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COURSE OUTLINE IN CONFLICTS OF LAW

By: Atty. Enrique V. dela Cruz, Jr.

CONFLICTS OF LAW

Comity of nations is the recognition


which one nation allows within its
territory to the legislative, executive or
judicial acts of another nation, having
due regard both to international duty
and convenience, and to the rights of
its own citizens or of other persons who
are under the protection of its laws.

By: Atty. Enrique V. dela Cruz, Jr.1

PART ONE: INTRODUCTION


I. Scope and Conflict of Laws: Nature,
Definition and Importance

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
plaintiffs claim.

A.

PRIL: that part of municipal law which


covers cases with a foreign element.

Hilton vs. Guyot


(1895)
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.

B. Definition
Second Edition of Jurisprudence: private
international law is 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.

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
territory xxx shall be allowed to operate
within the dominion of another nation,
depends upon xxx the comity of
nations.

Distinguished from Public International Law


and other disciplines:

Public International
Law

Private International
Law

Principally
governs
states
in
their
relationships
amongst themselves

Principally
governs
individuals in their
private transactions
which
involves
a
foreign element

Diversity of Laws, Customs and


Practices

1 Atty. Dela Cruz is an MCLE lecturer and a Bar


Reviewer at the Jurist Bar Review Center and the
Cosmopolitan Review Center. He teaches law at UST,
FEU and the Bulacan State University. He obtained his
Master of Laws (with Distinction) from the London
Metropolitan University, and a Postgraduate Diploma
in International Trade Law from the University
College London (UCL), U.K., both as a Chevening
scholar of the British government. He completed a
Postgraduate Fellowship on Leadership and
International Relations from the John F. Kennedy
School of Government, Harvard University, USA. He
also holds a Masters in Public Management degree
from the Ateneo School of Government. He obtained
his Bachelor of Laws degree (with honors) and an AB
Legal Management degree (cum laude) from the
University of Santo Tomas as a Rectors Scholar. He is
on his 3rd term as an elected Councilor of Baliuag,
Bulacan and the current Vice-President (Luzon) of the
Philippine Councilors League. He is also a Partner at
the Ponce Enrile Reyes & Manalastas (PECABAR) Law
Office in Makati City.

As to sources of law:
Codified in Art. 38 of Generally
derived
the
Statute
of from the internal law
International
Court of each state and not
of Justice
from
any
international
law
extraneous
to
municipal law
As to persons involved:

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

deciding
disputes

multi-state

and

multinational

Governs only states Governs individuals


and internationally- or corporations
recognized
organizations

2) Issue of choice-of-law: refers to the


probable sources from which the applicable
law of the controversy may be derived

As to transactions:

3) Recognition and enforcement of foreign


judgments: study of situations which justify
recognition by the forum court of a
judgment rendered by a foreign court or
the enforcement of such within the forum

Involves
state-to- Relates to private
state or government- transactions
to-government
between individuals
matters

II. A Brief History and Development of


Conflict of Laws

In case of violation, a
state may resort to
1) diplomatic protest
2) peaceful means of
settlement
(diplomatic
negotiations,
arbitration
or
conciliation)
3) adjudication by
filing a case before
international
tribunals
4) use force short of
war, or eventually go
to war

A.

As to remedies:

Roman Law

All the remedies are


provided
by
municipal laws of the
state, such as resort
to
courts
or
administrative
tribunals

Ius gentium
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

Italian City States


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.

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.

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

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
individuals
and
juridical
entities,
naturalization law, laws on domicile and
residence, family relations, contracts, torts,
crimes, corporation law and property law.

C. Object, Function and Scope

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.

3 Issues in Conflict of Laws:

16th century, France

1) Issue of adjudicatory JD: determines the


circumstances that allow for a legal order
to impose upon its judiciary the task of

Charles Dumoulin advocated a


method to determine what law would

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

- founder of modern private IL


-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

govern contracts
nationals

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.
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.

Neo-Statutists

followed Italian theory: when 2 or


more
independent
laws
are
applicable to a Conflict problem,
the
method
so
devised
determines what law shall prevail
Internationalists

Comitas Gentium was readily accepted


because of increasing international
transactions.

there should be a single body of


rules that can solve problems
involving a foreign element
Territorialists

Ius Commune, applied by Italian and


French jurists, was a supranational law
based on Roman law and which
became the continental European
common law.

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
1969

Netherlands
Ulrich Huber first used the term,
conflict of laws

B. Modern Developments

different

Bertrand DArgentre 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

between

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

2nd 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.

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

19th Century
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.
Frederich Carl Von Savigny

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Spanish Civil Code was enforced in the


Philippines on December 7, 1889 until the
Philippine Civil Codes effectivity on August
30, 1950 which contained the provisions on
conflict of laws of the earlier code.

represents the system of universal


succession. Art. 17, par. 1 follows lex loci
contractus. But there was no significant
jurisprudence on the subject.
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.

Spains Code of Commerce, having some


provisions on foreign transactions, were
also enforced in the Philippines on Dec 1,
1888.

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.

One basic source of law is the 1987


Constitution which contains principles on
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
B. Treaties
and
Conventions

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.
III. Sources of Conflict of Laws
A.

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.

International

The Philippines has entered into a number


of treaties and international conventions
which deal with private international law
since it became a Republic.

3.
4.

Some of these treaties/conventions are:


1.
2.
3.
4.
5.
6.
7.
8.

Codes and Statutes

5.

Convention on Intl Civil Aviation,


Warsaw Convention,
Convention on Offenses Committed
on Board Aircraft
Convention on the Suppression of
Unlawful
Acts against Civil Aviation
UN Convention COGSA
Convention on Consent to Marriage,
etc
Convention on Traffic of Persons

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

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

9.

PART TWO: JURISDICTION AND CHOICE OF


LAW

13.

10.
11.
12.

14.

IV. Jurisdiction

Although many Hague Conventions on


Private International Law were concluded
since 1951, which dealt with issues on:
Personal status

Jurisdiction may mean either a) judicial or


b) legislative jurisdiction. (This part talks of
judicial jurisdiction)

Judicial JD the power or authority of a


court to try a case, render judgment and
execute it in accordance with law.

4 Major Questions in Analyzing a Conflict of


Laws Problem:

C. Treatises,
Commentaries
Studies of Learned Societies

1) Has the court JD over the person


of the defendant or over his
property?

Distinguished writers in continental Europe


include Huber Manreas, Savigny (whose
work was translated into English by
Guthrie), and Weiss.

3) Has the suit been brought in the


proper venue in cases where a
foreign element is involved?

Distinguished
American
and
English
writers, on the other hand, include Beale,
Cavers, Cheatham, Currie, Ehrenzweig,
Goodrich, Gussbaum, Story, Wharton,
Cheshire, Graveson.

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?
of

and

In interpreting statutes and codes involving


CL, courts resort to works of distinguished
jurists and studies of learned societies.

2) Has the court JD over the subject


matter (competency)?

Basis of Exercise
Jurisdiction

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.

Legislative JD the ability of the state to


promulgate laws and enforce them on all
persons and property within its territory.

A.

Convention
on
Elimination
of
Discrimination against Women
Convention on Political Rights of
Women
IC on the Suppression of Traffic of
Women and Children
Convention on World Intellectual
Property Organization
Berne Convention on Protection of
Literary and Artistic Works
Paris Convention on Protection of
Industrial Property.

The American Law Institute published 2


studies on CL: Restatement of the Conflict
of Laws and a Second Restatement with
William Reese as Reporter.

Judicial

Bases of Judicial Jurisdiction (3 groups):


D. Judicial decisions

1) JD over the person (based on


forum-defendant contacts)

Decisions of courts are the most important


source of CL rules and form the main bulk
of source of conflict rules.

2) JD over the res (based on forumproperty contacts)


3) JD over the subject matter

According to Graveson: This branch of law


is more completely judge-made than
almost any other. In its application, judges

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

b) submission to authority

1.

rule: in substituted service, the premise is


that the defendant is within the territorial
JD of the court

Jurisdiction
Person

over

the

This is acquired by the voluntary


appearance of a party and his submission
to authority.

exception: Gemperle case because Helen


is legally authorized to file a case in behalf
of Paul, she is also authorized to receive
summons

Over the person of the plaintiff: acquired


the moment he invokes the aid of the court
by filing a suit.

2) over the property


a) in rem the situs could
bind the world
b) quasi in rem

Over the person of the defendant: acquired


when he enters his appearance or is
served with the legal process within the
state.

basis of JD: presence of the property within


the territory

When he or his lawyer appears in court, he


gives consent to the forums exercise of JD
over him, except where the appearance is
for the purpose of protesting the JD over
him.

3) over the subject-matter - WON


the court has competence to hear
the case and render judgment;
the courts JD must be properly
invoked (provided for by statute)

A non-resident plaintiff who files a suit is


deemed to consent to the courts exercise
of JD over subsequent proceedings arising
out of his original cause of action
(counterclaims).

_______________
2.

Jurisdiction
Property

over

the

JD over the defendant may be had by


personal
or
substituted
service
of
summons.

JD over the property results from:


a) seizure of the property under
a legal process

Gemperle vs. Schenker


(1967)
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 businessman. Schenkers
defense: court has no JD over the person
of Paul.

b) the
institution
of
legal
proceedings
wherein
the
courts
power
over
the
property is recognized and
made effective
This kind of JD is referred to as in rem 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)

HELD: Jurisdiction was acquired by the


lower court over the 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.

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).

Note

Jurisdiction:
1) over the person
a) voluntary appearance

Pennoyer vs. Nef

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

maintenance of the suit does not offend


traditional notions of fair play and
substantial
justice.
(Minimum
contacts so that the suit will not
ofend traditional notions of fair
play and substantial justice.)

(1878)
FACTS: Neff, a California resident, owned
land in Oregon which was sold under a
Sheriffs 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.

The demands of due process regarding


the corporations 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.

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.

Its presence can be manifested only by


such activities carried on in its behalf by
those who are authorized to act for it.
Mullane vs. Central Hanover Bank &
Trust Co.
(1950)
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
the suit is merely in personam,
constructive service in this form upon a
non-resident is ineffectual for any
purpose.
The important thing to prove is what kind
of action is involved (to determine
sufficiency of form of service to be used)

HELD: When notice is a persons 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.

International Shoe Co. vs.


Washington
(1945)
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.
International Shoes defense is that its
activities within the 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.

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.

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 minimum
contacts
with it,
such
that the

Shafer vs. Heitner


(1977)
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,

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

establishes the states paramount interest


in adjudicating a claim over it and provides
the necessary minimum contacts.
Long-Arm Statutes
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.
3.

Jurisdiction
over
Subject-matter

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.

the

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.

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.

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.

Traditional basis for the exercise of judicial


JD is the states 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.

Idonah Perkins vs. Roxas


(1941)
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.

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.

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 cross-complaint
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

Distinction, Shaffer and International Shoe:


while International Shoe requires minimum
contacts between the defendant and the
forum, Shaffer demands that minimum
contacts exist among the forum, defendant
and the cause of action.
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

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Reasons
for
conveniens:

applying

forum

whether or not the tribunal has power to


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

non

1) to prevent abuse of the courts


processes (prevent harassment of
defendant,
dissuade
a
nonresident plaintiff from choosing
the forum because of larger jury
verdicts, etc.)
2) burdensome on the court
taxpayers (severe backlog
cases)

Note

Presence/Jurisdiction:
1) Traditional Views
a) Pennoyer

physical presence
2) Modern Views

or
of

actual

a) Intl. Shoe contact


between the forum and
the corporation (even in
the absence of an actual
office, etc.)

3) local machinery is inadequate to


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

b) Mullane disregards strict


distinction between in
rem and in personam

4) avoid global forum shopping


English and Scottish courts have applied
FNC when there was another available 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.

c)

Shaffer

minimum
contacts
between
the
properties
and
forum;
fundamental fairness test

Long-arm statutes: already identify what


are the bases of JD.

Jurisdiction and choice of law


do not mean the same thing.
_______________

Heine vs. New York Insurance Co.


(1940)
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.

B. Ways of Dealing with a Conflicts


Problem
The court may
problem, by:

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

deal

with

conflicts

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
1.

Dismiss the case

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.

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

considering that defendant is a resident


of the Philippines.

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.

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.

In re: Union Carbide


(1986)
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 in NY in behalf of the
victims. Union carbide moved to dismiss
on the ground of forum non conveniens.

Bank of America vs. CA


(2003)
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 businesses 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.

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.).

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 courts 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.

Wing On Company vs. Syyap


(1967)
FACTS: Syyap failed pay Wing On, a NYbased 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.
HELD:
Forum
non
conveniens
is
inapplicable. Unless the balance is
strongly in favor of the defendant, the
plaintiffs 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,

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.
Note

Forum non conveniens:


1) prevent abuse of court processes
2) burdensome
on
the
court/taxpayers

10

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

b) 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) 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 plaintiffs
choice of forum should rarely be
disturbed, because in the first
place, it was the plaintiff who
chose that forum.
_______________

Fleumer vs. Hix


(1930)
FACTS:
Fleumer,
the
special
administrator of the estate of Hix,
appealed the denial of the probate of
Hixs will, alleging that since the will was
executed in West Virginia by a resident
therein, West Virginia law should govern.
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 facts. 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 Civil Procedure; nor was the extract
from the law attested by the certificate
of the officer having charge of the
original.

2.

Assume Jurisdiction

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

Philippine Trust Co. vs. Bohanan


(1960)
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. Bohanans widow questioned
the validity of the will under Philippine
law; however, if Nevada law was to be
applied, the will would be valid.

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).

Example:
prohibitory
or
mandatory laws of the forum

2) The proper foreign law was


not properly pleaded and
proved

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 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

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.

Under the Rules of Court, the


foreign law may be proved by:
a) official publication

11

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

proof of such law having been offered at


the hearing of the project of partition.

BUT these are 2 diff. concepts. A court may


exercise jurisdiction but apply foreign law
or not exercise jurisdiction but the states
internal law will be applied.

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.

B. Approaches to Choice of Law


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

1. Traditional Approaches
theories
that
emphasize
simplicity,
convenience
and
uniformity
a.

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
b) The foreign law is penal in
nature
c) The foreign law is procedural
in nature
d) The foreign law purely fiscal
or administrative in nature
e) The application of the foreign
law will work undeniable
injustice to the citizens of the
forum
f) The case involves real or
personal property situated in
the forum
g) The application of the foreign
law might endanger the vital
interest of the state
h) The foreign law is contrary to
good morals

vested rights theory

advanced by Prof. Beale (1st


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.

V. Choice of Law

Gray vs. Gray


(1934)
FACTS: Wife (W) sued husband (H) for
damages in New Hampshire where they
are residents. Accident happened in
Maine. Maine bars suit between spouses.

A.

The
Correlation
between
Jurisdiction and Choice of Law
1) The
factors
that
justify
exercise of judicial jurisdiction
maybe the same factors used
to determine choice of law

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).

2) 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

12

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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
2.

Alabama Great Southern Railroad


vs. Carroll
(1892)
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)

Modern Approaches

a. Place of the
Significant Relationship

Most

-identifies a plurality of factors:


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

Criticisms to the Approach: failure to


resolve conflicts cases with considerations
of policy and fairness.
b.

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

Cooks 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 narrowmined 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.
c. Cavers
Preference

Auten vs. Auten


(1954)

13

Principles

of

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.
Cavers
principles
have
a
territorialist bias; it looks to the

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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 sued in NY to enforce
agreement. H claimed that legal
separation suit, extinguished liability
under NY law.

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:
1st: 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)
2nd: 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.

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.

Babcock vs. Jackson


(1963)
FACTS: Babcock & Jackson, NY residents,
met a car accident in Ontario thru Js
fault. B sued J in NY for damages. Ontario
bars recovery under a guest statute. NY
does not have a similar rule.

Haag vs. Barnes


(1961)
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.
Bs
defense:
Illinois
agreement bars suit.

HELD: B should be allowed to recover. NY


had a greater & more direct interest than
Ontario. NYs policy is to afford
compensation to a guest against
tortfeasor host while Ontarios policy is
to prevent fraudulent collusion to the
prejudice
of
Ontario
defendantsinsurance companies. Thus, Ontario had
no interest in denying a remedy to a NY
guest against a NY host.

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)

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.

14

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

2) maintenance of interstate and


intl order
3) simplification of the judicial
task
4) application of the better rule
of law
5) advancement of the forums
governmental interest
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.

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.

Note

Pangalangan on Interest analysis:


why consider what the state wants
when interests of individuals are in
issue?

c.

Note

Traditional approaches do not consider


policy; all modern approaches look at
policy.
______________

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

VI. The Problem of Characterization


A.

Comparative Impairment

Characterization and the SingleAspect Method

d.

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.

Trautmans
Analysis

Functional

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

Leflars
Influencing
Considerations

Choice-

5
major
choice-influencing
considerations
1) predictability of results

Art 16: Real property as well as personal


property is subject to the law of the
country where it is situated.

15

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

(1933)
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 wifes death previous
to husband, community property belongs
absolutely to husband.

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. (AOI)

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.

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.

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.

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.

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
decedents
national
law
(California)

The rules specify geographical location in


accordance with traditional approach. The
problem with this: inherent rigidity, unjust
decisions.

Characterization problems are considered a


threat to traditional choice-of-law theories
whose aims are uniformity & predictability
of results.

Solution: Characterization, Renvoi, Escape


devices
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.

Problems:
A) C, is adopted in the Philippines by a
former Filipino citizen and moves to the US
with her adoptive mother, M. By Ms laws,
C will not be an heir. Will C be entitled to an
intestate share in Ms estate?

Two Types of Characterization:

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

1.

Subject-matter
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

2. Succession: adopters personal


law shall prevail

Gibbs vs. Govt. of PI

16

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

B) Principal authorizes a person to act as


his agent in another country. Agent
commits a negligent act. What law will
determine the principals liability?
It depends on the courts characterization
of the case as:

Grant vs. Mcaulife


(1953)
FACTS: Plaintiffs, Grant, et al., (California
residents) were injured in Arizona when
their vehicle collided with that of Pullens
(California resident), who died of
accident.
The 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.

1. Contractual: law of the place


where the contract of agency was entered
into; or
2. Tortious: law of the place where
tortuous conduct or injury occurred
2.

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 wrong resulting to a physical injury
shall not abate because of the death of
the wrongdoer. Plaintiffs cause of action
survives Pullens death.

Substance-Procedure
Dichotomy

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
Why apply forum law to matters of
procedure?

The reaction to Grant was generally


negative. It was criticized as being based
on an erroneous characterization greatly
influenced by sympathy.

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.

Other view: Correct result but arrived at


using dubious method.

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.

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.
better if courts
considerations
the results and
considerations

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 plaintiffs
claim.

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.

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.

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.

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.

This device is not ideal. It is


could expressly state the
that helped them determine
indicate clearly how these
will be used in other cases.

17

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Purpose: Many states, the


Philippines
among others, have passed borrowing
statutes to eliminate forum-shopping.

Two Issues whose classification (as


procedural or substantive) is debatable:

However, in the case of Cadalin, the court


said that to enforce the borrowed statute
would
contravene
public
policy
on
protection of labor.

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

Cadalin vs. POEA Administrator


(1994)
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.

Marie vs. Garrison: Defendant maintains


that the NY Statute of Frauds affects the
remedy upon a contract w/in its termsa
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.

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 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.

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 SLs 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.

B. Depecage
From depecer, which means to dissect.
Different aspects of a case involving a
foreign element may be governed by
different systems of laws.

Specificity test: to determine whether an


SL is substantive or procedural.

Von Mehren & Trautman: A man dies


intestate domiciled in state A & w/ movable
properties in State B.

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

How will the mans 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

Borrowing statutes

18

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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

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

the woman claiming the share is a wife is


referred to family law, not laws on
succession.
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.
The presence of an incidental Q is one
instance which calls for the employment of
depecage.
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.

Haumschild vs. Continental Casualty


(1959)
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.

The consideration of any elements &


acceptance by courts of depecage help
ease restrictions of single aspect method.
Courts not compelled to apply entire law to
all aspects of casethat might produce
egregious results. Cutting up the case issue
by issue is fair & reasonable.
But even if a useful tool in modern choiceof-law analysis, the express reference to
depecage in case law, both in US & the Phil
still uncommon.

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.

VII. The Problem of Renvoi


A.

Definition

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.

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.

Remission: reference is made back to the


law of the forum
Transmission: reference to a third state

19

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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
testators 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.

Renvoi:

State A (RP)

State B

Art. 16 CC

Internal law
Conflict-of-laws rule
renvoi
(remission)

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 law.

B. Various ways of dealing with the


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

4) foreign court theory the forum


court would assume the same
position the foreign court would
take were it litigated in the
foreign state

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

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.

2) the court may accept the renvoi


and refer not just to another
states internal law but to the
whole law (includes choice-oflaw rules applicable in multi-state
cases)

Annesley, Davidson vs. Annesley


(1926)
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 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.

Aznar vs. Garcia


(1963)
FACTS: The will of Edward Christensen, a
domiciliary of the Philippines, was
admitted to probate, and a project of
partition
was
proposed.
Edwards
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: 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

20

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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 persons 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.

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 state 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 under
Michigan law, her note and trust deed
were void.

Note

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.
_______________

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.

C. Usefulness of Renvoi
Renvoi has been used to avoid unjust
results.

University of Chicago vs. Dater


(1936)
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

Griswold: the objection is based on a false


premise; as long as remission is to the
states internal law alone there will be a
stop to the endless chain of reference.

21

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

2) Courts may be unnecessarily


burdened with the task of
identifying the choice-of-law rules
of another state.

(1968)
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.

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.
Inapplicability of Renvoi in a False Conflict

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 reference back (renvoi) to Philippine
law, but would still refer to Texas law.

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.

VIII. Notice and Proof of Foreign Law


A.

Pfau vs. Trent Aluminum Co.


(1970)
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 Trents car. The defense of Trent
Aluminum was that Iowa law is
applicable, which provides that the hostdriver is not liable to his passenger-guest
for ordinary negligence.

Extent of Judicial Notice

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
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 previously ruled
upon it in other cases.

HELD: Connecticut and New Jersey law


both allow passenger-guest recovery. It
appears that Connecticuts substantive
law allowing a guest to recover form his
hosts 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.

In US, courts are allowed to take judicial


knowledge of the law of sister states.
B. Proof of Foreign Law
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

Bellis vs. Bellis

22

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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)

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.

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

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.

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.

Effects of Failure to Plead and Prove


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

3) before such person which the


parties have stipulated in writing
to

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)

PCIB vs. Escolin


(1974)
FACTS: Case bet. the administrators of
the estates of Hodges spouses. Ws
administrator sought the application of
Texas law. Hs 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

First approach: Dismiss the case

Walton vs. Arabian Oil Co.


(1956)
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.

In Re Estate of Johnson
(1918)

23

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

Zalamea vs. CA
(1993)
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.

The
applicable
tort
principles
necessary to establish plaintiffs
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.

Leary vs. Gledhill


(1951)
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 Ls proof
were insufficient as there is no pleading
or proof of the law of France where the
transaction occurred.

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.

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 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.

Third approach: processual presumption

Miciano vs. Brimo


(1924)
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.
Suntay vs. Suntay
(1952)
FACTS: A will executed in Amoy by the
deceased is sought to be allowed in the

24

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

father all performed in China were not


properly proven.

Phils. The will was allegedly recorded


and probated by a district court in Amoy.

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

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.

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 crossexamine 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.

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

CIR vs. Fisher


(1961)
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.

C. Exceptions to the Application of


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

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.
Board of Commissioners vs. CID
(1991)
FACTS: Board sought the deportation of
G who is alleged to be an alien.
Marriages of Gs grandfather and of Gs

25

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

These exceptions
categories:

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.
2.

The
foreign
law
procedural in nature

1.

is

main

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

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.

to

Pakistan Intl Airlines v. Ople


(1990)
FACTS: 2 Filipino stewardess-employees
of PIA filed a case for illegal dismissal
against their employer in DOLE. PIAs
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.

The universally-accepted rule is that as to


immovable property, it is governed by the
law of the place where it is located.
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.
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
4.

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.

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
Issues are related
property (lex situs)

under

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

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 forums rules of
procedure.

3.

fall

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.

The issue involved in the


enforcement of foreign
claim
is
fiscal
or
administrative

26

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

State is not obliged to enforce the revenue


law of another.
PART THREE: PERSONAL LAW

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.

IX. Nationality
A. Importance of a Personal Law

Opposition to exception: person should not


be permitted to escape his obligations in
maintaining the government by crossing
state lines.

The individuals 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.

5.

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.
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.

Foreign law or judgment


is contrary to Good Morals

contra bonos mores - acts having


mischievous or pernicious consequences or
against true principles of morality.
ex. Hiring for killing, bribery of public
officials, marriage between ascendants and
descendants

Merits & Demerits of Nationality as


Personal Law

6.

The application of Foreign


law will work Undeniable
Injustice to the Citizens of
the Forum

7.

The Foreign law is Penal


in Character

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

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.

-since laws considered physical,


moral qualities of citizens, laws
should apply to citizens wherever
they are

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.

2) an individuals 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

This exception is partly remedied under the


international law of extradition on the basis
of
jurisdictional
cooperation
and
assistance.
8.

2) a persons ties to his nation may


be so attenuated if he has lived in
another country.

27

The application of the


Foreign
law
might
endanger
the
Vital
Interests of the State

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

- unreasonable for his national law


to govern him if he has no shared
sense of identity.

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

Importance of Nationality in the Philippines


Most civil law countries follow the national
law theory.

1. Natural-born Citizens
Two principles w/c may be followed:

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 latters
nationality.

jus soli: looks to the law of the place of


ones birth to determine ones nationality
(followed in many common law countries).
jus sanguinis: rule of descent or blood.
Followed in the Philippines, articulated in
the Constitution.

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.

Natural born citizens: citizens of the


Philippines from birth w/out having to
perform any act to acquire or perfect
citizenship.

This notion that a persons 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,

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.

B. Determination of Nationality

Talaroc vs. Uy
(1952)
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.

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/ intl.
convention, intl. customs, & the principles
of law generally recognized w/ regard to
nationality.

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.

Art 2. Hague Convention: Question on


possession of nationality of a particular
state shall be determined in accordance
w/ the law of that state.
Who are Filipino
Constitution, Art IV)

citizens?

(Philippine

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

Co vs. Electoral Tribunal of the


House of Representatives

28

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

So
government
can
observe
applicants
conduct
&
ensure
he
imbibes principles & spirit
of our Constitution.

When may period


reduced to 5 years?

(1991)
FACTS: Ong Jr. ran as representative of
the 2nd district of Samar and was
proclaimed the winner. The losing
candidates
filed
election
protests,
claiming that Ong Jr. was not a naturalborn citizen.

be

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.

a) applicant
honorably
held
office under the Phil govt. or
under any of its political
subdivisions
b) applicant has established a
new industry or introduced a
useful invention in the Phil
c) Married to a Filipino woman
d) 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
e) Born in the Philippines
3) Must be of good moral character,
& believe in the principles underlying
the Phil Constitution &

2.

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

Citizens by Naturalization

Naturalization confers to an alien a


nationality after birth by any means
provided by the law.
In the Philippines, naturalization is by
judicial method, under CA 473, as
amended RA 530.

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 naturalization process was relaxed


under Marcos regime. Liberal method,
summary inquiry. This, however, is no
longer in force.
Qualifications for Applicants for
Naturalization
1) Petitioner must not be less than
21 years of age on date of
hearing of petition

The law requires moral character of highest


degree. Being merely a law-abiding citizen
is inadequate.

2) He must have, as a rule, resided


in the Philippines for a continuous
period of not less than 10 years

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

29

Why the 10 yr residence


requirement?

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

of 1,000 sq. m. urban or 1 ha rural


land)
c) SC broadened exception
to prohibition by applying In Pari
Delicto doctrine, excluding from the
ban the alien vendee who later
becomes a naturalized Filipino

Yu Kian Chie vs. Republic


(1965)
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.

Additional exceptions thru judicial


decisions have been criticized for
inviting
violation
of
the
Constitution & disregarding a
fundamental policy of allowing no
one to reap benefits from an
unlawful act.

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.

5) Must be able to speak & write


English or Spanish & any one of
the principal Philippine languages

What does lucrative trade,


profession,
or
lawful
occupation mean?
Substantial gainful employment or
the obtaining of tangible receipts

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.

Children must learn & imbibe


customs, traditions & ideals of
Filipinos so theyll become lawabiding citizenship.

Compliance
&
affirmative
showingotherwise, denied.

Non-compliance
because
insufficient finances: denied.

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.

of

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
natural-born citizen who lost his
Filipino
citizenship
to
be
a
transferee of a private land for
residential purposes (not in excess

Disqualification for Naturalization


General
Rule:
Burden
of
disqualification is upon the state.

Requirement of ownership of
real property: At odds w/ Art
XII, Sec. 7 Phil Constitution:
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.

proving

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;

30

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

contrary to conduct of honesty,


modesty or good morals)

Exemptions to Filing of Declaration of


Intention:

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

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

3) applicants conduct of keeping wife


and children in a neighboring
country and only visiting them
(lack of sincere desire to embrace
Filipino customs and traditions)

2) those
who
have
resided
continuously in the Philippines for
a period of thirty years or more
before filing their application

4) if it is not fully established that


applicants nation grants reciprocal
rights to Filipino citizens

3) 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.

C. Procedure for Naturalization


The
following
naturalization:

Requirement
is
mandatory,
absolute
prerequisite to naturalization. Failure is
fatal. Void for noncompliance with law.

on

Wife

steps

for

b) The petition for naturalization


must then be filed (Sec. 8, Com
Act No. 473)

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.

Naturalization

the

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).

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.

Effect of
Children

are

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)

and

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.

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)

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

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

31

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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 fathers
naturalization,
they
were
already
required to leave the country, they
cannot be said to be lawfully residing
here.

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.

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 fathers
oath taking because their allowed stay
was for a definite period up to a fixed
day.

Vivo vs. Cloribel


(1968)
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

Moy Ya Lim vs. Commissioner of


Immigration
(1971)
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.
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.

HELD: The wife, under Sec. 15 of the


Revised Naturalization Law, will not
automatically become a Filipino citizen
upon her husbands 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)

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
Citizenship

Declaration

of

Philippine

A declaration of Phil citizenship may not be


granted in an action for declaratory relief

32

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

nor under the Civil Code provision (Art.


412) on correction of entry in the Civil
Registry.

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.

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.

Frivaldo vs. COMELEC


(1996)
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

Tan Yu vs. Republic: There can be no action


or proceeding for the judicial declaration of
the citizenship of an individual.

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 Frivaldos repatriation
retroacted to the date of his filing his
application in Aug. 1994.

D. Loss of Philippine Citizenship


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

Naturalization

in

foreign

Frivaldo vs. COMELEC


(1989)
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 respondents contention that
he is a US citizen because he did not
repatriate himself after his naturalization
in the US

Labo vs. COMELEC


(1989)
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.

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:

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

1. direct act of Congress


2. naturalization
3. 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

33

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

before a certificate of registration is


issued by the CID.

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:

2) Express renunciation of
citizenship

Aznar vs. COMELEC


(1990)
FACTS: Osmea 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. Osmea
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.

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;

HELD: Osmea 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.

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.

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

Certified copy of decree canceling


certificate forwarded to the Office of
the President & the Solicitor General.

4) by rendering service to, or


accepting commission in, the
armed forces of a foreign country,
subject to certain exceptions

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.

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

Only a Grant of Political Privilege:

6) in the case of a woman, upon


her marriage to a foreigner, if by
virtue of the laws in force in her
husbands country, she acquires
his nationality

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.

7) cancellation of the certificate of


naturalization

34

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

2) Filipino citizen who marries an


alien may acquire citizenship of his
or her spouse if the spouses
national law so allows.

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.

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 spouses
country or by express renunciation.

Republic vs. Li Yao


(1992)
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.

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.

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.

In determining rights of an individual who


may claim multiple nationality in a third
state, the ICJ applied principle of effective
nationality.

Nottebohm Case
(1955)
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.

E. Problems in Applying the Nationality


Principle
1.

Dual or Multiple
Citizenship

Each state determines who its nationals are


in accordance w/ the rule in the Hague
Convention on Conflict of National Laws.

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.

Questions on WON a person possesses the


nationality of a certain state are to be
determined in accordance w/ the states
internal law.
It is possible that a person can be claimed
as national of 2 or more states.
Situations w/c may result to
nationality:
Application of jus soli & jus sanguinis

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.

dual

1) Child born of
o parents who are nationals
of country applying jus
sanguinis
o in a country applying jus
soli
has dual nationality

35

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Conventions to Alleviate
Stateless Persons:

Problems

of

Oh Hek How vs. Republic


(1969)
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.

1) 1951 Geneva Convention on Status


Refugees
-provided some basic rights of stateless
persons
2) 1954 UN
Elimination or
Statelessness

Conference on the
Reduction of Future

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
depriving nationals of identity:

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.

from

1) as punishment or
2) 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.

2.

Statelessness

Understood in two senses:

Convention mandates that:


*jus sanguinis country grant its nationality
to a person born w/in its territory if he
would otherwise be stateless.

a) 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.

*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.

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.

Kookooritchkin vs. Solicitor General


(1948)
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.

- 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.

HELD: K is a stateless person. His


testimony,
aside
from
being
uncontradicted, is supported by the well-

36

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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 Ks 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.

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

X. Domicile
A.

Definition

Municipal law concept of domicile (Art. 50,


CC):

Habitual
residence:
bridge
between residence and domicile

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.

_______________
Caasi vs. CA
(1990)
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.

Conflict-of-laws definition of domicile


(Restatement): the place with which a
person has a settled connection for certain
legal purposes, either because his home is
there or because that place is assigned to
him by law.

HELD: Miguels 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.

Justice Story: the place of true, fixed


permanent
home
and
principal
establishment, and to which, whenever he
is absent, he has the intention of returning.
A person may live in a place where he is
not domiciled. To acquire a domicile, there
must be concurrence of
1) intention to make it ones domicile and
2) physical presence.

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 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.

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).
Note

Domicile is permanent in nature; it is not as


transient and temporary as residence.

37

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Uytengsu vs. Republic


(1954)
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.
Uytengsus 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.

1) ones
domicile
is
not
ascertainable
without
first
resorting to the courts to establish
whether or not there is animo
manendi
2) the notion of domicile differs
widely in different states (some
distinguish between domicile and
residence;
others
attribute
different meanings of domicile for
different purposes)
3) 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)
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.

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.
B. Merits and Demerits of Domicile

C. General Rules on Domicile

Merits:

1) No person shall be without a


domicile; his domicile of origin
prevails until the acquisition of a
new one.

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) 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).

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

3) Domicile establishes a connection


between a person and a particular
territorial unit.

Demerits:

38

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

4) The burden of proving a change of


domicile is upon whoever alleges
that a change has been secured.

Romualdez-Marcos vs. COMELEC


(1995)
FACTS:
Imelda
Marcos
filed
her
Certificate
of
Candidacy
for
representative of 1st 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.

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.

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.

D. Kinds of Domicile
3 Kinds of Domicile:

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.

1) Domicile of origin: a persons


domicile at birth. A legitimate
childs domicile is that of his
father, while an illegitimate childs
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 ones home.

Ujano vs. Republic


(1966)
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.

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.

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.

Reverter or revival doctrine: presumption


that domicile of origin revived once the
domicile of choice is given up, before a new
one is required.

Velilla vs. Posadas


(1935)
FACTS: Velilla, the administrator of the
estate
of
Moody,
appealed
the
inheritance tax assessed against the
estate on the ground that the decedent

In re Dorrances Estate
(1932)

39

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

domicile of their mother upon the death of


their father.

was not domiciled in the Philippines.


Moody went to Calcutta and Paris before
his death, and he died in India.

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.

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.

Special Problems in Domicile of Choice vis-vis Constructive Domicile


1) domicile of people kept under
physical or legal compulsion
2) domicile
of
married
women
seeking to acquire separate
domicile from their husbands

White vs. Tennant


(1888)
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
wifes 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, of the estate would go to
Whites siblings. The law of his domicile
governs the distribution of his estate.

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.

Caraballo vs. Republic


(1962)
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: Pennsylvania was his domicile at


the time of his death. Two things must
concur to establish domicilethe 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.

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.

3) Constructive domicile: domicile


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

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.

Minors or infants are indubitably incapable


of choosing their own domicile. Their
domicile automatically changes when their
fathers domicile changes. Minors take the

40

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Married Women: based on the concept of


unity of identity of spouses, the wife was
presumed to take the domicile of the
husband.

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 husbands domicile.

Go Chen and Go Lek vs. Collector of


Customs
(1932)
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.

Modern view (married women): dispenses


with the presumption that the wifes
domicile is the same as her husbands.
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.

XI. Principles
Capacity
A.

on

Personal

Status

HELD: The minor children cannot enter


the Philippines. A Chinamans 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.

and

Definition

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.

De La Vina vs. Villareal and Geopano


(1920)
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.

Juridical capacity: fitness of a man to be


the subject of legal relations

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.

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.

*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

41

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

In case of Filipinos, Art. 15 of the CC states


that personal status and capacity follows
the nationality principle.

jurisdiction of the court to issue the said


decree.
HELD: Phil court has jurisdiction. The
authority and jurisdiction of courts are
not a matter of private law of 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 aliens, courts may refer to their


national law or domiciliary law.

Recto vs. Harden


(1959)
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 attorneys fees. H moved to
dismiss on the ground of invalidity of the
contract of service because divorce is
contrary to Phil law.

Note: The doctrine is no longer controlling.


Divorce is considered a violation of public
policy so that courts cannot issue the
same.
C. Beginning and End of Personality
The determination of the exact moment
personality begins is referred to the
individuals personal 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.

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.

B. Legislative
Distinguished
Jurisdiction

Art. 41, CC
For civil purposes, the fetus is considered
born if it is alive at the time it is completely
delivered from the mothers 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

from

Jurisdiction
Judicial

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.

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
mothers 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.

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.

Barnuevo vs. Fuster


(1913)
FACTS: Fuster and Yanez separated. After
10 years, Y filed for divorce on the
ground of Fs adultery. Court granted
decree of divorce. Fuster contests

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

42

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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.

D. Absence
The domestic laws of states do not treat
absentees alike.

E.

Name

Three ways of dealing with the problem:

A persons 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

there is a rebuttable presumption that


a person is dead after he has been
absent for a number of years

2.

a persons 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
presumption (1).

the

rebuttable

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.

Confusion as to ones paternity has been


held to justify the courts denial of a
petition for change of name.
Whether an aliens change of name is valid
depends solely on his personal law.
F.

1.

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.

Age of Majority

The legal disability and rights attached to


minority are aspects of personal status. It
is the individuals personal law which
determines whether he has reached the
age of majority.

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

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.
G. Capacity
A persons 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

43

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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.

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.

Insular Government vs. Frank


(1909)
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.

Marriage is a special contract as


distinguished from an ordinary contract:
1) entered into by a man & a woman
2) both at least 18 years of age
3) solemnized
by
a
person
specifically authorized by law
4) a permanent union unless one
party dies, or marriage is annulled
or declared void in special
circumstances
5) cannot be abrogated, amended or
terminated by one or both parties
at will
6) nature & consequences as well as
incidents are governed by law &
not subject to stipulation by
parties unlike ordinary contracts
7) 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
1.

HELD: Illinois law should apply. Matters


bearing
upon
the
execution,
interpretation and validity of a contract
are determined by the law of the place
where the contract is made.
Note

This case should have been resolved as a


capacity case instead of as a contract case
(characterization).
PART FOUR: CHOICE OF LAW PROBLEMS
XII. Choice of Law in Family Relations
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).

Philippine
Policy
on
Marriage and the Family

Art XV. Sec. 2: Marriage as an inviolable


social institution, is the foundation of the
family & shall be protected by the state.

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.

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

A.

Marriage

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.

Goal: Guide courts, strengthen family, &


emphasize state interest in its preservation

44

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

conviction of the existence of the alleged


Chinese marriage.

2. Extrinsic Validity of Marriage


This is governed by lex loci celebrationis.

People vs. Mora Dumpo


(1935)
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 2nd marriage was void
because her father did not consent
thereto.

Extrinsic validity covers questions on


formalities or external conduct required of
parties for legally valid marriage.
Art 2. Hague Convention on Celebration &
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.

HELD: Dumpo is not guilty of bigamy.


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

PHILIPPINES,
Marriage

Formal

Requirements

of

Art 3. FC sets the ff requirements:


1) Authority of solemnizing officer
2) Valid marriage license 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

Wong Woo Yu vs. Vivo


(1935)
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 Wong to be excluded from the
country, on the ground that her marriage
to Blas was bereft of substantial proof.

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

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
celebrated is also valid here; but there
was no proof presented on the applicable
law of China. Therefore it may be
presumed to be the same as our law.

Adong vs. Cheong Seng Gee


(1922)
FACTS: The late Cheong Boos 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

Apt vs. Apt


(1947)

45

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Note that the exceptions put in issue the


parties capacity to enter into marrriage,
thus, relating to a substantive requirement.

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.

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.

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.

3. Intrinsic Validity of Marriage


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 individuals being permitted to
marry a specific person or person of a
determinate class.
What law controls intrinsic requirements?
The parties personal lawseither domicile
or nationality.

Exceptions to Lex Loci celebrationis: The


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

Municipal laws of each state provides


substantive requirements of marriage.
Philippine
Law
sets
the
following
substantive or essential requisites:

The Family Code (Art 26) widens these


exceptions.

1) Legal capacity: must be 18 years


of age & not barred by any
impediment to marry each other

A foreign marriage although valid in the


foreign country where it was entered into
will be void in the Philippines if:

2) Consent freely given: in the


presence
of
an
authorized
solemnizing officer

1) either or both parties are below


18
2) it is bigamous or polygamous
3) 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 o& distribution of the
properties of the spouses & the
delivery of presumptive legitimes
4) there was a mistake as to identity
of the contracting party
5) one of the contracting parties was
psychologically incapacitated to
comply with the essential marital
obligations
6) the marriage is incestuous
7) marriage is void by reason of
public policy

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 4th civil degree
2) b/w step-parents & stepchildren
3) b/w parents-in-law & children-inlaw

46

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Sottomayor vs. de Barros


(1877)
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.

4) b/w adopting parent & adopted


child
5) b/w surviving spouse of adopting
parent & adopted child
6) b/w surviving spouse of adopted
child & adopter
7) b/w adopted child & legitimate
child of adopter
8) b/w adopted children of same
adopter
9) b/w parties where one, w/
intention to marry the other, killed
the persons spouse or his or her
own spouse

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.

Marriages Between First Cousins:


Marriage of 1st cousins is no longer
incestuous but still void ab initio on the
ground of public policy.
It is submitted that our prohibition against
marriage of 1st cousins be limited only to
Filipino nationals because many countries
allow such marriages.

In re Mays Estate
(1920)
FACTS: Fannie is Sams 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.

Marriages b/w foreigners whose national


laws allow marriage of 1st 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.
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)

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 positive 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.

2) spouses were related to one


another by blood or by adoption,
in the direct line or as brother or
sister
3) one of spouses had not attained
the minimum age required for
marriage
nor
acquired
the
necessary dispensation
4) one of the spouses did not have
the mental capacity to consent
5) one of the spouses did not freely
consent to the marriage

47

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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).

Instances Where Recognition of Validity of


Marriage May be Withheld:
Christianity
prohibits
polygamous
&
incestuous marriages but care must be
taken to confine doctrine to cases deemed
incestuous by general consent of all
Christendom.

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.

The state may resort to ultimate escape


device- contravention of a public policy to
w/hold recognition of validity of a foreign
marriage.

Additional requirements for:


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

Rule: Marriages manifestly incompatible


with the ordre public of the state of
nationality of parties may be refused
recognition.

2) stateless persons or refugeessubmission of affidavit stating


circumstances
showing
legal
capacity to contract marriage

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.

4. Effects of Marriage
Personal Relations between the Spouses

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.

These include mutual support, fidelity,


respect, cohabitation & right of wife to use
husbands family name)
What is the governing law? National law of
parties

Under California laws, only 1st


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.

If spouses are of different nationalities,


generally, the husbands national law may
prevail as long as it is not contrary to law,
customs, & good morals of the forum.
Art 69 Family Code: Husband & wife have
the right to fix family domicile.
Court, for compelling reasons, may
exempt spouse from living with the
other.

Court, citing English & American cases:


Polygamous marriages can be recognized
in English law so as to confer on the
wives the 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.

Djumantan vs. Domingo: Filipino marries


Indonesian. They go to Philippines w/
intention of staying here permanently.
Subject of petition: Effect of marriage on
wifes right to stay in the Philippines.

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

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 fact of marriage by an alien to a
citizen does not withdraw her from
operation of immigration laws governing
admission & exclusion of aliens. Marriage

Philippine law: Marriage of Filipino nationals


shall be officiated by Philippine consul

48

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

remains unchanged because of principle of


immutability.

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.

Hague Convention on Matrimonial Property


Regimes. Art 7: The applicable law
continues notwithstanding any change of
their nationality or habitual residence.

Restatement 2nd: The wife who lives w/ her


husband has the same domicile as his
unless special circumstances of wife make
such result unreasonable.

Note

extrinsic
validity:
refers
to
formal
requisites, apply lex loci celebrationis

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.

intrinsic validity: refers to essential


requisites, apply personal law of the parties

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)
________________

Property Relations of Spouses


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.
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.

B. Divorce and Separation


Divorce: Absolute or Limited
Absolute: termination of legal relationship
b/w spouses by an act of law.

This rule shall not apply:


1) If both spouses are aliens

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.

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

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.

3) 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

Local law governs legal consequences of


divorce of spouses, nationals of same
country, who marry, are domiciled &
divorce.

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.

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

Divorce jurisdiction:

49

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Effect of Provision (Art 26): partial


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

Basis of JD of some countries: Domicile of


one of the parties or matrimonial domicile
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.

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.

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.

Tenchavez vs. Escao


(1965)
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. Vicentas
defense is that there was a valid divorce
issued by the Nevada court.

Some laws in PRiL have made


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

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.
Van Dorn vs. Romillo
(1985)
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.

1.

Divorce decrees obtained


by Filipinos

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).

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.

Effects:
1. alien is capacitated to remarry
2. Filipino spouse shall likewise have
the capacity to remarry under
Philippine law

50

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

2.

Validity of Foreign Divorce


between Foreigners

Hague Convention on Recognition


Divorce & Legal Separation:

Pilapil vs. Ibay Somera


(1989)
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.

of

A foreign divorce will be recognized in all


contracting states if at the date of
institution of proceedings:
a) Respondent or petitioner had his
habitual residence there, or

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).

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.

Quita vs. Court of Appeals


(1998)
FACTS: Quita and Padlan were married in
the Philippines, but Quita filed for divorce
in California which was granted. She
remarried twice after the divorce. Upon
Padlans 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.

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

but would be recognized under


the same circumstance that a
sister states divorce decree is
given recognition.

HELD: Quitas right to inherit from Padlan


depends on her citizenship at the time
the divorce was decreed. If she was no
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.

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;
o but such will be recognized under
international comity, provided it
does not violate a strongly held
policy of the Philippines

Note

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)
________________

C. Annulment and Declaration of


Nullity
Effect: Affects status & domestic relations
of parties.
Distinction from Divorce

51

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Divorce

Sample conflicts Annulment Case

M&F, domiciliaries of STATE A, both 18


years old

marry in STATE B w/out knowledge of


their parents

The ground occurs Based on defects


after
marriage present at time of
celebration
celebration

suit for annulment was brought in


STATE C (place of Ms residence)

State C can exercise JD over the case but what


is the governing law?

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

Grounds for Annulment & Nullity:

What law determines legitimacy of a child?


Personal law of parents - either domicile or
nationality.

a) state
where
marriage
celebrated
b) place of marital domicile

Filiation

What law governs legitimacy of child in the


Philippines? National law of the parents.

was

Wheaton vs. Wheaton: Even a court which


acquires personal JD over parties can grant
an annulment case (US case).

If parents are of different nationality:


national law of father is controlling.
In the PHILIPPINES:

Personal law of the child is the


national law of the mother if the
child is illegitimate.

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

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

Law on parental relations include:


o Paternity

Both lex loci celebrationis and law of


marital domicile can provide jurisdictional
basis, but only one can be a choice-of-law
in the determination of the annulment
decree.

Most countries: fathers personal law


German law: law of head of family

Personal law of the child is the


national law of the father if the
child is legitimate or legitimated.

States w/ traditional choice-of-law


approach:
follow the lex loci
celebrationis

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

D. Parental Relations

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.

The Choice of Law rule of STATE C will be


irrelevant

Annulment and
Nullity

52

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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

In the UNITED STATES:


as per Second Restatement On Legitimacy
of the American Law Institute

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 & the child is
domiciled in another?
Twin problems of
jurisdiction and choice-of-law.

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

What law controls? Fathers personal law


controls rights & duties of parents &
children.

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 doesnt
reside there.

o
o

Art. 211 FC: Reference to fathers


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:


1) care & rearing

if he is a citizen of a state but he


doesnt reside there (there is little
basis for court to protect child
interest competently)

2) action a parent may file against


another for child custody
3) requirements for parental consent
of childs marriage

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.

E.

Adoption

Definition: The act by which relations of


paternity & affiliation as legally existing
b/w persons not so related by nature.
It is a judicial act w/c creates b/w 2 persons
a relationship similar to that w/c results
from legitimate paternity & affiliation.

Exceptions:
o Art 184. Aliens who have some
relationship with the child by
consanguinity or affinity

Child is legitimate if this is his


status under the local law where
the parent is domiciled when the
childs 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

Childs personal law as basis for exercise of


jurisdiction weakened in situations where
childs domicile is:
o merely constructive, or

Legitimacy
of
the
child
determined by the national law of
the father if both parents are not
Filipino.

Early societies considered it as a means of


perpetuating a house or cult threatened by
extinction.

RA 8552 (Domestic Adoption Act


Of 1998)

Original purpose: solace for childless or


people who lost children

These two introduced significant changes


in adoption law.

53

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Change Pertinent to Conflict Law

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.

1) Aliens who have resided in the


Philippines for 3 years prior to the
date of filing the application for
adoption, and maintains residency
until decree of adoption is granted
QUALIFIED TO ADOPT
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.

Effects Of Adoption
What law governs rights of adopted child &
other effects of legal adption? (law that
governed the creation of adoption)
2 different legal orders depending on which
law governed the creation of adoption:

These other requirements may be waived if


the adoptee is related by consanguinity or
affinity to the
o adopter, or

1) If Personal law of adopter applied


same law governs effects of
adoption.

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.

his/ her spouse as specified


by law.

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

Philippine courts:
o Adoption relates to a civil
rights of adopted child
o Does not effect changes in
political
rights,
including
eligibility to acquire adopters
citizenship

RA 8043 regulate the adoption of Filipino


children by
o aliens, or

Filipino citizens permanently


residing abroad.

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.

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.

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.

Uggi Lindamand Therkelsen vs.


Republic
(1964)
FACTS: Therkelsen (a German) and his
wife Erlinda (a Filipino), filed a petition to
adopt Erlindas 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 aliens
country.

Republic of the Philippines vs. CA


(1993)
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.

54

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

the a) lex domicilii, b) lex situs, or c) lex


loci actus (the proper law of transfer).

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.

Lex domicilii: the rights over the movables


are governed by the law of the owners
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.

Ng Hian vs. Collector of Customs


(1916)
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.

Alternatives to lex domicilii and lex situs:


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

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.

b) the proper law of the forum: law


of the state which has the most
real connection with the transfer
In the Philippines, real 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.
Note

XIII. Choice of Law in Property

For real property, there is very little room


for choice of law, because of the emphasis
on lex situs.

A.

Why?
1) 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)
________________

The Controlling Law

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.

B. Capacity to Transfer or Acquire


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

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

Llantino vs. Co Liong Chong


(1990)

55

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

and right over the land, which is not


granted to him under the Constitution.

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.

C. Extrinsic and Intrinsic Validity of


Conveyances
The lex situs law applies to the following:
1) formalities of a contract to convey
property

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.

2) the essential validity of the


transfer (unless the lex intentionis
is clearly established)
3) the effects of the conveyance or
properties
D. Exceptions to the Lex Situs Rule

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.

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)

Liljedahl vs. Glassgow


(1921)
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.

Cheesman vs. IAC


(1991)
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.

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.

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

2) 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

56

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

(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)

1) choses in possession embraces


all types of tangible physical
objects
2) choses in action
intangible objects

refers

to

3) testate or intestate succession


and capacity to succeed, which
are governed by the national law
of the decedent

a) mere rights of actions


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

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.

Harris vs. Balk


(1905)
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.

Also,
when
the
issue
involves
considerations other than the validity and
effect of the transfer itself, 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.

HELD: The attachment of Harris debt is


valid, and the North Carolina court
should give credit to the Maryland
judgment. The obligation of the debtor to
pay his debt clings 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.

E.

1.

Situs of Personal Property


for Tax Purposes

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.

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
creditors claim to the accident of the
debtors presence in one state or another.
4.

Situs of Certain Properties

2.

Situs of Money

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.

Situs of Corporate Shares


of Stocks

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.

3.

Situs of Debts

2 Kinds of Movable Property:

57

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

reciprocal rights to our nationals by law


shall be entitled to benefits to the extent
necessary to give effect to any provision of
such convention

CIR vs. Anglo California National


Bank
(1960)
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.

Philips Export vs. CA


(1992)
HELD: A corporations 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.

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.

Emerald Garment Mfg. vs. CA


(1995)
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. Lees trademark as to cause
confusion, mistake and deception on the
public as to the origin of the goods.

F.

Patents, Trademarks, Trade Name,


and Copyright

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.

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 21A 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.

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 companys corporate and
trade name is a property right which may
be asserted against the whole world.

XIV. Choice of Law in Contracts

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.

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

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 property rights to which the
Philippines is also a party or extends

58

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Intrinsic validity refers to nature, contents


and effects of the agreement.

been entered into provided that all the


essential requisites for validity are present.

Art.
a.
b.
c.

Principal purposes of contract:


1. protect the reasonable expectations
of the parties to the contract
2. secure
stability
in
commercial
transactions

1318, CC: requisites of a contract


consent of the contracting parties
object certain
cause of the obligation

There are 3 possible laws that will govern


intrinsic validity of contracts:
1. law of the place of the making
2. law of the place of performance
3. law intended by the parties
1.

A.

Involving

Foreign

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.

Lex Loci Contractus

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.

Interpretations of contracts are applied


only when the lex loci intentionis cannot be
ascertained.

Advantages:
a) relative
ease
establishing
place
contracting

Contracts
Element

in
of

Unlike family law, contract law does not


reflect strong state policies or values.

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.

2.

B. Extrinsic Validity of Contracts


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 valid which is not made in accordance
with the local form.

Lex Loci Solutionis

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.

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.

Macmillan & Bloedel vs. Valderama


& Sons
(1964)
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

C. Intrinsic Validity of Contracts

59

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

should apply the law that will sustain the


contract.

Control Comm failed to act on his


application. Macmillan suffered damages
because it had to cancel the freight
engagement.

D. Capacity to Enter into Contracts

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.

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.
E.

In case of conflict in determining validity,


nature and obligation and effect of
contract, lex loci solutionis prevails over
lex loci contractus.

Choice of law Issues in Conflicts


Contracts Cases
1.

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.

Choice of Forum Clause

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.

3.

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.

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.
3.
4.

5.

Lex Loci Intentionis

Also construction and interpretation of


contracts may be agreed upon by parties.
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.

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

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.

Compagnie de Commerce vs.


Hamburg Amerika
(1917)
FACTS:
Compagnie
(french)
and
Hamburg (Germany) entered into a

Parties are presumed to contemplate to


enter into a valid contract. The court

60

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

charter party to transport Cs goods from


SaigonEurope.
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 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.

HELD: Phil. courts have jurisdiction. The


parties are free to waive the stipulation if
they so desired.
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
courts jurisdiction; it also sought
affirmative relief.

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.
Note

Pangalangan: HSBC case is disappointing


why did the courts not recognize the choice
of forum clause? Courts are turfconscious; for PRIL to progress, there is a
need for each country to give up some of
its exercise of sovereignty.
_______________
2.

King Mau vs. Sycip


(1954)
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.

Contracts with Arbitration


Clause

Puromines vs CA
((1993)
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: Phil court has jurisdiction. A nonresident 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.

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.

It is a personal action for the collection of


a sum of money which the CFIs have
jurisdiction to try and decide.

The courts will look with favor upon such


amicable settlements (arbitration) and
will only interfere with great reluctance
to anticipate or nullify the action of the
arbitrator.
The Bremen vs. Zapata
(1972)

HSBC vs. Sherman


(1980)
FACTS: HSBC granted Eastern Book
Supply an overdraft secured by the

61

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

FACTS: Zapata, a Houston company,


entered into a contract of towage with
Unterweser, a German corp. Contract
contained a forum selection clause which
provides that any dispute arising must
be treated before London courts.

Pan Am World Airways vs. Rapadas


(1992)
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.

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 forumselection clause.

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.

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. enforcement would be unreasonable
and unjust or
b. that the clause was invalid for such
reasons as fraud or overreaching or
c. 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
d. 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.

PAL vs. CA
(1996)
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.

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 intl transaction and to provide a
neutral forum experienced and capable
in the resolution of admiralty litigation.
3.

Adhesion Contracts

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.

Also,
the
willful
misconduct
and
insensitivity of the officers of PAL in not
attempting to explain the damage
despite
due
demand
and
the
unexplained delay in acting on her claim,
amounted to bad faith and renders
unquestionable its liability for damages.

62

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

PAL vs. CA: when there is


ambiguity in adhesion contract,
construe against the drafter.
________________

4.

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

Special Contracts

In sales or barter of goods, the law of the


place where the property is located will
govern (lex situs).

3) when there is ambiguity in the


adhesion contract, it must be
resolved contra preferentum and
in favor of the party impugning it

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.

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

In contracts of pledge, chattel mortgage


and antichresis, the extrinsic and intrinsic
validity of the contracts are governed by
lex situs.

Sweet Lines vs. Teves: Petitioners assail the


validity of the tickets issued by Sweet
Lines.

Carriage of Goods by Sea

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 low-income groups and are less
literate and who have little or no choice but
to avail of petitioners vessels.

American President Lines vs.


Klepper
(1960)
FACTS: K shipped on board APLs vessel
personal effects. Because of damage to
the effects, K sued APL. CA affirmed CFIs
finding of liability but awarded damages
on 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

Note

Parties may include any stipulation as long


as such stipulations do not violate public
policy or morals of the forum.
Lessons:

63

PanAm: not all contracts of


adhesion are against public
policy; balancing of interests
(airline vs. passenger)

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

the bill of lading, this is merely


suppletory to the provisions of the Civil
Code.

Contracts for International Air


Transportation

Lopez vs. Pan Am


(1965)

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.

FACTS: Despite several confirmations,


Sen. Lopez and his family failed to get 1st
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

Liabilities of the Carrier:

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

a.
b.

c.

KLM Royal Dutch vs. CA


(1975)
FACTS: Mendozas went on a world tour.
KLM issued the tickets for the whole trip.
Their coupon for Aer Lingus was marked
RQ. Thru KLMs 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)

d.

e.

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 KLMs 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

64

in case of death or woundingcarriers 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

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

denied liability as the carriage was


performed by PAL.

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.

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

American Airlines vs. CA


(2003)
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
AAs security officers 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.

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.

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.

Santos III vs. Northwest Airlines


(1992)
FACTS: Santos bought a roundtrip (SFManila-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
4. place of destination San Francisco
(not Manila because it was merely
an agreed stopping place, SF is still
the ultimate place of destination

Chiok vs. China Airlines


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

Note

65

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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 for 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)

F.
XV. Choice of Law in Wills, Succession and
Administration of Estates

The Applicable law in the absence


of an Effective Choice

According to the 2nd 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

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.

1.
2.
3.
4.

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

5.
6.

Conflicts of Law Perspective:


Will: an involuntary transfer of property,
because it comes into effect only upon
death of owner. Death is involuntary, thus
making a will is an involuntary transfer of
property.

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.

Wills are governed by the proper law


o common law- law of domicile of
testator
o civil law- national law of testator

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 parties. The court should also
consider the legitimate expectations of the
parties.

A. Extrinsic Validity of Wills


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.

G. Limitations to Choice of Law


1) if the law selected has no
connection at all with the
transaction or the parties
2) if it ousts the jurisdiction which
the court has already acquired
over the parties and the subject
matter

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

66

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

The Code should have expressly stated this


considering general provision in Art 17.

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.

In re Estate of Johnson
(1918)
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).

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)

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.

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.
Aliens making wills outside the Philippines
are, under Art 816 & 817, permitted to
follow:
o lex nationalii

Extrinsic Validity of Joint Wills

o
o

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.

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)

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)

Joint wills are prohibited on grounds of


public policy, because:
1)

lex domicilii

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.

when a will is made jointly or in


same instrument, the more

67

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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.

Joint wills executed by Filipinos in a foreign


country allowing joint wills are expressly
invalidated by 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

B. Intrinsic Validity of 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.

- 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.

Art 816 & 817 are also applicable to


holographic wills

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)

Merits:

o
o
o
o

simple
convenient
does
not
notarization
guarantees
secrecy

require
absolute

Demerits:

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.

o
o
o

peculiarly dangerous
an invitation to forgery
short
statements
can
confuse
handwriting
experts

Babcock Templeton vs. Rider


Babcock
(1928)
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

The Court decided that although Andre


Brimo opposed his brothers 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

68

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

Note

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

Criticisms
decision:

on

the

Miciano

vs.

Brimo

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 policy-centered approach.

__________________
C. Interpretation of Wills
Interpretation of wills is to be governed by
lex nationalii.

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.

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
testators acts.

Under the escape device of disingenuous


characterization, the same result could
have resulted without flouting testators
will. The court could have characterized the
main issue as one of property and not of
succession, thus making Philippine law the
governing law as the lex rei sitae.

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)

Cayetano vs. Leonidas


(1984)
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
Adoracions 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.

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

HELD: Since the governing law with


respect to the amount of successional
rights is the national law of the
decedent,
the
governing
law
of
Adoracions 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.

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)
D. Revocation
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

69

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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

For non-domiciliary: the governing


law is the law where the will was
executed (lex loci celebrationis)
__________________
E.

Probate

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.

Article 830. No will shall be revoked except


in the following cases:
1) By implication of law; or

But the forum will still have to look at the


foreign law concerning compliance with
extrinsic validity.

2) By some will, codicil, or other


writing executed as provided in
case of wills; or

Rule 76 Section 9 Grounds for disallowing


will.: The will shall be disallowed in any of
the following cases;

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)

(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;

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?

(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.

Common law practice: law of the domicile


at the time of death.

Rule 77
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.

Philippine law:
revocation.

law

of

the

place

of

Note

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)

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

70

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

manner in which the instrument will


distribute his property among the objects
of his bounty. (Bugnao vs. Ubag, 014 SCRA
163)

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.

Rule 77 Section 1 + testamentary capacity


- will made in a foreign country allowed
here in the Philippines !!! (see Article 816)

Vda. De Perez vs. Tolete


(1994)
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:

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

Suntay vs. Suntay


(1954)
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 that 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

(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 1st and 5th 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.

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

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

71

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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.

Note

F.

Succession and administration of estates


are governed by different laws:
succession national law

Duties of the administrator:

administration situs of property


(territorial/JDal)
______________

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)

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

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 latters
application.

The trust contains an express choice-of-law


provision.

When there is no will, the court may


appoint an administrator.

The courts usually apply that law in


keeping with the policy of carrying out the
intent of the creator of the trust.

Two kinds of administrators:

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.

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

Choices-of-law for testamentary trusts:


a) rules governing the intrinsic and
extrinsic validity of wills

Tayag vs. Benguet Consolidated


Inc.
(1968)
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.

b) lex rei sitae with respect to the


property

XVI. Choice of Law in Torts and Crimes


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.
A.

Administration of Estates

HELD: The
Philippine
allegiance
unrestricted

Policies behind Conflicts Tort Law

72

appeal must fail. BCI is a


corporation
owing
full
and
subject
to
the
jurisdiction of local courts.

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

first is used in contracts cases, the second


is used in torts cases.

2 Important Policies underlying substantive


tort law:

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
________________

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.

B. Lex loci delicti commissi


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.

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.

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.

Conflicts torts cases arise:


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

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.

2) when there are different product


liability laws and varying judicial
interpretations of the extent of
liability

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 persons act should
be determined by the law of the state
where he is at the time he does such act.

Note

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

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.

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

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.

Loucks vs. Standard Oil Co.


(1913)

Distinguish: upholding the legitimate


expectations of parties vs. shielding
defendant from unnecessary surprise the

73

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

she
was
terminated
employment by Saudia.

from

her

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 corporations
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: 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.

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.

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.
2.

Interest Analysis
C. Modern Theories on Foreign Tort
Liability

This approach considers the relevant


concerns the state may have in the case
and its interest in having its law applied on
that issue.

1.

The court should first determine whether


there is a true or false conflict.

The
Most
Relationship

Significant

This theory considers the states contacts


with the occurrence and the parties.

False conflict: only one state has an


interest in having its law applied, and
failure to apply the other states law would
not impair the policy reflected in that law.

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

Apparent conflict: more than one state has


an apparent interest in applying its law to
the case.

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.

Prof. Currie: if only one state has a real


interest in the case and the other states
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.

Saudi Arabian Airlines vs. CA


(1998)
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,

Note

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).
________________

74

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

contributions of American jurisprudence to


international conflicts thought.

3.

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.
Note

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.

True conflict: both states have an


interest in having their law
applied
maybe true conflict

Schmidt vs. Driscoll Hotel


(1957)
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.

false conflict: no choice necessary


the court should apply the law of
the only interested state
_______________
D. Foreign Tort Claims
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.

HELD: Minnesota court has jurisdiction,


even if the injury which followed the
illegal sale occurred outside 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.

i. Conditions
for
the
enforcement of tort claims
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)

of

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.

In modern approaches, there is a


distinction between true or false conflict.

Cavers
Principle
Preference

the judicial machinery of the


forum is adequate to satisfy the
claim

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

ii. Products liability of the


foreign manufacturer

75

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

Conflicts torts cases arise due to significant


differences in the laws of states on the
basis and extent of liability for defectively
manufactured products.

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).

Asahi Metal Industry vs. Superior


Court of California
(1987)
FACTS: Asahi Metal manufactures tire
valve assemblies in Japan and exports
them, including to a Taiwanese company
which, in turn, incorporates them into
finished tires sold 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.

Sovereignty as Basis of Jurisdiction


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

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.

Worldwide Volkswagen Corp. vs.


Woodson
(1980)
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.

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.

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.

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 not be able to pursue
legal proceedings against the Malaysian
company which operates and services the
helicopter.

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).

76

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

Note

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).

*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.

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).
________________

Guinto vs. Marcos


(1986)
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.

iii. The Alien Tort Act


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.

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.

Hilao vs. Estate of Ferdinand Marcos


(1996)
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

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, there is a need to establish
that the tortious conduct violated an
internationally protected human right.

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.

iv. Philippine Rule on Foreign


Torts

HELD: The US federal court has JD, on


the basis of the Alien Tort Statute. This
action is undeniably an action by an

Filartiga vs. Pena-Irala


(1980)
FACTS: Plaintiffs brought an action in the
US against Pena-Irala for wrongfully
causing the death of Dr. Filartigas son in
Paraguay.

77

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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.

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.

It has been suggested that the English


may be followed, such that the
committed abroad is actionable in
country where it was committed and
under Philippine law.

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
_______________
E.

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

Distinguishing between Torts and


Crimes

Tort

Crime

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

Time, Inc. vs. Reyes


(1971)
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).

An injury to an An injury to the state


individual who may where
it
is
be situated in any committed
place
Liability is attached
to the perpetrator to
indemnify the victim
for
injuries
he
sustained

F.

Rule
tort
the
also

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 publication was not printed in
the Philippines.

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

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.

Lex loci delicti

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

Note

78

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

actually commit
states territory.

Liang (Huefeng) vs. People


(2000)
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.

the

crime

within

the

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)

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.

Wylie vs. Rarang


(1992)
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.

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.

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.

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

This immunity for sovereign acts is


impliedly waived when the foreign state
and
its
officials
perform
private,
commercial or proprietary acts.

People vs. Wong Cheng


(1922)
FACTS: Wong was charged for having
illegally smoked opium on board an
English vessel Changsa while anchored
in Manila Bay.

Note

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.

HELD: Under the English rule which is


applicable here (it is the prevailing

79

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

RESULT

No JD

Acquired
JD

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.

Acquired
JD

In RP, we follow the French Rule.


XVII. Choice of Law Affecting Corporations
and Other Juridical Entities
A.

Corporations

US vs. Look Chaw


(1910)
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.

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.
1.

Personal
Law
Corporation

of

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.

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 shall be
void despite the express permission given
by the other state.

3) Third Exception: crimes which,


although committed by Philippine
nationals abroad, are punishable
under Philippine law (ex. Art. 2
RPC)

ME Gray vs. Insular Lumber Co.


(1939)
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 the right to
stockholders owning 3% of the capital
stock of the company. Gray does not own
the required shares.

Note

Fowler

Cheng

Look
Chaw

US

English

English

LOCATIO
N

High
seas

Within RP
territorial
waters

Within RP
territorial
waters

CRIME

theft

Smoking
opium

Possessio
n and
selling of
opium

FLAG

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

80

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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:

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.

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.

Anglo American Theory on Corporations

Bank of Augusta vs. Earle


(1839)
FACTS: Bank of A (incorporated in
Georgia), thru MGran 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.

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

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.
Note

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.
________________
2.

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

Exceptions to the Rule of


Incorporation Test

2) a corporation cannot exercise


powers not granted by its
corporate charter or by the laws
of the state of incorporation

a.
Constitutional and
Statutory Restrictions
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 corporations right to do business
within its territory.

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

1987 Phil Constitution:


a.

regulates
exploration,
development and utilization of
natural resources such that only

81

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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

Pedro Palting vs. San Jose


Petroleum
(1966)
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 citizens
the right to use & exploit natural
resources in the Phils because its
stockholders are US citizens.

Note

Filipinas Compania case was decided that


way because of the government interest
involved.
_______________
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.
3.

60% Filipino-owned corps may be


allowed to engage in these
activities
the nations 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%)

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.

Domicile or Residence of
Foreign Corporations

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
the War

During

During wars, courts may pierce the


corporate identity and look into the
nationality of stockholders to determine
the citizenship of the corp.

A foreign corp. granted license to do


business here acquires a domicile in the
Phils.

Filipinas Compania de Seguros vs.


Christern, Huenfeld, Co., Inc.
(1951)
FACTS: Christern (German Co.) filed a
claim against Filipinas (US Co.) for
recovery on fire insurance policies issued

State Investment House vs. Citibank


(1991)

FACTS: CMI obtained loans from Citibank.


CMI defaulted. Citibank filed petition for
involuntary insolvency against CMI with

82

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

All foreign corporations lawfully doing


business in the Philippines shall be bound
by all laws, rules and regulations applicable
to domestic corporations.

CFI, Rizal. State Investment, a creditor of


CMI, opposed claiming that Citibank had
no jurisdiction because the banks are not
resident creditors of CMI.

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

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.

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
4.

5.

Jurisdiction Over Foreign


Corporations

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.

Right
of
Foreign
Corporation to bring Suit

Acquisition of a license by a foreign


corporation is an essential prerequisite for
filing of suit before our courts.
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.

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

Home Insurance Co. vs. Eastern


Shipping Lines
(1983)
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.

Foreign Corporations doing Business are


Bound by Philippine Law

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.

Art. 129, Corp Code

83

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

engaging in business within the purview


of the Corpo Law.
b.

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.

Action
to
Protect
Trademark,
Trade
Name,
Goodwill,
Patent or for Unfair
Competition

Atlantic Mutual Insurance vs. Cebu


Stevedoring
(1966)
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.

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.

Converse Rubber vs. Jacinto Rubber:


FACTS: Converse owns the trademark of
Converse Chuck Taylor All Star. Jacinto
manufactures
shoes
of
identical
appearance. Hence, this suit.

HELD: Such allegation is unnecessary.


However, AMIs 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.

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.

6.

Exceptions
to
Requirement
a.

Leviton Industries vs. Salvador


(1982)
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.

License

Isolated Transactions

This has been defined as one which is


occasional, incidental and casual, not of a
character to indicate a purpose to engage
in business. It does not constitute doing
business under the law.

HELD: Plaintiff failed to allege capacity to


sue.
1. 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:
a. it registered its trademark with the
Phil. Patent Office or that it is an
assignee of the trademark, and
b. 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.

Eastboard Navigation vs. Ysmael &


Co.
(1957)
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

84

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

d.

Petition
Filed
is
Merely a Corollary
Defense in a Suit
against it

2. 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.

Time Inc. vs. Reyes


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.

c.

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.

Phil. Columbia Enterprises vs. Lantin


(1971)
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.

Universal Shipping Lines vs IAC


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.

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.

Hang Lung Bank vs. Saulog


(1991)
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.

Definition and Scope


of
Transacting
Business

A foreign corporation may do business,


state consent being presumed, except:
1. where it is prohibited by 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
Act)
- soliciting orders,

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.
Reasons 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

Investments

service contracts,
opening
offices
liaison offices,

whether

Agreements
Fully
Transacted
Outside
the Philippines

called

85

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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

Thus, it cannot be said that the case


involved
an
isolated
or
single
transaction. The transaction is not
merely incidental or casual but is of such
nature as to indicate a purpose to do
other business in the State.
CIR vs. JAL
(1991)
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 nonresident foreign corp. it can only be
taxed on income from Phil sources.

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.

Avon Insurance vs. CA


(1997)
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.

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.

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.

Merrill Lynch Futures vs CA


(1992)
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.

Wang Laboratories vs. Mendoza


(1987)
FACTS: Wang Lab (US corp) sells its
products in the Phils thru its exclusive

HELD: MLFI had the capacity to sue and


Laras are estopped from denying the

86

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

2.

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 corps non-compliance
with the statutes where such person
received benefits under their contract.

Transnational
Corporations

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.

Granger vs. Microwave Systems


(1990)
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.

But the transnational corporations are


established under and governed by each
host countrys national laws.
However, all locally incorporated branches
are joined together by the common control
and management of higher officials in the
home state.

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.

As to liability, the single unit comprising


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 subsidiarys stock is enough to
give jurisdiction over the subsidiary
2. whether
the
activities
of
the
subsidiary in a state will give that
state jurisdiction over he parent
corporation

B. Special Corporations
1.

Religious Societies and


the Corporation Sole
A religious society, if controlled by aliens, is
not permitted to acquire lands.

Restatement 2nd:
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.

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.

Roman Catholic Administrator vs.


LRC
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 subsidiarys agent.
C. Partnerships

87

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

PART FIVE: FOREIGN JUDGMENTS


XVIII: Recognition
Foreign Judgments
A.

and

Enforcement

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.

of

Distinction between Recognition


and Enforcement

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.

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 govt.

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

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.
B.

What are governed or subject to the law of


the place of business?
1.
2.
3.
4.

Bases
of
Recognition
and
Enforcement of Foreign Judgments

1) Comity

entitlements
and
limitations,
in
general
creation of establishments in the
state
mercantile operations
jurisdiction of nations

Note

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.

Domestic Corp.:
a) Can sue
b) Can be sued

Foreign Corps.
1) Doing Business
a. With license can sue and
be sued
b. Without license cannot
sue, can be sued

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) Not Doing Business (isolated


transaction) can sue and be
sued
________________

2) Obligation of foreign judgments

88

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

a.
b.

those who contested an issue


shall be bound by the result
&
matters once tried & decided
w/ finality in one jurisdiction
shall be considered as settled
b/w the parties

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

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.

Goddard vs. Godard


(1870)
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 nonperformance
of
this
agreement,
estimated amount of freight as a clause
that sets the limits 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.

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 tribunal 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.

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

It considers the plaintiffs cause of action


as merged in the judgment. Thus, he may
not relitigate that exact same claim.
3.

Bar

This is where
interposes the
avert a second
same claim.
relitigation of
precluded

a successful defendant
judgment in his favor to
action by plaintiff on the
By direct estoppel, the
all matters decided are

In addition, DOCTRINE OF COLLATERAL


ESTOPPEL renders conclusive all essential
issues of fact actually litigated in the suit
decided on by the foreign court.
Distinction between
Collateral Estoppel

Res

Judicata

C.

Policies Underlying Recognition and


Enforcement

1. Res judicata

&

Many courts recognize & enforce foreign


judgments on ground of res judicata, under
which principle:

RES JUDICATA- seeks to end litigation by


disallowing suit on the same claim

89

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

COLLATERAL ESTOPPEL- concerned with


preclusion by barring relitigation of an
issue already litigated on in a prior
proceeding
D.

Requisites
Enforcement

for

Recognition

or

1) The
foreign
judgment
was
rendered by a judicial or a quasijudicial
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

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.

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 fixed
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

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

Northwest Orient Airlines vs. CA and


C.F. Sharp
(1995)

90

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

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)

Boudard vs. Tait


(1939)
FACTS: Boudards 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.

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
Philadelphias
contention that a default judgment by the
English courts should not be extended
hospitality by American courts.

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.

In the absence of fraud or collusion, a


default judgment is as conclusive as
adjudication between the parties as when
rendered after answer & complete contest
in open court.
The polestar is whether a reasonable
method for notification is employed &
reasonable opportunity to be heard is given
to the person concerned.

Borthwick vs. Castro


(1987)
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. Bs
defense is that the Hawaii court has no
jurisdiction over the cause of action and
over his person.

Ramirez vs. Gmur


(1918)
FACTS: The will of Bischoff contained a
statement to the effect that he had no
living forced heirs. Leona Castro,
Bischoffs 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:
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 3rd chance to contest
the jurisdiction of the foreign court. In

HELD: as to the Mory children NO, the


second marriage is void. The right to
inherit pertains only to legitimate,

91

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

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.

Querubin vs. Querubin


(1950)
FACTS: Following their divorce because
of Margarets 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.

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.

HELD: Her contention is erroneous. A


foreign interlocutory order in favor of
Margaret did not establish a vested right
with respect to rightful 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
childs interest.

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.

Nouvion vs. Freeman


(1889)
FACTS: Nouvion filed an action for
administration
of
the
estate
of
Henderson. In order to show that he was
Hendersons creditor, Nouvion alleged
that he obtained a foreign judgment
establishing Hendersons indebtedness
to him.

4. The state where the foreign judgment


was obtained allows recognition or
enforcement of Philippine judgment

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.

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.
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

92

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

effect as the latter gives to a foreign


judgment.

appropriately wielded by the other


branches of government.

5. The judgment must be for a fixed sum of


money

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.

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, 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

Querubin vs. Querubin


(1950)
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).

Cowans, et al. vs. Teconderoga Pulp


and Paper Co.
(1927)
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 should also not recognize the
Quebec judgment as adjudications of the
issues.

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,

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

93

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

collusion, fraud, or clear mistake


of law or fact.

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.

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.

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.

Philippine Aluminum vs. FASGI


(1950)
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
satisfy 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-ininterest, 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.

E. Grounds for Non-Recognition


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

Puyat vs. Zabarte

(2001)

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COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

of Foreign Judgments in Civil & Commercial


Matters established conditions & requisites
for contracting states to recognize &
enforce each others judgment.

3) The cause of action or claim for


relief on which
judgment is
based is repugnant to public 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

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 applicable 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

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 seventh session looked into possibility


of a general convention on recognition &
enforcement of judgments whose chief
benefit will be the relatively uniform
procedure among contracting states.
2. The EEC Convention of 1968

The service of summons as the traditional


basis for exercise of jurisdiction has been
eroded.

Six countries comprising the European


Economic Community are signatories to
Convention on Jurisdiction of Courts &
Enforcement of Decisions

The ground that foreign court was


seriously inconvenient employs doctrine of
forum non conveniens to restrain use of
presence as cornerstone of jurisdiction.

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
Recognition Act

Art 23 Hague Convention on Jurisdiction,


Applicable Law, Recognition, Enforcement
&
Cooperation
in
re
of
Parental
Responsibility & Measures for Protection of
Children:

Money-Judgments

Considering the best interests of child,


recognition of measures directed for
protection of the child or his property may
be refused if such were taken without
giving the child opportunity to be heard or
if contrary to public policy.

This seeks to inspire more confidence in


stability of American law & bring together
into one statute all common law rules of
recognition from jurisprudence.
What does the act cover?

Violation of ordre public & nonobservance


of due process are included as grounds for
non-recognition
in
many
Hague
Conventions.

It is applicable to any foreign country


judgment that is final & conclusive &
enforceable when rendered even though an
appeal is pending or it is subject to appeal.

F.

G. Procedure for Enforcement

Modern
Developments
in
Enforcement of Foreign Judgment

1. The Hague Conference on Private IL


Convention on Recognition & Enforcement

95

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

The Philippines has adopted the common


law practice of not instantaneously
executing foreign judgment.

assignment by the Custodian of the


assets of the Manila firm cannot and will
not be allowed to affect the rights of the
party concerned in Hong Kong, the court
ruled that it is not possible for a foreign
court to pronounce his decision wrong.

MODES OF ENFORCEMENT
A. First Mode: Need for New Judicial Action

Procedure in other civil law countries

Procedure in Philippines
(Compared
to
simple
procedure
of
exequaure, Philippine mode is protracted &
expensive).

B. Second Mode: Exequatur - -Summary


proceeding also known as exequatur
procedure.
Authenticated copy of foreign judgment
need
only
be
accompanied
by
a
certification from Clerk of Court. Once
validated the foreign judgment has same
effect as local judgment. Example: French
formule executoire, used in France, Italy,
Austria

Our laws require that a petition should be


filed
in
proper
court
attaching
authenticated copy of foreign judgment to
be enforced.
Philippine consul must certify that it had
been rendered by a court of competent
jurisdiction. The petition must comply w/ all
the requisites of an enforceable judgment.

C. Third Mode: Judgment Registration


It may or may not involve judicial
supervision. Authenticated copy of foreign
judgment filed w/ registrars office w/ other
proofs required by domestic laws & foreign
judgment is converted into a local one that
is immediately executory.

Requirement to file an action anew


Attempt to reconcile the principle of
territorial
jurisdiction
of
courts
w/c
demands that the enforcement of a
judgment outside the territory of rendering
court must be placed upon some other
basis than the authority of the rendering
court w/c ceased at its jurisdictional limits& the principle of res judicata.

It is used in Australia, England.


Distinctions between a foreign country & a
sister-state judgment in United States

Ingenohl vs. Olsen and Co.


FACTS: Ingenohl obtained a HK judgment
declaring it to be the owner of the
trademark against Olsen. Ingenohl then
recovered the sums awarded by the HK
judgment in an action for collection in
Manila. Olsen appealed. The appeal was
granted because the trial court erred in
not taking into account the fact that
Olsen
had
bought
the
Ingenohl
trademark in a sale of the same
conducted
by
the Alien
Property
Custodian. Hence this petition by
Ingenohl.

These differences are premised on possible


absence of principles underlying res
judicata practices within foreign country.
Von Mehren & Trautman: There are
significant differences between the 2 to
justify refusal of a foreign country
judgment even though it could be
recognized if rendered by a sister state:
1) US Constitution clause of full faith
and credit. This substitutes a
federal
policy
in
place
of
individual state policies, thus
demanding
that
sister-state
judgments be given more than
minimal preclusive effects.
2) Judgments of sister-state may be
brought to US Supreme Court for
review
3) Judgments rendered by sister
states
are based on legal
procedures & standards similar to
those
whose
recognition
is
sought.

HELD: There is no error on the part of the


HK court. In authoritatively passing upon
the issue of not giving effect to the sale
by the Alien Property Custodian, it
cannot be said that the HK tribunal
committed a wrong decision. The
judgment is unquestionably valid and is
binding between the parties. When the
judge who is the final exponent of that
law, authoritatively declares that the

96

COURSE OUTLINE IN CONFLICTS OF LAW


By: Atty. Enrique V. dela Cruz, Jr.

On the other hand, a foreign country


judgment may have been decided under
rules that disregard private rights & duties
or
fundamental
policies
that
the
recognizing court deem important.
In practice, courts are inclined to give
recognition because of
1) overriding public interest
2) dictates of public policy that there be an
end to litigation.

97