under Art. 15, IATA Rules and Art. 1 of the  Warsaw Convention  Art. 1, Sec. 3 WC: transportation to be performed by several successive carriers shall be deemed to be one undivided transportation, if it has been regarded by the parties as a single operation, whether it has been agreed upon under the form of a single contract or of a series of contracts.  Art. 15 IATA: carriage to be performed by several successive carriers under one ticket, or under a ticket and any conjunction ticket issued therewith, is regarded as a single operation. Pal acted as carrying agent of CAL, thus, CAL cannot evade liability.

FACTS: Santos bought a roundtrip (SF-Manila-SF) ticket from NW airlines office in SF. Despite previous confirmations, he was informed that he had no reservation on his trip. He sued NW for damages in RTC Makati. NW filed MTD for lack of jurisdiction. HELD: Phil court has no jurisdiction to hear the case under  Art. 28 of the Warsaw Convention. This article enumerates the places where action must be filed, to wit: 1. Domicile –  Minnesota, USA (domicile must be understood in the English sense –  place of incorporation) 2. principal place of business – Minnesota

3.

place of business where contract is made –  San Francisco place of destination –  San Francisco (not Manila because it was merely an agreed stopping place, SF is still the ultimate place of destination

2)

if it ousts the jurisdiction which the court has already acquired over the parties and the subject matter

3)

if it affects a public policy or the matter is heavily impressed with public interest

Distinction between KLM and China Air: in KLM, KLM  was the only company the passenger dealt with; in Chiok, it  was alleged that Chiok himself (passenger) requested f or the PAL booking. It can then be argued that CAL should not be held liable. ________________

4)

in case of confession-of-judgment clauses (waives the debtors right to receive notice or authorizes entry of judgment)

4.

 According to the 2   Restatement, in the absence of an effective choice of law, these factors will be considered in determining the state with which contract has its most significant relationship nd

1. 2. 3. 4. 5. 6.

place of contracting place of negotiating of the contract place of performance situs of the subject matter of the contract domicile, residence, nationality, place of incorporation and place of business place under whose local law the contract will be most effective

Courts should localize the contract by examining the contacts it has with a state relative to the cogency to the issue. Example: For contracts involving liability for destruction of goods in transit, the state of the most significant relationship is the state of destination. In the absence of an effective choice of law, courts applying a policy-centered approach will apply its own law when there are significant contacts with the transaction. Once these exist, the forum has a real interest in applying its own law and such  would not be fundamentally unfair to the parti es. The co urt should also consider the legitimate expectations of the parties.

1)

if the law selected has no connection at all with the transaction or the parties 39

Will or testament: act whereby a person is permitted, w/ formalities prescribed by law, to determine to a certain extent the distribution of his estate to take effect after his death.

It is a disposition made by a competent testator in the form prescribed by law of property over which he has legal power of disposition Conflicts of Law Perspective:  Will: an involuntary transfer of property, becaus e it comes into effect only upon death of owner. Death is involuntary, thus making a will is an involuntary transfer of property.  Wills are governed by the ―proper law‖ common law- law of domicile of testator o civil law- national law of testator o

Filipino national making a will abroad may comply with: o lex nationalii (no express provision) or o lex loci celebrationis (Art 17, 815) Pertinent Conflict-of-law rules: (referring to law of place where will was executed as law governing forms & solemnities of will)  Art 17 : The forms and solemnities of contracts, wills, and other public instruments shall be governed by the laws of the country in which they are executed.  When the acts referred to are executed before the diplomatic or consular officials of the Republic of the

Philippines in a foreign country, the solemnities established by Philippine laws shall be observed in their execution. Prohibitive laws concerning persons, their acts or property, and those which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country.  Art 815 : When a Filipino is in a foreign country, he is authorized to make a will in any of the forms established by the law of the country in which he may be. Such will may be probated in the Philippines. (n)

What is the proper law for wills written abroad by Filipinos? (There is no express provision that it is lex nationalii )

Tolentino:  Art 815 follows general rule of lex loci celebrationis. The Civil Code did not mean to invalidate the will of a Filipino made in conformity w/ Phil law.

FACTS: Ebba Ingeborg sought to annul the probate of the  will of his father Emil Johnson, because the resulting intestacy would be favorable to her as a sole heir. She stresses that Section 636 of the Code Of Civil Procedure should not govern the will executed by her father in the US, because the word ―state‖ in the body of the section is not capitalized (thus not referring to a State in the US). HELD: This interpretation is erroneous because the full phrase ―another state or country‖, means that the section refers to either a State in the US or another country. The admission of the will to probate by the CFI of Manila under Section 636 was therefore correct. Although the CFI Of Manila most likely erred in taking judicial notice of Illinois law when it promulgated that the will was executed in conformity with the laws of Illinois, Ebba is now precluded to raise this issue because the petition to annul the probate did not allege the difference between Philippine Law and Illinois law.

 Joint wills executed in the Philippines by aliens (whose laws do not prohibit it): the law is silent It is suggested that such will should not be probated if it affects heirs in the Philippines (in accordance with the expressed policy in Art 819).

Extrinsic Validity of Holographic Wills  Art 810: a holographic will is one entirely written, dated and signed by the hand of the testator himself. It is not subject to any other form, need not be witnessed and may be made in or out of the Philippines.

 Art 816 & 817 are also applicable to holographic wills Merits: o o

Extrinsic Validity of Joint Wills

o o

 Aliens making wills outside the Philippines are, under Art 816 & 817, permitted to follow: o lex nationalii o lex domicilii o lex loci celebrationis  Article 816 . The will of an alien who is abroad produces effect in the Philippines if made with the formalities prescribed by the law of the place in which he resides, or according to the formalities observed in his country, or in conformity with those which this Code prescribes. (n)  Article 817.   A will made in the Philippines by a citizen or subject of another country, which is executed in accordance  with the law of the country of which he is a citizen or subject, and which might be proved and allowed by the law of his own country, shall have the same effect as if executed according to the laws of the Philippines. (n)

It cannot be assumed that the Code places a Filipino citizen in a worse position than an alien in relation to our law. The Code should have expressly stated this considering general provision in Art 17.

 Art 818. Two or more persons cannot make a will jointly or in the same instrument, either for their reciprocal benefit or for the benefit of a third person.

Demerits: o o

 Joint wills are prohibited on grounds of public policy, because: 1)

a will is a purely personal & unilateral act & this is defeated if 2 or more persons make their will in the same instrument

2)

the revocable character of a will is defeated, because if one of testators revoke the will, the other testators will have no instrument left

3)

it exposes a testator to undue influence & may even tempt one of testators to kill the other

4)

 when a will is made jointly or in same instrument, the more aggressive spouse is liable to dictate the terms of the will for his/her own benefit - where will is also reciprocal, either of the spouses who may be wicked may be tempted to kill the other.

 Joint wills executed by Filipinos in a foreign country allowing  joint wills are expressly invalidated by law. 40

simple convenient does not require notarization guarantees absolute secrecy

o

peculiarly dangerous an invitation to forgery short statements can handwriting experts

confuse

FACTS: The will of Jennie Rider Babcock was executed in California. Babcock Templeton, being the mother of the three beneficiaries of the will, stressed that the laws of California should govern the probate since Jennie Rider Babcock acquired domicile in California. William Rider Babcock opposes this by stressing that her sister never acquired domicile in California as her latest domicile was New York. HELD: Her domicile was California, because even though she later left California for New York, she never intended to be a New York domiciliary. The trial court was also correct in admitting the will for probate under Section 636 of the Code Of Civil Procedure, because the length of time of her residence in and eventual death in the Philippines did not result into a loss of her US citizenship. She never intended to become a Philippine domiciliary, thus making Section 618 inapplicable to the will she executed abroad.

one of property and not of succession, thus making Philippine law the governing law as the lex rei sitae. - governed by lex nationalii   Art 16: Real property as well as personal property is subject to the law of the country where it is stipulated.

However, intestate and testamentary successions, both with respect to the order of succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated by the national law of the person whose succession is under consideration,  whatever may be the nature of the property and regardless of the country wherein said property may be found. (10a) Miciano vs. Brimo: Miciano, as the administrator of the estate of Joseph Brimo, filed a petition for the partition of the estate. Andre Brimo opposed the partition because the  will itself was not executed in accordance with the laws of Turkey, in violation of Article 10 of the Civil Code.

The Court decided that although Andre Brimo opposed his brother‘s intention to have Philippine laws apply he was not deemed to have contested the legacy, because the choice of law clause in the will was contrary to law. Our laws apply the lex nationalii   of decedent to determine intrinsic validity of a  will and this law was purposefully disregarded by decedent. The Court considered this clause as not imposed and ―shall I no manner prejudice the heir even if the testator should otherwise provide.

FACTS: Upon the death of Adoracion Campos, her father Hermogenes sought to be declared as owner of the entire estate as the only compulsory heir. On the other hand, Nenita Paguia (one of Adoracion‘s sisters)  sought the reprobate of the will executed by Adoracion in the US.  When the trial court allowed probate of the will in the Philippines, Hermogenes raised in issue that the allowance of the will to probate divested him of his legitime, because the will preterited him. HELD: Since the governing law with respect to the amount of successional rights is the national law of the decedent, the governing law of Adoracion‘s will is Pennsylvania law. And since Pennsylvania law does not have a system of legitimes, Hermogenes is therefore not preterited. Although the Philippines adopt a system of legitimes as a matter of public policy, such policy does not extend to the successional rights of foreigners.

General Rule: the probate court can only rule on: 1) extrinsic validity 2) due execution 3) testamentary capacity 4) compliance with requisites/solemnities prescribed by law __________________

Presence of ambiguous provisions Presumptions to help interpretation: 1) The interpretations of such should be determined in accordance w/ laws & customs of that state most probably in mind of testator 2) In case a will admits of different dispositions, the interpretation by which the disposition is to be operative shall be preferred  Article 788. If a testamentary disposition admits of different interpretations, in case of doubt, that interpretation by which the disposition is to be operative shall be preferred. (n)

 Article 829. A revocation done outside the Philippines, by a person who does not have his domicile in this country, is  valid when it is done according to the law of the place where the will was made, or according to the law of the place in  which the testator had his domicile at the time; and if the revocation takes place in this country, when it is in accordance with the provisions of this Code. (n) Revocation: 1. lex loci celebrationis 2. lex domicilii 3. according to our Code  Article 830. No will shall be revoked except in the following cases: 1) By implication of law; or

2)

By some will, codicil, or other writing executed as provided in case of wills; or

3)

By burning, tearing, canceling, or obliterating the  will with the intention of revoking it, by the testator himself, or by some other person in his presence, and by his express direction. If burned, torn, cancelled, or obliterated by some other person,  without the express direction of the testator, the  will may still be established, and the estate distributed in accordance therewith, if its contents, and due execution, and the fact of its unauthorized destruction, cancellation, or obliteration are established according to the Rules of Court. (n)

Criticisms on the Miciano vs. Brimo  decision: Considering the primacy of giving primacy to the last will and testament of the decedent, the court should have respected the wishes of the decedent (i.e. the clause in the  will should not have been annulled) by applying a policycentered approach. Using the most significant relationship approach, Philippine law would govern because Joseph Brimo is a Philippine resident, the properties are in here, and he made the will here… the only contact with Turkey is the fact of his nationality. Under the escape device of ―disingenuous characterization‖, the same result could have resulted without flouting testator‘s  will. The court could have characterized the main issue as

Interpretation of wills is to be governed by lex nationalii. If terms are clear & unambiguous: lex intentionis   When there are ambiguous provisions: intention of party may be inferred by referring to context of the will & the testator‘s acts.  Article 1371 . In order to judge the intention of the contracting parties, their contemporaneous and subsequent acts shall be principally considered. (1282)  Article 1375. Words which may have different significations shall be understood in that which is most in keeping with the nature and object of the contract. (1286) 41

Problem: Testator revokes his will in then domicile State A and dies in his new domicile State B. If his revocation under the laws of State A is invalid under State B laws, what law will apply?

Common law practice: law of the domicile at the time of death. Philippine law: law of the place of revocation.

Notice that there is a difference in the applicable law governing revocation of wills by a person domiciled in the Philippines and a non-domiciliary:  For domiciliary: the governing law is the law of the place where the revocation  was made (lex actus )  For non-domiciliary: the governing law is the law  where the will was executed  (lex loci celebrationis ) __________________

Probate: an adjudication that the last will and testament of a person was executed with all the formalities required by law

 As part of procedural law, probate is governed by the law of the forum. But the forum will still have to look at the foreign law concerning compliance with extrinsic validity.

Rule 76 Section 9 Grounds for disallowing will.:  The will shall be disallowed in any of the following cases;

Section 1. Will proved outside Philippines may be allowed here. Wills proved and allowed in a foreign country, according to the laws of such country, may be allowed, filed, and recorded by the proper Court of First Instance in the Philippines. Testamentary capacity   is the capacity to comprehend the nature of the transaction in which the testator is engaged at the time, to recollect the property to be disposed of and the persons who would naturally be supposed to have claims upon the testator, and to comprehend the manner in which the instrument will distribute his property among the objects of his bounty. ( Bugnao vs. Ubag , 014 SCRA 163)

Rule 77 Section 1 + testamentary capacity - will made in a foreign country allowed here in the Philippines !!! (see  Article 816)  A will allowed in a foreign country in accordance with the law of that country may be allowed in the Philippines… no need to prove testamentary capacity and due execution (see  Article 817). Common Law conflicts rules… 1) If the will is valid under the laws of the last domicile, the will is valid everywhere with respect to movable property  2) 

but the probate in the last domicile does not affect real property , as these will be governed by lex rei sitae

(a) If not executed and attested as required by law; (b) If the testator was insane, or otherwise mentally incapable to make a will, at the time of its execution; (c) If it was executed under duress, or the influence of fear, or threats; (d) If it was procured by undue and improper pressure and influence, on the part of the beneficiary, or of some other person for his benefit; (e) If the signature of the testator was procured by fraud or trick, and he did not intend that the instrument should be his will at the time of fixing his signature thereto. Rule 77

FACTS: Natividad Billian sought to have the will (executed in the Philippines) of his husband Jose Suntay probated. The trial court denied probate because during the course of the proceedings, the will was lost. Later, her son Silvino filed a petition for the probate of a will allegedly executed by Suntay in China. The trial court again denied probate, and  was correct in deciding t hat way, because there was no proof that: 1. the municipal district court of Amoy, China, is a probate court 2. there was a law of China on procedure in the probate or allowance of wills 3. the legal requirements for the execution of a valid  will in China in 1931 were satisfied 4. the order of the municipal district court of Amoy purports to probate the will 42

HELD: In the absence of proof that the municipal district court of Amoy is a probate court and on the Chinese law of procedure in probate matters, it may be presumed that the proceedings in the matter of probating or allowing a will in the Chinese courts are the same as those provided for in our laws on the subject. Because of this, rules on notice must be followed. Since Silvino did not cause the notification of the other heirs, this petition must fall.

FACTS: Each of the Cunanan spouses (Jose and Evelyn) executed a will in New York containing similar provisions on the presumption of survivorship. When the entire family perished in a fire that gutted their home in New York, Rafael as the named trustee in the will of Jose filed separate proceedings in New York for the probate of the wills of his brother and sister-in-law. Later, Salud Perez (mother of Evelyn) filed a petition for reprobate in Bulacan. Rafael opposed by arguing that Salud was not an heir as per New  York law which must be the law that should govern the wills as they were executed in New York. In deciding the matter, the necessary evidence that should be submitted are: (1) the due execution of the will in accordance with the foreign laws (2) the testator has his domicile in the foreign country and not in the Philippines (3) the will has been admitted to probate in such country (4) the fact that the foreign tribunal is a probate court (5) the laws of a foreign country on procedure and allowance of wills. Except for the first and last requirements, the petitioner submitted all the needed evidence. Salud failed to submit the 1   and 5   requirement. While the probate of a will is a special proceeding wherein courts should relax the rules on evidence, the goal is to receive the best evidence of which the matter is susceptible before a purported will is probated or denied probate. Not only that, Salud also failed to notify the heirs of Jose of the proceedings. st 

th

HELD: The rule that the court having jurisdiction over the reprobate of a will shall "cause notice thereof to be given as in case of an original will presented for allowance" means that with regard to notices, the will probated abroad should be treated as if it were an "original will" or a will that is presented for probate for the first time. Accordingly, compliance with Sections 3 and 4 of Rule 76, which require publication and notice by mail or personally to the "known

heirs, legatees, and devisees of the testator resident in the Philippines" and to the executor are required.

succession – national law administration – situs of property (territorial/JDal) ______________  

In determining the applicable law, consider the policies of: a) upholding the justified expectation of parties, and b) minimizing the adverse consequences that might follow from subjecting a party to the law of more than one state. Conflicts torts cases arise:

Duties of the administrator: 1)

to manage and settle the debts of the decedent (primary purpose)

2)

to distribute the residuum of the estate to the heirs (secondary purpose)

 When the will has been proved or allowed, it is the duty of the probate court to issue letters testamentary thereon to the person so named in the will upon the latter‘s application.  When there is no will, the court may appoint an administrator. Two kinds of administrators:

a)

domiciliary -power over assets located in state

b)

ancillary- appointed by a foreign court to look after the properties located in such foreign state

Trust: a right of property, real or personal, held by one party for the benefit of the other.

 when the tortious conduct and place of resulting injury are different and one state imposes higher standards than the other state

2)

 when there are different product liability laws and  varying judicial interpretations of the extent of liability

The trust contains an express choice-of-law provision. The courts usually apply that law in keeping with the policy of carrying out the intent of the creator of the trust.  When the trust does not contain an express choice-of-law provision, the Court will deem controlling the law that will sustain the validity of the trust. Choices-of-law for testamentary trusts:

a)

rules governing the intrinsic and extrinsic validity of wills

b)

lex rei sitae  with respect to the property

FACTS: BCI stocks owned by the decedent Idonah Slade Perkins were in the possession of the domiciliary administrator County Trust Company Of New York. Later, the CFI Of Manila named Renato Tayag as the ancillary administrator. When Tayag obtained a court order for the County Trust Company to deposit the stocks to him, BCI appealed.

Tort : derived from the French word torquere or ―to twist‖. It is an act or omission producing an injury to another without any previous existing lawful relation of which the act or omission may be said to be a natural outgrowth or incident.

HELD: The appeal must fail. BCI 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 situs of shares of stock is the place of domicile of the corporation. And since the power of the ancillary administrator over shares located here is beyond question, it follows that the stocks should be in the possession of Tayag.

2 Important Policies underlying substantive tort law:

Succession and administration of estates are governed by different laws:

1)

1)

to deter  socially undesirable or wrongful conduct

2)

to rectify   the consequences of the tortuous act by distributing the losses that result from accident and products liability

In view of these, the policy behind tort law will most likely be a strongly held policy of the state and as result, that state  will not easily displace its own law with the law of another state. 43

Policies: 1) deter undesirable or wrongful conduct 2) rectify consequences – by distributing the losses  similarity between family conflicts cases and torts conflicts cases: strongly held policies of the state 3 concerns in torts: 1) achieving just and reasonable results (consider the interest of both parties 2) societal interest 3) shielding defendant from unnecessary surprise Distinguish: ―upholding the legitimate expectations of parties‖ vs. ―shielding defendant from unnecessary surprise‖ –  the first is used in contracts cases, the second is used in torts cases.  Why is the ―place of the tort (locus delicti )‖  difficult to determine? Different concepts of locus delicti : 1) civil law: place of tortious conduct 2) common law: place of injury/vested rights theory  to determine lex loci delicti: determine whether  you are dealing with a civil law or common law country ________________

Lex loci delicti commissi: the law of the place where the alleged tort was committed. It determines the tort liability in matters affecting conduct and safety.

Difficulty has been encountered in determining the locus delicti   where the liability producing conduct happens in one state but the injuries are sustained in another. Common law concept of place of wrong: place where the last event necessary to make an actor liable for an alleged tort occurs. It adheres to the vested rights theory , so that if harm does not take place then the tort is not completed. Negligence or omission is not in itself actionable unless it results in injury to another. Civil law concept of place of wrong: place where the tortious conduct was committed. This is premised on the principle that the legality or illegality of a person‘s act should be determined by the law of the state where he is at the time he does such act. The traditional view (whether the situs of the tort is the place of conduct or injury) is that an actor liable by the lex loci delicti is liable everywhere. Damages arising from torts committed in one state are actionable in another state.  Alabama Railroad vs. Carrol:   the negligent infliction of an injury in one state creates a right of action there, which may be enforced in any other state or country the comity of  which admits of it.

FACTS: Loucks, a NY resident, was run down and killed by Standard Oil employees in an accident while engaged in its business. Under Massachusetts law, the corporation is liable for the death of a person where the death was caused by the negligence of the corporation‘s employees while engaged in its business. However, under NY law, the corporation is liable for such death where the death occurred in NY. The action to recover damages was filed in NY. HELD: Massachusetts law may be applied. A tort committed in one state creates a right of action that may be sued upon in another unless public policy forbids. A foreign statute is not law in the state, but it gives rise to an obligation,  which, if transitory, follows the person and may be enforced  wherever the person may be found.

False conflict:   only one state has an interest in having its law applied, and failure to apply the other state‘s law would not impair the policy reflected in that law.

This theory considers the state‘s contacts with the occurrence and the parties.

 Apparent conflict:   more than one state has an apparent interest in applying its law to the case.

Two-fold purpose: 1) identify the interested state 2) evaluate the relevance of these contacts to the issue in question

Prof. Currie: if only one state has a real interest in the case and the other state‘s interest is insubstantial then there is a false conflict. However, if both states have a real interest in applying their law then the apparent conflict becomes a true conflict.

The significant-relationship approach does not call for a mechanical counting of factual contacts where strength is drawn in numbers; instead the court localizes the state of the most significant relation and assesses the event or transaction in the light of the relevant policy considerations of the interested states and these underlying policies.

FACTS: Morada was a flight stewardess of Saudi Airlines. She was involved in an attempted rape case, which led to her conviction of violation of Islamic laws in Saudi. The Prince of Makkah ruled that she was wrongfully convicted. However, she was terminated from her employment by Saudia.

Problem with Interest Analysis approach: are the policies of the law always discernible? Sometimes we merely guess the policies of the state (because unarticulated in the law). ________________

This principle deals with rules that sanction some kinds of conduct engaged in by a defendant in one state and extends the benefit of this higher standard of conduct and financial protection to the plaintiff even if the state of injury does not create analogous liabilities.

HELD: The RTC of Manila has JD to try the case, applying the ―state of most significant relationship rule.‖ The following contacts should be considered in using this rule: place where the injury occurred, place where the conduct causing injury occurred, domicile/residence/nationality/place of business of the corporation, and place where the relationship between the parties is centered.

Pangalangan: Since both states consider that a tort has been committed, the law of the state which places a higher standard of conduct should apply. This is true even if this is the place of tortious conduct and not the place of injury.

In CAB, the Philippines had the most significant contacts. The overall injury occurred in the Philippines, Morada is a resident and a Filipina national, Saudia is a foreign corporation engaged in business here, and the relationship of the parties is centered here.

FACTS: Schmidt sued Driscoll Hotel for illegally selling liquor to Sorensen, who was the driver of a vehicle which turned over in Wisconsin. Schmidt was a passenger of that  vehicle and sustained injuries as a result of the accident. The suit was filed in Minnesota, where the illegal sale was conducted.

This approach considers the relevant concerns the state may have in the case and its interest in having its law applied on that issue. The court should first determine whether there is a true or false conflict. 44

HELD: Minnesota court has jurisdiction, even if the injury  which followed the illegal sale occurred outsi de Minnesota. The Restatement should not be applied where the plaintiff  would have no remedy against the offending liquor dealer. Under the principles of equity and justice, the Minnesota law granting him a remedy should be applied, considering that all the parties are residents of Minnesota, Driscoll Hotel was

licensed under Minnesota law, the violation of Minnesota law occurred there, and the wrongful conduct was completed by Sorensen in Minnesota. Schmidt illustrates the imposition of liability under a substantive rule of tort law that has a strong underlying admonitory policy.

The defendant in a transnational tort is often sued in a foreign court against his will; his consent to be sued is not necessary for the acquisition of jurisdiction by the court. Hence, questions as to the legitimacy of the JD and validity of the decision may arise.

 American Contributions to Conflicts Tort Law

The determination of whether the law where the tort was committed or the law of the domicile of the parties is the controlling law is considered one of the major contributions of American jurisprudence to international conflicts thought. Law of the tort:   deemed as the proper law in questions involving regulation of conduct. Law of the domicile of the parties: governs in matters that relate to loss-distribution or financial protection.

In modern approaches, there is a distinction between true or false conflict. True conflict: both  states have an interest in having their law applied  ―maybe true‖ conflict   false conflict: no choice necessary –  the court should apply the law of the only interested state _______________ 

Tortious liability is transitory – the liability resulting from the tort is deemed personal to the perpetrator of the wrong,  which follows him wherever he goes. Compensations may be exacted from him in any proper tribunal; the right to sue is not confined to the place where the cause of action arises.

a)

the foreign tort is based on a civil action and not on a crime

b)

the foreign tort is not contrary to the public policy of the forum

c)

the judicial machinery of the forum is adequate to satisfy the claim

not be able to pursue legal proceedings against the Malaysian company which operates and services the helicopter. Bier vs. Mines de Potasse:  A Dutch market gardener filed an action for damages in a Dutch court against a French mining company. The Dutch court held that it had no JD, but the French court held that the plaintiff could elect where to sue (place of damage or place of injurious conduct). Sovereignty as Basis of Jurisdiction

Conflicts torts cases arise due to significant differences in the laws of states on the basis and extent of liability for defectively manufactured products.

The sovereignty model has been accepted both to: a)  justify any exercise of jurisdiction over a defendant present within the territory, however short (―tag  jurisdiction‖) b)

FACTS: Asahi Metal manufactures tire valve assemblies in  Japan and exports them, including to a Taiwanese company  which, in turn, incorporates them i nto finished tires s old in the US. The driver of a motorcycle, who had an accident resulting in injuries to him and death to his passenger, sued the Taiwanese company. The Taiwanese company filed a cross-complaint against Asahi. HELD: The California court has no JD over Asahi Metal. The constitutional touchstone/test of due process is whether the defendant purposefully established ―minimum contacts‖ in the forum state. And ―minimum contacts‖ must have a basis in some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws. In the CAB, no purposeful availment of the California market on the part of Asahi. It does not do business in California; has no office, agents, employees, or property in Cal.; does not advertise or otherwise solicit business there; and did not create, control, or employ the distribution system that brought its valves to California.

Societe Nationale Industrille Aerospatiale vs. Lee Kui Jak:  An Aerospatiale helicopter crashed in Brunei, killing a passenger who was a Brunei resident. The administrator of the estate brought the action in Texas, where Aerospatiale does business. Held: Brunei (where the deceased lived and the helicopter crashed) was the natural forum for the trial for an action for damages against the manufacturer of the helicopter, and it would be oppressive for the plaintiffs to continue with the Texas proceedings as Aerospatiale would 45

deny enforcement of a foreign court judgment over a defendant who was not present within that court‘s jurisdiction

FACTS: The spouses Robinson purchased a car from Seaway Volkswagen in New York. They met an accident in Oklahoma and pinned the blame on the defective design of the car. They brought a suit against the retailer and distributor in Oklahoma. HELD: Oklahoma court has no JD. A state court may exercise personal JD over a nonresident defendant only so long as there exist ―minimum contacts‖ between the defendant and the forum state. The 2 functions of the concept of minimum contacts is to protect the defendant against the burdens of litigating in a distant or inconvenient forum, and to ensure that the states, through their courts, do not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system. In CAB, there us a total absence of those affiliating circumstances that are a necessary predicate to any exercise of state-court JD (no activity whatsoever on Oklahoma; no sales closed nor services performed there; no availment of the privileges and benefits of Oklahoma law; no solicitation of business there).

In  Asahi, even if there were minimum contacts, it failed the reasonableness test.

Criticism of  Asahi:  ―additional acts‖ requirement is a reinvention of the stream of commerce law. The fear is that the court might go back to pre-International Shoe   standards n JD (requirement of actual presence). In Worldwide Volkswagen, the only requirements for the exercise of JD were minimum contacts and the reasonableness test; Asahi did not follow this, and include an additional requirement (purposeful availment). ________________

The Alien Tort Statute granted US district courts original JD over any civil action by an alien for a tort committed in  violation of the law of nations or a treaty of the US.

FACTS: A class suit was brought against Marcos by parties seeking damages for human-rights abuses committed against them or their decedents. The Hawaii district court found for Hilao and ordered a verdict of almost $2 billion in damages. The Estate in its appeal, argues that the Alien Tort Claims  Act does not apply to conduct that occurs abroad, and since the acts complained of all occurred in the Phils., the court has no JD HELD: The court has JD. In a prior appeal it has been held that subject-matter JD was not inappropriately exercised even though the actions xxx occurred outside the US.

FACTS: Plaintiffs brought an action in the US against PenaIrala for wrongfully causing the death of Dr. Filartiga‘s s on in Paraguay. HELD: The US federal court has JD, on the basis of the  Alien Tort Statute. This action i s undeniably an action by an alien, for a tort only, committed in violation of the law of nations. A wrong is recognized as a violation of the law of nations where the nations of the world have demonstrated that the wrong is of mutual, and not merely several, concern.

*The concept of accountability, if considered the core of the  Alien Torts Act (as espoused by the US Justice Department

in Trajano vs Marcos) , would be a significant setback to the advancement of international law.

FACTS: Guinto and Suarez filed an action for damages against Marcos in California under the Alien Tort Claims  Act. According to Guinto, Marcos‘ act of seizing their film ―100 Days in September‖ violated their freedom of speech. HELD: Test to determine when a violation of the law of nations has occurred – there has been a violation by one or more individuals of those standards, rules or customs a) affecting the relationship between states or between an individual and a foreign state, and b) used by those states for their common good and/or dealings inter se. A violation of the First Amendment right of free speech does not rise to the level of such universally recognized rights as to constitute a violation of the law of nations.

The Alien Tort Statute justifies exercise of court JD over completely foreign tort cases because of the universal evil exemplified by human rights violations. This is so even though there are no significant contacts between the courts and the parties and events nor substantial state interest in the case other than a general desire for compliance with customary international law. That is why in order for the  Alien Tort Act to apply, t here is a need to establish that the tortious conduct violated an internationally protected human right.

There is no specific statutory law governing the enforcement of claims for damages arising form foreign torts. But on the theory of vested rights the victim of a foreign tort may decide to file the case in the Philippines. It has been suggested that the English Rule may be followed, such that the tort committed abroad is actionable in the country where it was committed and also under Philippine law. Two conditions for a case based on a foreign tort to be filed in the Philippines (English Rule): 1)

the wrong must be of such a character that it  would have been actionable if committed in the Philippines 46

2)

the act must not have been justifiable by the law of the place where it was done

FACTS: Villegas and Enrile filed a complaint for damages against Time, Inc. upon an alleged libel arising from a publication of Time Magazine. Plaintiffs filed their action in CFI Rizal. But according to the applicable law, they may file the action only in the place of first publication or in the City of Manila (since they are public officers). HELD: The case should be dismissed for improper venue. The only alternative allowed to the public official is to prosecute in the place where the offending article was printed and first published; but in the CAB the alternative  was not open to plaintiffs since the offending publicati on was not printed in the Philippines.

In Time, Inc., if the court had not characterized the issue as  jurisdictional, and decided the case from a conflicts tort perspective, it could have taken cognizance of the case following the most significant relations approach because of the significant links between the forum and the parties.

In ordinary foreign tort, the court acquiring JD must be either the place of tortious conduct or place of injury. In  Alien tort Statute, US courts may acquire JD even if it is neither the place of tortious conduct nor place of injury. ―law of nations‖ (Filartiga):  ―mutual‖ concern –   nations consider the act to be detrimental to all nations; it is a  violation of a law of all  countries. Guinto: violation of law of nations test — 1) the violation affects relationship between states, or an individual and a foreign state 2) used by the states for their common good and/or dealings inter se _______________

Transitory in character; hence liability is deemed personal to the tortfeasor and make him amenable to suit in whatever JD he is found

Local in character; the perpetrator of the wrong can be sued only in the state wherein he commits the crime

 An injury to an individual  who may be situated in any place

 An injury to the state  where it is committed

Liability is attached to the perpetrator to indemnify the victim for injuries he sustained

Promulgated to punish and reform the perpetrators and deter them and others from  violating the law

Under the territorial principle, crimes committed within the Philippines by all persons, whether Filipino citizens or aliens, are prosecuted and penalized under Philippine law.  As a rule, criminal laws of a state are effective only upon persons who actually commit the crime  within the state‘s territory. The lex loci delicti   or the law of the place where the crime  was committed is the controlling law since it determines the specific law by which the criminal is to be penalized, and designates the state that has the JD to punish him. 3 Exceptions to the Territorial rule: 1)

First Exception: crimes committed by state officials, diplomatic representatives and officials of recognized international organizations (based on doctrine of state immunity)

FACTS: Wylie and Williams are officers of the US Navy stationed in the Subic Naval base, and are in charge of the publication ―Plan of the Day.‖ Rarang filed an action for damages against them for libelous statements published in the POD.

HELD: Wylie and Williams are not immune from the suit. They are sought to be held answerable for personal torts in  which the US is not involved; if found liable, they alone must satisfy the judgment. The Bases Treaty provision on immunity could not possibly apply in this case, as it is presumed that the laws of the US do not allow the commission of crimes in the name of official duty. The general rule is that public officials can be held personally accountable for acts claimed to have been performed in connection with official duties where they have acted ultra vires  or where there is showing of bad faith.

This immunity for sovereign acts is impliedly waived when the foreign state and its officials perform private, commercial or proprietary acts.

In Rarang, although the publication was part of the duty of  Wylie and Williams, the goal of the publication of the complaint would have been achieved without identifying Rarang by name.

FACTS: Liang, a Chinese working at the ADB, was charged by a fellow worker with grave oral defamation. The lower court dismissed the complaint on the ground that Liang is covered by the immunity provision under the Agreement between ADB and the Phil. Government. HELD: Liang is not immune from suit. The immunity under the Agreement is not absolute, and it only extends to acts done in official capacity. Slandering a person could not possibly be covered by the immunity agreement because our laws do not allow the commission of a crime, such as defamation, in the name of official duty.

2)

Second Exception: crimes committed on board a foreign vessel even if it is within the territorial  waters of the coastal state

In the Philippines, our courts will not acquire JD over offenders nor can Phil. laws apply as long as the effect of such crime does not disturb our peace and order.

FACTS: Fowler et al were accused of theft on board the US  vessel Lawton  while it was traveling on the high seas. 47

HELD: Philippine courts have no jurisdiction over Fowler.  Act 400 granting JD to RP courts for crimes and offenses committed on the high seas, apply to ship or water craft registered or licensed in the Philippines only. In the CAB, the Lawton was not registered in the Philippines; it was a US  vessel.

FACTS: Wong was charged for having illegally smoked opium on board an English vessel Changsa   while anchored in Manila Bay. HELD: Under the English rule which is applicable here (it is the prevailing theory in the US), to smoke opium within our territorial limits, even though aboard a foreign merchant ship, is certainly a breach of the public order here established. It causes such drug to produce its pernicious effects within our territory. It seriously contravenes the purpose that our Legislature had in mind in enacting the repressive statute, and is therefore triable in our courts.

FACTS: Two sacks of opium were found to be in the control of Look Chaw aboard the Erroll, an English steamship. A complaint for possession and sale of opium  was filed against him. HELD: Philippine courts have jurisdiction. Although the mere possession of an article of prohibited use in the Philippines, aboard a foreign vessel in transit, in any local port, does not as a general rule constitute a crime triable by the courts of the Islands, such vessel being considered as an extension of its own nationality, the same rule does not apply  when the article, the use of which is prohibited in the Islands, is landed from the vessel upon Philippine soil. 3)

Third Exception: crimes which, although committed by Philippine nationals abroad, are punishable under Philippine law (ex. Art. 2 RPC)

the right to stockholders owning 3% of the capital stock of the company. Gray does not own the required shares.

FLAG LOCATION

CRIME

RESULT

US

English

English

High seas

Within RP territorial  waters

 Within RP territorial  waters

theft

Smoking opium

Possession and selling of opium

No JD

Acquired  JD

 Acquired  JD

HELD: Gray is not entitled to the right to examine the books of Insular. Gray is bound by the NY law which only gives him the right to receive from the treasurer of the corporation a statement of affairs covering a particular account of all its assets and liabilities. Neither can his rights be granted under common law absent a showing that: a. he seeks information for an honest purpose or to protect his interest as stockholder b. he exercises right in good faith and for a specific and honest purpose not merely to satisfy curiosity or for speculative or vexatious purposes.  Anglo American Theory on Corporations

The power of a foreign corporation depends upon the laws of the state recognizing it. It may impose conditions or limitations subject to a few exceptions as decided by US courts, to wit: a)

commerce clause –  prohibits a state from imposing conditions on corporations engaged in interstate commercial activities and provides the basis of federal power to regulate interstate commerce.

b)

Since it is considered a ―person‖, once allowed to enter a state and acquire property, it cannot be discriminated against by domestic corps

c)

Unconstitutional conditions – forbids a state from requiring the foreign corporation to give up its constitutional rights either as a prerequisite to allowing it to do business or to avoid being removed from that state

In RP, we follow the French Rule. FACTS Bank of A (incorporated in Georgia), thru M‘Gran bought bills from Earle in Alabama. Bills were unpaid so Bank sued Earle. TC ruled that the Georgian Bank could not exercise power in Alabama thereby making the contracts  void.  A corporation is an artificial being created by operation of law, having the right of succession and the powers, attributes and properties expressly authorized by law or incident to its existence. Foreign corporation – formed under the laws of a state other than the Phils; such laws allowing Filipino citizens and corporations to do business there. It shall have a right to do business here only after obtaining a license and a certificate of authority from the appropriate government agency.

The personal law of the corporation is the law of the state  where it is incorporated. If the law creating it does not authorize it to enter into certain contracts, such contracts  which can be made in other states s hall be void despite the express permission given by the other state.

FACTS: Gray, a stockholder of Insular (incorporated in NY) filed an action in CFI to compel Insular to allow him to examine its books. Sec. 77 of NY Stock Corp Law only gives

HELD Bank can exercise its powers in Alabama and the contracts are therefore valid. It is well-settled that by the law of the comity of nations, a corp. created by 1 sovereignty is permitted to make contracts in another and sue in its courts and that the same law of comity prevails in several States of US including Alabama. Alabama courts have held that a foreign corp may sue in its courts based on the comity of nations.

 A foreign corporation, although a person, is not a citizen entitled to the privileges given by the state to its individual citizens.

If according to the personal laws of the corporation, stockholders are given certain rights, such rights cannot be diminished nor added upon by the law of the place where the corporation does business. This is because such rights are already fixed by the corporation. ________________

Four Basic (Important) Theories from the case: 

1)

a corporation, being a creature of law, has no legal status beyond the bounds of the sovereignty within  which it was created

2)

a corporation cannot exercise powers not granted by its corporate charter or by the laws of the state of incorporation

3)

no state is under any obligation to adhere to the doctrine of comity (every state has the power to refuse recognition)

4)

a state is not obliged to grant to a foreign corporation the privileges and immunities common to its citizens 48

a. Constitutional Restrictions

and

Statutory

 A state may, by legislation, exclude a foreign corp altogether, subject to the constitutional limitations, or prescribe any conditions it may see fit as a prerequisite to the corporation‘s right to do business within its territory. 1987 Phil Constitution: a.

regulates exploration, development and utilization of natural resources such that only 60% Filipinoowned corps may be allowed to engage in these activities

b. c.

the nation‘s marine wealth and the exclusive economic zone is reserved exclusively to Filipinos Congress is empowered to reserve certain areas of investments to 60 % Filipino owned corps or provide for a higher percentage (e.g. mass media – 100%)

time the insurable risk occurred. But C is entitled to a return of the premiums paid.

Filipinas Compania case was decided that way because of the government interest involved. _______________

FACTS: Palting opposes the tie-up between San Jose Petroleum (a Panamanian corp.) and San Jose Oil (domestic corp.) as being violative of the Constitution and the Petroleum Act. SJP claimed that it is entitled to the Parity  Amendment which grants to US citi zens the right to use & exploit natural resources in the Phils because its stockholders are US citizens.

Daimler Co. Continental Tire and Rubber Co.:  HELD: An English corporation with an English secretary but whose shares of stock are controlled by German nationals was considered an enemy corporation and prohibited from trading in England. It ruled that the company itself was incapable of loyalty or enmity. These qualities are attributable only to human beings. The company therefore had the predominant character of its shareholders being Germans.

HELD: SJP is not covered by the Parity Agreement. It is not owned or controlled directly by US citizens. It is owned by another Panamanian corp., Oil Investments. Oil Investments on the other hand is owned by 2 Venezuelan corps. Even assuming that the stocks of the 2 Venezuelan corps are owned by US citizens, to hold that the set-up in CAB falls within the Parity Amendment is to unduly stretch and strain the language and intent of the law. There would be practical impossibility to determine at any given time the citizenship of the controlling stock.

 Art. 51, CC  When the law creating or recognizing them, or any other provision, does not fix the domicile of juridical persons, it is understood to be a. the place where legal representation is established b.  where they exercise their principal functions

b.

Control Test During the War

During wars, courts may pierce the corporate identity and look into the nationality of stockholders to determine the citizenship of the corp.

FACTS: Christern (German Co.) filed a claim against Filipinas (US Co.) for recovery on fire insurance policies issued by the latter. F refused to pay claiming that the policies ceased to be in effect on the date the US declared  was against Germany. Dir. Of Bureau of Financing directed F to pay C. HELD: The policy ceased to be valid and binding because of the fact that majority of the stockholders of C are Germans and it became an enemy corporation when war  was declared. Under Phil Insurance Code, anyone except a public enemy may be insured. C is a public enemy at the

 A foreign corp. granted license to do business here acquires a domicile in the Phils.

FACTS: CMI obtained loans from Citibank. CMI defaulted. Citibank filed petition for involuntary insolvency against CMI with CFI, Rizal. State Investment, a creditor of CMI, opposed claiming that Citibank had no jurisdiction because the banks are not resident creditors of CMI. HELD: The Phil branches of the bank are residents of the Phils being resident foreign corporations as defined in the Tax Code and other Banking Laws. What effectively makes a foreign corp a resident corp in the Phils is its actually being in the Phils and licitly doing business here (locality of existence) The grant of license merely gives legitimacy to its doing business here but it does not make the corp a resident.  Also, the failure of the bank to aver categorically that they are residents are not fatal to the cause of action where it alleged that it is a foreign bank licensed to do business here 49

The dictum that a corporation has force only in the incorporating state and no existence outside that state has been abandoned. The prevailing rule is, with the consent of a state, a foreign corp. shall be recognized and will be allowed to transact business in any state, which gives its consent. Requirements for License: Secs. 125-128, Corpo Code) a. sworn application b. copy of articles of incorporation c. designation of an agent d. sworn certification of an official of the incorporating state that a similar right is given to Filipinos in that state and that the foreign corp. is in good standing e. statement under oath by the official of the corp. attesting that the corp is solvent and in sound financial condition

Foreign Corporations doing Business are Bound by Philippine Law  Art. 129, Corp Code  All foreign corporations lawfully doing business in the Philippines shall be bound by all laws, rules and regulations applicable to domestic corporations.

Exceptions: 1. laws on creation, formation, organization or dissolution of corporations 2. laws which fix the relations, liabilities, responsibilities or duties of stockholders, members or officers of the corp to each other Rule 14, Sec. 14 ROC Service upon foreign corporations doing business in the Phils. may be made on the:

1. 2.

3.

resident agent in the absence thereof, to the government official designated by law or any of its officers or agents within the Phils on any officer or agent of the corp in the Phils

*a fourth method is established by case law: service thru diplomatic channels

in business. It does not constitute ―doing business‖ under the law.

 Acquisition of a license by a foreign corporation is an essential prerequisite for filing of suit before our courts.

1.

a. b.

 Art. 133, Corp Code states that these corporations may be sued or proceeded against before Phil courts or administrative tribunals on any valid cause of action recognized under Phil law.

FACTS: Home Insurance was subrogated to the rights of shippers against eastern Shipping for damages on cargo. Eastern refused to pay. HI filed action to recover sum of money. TC dismissed because HI failed to prove capacity to sue. HELD: HI has capacity to sue because at the time the complaints were filed, it already had a license to conduct insurance business in the Phils. Insurance contracts are not null and void for lack of license at the time it was entered into. The Corp. Code is silent on the status of the said contracts. Also, the object of the law in requiring registration is to subject the foreign corp. to the JD of our courts.

FACTS: Cebu Stevedoring carried copra for Procter & Gamble. Copra were insured with AMI. Bec. of damages,  AMI sued Cebu Stevedoring. CS filed a MTD bec. AMI had no capacity to sue. TC ruled that it must allege that it has a license to be able to sue. HELD: Such allegation is unnecessary. However, AMI‘s mere allegation that it is a foreign corp is not sufficient. It must state WON it is doing business in the Phils bec different rules attach to the same. If it is engaged in business, it must be licensed to be able to sue. If not so engaged, the license is not required and it may sue esp. if it is a single/isolated transaction.

FACTS: Eastboard was able to secure a favorable decision from NY arbiters against J.Y. & Co. It brought an action for enforcement of a money claim against JY & Co. in the Phils.  JY opposed alleging that E had no capacity to sue. HELD: E has capacity to sue. The license is not necessary because it is not engaged in business in the Phils. The 2 isolated transactions do not constitute engaging in business  within the purview of the Corpo Law.

b.

 Action to Protect Trademark, Trade Name, Goodwill, Patent or for Unfair Competition

Even without a license, a foreign corporation may file complaint for unfair competition since it is a suit enjoining the unfair trader from pursuing the unlawful competition & for the aggrieved party to recover damages. This is based on equity considerations.

FACTS: Converse owns the trademark of ―Converse Chuck Taylor All Star‖. Jacinto manufactures shoes of identical appearance. Hence, this suit. HELD: Sec 69 of the Corp Law does not disqualify Converse from filing the suit although it is unlicensed to do business and is not doing business in the Phils. This is in compliance with the Convention of Paris for the Protection of Industrial Property from which the Phils adheres to and  which US is a signatory.

FACTS: Leviton Manufacturing (US) sued Leviton Industries (Phil) for unfair competition bec. the latter uses the trademark Leviton. Defendant filed MTD for failure to allege capacity to sue. a.

Isolated Transactions

HELD: Plaintiff failed to allege capacity to sue. This has been defined as one which is occasional, incidental and casual, not of a character to indicate a purpose to engage 50

2.

 All that Leviton Manufacturing alleged is that it is a foreign corporation. It should have, in addition, alleged the ff pursuant to Sec. 21-a: it registered its trademark with the Phil. Patent Office or that it is an assignee of the trademark, and that the country of which it is a citizen or domiciliary grants to Filipino corps the same reciprocal treatment, either in a treaty, convention or law. It also violates Sec. 4, Rule 8 of the Rules of Court,  which states that: Facts showing the capacity of a party to sue or be sued or the authority of a party to sue or be sued in a representative capacity or the legal existence of an organized association of persons that is made a party, must be averred.

c.

 Agreements Fully Transacted Outside the Philippines

 A foreign corporation is allowed to maintain an action on a transaction wholly celebrated and consummated abroad so as not to impair the policy of stabilizing commercial transactions.

HELD: The private respondent may sue in the Phils upon the marine insurance policies to cover international-bound cargoes shipped by the carrier. It is not the lack of the license but doing business without such license which bars a foreign corporation from access to our courts.

FACTS: Hang Lung Bank, not doing business in the Phils, entered into continuing guarantee agreements with Cordova Chin San in HongKong for the debts of Wolder Enterprises.  Wolder defaulted so Hang Lung sued Wolder and Chin San. No payment was made so it sued Chin San in RTC, Makati for enforcement of its money claim. Chin San moved to dismiss for incapacity to sue. HELD: A foreign bank not doing business in the Phils, such as Hang Lung, may sue a resident for contracts entered and consummated outside the Phils.  for rule: if not adopted, a. it will hamper the growth of business between Filipinos and foreigners b. it will be used as protection by unscrupulous Filipinos who have businesses abroad

d.

Petition Filed is Merely a Corollary Defense in a Suit against it

HELD: The court allowed a foreign corp is not maintaining a suit in our courts but is merely defending itself when it files a complaint for the sole purpose of preventing the lower court from exercising jurisdiction over the case. As such, it is not required to allege its capacity to sue.

FACTS: Katoh & Co. filed a complaint against Phil Columbian. Phil Columbian challenged its capacity to sue. TC deferred the determination of this issue until trial on the merits. PC opposed claiming that if it files a counterclaim, it  will be waiving its right to assail the capacity to sue of Katoh. HELD: A counterclaim is a complaint against the plaintiff. It  would not be the foreign corp who will be maintaining a suit. Therefore, Sec. 69 of the Corp Law will not apply.

7.

Definition and Scope Transacting Business

of

 A foreign corporation may do business, state consent being presumed, except: 1.  where it is prohibi ted b y express statutory authority or constitutional enactment 2.  where it is seeking to perform acts which are contrary to public policy 3.  where it is seeking to exercise extraordinary and special franchises 4.  where it is seeking to perform acts which are not authorized by the law of the state of its incorporation ―Doing Business‖ (Foreign Investments Act)  soliciting orders, service contracts, opening offices whether called ―liaison‖ offices, appointing representatives if the latter stays for at least 180 days, participating in the management, supervision or control of any domestic business and any other act that imply a continuity of commercial dealings and contemplate in the performance of acts or works -

the progressive prosecution of commercial gain or of the purpose/object of the business organization

What is not doing business: 1. mere investment as a shareholder 2. exercising of rights as investor 3. having a nominee director or officer to represent interests 4. appointing a representative or distributor in the Phils  which transacts business in its own name and for its own accounts

Doing business serves as the basis for jurisdiction over corps on the theory that they are present in the state or have consented to suit by making that state a major place of business.

HELD   A reinsurance company is not doing business in a certain state merely because the property or lives which are insured by the original insurer company are located in that state since the reinsurance contract is usually a separate and distinct arrangement from the original contract of insurance,  whose contracted risk is insured in the reinsurance agreement. The term ―doing business in the Phils‖ implies a continuity of commercial dealings and arrangements and contemplates, to that extent, the performance of acts or works or the exercise of functions normally incident to and in the progressive prosecution of the purpose and object of its organization.

FACTS: Wang Lab (US corp) sells its products in the Phils thru its exclusive distributor, Exxbite. ACCRS sued WL for breach of contract for failure to develop the software program contracted. WL filed MTD on the basis of lack of  jurisdiction over its person bec. the service was invalid it being a foreign corp not engaged in business in the Phils. HELD: WL is ―doing business‖ in the Phils. It has installed 26 products in the Phils and has registered its tradename  with PPO. It allowed E to use such trademark and to advertise the same.

Thus, it cannot be said that the case involved an isolated or single transaction. The transaction is not merely incidental 51

or casual but is of such nature as to indicate a purpose to do other business in the State.

FACTS: JAL was assessed deficiency income tax by CIR for the sales of its ticketing agent (PAL) in the Phils. JAL opposed and claimed that as a non-resident foreign corp. it can only be taxed on income from Phil sources. HELD: JAL is a resident foreign corporation under the Tax Code. For a foreign corporation to be regarded as doing business, there must be a continuity of conduct and intention to establish a continuous business (i.e. appointment of a local agent) and not a temporary one. JAL constituted PAL as a local agent to sell tickets which is the lifeblood of airline tickets, the generation of sales being its paramount objective.

FACTS: Lara spouses entered into a Futures Customer  Agreement with Merrill Lynch Futures Inc. They become indebted to it after a loss in the business. Laras refused to pay and claimed that the transactions were void because MLFI had no license to operate as a commodity or financial futures broker. HELD: MLFI had the capacity to sue and Laras are estopped from denying the same after having done business  with it over many years. The purpose of applying the doctrine of estoppel is to prevent persons from taking undue advantage of a corp‘s non -compliance with the statutes where such person received benefits under their contract.

FACTS: Granger (US) sued MSI (Phil) for recovery of a sum of money. MSI did not pay and claimed that G had no capacity to sue bec. it was unlicensed. HELD: G had no capacity to sue because of its being an unlicensed foreign corp doing business in the Phils. Neither does it fall under the established exceptions. Granger had the burden of showing that the finding fell under an exception. The purpose of requiring license is to enable Phil courts to exercise jurisdiction over them. If the foreign corp operates here without submitting to our laws by securing a

license, they may not be allowed to invoke our laws for their protection.

2.

 whether the activities of the subsidiary in a state will give that state jurisdiction over he parent corporation

Restatement 2 :  Jurisdiction over the parent will exist if the parent controls and dominates the subsidiary. In determining whether the separate corporate existence of the subsidiary has been adequately preserved, the courts will consider whether the subsidiary has its own records, assets, advertising, employees, payroll and accounting and whether its directors and headquarters are different form those of the parent.



Domestic Corp.: a) Can sue b) Can be sued



Foreign Corps. Doing Business a.  With license – can sue and be sued b.  Without license –  cannot sue, can be sued

nd

 A religious society, if controlled by aliens, is not permitted to acquire lands.  A corporation sole is an incorporated office composed of only one person as in the cases of the chief archbishop, bishop, priest, minister or an elder of a religious sect which may form a corporation sole for the purpose of managing its affairs, property and temporalities.

HELD: The 60% Filipino capital requirement to own lands  was not intended to apply to corporations sole because it is composed of one person usually a head or bishop of a diocese but he is only the administrator and not the owner of the temporalities. Such are administered for and in behalf of the faithful who are Filipino citizens.

In the converse situation, jurisdiction over the parent may give jurisdiction over the subsidiary if the separate corporate existence of each has not been adequately maintained or if the parent has acted within the state as the subsidiary‘s agent.

Partnership is formed by 2 or more persons who bind themselves to contribute money, property or industry to a common fund with the intention of dividing the profits among themselves. Phil internal law provides that if the domicile of the partnership is not identified by the law creating it, it is deemed domiciled in the place where it has its legal representation or where it exercises its principal functions.

Transnational corporations are clusters of several corporations, each with a separate entity, existing and spread out in several countries, but controlled by the headquarters in a developed state where it was originally organized. But the transnational corporations are established under and governed by each host country‘s national laws. However, all locally incorporated branches are joined together by the common control and management of higher officials in the home state.  As to liability, the si ngle uni t c omprising the cluster is held liable according to the laws of the host country but the transnational corporation, in its entirety, is not answerable to any legal order. Derivative Jurisdiction over Foreign Corporations (parent-  subsidiary) 2 Important Issues 1.  whether ownership by the parent over the subsidiary‘s stock is enough to give jurisdiction over the subsidiary

What matters are governed by the personal law of the  partnership? 1. nature, attributes and capacity to contract of the partnership 2.  whether or not a partnership has been constituted (esp. the conditions and formalities required) 3. determination of WON it requires a separate juridical personality (Common law does not consider a partnership a legal person but civil law endows partnerships with a separate legal personality) 4. grounds for dissolution and termination of partnerships 5. liability of partners esp. if limited partnership is allowed What are governed or subject to the law of the place of business?

1. 2. 3. 4.

entitlements and limitations, in general creation of establishments in the state mercantile operations  jurisdiction of nations

52

1)

2)

Not Doing Business (isolated transaction) –  can sue and be sued ________________

‗Foreign judgments‘- all decisions rendered outside the forum and encompasses judgments, decrees & orders of courts of foreign countries as well as of sister states in a federal system of gov‘t. Conceptual & Procedural Differences between Recognition & Enforcement: Rules on recognition & enforcement are analogous but there are differences in conceptual & procedural aspects.

ENFORCEMENT: This happens when a successful plaintiff fails to enforce judgment in the forum court so he seeks to carry out the execution of the judgment in another state. This requires the filing of an action and a new judgment before the properties of the defendant can be attached. RECOGNITION: This may arise when a successful defendant wins and asserts that decision to preclude the plaintiff from filing a suit on the same claim in another forum. It is basically a passive act because it does not require the filing of an action in another forum. EX. Decree of divorce.

RES JUDICATA- seeks to end litigation by disallowing suit on the same claim 1) Comity 1. Res judicata

 According to Cheshire, the theory on comity mean that in order to maintain reciprocal treatment from the courts of other countries, we are compelled to take foreign judgments as they stand & to give them Full faith & Credit. Comity calls for reciprocity between the concerned  jurisdictions. Thus, forum A will withhold recognition & enforcement of prior judgment if it comes from Forum B,  w/c does not give same concession to forum A judgment. 2) ―Obligation of foreign judgments‖ 

This doctrine of obligation is derived from the rigid & unyielding vested rights theory.  Judgment of a foreign court of competent jurisdiction is considered as imposing a duty or obligation on the losing litigant. i.e.: Forum 1- adjudicates debt owing to plaintiff Forum 2- treats F1 judgment as evidence of debt  w/c may be enforced in F2 by an action of debt

FACTS: Godard (French) obtained a favorable ruling by a French court arising on a charter party obligation against Gray (English). The French court interpreted the clause ―penalty for non-performance of this agreement, estimated amount of freight‖ as a clause that sets the limit s to liability to one voyage between the parties to the charter party contrary to the English interpretation. When this French  judgment was sought to be enforced in England, Gray interposed in defense that the erroneous French judgement is a bar to the action for enforcement in England.

Many courts recognize & enforce foreign judgments on ground of res judicata, under which principle: a. those who contested an issue shall be bound by the result & b. matters once tried & decided w/ finality in one jurisdiction shall be considered as settled b/w the parties Thus, parties are prevented from litigating issues already determined by a local judgment. In Anglo-American jurisprudence, foreign judgments are not open to reexamination on merits when placed in issue before local courts subject to a few exceptions. The principle seeks to accomplish the policy of giving finality to litigation. Public policy dictates diminishing the  judicial energy invested in deciding suits, encouraging confidence in court decrees and securing the legitimate expectations of successful plaintiff or defendant that he will no longer be harassed into protecting his interests. Rule 39 Sec 40:  A foreign judgment of a trib unal of a foreign country, having  jurisdiction to pronounce judgment renders it conclusive upon the title to the thing while a judgment against a person is presumptive evidence of a right as between the parties & their successors in interest

2.

It considers the plaintiff‘s cause of action as merged in the  judgment. Thus, he may not relitigate that exact same claim.

3. HELD: it is not a bar. In England, foreign judgement are enforced based on the principle that where a court of competent jurisdiction has adjudicated a sum of money to be due from one person to another, a legal obligation arises to pay the sum, on which an action of debt to enforce the  judgement may be maintained and not merely out of politeness and courtesy to other tribunals of other countries.  Anything that negates the existence of a legal obligation or excuses the defendant from performance is a good defense to the action (ex. Evidence that court exceeded its  jurisdiction or the judgement was obtained thru fraud)

Merger 

Bar 

This is where a successful defendant interposes the  judgment in his favor to avert a second action by plaintiff on the same claim. By direct estoppel, the relitigation of all matters decided are precluded

COLLATERAL ESTOPPEL- concerned with preclusion by barring relitigation of an issue already litigated on in a prior proceeding

1)

The foreign judgment was rendered by a judicial or a quasi-judicial tribunal which had jurisdiction over the parties & the case in the proper judicial proceeding.

2)

The judgment must be valid under the laws of the court that rendered it

3)

The judgment must be final & executory to constitute res judicata in another action

4)

The state where the foreign judgment was obtained allows recognition or enforcement of Philippine judgment

5)

The judgment must be for a fi xed sum of money

6)

The foreign judgment must not be contrary to the public policy or the good morals of the country  where it is to be enforced

7)

The judgment must not have been obtained by fraud, collusion, mistake of fact or mistake

1. The foreign judgment was rendered by a judicial or a quasi-judicial tribunal having jurisdiction over the parties & the case in the proper case

 A court validly asserts jurisdiction over actions in personam  based on consent of parties or relation of the parties or events to the forum, thus satisfying minimum standards of fair play & substantial justice. In in rem proceeding ,  jurisdiction is based on the power of the state over the property found within the territory

In addition DOCTRINE OF COLLATERAL ESTOPPEL  renders conclusive all ―essential issues of fact actually litigated in the suit decided on by t he foreign court‖. Distinction between Res Judicata  & Collateral Estoppel 53

FACTS: Under contract of agency, NOA authorized Sharp to sell airline tickets. Sharp failed to remit the proceeds of

the ticket sales to NOA. The court in Tokyo failed to serve the writ of summons against the Sharp branches in Tokyo. NOA had these writs served in the Manila main office of Sharp. Despite the notice, Sharp did not appear at the hearing. NOA obtained a judgment in its favor. NOA sought enforce the judgment in the Philippines. Sharp opposed claiming that the service of process was void so the Tokyo Court did not acquire jurisdiction over it. HELD: Service of summons by Tokyo court was valid. A foreign judgment is presumed to be valid and binding in the country where it comes, until the contrary is shown. The regularity of the proceedings and the giving of due notice is also presumed. The party attacking has the burden of overcoming this presumption. In CAB, SHARP alleged that the extraterritorial service of summons is void. However, Sharp failed to prove the applicable Japanese procedural law to base its claim since in matters of procedure, lex fori  applies. Also, Sec. 14 of ROC applies, it allows service to be made to: a. resident agent designated (if it has one, the designation is exclusive) b. if none, on the government official designated by law ( Insurance Commissioner –  foreign insurance co.; Superintendent of Banks –  foreign banking corps. & SEC –  other foreign corps licensed to do business in Phils) The government official shall transmit the summons by mail to the principal office. c. any of its officers/agents within the Phils. Sharp did not designate an agent so service on govt official or any of its officers in Japan is allowed. The Court finds that the service made by Tokyo court sufficient to fall under service to the proper govt official. (Tokyo DC- SC Japan – Ministry of Foreign Affairs of Japan – Japanese Embassy – DFA, Phils – RTC – sheriff delivered summons to principal office)

FACTS: Boudard‘s husband, employee of Tait, was killed by co-employees. Boudard obtained a favorable judgment against Tait who was declared to be in default in CFI of Hanoi. She filed action for execution of Hanoi judgment in CFI Manila. Court dismissed for lack of jurisdiction of Hanoi court over Tait who was not a resident of French Indo-China.

HELD: Hanoi court has no jurisdiction over Tait.  Jurisdiction in personam , over non-residents, in money suits, must be based upon personal service within the state that renders the judgment. At the time of the complaint, Tait was not in Hanoi nor were his agents or representatives. Also, the French law on service of summons was not applied. Instead of serving a copy to the Atty Gen of the Republic  who shall visae the original, the summons were served in Manila to J.M. Shotwell, a representative of Churchill & Tait Inc, which is an entity entirely different from Tait.

FACTS: The will of Bischoff contained a statement to the effect that he had no living forced heirs. Leona Castro, Bischoff‘s recognized natural daughter, had 2 sets of children from 2 marriages, who claim to be heirs of Bischoff.  first married to Von Kaufmann and had 3 children but  Von Kaufmann obtained divorce on France  Castro was remarried to Dr. Mory and they had 2 children HELD: as to the Mory children – NO, the second marriage is void. The right to inherit pertains only to legitimate, legitimated and acknowledged natural children. The French decree of divorce is not valid in the Philippines. French court had no jurisdiction to entertain actions for dissolution of marriages of performed in the Phils over persons domiciled here. The RULE is that when a court, where neither of the spouses are domiciled, and to which one or both, may resort merely to obtain decree of divorce, issues such decree, the divorce is not entitled to recognition elsewhere.  As long as the foreign court acquired jurisdiction, its decisions will not be disturbed whether it was reached through an adversary proceeding  or by default.

Somportex vs. Philadelphia Chewing Gum Corp.. Court rejected Philadelphia‘s contention that a default judgment by the English courts should not be extended hospitality by  American courts. ―In the absence of fraud or collusi on, a default judgment is as conclusive as adjudication between the parties as when rendered after answer & complete contest in open court.

54

The polestar is whether a reasonable method for notification is employed & reasonable opportunity to be heard is given to the person concerned.‖

FACTS: Borthwick (US) owned real properties in Hawaii. He issued promissory notes to Scallon but failed to pay the same. Scallon sued him in Hawaii. B was issued summons  while in California which process was valid under Hawaiian law. For failure to enforce the judgement, S filed action in Phils. B‘s defense is that the Hawaii court has no jurisdiction over the cause of action and over his person. HELD: Foreign judgements are presumptive evidence of the rights between parties and rejection may be justified, among others, by want of jurisdiction of the issuing authority, among others. But in CAB, such rejection was not justified. What Borthwick seeks in this appeal is a 3  chance to contest the  jurisdiction of the foreign court. In order to do that, he must show that the declaration of default was incorrect. But Borthwick did not do this. Borthwick was given an opportunity to file his answer in the Hawaii court, he was also given a chance in the CFI, Makati, but he failed to do the same. rd

2. The judgment must be valid under the laws of the court that rendered it

In Pemberto vs. Hughes  although there was error in procedure, since the Florida court was competent & no substantial injustice was committed, the English court did not consider the error as to significantly alter an otherwise  valid decree. 3. The judgment must be final & executory to constitute res  judicata in another action 

If judgment is interlocutory or provisional in character w/c ‗contemplates that a fuller investigation leading to final decision may later be held, it creates no obligation on the forum court to recognize it.

FACTS: Nouvion filed an action for administration of the estate of Henderson. In order to show that he was Henderson‘s creditor, Nouvion alleged that he obtained a foreign judgment establishing Henderson‘s indebtedness to him.

HELD: The Spanish judgment cannot be sustained because it was not yet final and conclusive. Where a court of competent jurisdiction has adjudicated a certain sum as due from one to another, a legal obligation arises, on which an action of debt to enforce judgment may be maintained. But to come within the terms of law properly laid down,  judgment must result from an adjudication of a court of competent jurisdiction, such judgement being final and conclusive. It is not sufficient that the judgement puts an end to and finally settles controversy. It must e shown that in the court by which it was pronounced it conclusively and finally settles forever the existence of debt of which it is sought to be made conclusive.

FACTS: Following their divorce because of Margaret‘s infidelity, rendered in New Mexico, their daughter Querubina was kept in a neutral home. Silvestre then obtained an interlocutory decree granting him custody. Margaret had the decree modified since the she was remarried and had a stable home for Querubina. When Silvestre fled to the Philippines with Querubina, Margaret filed for habeas corpus. She asserts that the interlocutory order should be complied with pursuant to Article 48 Rule 39. HELD: Her contention is erroneous. A foreign interlocutory order in favor of Margaret did not establish a  vested right with respect to rightf ul custody over Queribina. The decree is not yet final but subject to change with the circumstances. Generally, divorce decree awarding custody of child to one spouse is respected by other states but such decree has no effect in another state as to facts and conditions occurring subsequently to date of decree. Court of another state may award custody otherwise upon proof of subsequent matters justifying such decree to the child‘s interest.

4. The state where t he foreign judgment was obtained allows recognition or enforcement of Philippine judgment

In Hilton vs. Guyot , a French judgment was not recognized by a US court because it found out that French laws allowed review of American judgments on the merits. This ruling is  widely criticized because:  Instead of being a mutual exchange of privileges, comity was used as a means of retaliation.

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The court in Hilton discriminated against the litigants on account of the policies of their governments which they were in no position to shape and alter. It can be argued that the task of formulating policies through reciprocity is a power misplaced in the  judiciary and should be appropriately wielded by the other branches of government.

Trautman and Von Mehren point out the difficulties with the reciprocity requirement. a. its normal tendency is to lower rather than raise the standards of practice b. the private litigants burdened may not be closely attached to the legal order sought to be changed c. the administration of reciprocity clauses can be complicated esp. where case law systems are affected since finding the exact foreign law that grants reciprocity is still nebulous. It is unclear whether reciprocity is proved by general recognition of such or requires a specific recognition for a case identical or analogous to the one before the court.

FACTS: Cowans obtained a Quebec judgment in their favor for a sum of money. TPP asserts in defense that this  judgment is not conclusive upon, but merely a prima facie evidence before the US courts, pursuant to Quebec law. TPP alleges that since Quebec law does not reciprocate as to  judgements of NY courts, NY s hould also not recognize the Quebec judgment as adjudications of the issues. HELD: This claim of TPP pursuant to the Hilton vs. Guyot doctrine should not be followed. Persuasiveness of a foreign  judgment is not dependent upon comity nor reciprocity. Even without these principles, a judgment has its own strength. Following the Hilton vs. Guyot ruling would deprive a party of the private rights he has acquired by reason of a foreign judgement because the country in whose courts the judgement was rendered has a different rule of evidence than what the recognizing court has and does not give the same effect as the latter gives to a foreign judgment. 5. The judgment must be for a fixed s um of money

Unless the foreign judgment specifies performance or delivery, there is nothing for the forum court to enforce. In Sadler vs. Roberis , the English court held that until taxation, 55

the plaintiff could not enforce his claim because the  Jamaican court decided that from the sum due him should first be subtracted the costs incurred by the defendant which  was to be taxed. Hence, the amount decreed was not fixed. 6. The foreign judgment must not be contrary to the public  policy or the good morals of the country where it is to be enforced

HELD: It goes against the law, public policy, and good customs that a mother who violated her marital vows should have custody (referring to the fact that Margaret was having an illicit affair with another man). 7. The judgment must not have been obtained by fraud, collusion, mistake of fact or mistake of law

 Whether or not there is fraud is decided by the court where enforcement of judgment is sought on the basis of its own internal law. A problem may arise when the internal law is not in agreement with the notions of equity of the foreign state. Rule 39, Sec. 50 Effect of Foreign Judgment . The effect of a judgment of a court 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 judgment upon a person, the  judgment is a 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 want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact.

This rule does not refer to intrinsic fraud which goes to the merits of the case. To impeach a foreign judgment, fraud must be ―extrinsic, collateral act which vitiates the most solemn proceedings of the courts of justice‖ such as collusion by the parties, suppression of an important document or the presentation in evidence of a forged will or falsified affidavit. Extrinsic fraud signifies that a party is deprived of his day in court.

may be refused if such were taken without giving the child opportunity to be heard or if contrary to public policy. FACTS: FASGI (US) entered into a distributorship agreement with PAWI (Phil). PAWI shipped defective goods to FASGI. FASGI sued PAWI for breach of contract in US court. They entered into a settlement but PAWI still failed to pay. US court issued a certificate of final judgment upon application by FASGI of entry of judgment. FASGI  was not able to satisf y the claim in US so it filed a complaint for enforcement in RTC. RTC dismissed but CA reversed. HELD: California court judgment may be enforced. A  judgment for a sum of money ordered in a foreign court is presumptive evidence of a right between the parties and their successors-in-interest, but when suit for enforcement is filed in Phil court, the judgment may be repelled by evidence of  want of jurisdiction, want of notice, fraud, collusion or a clear mistake of law or fact. In CAB, PAWI failed to prove that there was collusion between its counsel, Mr. Ready, and FASGI in entering into the settlement and in agreeing to an entry of judgment against PAWI. PAWI should have raised the issue before the forum court in line with the principle of comity of nations that a court should refrain from assuming the power to pass upon the correctness of the application of laws and evaluation of facts of judgments issued by foreign courts.

FACTS: Z filed an action to enforce money judgment rendered by the Superior Court of California against P. RTC by summary judgment ordered Puyat to pay Z pursuant to  Judgment of Stipulation for Entry of Judgment contained in the Compromise Agreement between them in the Calif. court. CA held that P is estopped from assailing the  judgment that had become final. HELD: The summary judgment is allowed. Since the present action lodged in the RTC was for the enforcement of a foreign judgment, there was no need to ascertain the rights and obligations of the parties based on foreign laws or contracts; the parties needed only to perform their obligations under the Compromise Agreement they had entered into. None of the reasons for invoking forum non conveniens   barred the RTC from exercising its jurisdiction (forum shopping, overcrowded dockets, harassment of defendants, etc.) In CAB, there was no more need for material witnesses, no forum shopping or harassment of Puyat, no inadequacy in the local machinery to enforce the foreign judgment and no question raised as to the application of any foreign law.

Uniform Money-Judgment Recognition Act of the US, Section 4: (a)  A foreign judgment is not conclusive if1. The judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law 2. The foreign court did not have personal jurisdiction over the defendant 3. The foreign court did not have jurisdiction over the subject matter (b)  A foreign judgment need not be recognized if1) The defendant in the proceedings in foreign court did not receive notice of the proceedings in sufficient time to enable him to defend 2) The judgment was obtained by fraud 3) The cause of action or claim for relief on which  judgment is based is repugnant to pu blic policy of the state. 4) The foreign judgment conflicts with another final & conclusive judgment. 5) The proceeding in the foreign country was contrary to an agreement between the parties under which the dispute in question settled otherwise than the proceeding in that court 6) In the case of jurisdiction based only on personal service, the foreign court was a seriously inconvenient forum for the trial of the action Grounds 1-3 under letter b are mandatory & the last 3 are discretionary. The ground on non-recognition for lack of jurisdiction in  personam   is most debatable. Most courts consider  jurisdiction of foreign court as appropriate when there are significant contacts between forum states & individuals. The service of summons as the traditional basis for exercise of jurisdiction has been eroded. The ground that ―foreign court was seriously inconvenient‖ employs doctrine of forum non conveniens  to restrain use of ―presence‖ as cornerstone of jurisdiction.

 Art 23 Hague Convention on Jurisdiction, Applicable L aw, Recognition, Enforcement & Cooperation in re of Parental Responsibility & Measures for Protection of Children: Considering the best interests of child, recognition of measures directed for protection of the child or his property 56

 Violation of ordre public   & nonobservance of due process are included as grounds for non-recognition in many Hague Conventions.

1. The Hague Conference on Private IL Convention on Recognition & Enforcement of Foreign Judgments in Civil & Commercial Matters   established conditions & requisites for contracting states to recognize & enforce each other‘s  judgment. Contributions: a) provisions on applicability of Convention irrespective of nationality b) non-refusal for sole reason that court of state of origin has applied a law other than that which  would have been a pplicable according to the rules of Private IL of the state addressed c) it addresses the question of whether a default  judgment is subject to enforcement d) establishes recognition & enforcement procedures The seventh session looked into possibility of a general convention on recognition & enforcement of judgments  whose chief benefit will be the relatively unif orm procedure among contracting states. 2. The EEC Convention of 1968 Six countries comprising the European Economic Community are signatories to Convention on Jurisdiction of Courts & Enforcement of Decisions… The Convention extends to Common Market area the reach of jurisdictionally improper for a now available against nonresidents under procedural systems of 4 member states. 3. The Uniform Money-Judgments Recognition Act

This seeks to inspire more confidence in stability of  American law & bring together into one statute all common law rules of recognition from jurisprudence.