Republic of the Philippines local dialect.
Eventually, SAUDIA allowed plaintiff to return to Jeddah but
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 122191 October 8, 1998
SAUDI ARABIAN AIRLINES, petitioner,
vs.
COURT OF APPEALS, MILAGROS P. MORADA and HON. RODOLFO
A. ORTIZ, in his capacity as Presiding Judge of Branch 89, Regional Trial
Court of Quezon City, respondents.
QUISUMBING, J.:
This petition for certiorari pursuant to Rule 45 of the Rules of Court seeks
to annul and set aside the Resolution1 dated September 27, 1995 and the
Decision2 dated April 10, 1996 of the Court of Appeals3 in CA-G.R. SP No.
36533,4 and the Orders5 dated August 29, 1994 6 and February 2, 19957
that were issued by the trial court in Civil Case No. Q-93-18394.8
The pertinent antecedent facts which gave rise to the instant petition, as
stated in the questioned Decision9, are as follows:
On January 21, 1988 defendant SAUDIA hired plaintiff as a Flight Attendant for
its airlines based in Jeddah, Saudi Arabia. . . .
On April 27, 1990, while on a lay-over in Jakarta, Indonesia, plaintiff went to a
disco dance with fellow crew members Thamer Al-Gazzawi and Allah Al-Gazzawi,
both Saudi nationals. Because it was almost morning when they returned to their
hotels, they agreed to have breakfast together at the room of Thamer. When they
were in te (sic) room, Allah left on some pretext. Shortly after he did, Thamer
attempted to rape plaintiff. Fortunately, a roomboy and several security
personnel heard her cries for help and rescued her. Later, the Indonesian police
came and arrested Thamer and Allah Al-Gazzawi, the latter as an accomplice.
When plaintiff returned to Jeddah a few days later, several SAUDIA officials
interrogated her about the Jakarta incident. They then requested her to go back
to Jakarta to help arrange the release of Thamer and Allah. In Jakarta, SAUDIA
Legal Officer Sirah Akkad and base manager Baharini negotiated with the police
for the immediate release of the detained crew members but did not succeed
because plaintiff refused to cooperate. She was afraid that she might be tricked
into something she did not want because of her inability to understand the local
dialect. She also declined to sign a blank paper and a document written in the
barred her from the Jakarta flights.
Plaintiff learned that, through the intercession of the Saudi Arabian government,
the Indonesian authorities agreed to deport Thamer and Allah after two weeks of
detention. Eventually, they were again put in service by defendant SAUDI (sic).
In September 1990, defendant SAUDIA transferred plaintiff to Manila.
On January 14, 1992, just when plaintiff thought that the Jakarta incident was
already behind her, her superiors requested her to see Mr. Ali Meniewy, Chief
Legal Officer of SAUDIA, in Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the police took her passport and
questioned her about the Jakarta incident. Miniewy simply stood by as the police
put pressure on her to make a statement dropping the case against Thamer and
Allah. Not until she agreed to do so did the police return her passport and allowed
her to catch the afternoon flight out of Jeddah.
One year and a half later or on lune 16, 1993, in Riyadh, Saudi Arabia, a few
minutes before the departure of her flight to Manila, plaintiff was not allowed to
board the plane and instead ordered to take a later flight to Jeddah to see Mr.
Miniewy, the Chief Legal Officer of SAUDIA. When she did, a certain Khalid of
the SAUDIA office brought her to a Saudi court where she was asked to sign a
document written in Arabic. They told her that this was necessary to close the
case against Thamer and Allah. As it turned out, plaintiff signed a notice to her to
appear before the court on June 27, 1993. Plaintiff then returned to Manila.
Shortly afterwards, defendant SAUDIA summoned plaintiff to report to Jeddah
once again and see Miniewy on June 27, 1993 for further investigation. Plaintiff
did so after receiving assurance from SAUDIA's Manila manager, Aslam Saleemi,
that the investigation was routinary and that it posed no danger to her.
In Jeddah, a SAUDIA legal officer brought plaintiff to the same Saudi court on
June 27, 1993. Nothing happened then but on June 28, 1993, a Saudi judge
interrogated plaintiff through an interpreter about the Jakarta incident. After
one hour of interrogation, they let her go. At the airport, however, just as her
plane was about to take off, a SAUDIA officer told her that the airline had
forbidden her to take flight. At the Inflight Service Office where she was told to
go, the secretary of Mr. Yahya Saddick took away her passport and told her to
remain in Jeddah, at the crew quarters, until further orders.
On July 3, 1993 a SAUDIA legal officer again escorted plaintiff to the same court
where the judge, to her astonishment and shock, rendered a decision, translated
to her in English, sentencing her to five months imprisonment and to 286 lashes.
Only then did she realize that the Saudi court had tried her, together with
Thamer and Allah, for what happened in Jakarta. The court found plaintiff guilty
of (1) adultery; (2) going to a disco, dancing and listening to the music in violation
of Islamic laws; and (3) socializing with the male crew, in contravention of Islamic
tradition. 10
Facing conviction, private respondent sought the help of her employer,
petitioner SAUDIA. Unfortunately, she was denied any assistance. She
then asked the Philippine Embassy in Jeddah to help her while her case
is on appeal. Meanwhile, to pay for her upkeep, she worked on the
domestic flight of SAUDIA, while Thamer and Allah continued to serve in
the international flights. 11
Because she was wrongfully convicted, the Prince of Makkah dismissed
the case against her and allowed her to leave Saudi Arabia. Shortly
before her return to Manila, 12 she was terminated from the service by
SAUDIA, without her being informed of the cause.
On November 23, 1993, Morada filed a Complaint 13 for damages against
SAUDIA, and Khaled Al-Balawi ("Al-Balawi"), its country manager.
On January 19, 1994, SAUDIA filed an Omnibus Motion To Dismiss 14
which raised the following grounds, to wit: (1) that the Complaint states
no cause of action against Saudia; (2) that defendant Al-Balawi is not a
real party in interest; (3) that the claim or demand set forth in the
Complaint has been waived, abandoned or otherwise extinguished; and
(4) that the trial court has no jurisdiction to try the case.
On February 10, 1994, Morada filed her Opposition (To Motion to
Dismiss) 15. Saudia filed a reply 16 thereto on March 3, 1994.
On June 23, 1994, Morada filed an Amended Complaint 17 wherein Al-
Balawi was dropped as party defendant. On August 11, 1994, Saudia filed
its Manifestation and Motion to Dismiss Amended Complaint 18.
The trial court issued an Order 19 dated August 29, 1994 denying the
Motion to Dismiss Amended Complaint filed by Saudia.
From the Order of respondent Judge 20 denying the Motion to Dismiss,
SAUDIA filed on September 20, 1994, its Motion for Reconsideration 21 of
the Order dated August 29, 1994. It alleged that the trial court has no
jurisdiction to hear and try the case on the basis of Article 21 of the Civil
Code, since the proper law applicable is the law of the Kingdom of Saudi
Arabia. On October 14, 1994, Morada filed her Opposition 22 (To
Defendant's Motion for Reconsideration).
In the Reply 23 filed with the trial court on October 24, 1994, SAUDIA
alleged that since its Motion for Reconsideration raised lack of
jurisdiction as its cause of action, the Omnibus Motion Rule does not
apply, even if that ground is raised for the first time on appeal.
Additionally, SAUDIA alleged that the Philippines does not have any
substantial interest in the prosecution of the instant case, and hence,
without jurisdiction to adjudicate the same.
Respondent Judge subsequently issued another Order 24 dated February
2, 1995, denying SAUDIA's Motion for Reconsideration. The pertinent
portion of the assailed Order reads as follows:
Acting on the Motion for Reconsideration of defendant Saudi Arabian Airlines
filed, thru counsel, on September 20, 1994, and the Opposition thereto of the
plaintiff filed, thru counsel, on October 14, 1994, as well as the Reply therewith of
defendant Saudi Arabian Airlines filed, thru counsel, on October 24, 1994,
considering that a perusal of the plaintiffs Amended Complaint, which is one for
the recovery of actual, moral and exemplary damages plus attorney's fees, upon
the basis of the applicable Philippine law, Article 21 of the New Civil Code of the
Philippines, is, clearly, within the jurisdiction of this Court as regards the subject
matter, and there being nothing new of substance which might cause the reversal
or modification of the order sought to be reconsidered, the motion for
reconsideration of the defendant, is DENIED.
SO ORDERED. 25
Consequently, on February 20, 1995, SAUDIA filed its Petition for
Certiorari and Prohibition with Prayer for Issuance of Writ of
Preliminary Injunction and/or Temporary Restraining Order 26 with the
Court of Appeals.
Respondent Court of Appeals promulgated a Resolution with Temporary
Restraining Order 27 dated February 23, 1995, prohibiting the respondent
Judge from further conducting any proceeding, unless otherwise directed,
in the interim.
In another Resolution 28 promulgated on September 27, 1995, now
assailed, the appellate court denied SAUDIA's Petition for the Issuance of
a Writ of Preliminary Injunction dated February 18, 1995, to wit:
The Petition for the Issuance of a Writ of Preliminary Injunction is hereby
DENIED, after considering the Answer, with Prayer to Deny Writ of Preliminary
Injunction (Rollo, p. 135) the Reply and Rejoinder, it appearing that herein
petitioner is not clearly entitled thereto (Unciano Paramedical College, et. Al., v.
Court of Appeals, et. Al., 100335, April 7, 1993, Second Division).
SO ORDERED.
On October 20, 1995, SAUDIA filed with this Honorable Court the
instant Petition 29 for Review with Prayer for Temporary Restraining
Order dated October 13, 1995.
However, during the pendency of the instant Petition, respondent Court
of Appeals rendered the Decision 30 dated April 10, 1996, now also
assailed. It ruled that the Philippines is an appropriate forum considering
that the Amended Complaint's basis for recovery of damages is Article 21
of the Civil Code, and thus, clearly within the jurisdiction of respondent
Court. It further held that certiorari is not the proper remedy in a denial
of a Motion to Dismiss, inasmuch as the petitioner should have proceeded
to trial, and in case of an adverse ruling, find recourse in an appeal.
On May 7, 1996, SAUDIA filed its Supplemental Petition for Review with
Prayer for Temporary Restraining Order 31 dated April 30, 1996, given
due course by this Court. After both parties submitted their Memoranda,
32 the instant case is now deemed submitted for decision.
Petitioner SAUDIA raised the following issues:
I alleged abuse of rights occurred in the Kingdom of Saudi Arabia. It
The trial court has no jurisdiction to hear and try Civil Case No. Q-93-18394
based on Article 21 of the New Civil Code since the proper law applicable is the
law of the Kingdom of Saudi Arabia inasmuch as this case involves what is known
in private international law as a "conflicts problem". Otherwise, the Republic of
the Philippines will sit in judgment of the acts done by another sovereign state
which is abhorred.
II
Leave of court before filing a supplemental pleading is not a jurisdictional
requirement. Besides, the matter as to absence of leave of court is now moot and
academic when this Honorable Court required the respondents to comment on
petitioner's April 30, 1996 Supplemental Petition For Review With Prayer For A
Temporary Restraining Order Within Ten (10) Days From Notice Thereof.
Further, the Revised Rules of Court should be construed with liberality pursuant
to Section 2, Rule 1 thereof.
III
Petitioner received on April 22, 1996 the April 10, 1996 decision in CA-G.R. SP
NO. 36533 entitled "Saudi Arabian Airlines v. Hon. Rodolfo A. Ortiz, et al." and
filed its April 30, 1996 Supplemental Petition For Review With Prayer For A
Temporary Restraining Order on May 7, 1996 at 10:29 a.m. or within the 15-day
reglementary period as provided for under Section 1, Rule 45 of the Revised Rules
of Court. Therefore, the decision in CA-G.R. SP NO. 36533 has not yet become
final and executory and this Honorable Court can take cognizance of this case. 33
From the foregoing factual and procedural antecedents, the following
issues emerge for our resolution:
I.
WHETHER RESPONDENT APPELLATE COURT ERRED IN HOLDING THAT
THE REGIONAL TRIAL COURT OF QUEZON CITY HAS JURISDICTION TO
HEAR AND TRY CIVIL CASE NO. Q-93-18394 ENTITLED "MILAGROS P.
MORADA V. SAUDI ARABIAN AIRLINES".
II.
WHETHER RESPONDENT APPELLATE COURT ERRED IN RULING THAT
IN THIS CASE PHILIPPINE LAW SHOULD GOVERN.
Petitioner SAUDIA claims that before us is a conflict of laws that must be
settled at the outset. It maintains that private respondent's claim for
alleges that the existence of a foreign element qualifies the instant case
for the application of the law of the Kingdom of Saudi Arabia, by virtue of
the lex loci delicti commissi rule. 34
On the other hand, private respondent contends that since her Amended
Complaint is based on Articles 19 35 and 21 36 of the Civil Code, then the
instant case is properly a matter of domestic law. 37
Under the factual antecedents obtaining in this case, there is no dispute
that the interplay of events occurred in two states, the Philippines and
Saudi Arabia.
As stated by private respondent in her Amended Complaint 38 dated June
23, 1994:
2. Defendant SAUDI ARABIAN AIRLINES or SAUDIA is a foreign airlines
corporation doing business in the Philippines. It may be served with summons
and other court processes at Travel Wide Associated Sales (Phils.). Inc., 3rd Floor,
Cougar Building, 114 Valero St., Salcedo Village, Makati, Metro Manila.
xxx xxx xxx
6. Plaintiff learned that, through the intercession of the Saudi Arabian
government, the Indonesian authorities agreed to deport Thamer and Allah after
two weeks of detention. Eventually, they were again put in service by defendant
SAUDIA. In September 1990, defendant SAUDIA transferred plaintiff to Manila.
7. On January 14, 1992, just when plaintiff thought that the Jakarta incident was
already behind her, her superiors reauested her to see MR. Ali Meniewy, Chief
Legal Officer of SAUDIA in Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the police took her passport and
questioned her about the Jakarta incident. Miniewy simply stood by as the police
put pressure on her to make a statement dropping the case against Thamer and
Allah. Not until she agreed to do so did the police return her passport and allowed
her to catch the afternoon flight out of Jeddah.
8. One year and a half later or on June 16, 1993, in Riyadh, Saudi Arabia, a few
minutes before the departure of her flight to Manila, plaintiff was not allowed to
board the plane and instead ordered to take a later flight to Jeddah to see Mr.
Meniewy, the Chief Legal Officer of SAUDIA. When she did, a certain Khalid of
the SAUDIA office brought her to a Saudi court where she was asked to sigh a
document written in Arabic. They told her that this was necessary to close the
case against Thamer and Allah. As it turned out, plaintiff signed a notice to her to
appear before the court on June 27, 1993. Plaintiff then returned to Manila.
9. Shortly afterwards, defendant SAUDIA summoned plaintiff to report to Jeddah
once again and see Miniewy on June 27, 1993 for further investigation. Plaintiff
did so after receiving assurance from SAUDIA's Manila manger, Aslam Saleemi,
that the investigation was routinary and that it posed no danger to her.
10. In Jeddah, a SAUDIA legal officer brought plaintiff to the same Saudi court
on June 27, 1993. Nothing happened then but on June 28, 1993, a Saudi judge
interrogated plaintiff through an interpreter about the Jakarta incident. After
one hour of interrogation, they let her go. At the airport, however, just as her
plane was about to take off, a SAUDIA officer told her that the airline had
forbidden her to take that flight. At the Inflight Service Office where she was told
to go, the secretary of Mr. Yahya Saddick took away her passport and told her to
remain in Jeddah, at the crew quarters, until further orders.
11. On July 3, 1993 a SAUDIA legal officer again escorted plaintiff to the same
court where the judge, to her astonishment and shock, rendered a decision,
translated to her in English, sentencing her to five months imprisonment and to
286 lashes. Only then did she realize that the Saudi court had tried her, together
with Thamer and Allah, for what happened in Jakarta. The court found plaintiff
guilty of (1) adultery; (2) going to a disco, dancing, and listening to the music in
violation of Islamic laws; (3) socializing with the male crew, in contravention of
Islamic tradition.
12. Because SAUDIA refused to lend her a hand in the case, plaintiff sought the
help of the Philippines Embassy in Jeddah. The latter helped her pursue an
appeal from the decision of the court. To pay for her upkeep, she worked on the
domestic flights of defendant SAUDIA while, ironically, Thamer and Allah freely
served the international flights. 39
Where the factual antecedents satisfactorily establish the existence of a
foreign element, we agree with petitioner that the problem herein could
present a "conflicts" case.
A factual situation that cuts across territorial lines and is affected by the
diverse laws of two or more states is said to contain a "foreign element".
The presence of a foreign element is inevitable since social and economic
affairs of individuals and associations are rarely confined to the
geographic limits of their birth or conception. 40
The forms in which this foreign element may appear are many. 41 The
foreign element may simply consist in the fact that one of the parties to a
contract is an alien or has a foreign domicile, or that a contract between
nationals of one State involves properties situated in another State. In
other cases, the foreign element may assume a complex form. 42
In the instant case, the foreign element consisted in the fact that private
respondent Morada is a resident Philippine national, and that petitioner
SAUDIA is a resident foreign corporation. Also, by virtue of the
employment of Morada with the petitioner Saudia as a flight stewardess,
events did transpire during her many occasions of travel across national
borders, particularly from Manila, Philippines to Jeddah, Saudi Arabia,
and vice versa, that caused a "conflicts" situation to arise.
We thus find private respondent's assertion that the case is purely
domestic, imprecise. A conflicts problem presents itself here, and the
question of jurisdiction 43 confronts the court a quo.
After a careful study of the private respondent's Amended Complaint, 44
and the Comment thereon, we note that she aptly predicated her cause of
action on Articles 19 and 21 of the New Civil Code.
On one hand, Article 19 of the New Civil Code provides:
Art. 19. Every person must, in the exercise of his rights and in the performance of
his duties, act with justice give everyone his due and observe honesty and good
faith.
On the other hand, Article 21 of the New Civil Code provides:
Art. 21. Any person who willfully causes loss or injury to another in a manner
that is contrary to morals, good customs or public policy shall compensate the
latter for damages.
Thus, in Philippine National Bank (PNB) vs. Court of Appeals, 45
Court held that:
The aforecited provisions on human relations were intended to expand the
concept of torts in this jurisdiction by granting adequate legal remedy for the
untold number of moral wrongs which is impossible for human foresight to
specifically provide in the statutes.
Although Article 19 merely declares a principle of law, Article 21 gives
flesh to its provisions. Thus, we agree with private respondent's assertion
that violations of Articles 19 and 21 are actionable, with judicially
enforceable remedies in the municipal forum.
Based on the allegations 46 in the Amended Complaint, read in the light
of the Rules of Court on jurisdiction 47 we find that the Regional Trial
Court (RTC) of Quezon City possesses jurisdiction over the subject matter
of the suit. 48 Its authority to try and hear the case is provided for under
Section 1 of Republic Act No. 7691, to wit:
Sec. 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary
Reorganization Act of 1980", is hereby amended to read as follows:
Sec. 19. Jurisdiction in Civil Cases. Regional Trial Courts shall exercise
exclusive jurisdiction:
xxx xxx xxx
(8) In all other cases in which demand, exclusive of interest, damages of whatever
kind, attorney's fees, litigation expenses, and cots or the value of the property in
controversy exceeds One hundred thousand pesos (P100,000.00) or, in such other
cases in Metro Manila, where the demand, exclusive of the above-mentioned
items exceeds Two hundred Thousand pesos (P200,000.00). (Emphasis ours)
xxx xxx xxx
And following Section 2 (b), Rule 4 of the Revised Rules of Court the
venue, Quezon City, is appropriate:
Sec. 2 Venue in Courts of First Instance. [Now Regional Trial Court]
(a) xxx xxx xxx
(b) Personal actions. All other actions may be commenced and tried where the
defendant or any of the defendants resides or may be found, or where the plaintiff
this or any of the plaintiff resides, at the election of the plaintiff.
Pragmatic considerations, including the convenience of the parties, also
weigh heavily in favor of the RTC Quezon City assuming jurisdiction.
Paramount is the private interest of the litigant. Enforceability of a
judgment if one is obtained is quite obvious. Relative advantages and
obstacles to a fair trial are equally important. Plaintiff may not, by choice
of an inconvenient forum, "vex", "harass", or "oppress" the defendant, e.g.
by inflicting upon him needless expense or disturbance. But unless the
balance is strongly in favor of the defendant, the plaintiffs choice of forum
should rarely be disturbed. 49
Weighing the relative claims of the parties, the court a quo found it best
to hear the case in the Philippines. Had it refused to take cognizance of
the case, it would be forcing plaintiff (private respondent now) to seek
remedial action elsewhere, i.e. in the Kingdom of Saudi Arabia where she
no longer maintains substantial connections. That would have caused a
fundamental unfairness to her.
Moreover, by hearing the case in the Philippines no unnecessary
difficulties and inconvenience have been shown by either of the parties.
The choice of forum of the plaintiff (now private respondent) should be
upheld.
Similarly, the trial court also possesses jurisdiction over the persons of
the parties herein. By filing her Complaint and Amended Complaint with
the trial court, private respondent has voluntary submitted herself to the
jurisdiction of the court.
The records show that petitioner SAUDIA has filed several motions 50
praying for the dismissal of Morada's Amended Complaint. SAUDIA also
filed an Answer In Ex Abundante Cautelam dated February 20, 1995.
What is very patent and explicit from the motions filed, is that SAUDIA
prayed for other reliefs under the premises. Undeniably, petitioner
SAUDIA has effectively submitted to the trial court's jurisdiction by
praying for the dismissal of the Amended Complaint on grounds other
than lack of jurisdiction.
As held by this Court in Republic vs. Ker and Company, Ltd.: 51
We observe that the motion to dismiss filed on April 14, 1962, aside from
disputing the lower court's jurisdiction over defendant's person, prayed for
dismissal of the complaint on the ground that plaintiff's cause of action has
prescribed. By interposing such second ground in its motion to dismiss, Ker and
Co., Ltd. availed of an affirmative defense on the basis of which it prayed the
court to resolve controversy in its favor. For the court to validly decide the said
plea of defendant Ker & Co., Ltd., it necessarily had to acquire jurisdiction upon
the latter's person, who, being the proponent of the affirmative defense, should be
deemed to have abandoned its special appearance and voluntarily submitted itself
to the jurisdiction of the court.
Similarly, the case of De Midgely vs. Ferandos, held that;
When the appearance is by motion for the purpose of objecting to the jurisdiction
of the court over the person, it must be for the sole and separate purpose of
objecting to the jurisdiction of the court. If his motion is for any other purpose
than to object to the jurisdiction of the court over his person, he thereby submits
himself to the jurisdiction of the court. A special appearance by motion made for
the purpose of objecting to the jurisdiction of the court over the person will be
held to be a general appearance, if the party in said motion should, for example,
ask for a dismissal of the action upon the further ground that the court had no
jurisdiction over the subject matter. 52
Clearly, petitioner had submitted to the jurisdiction of the Regional Trial
Court of Quezon City. Thus, we find that the trial court has jurisdiction
over the case and that its exercise thereof, justified.
As to the choice of applicable law, we note that choice-of-law problems
seek to answer two important questions: (1) What legal system should
control a given situation where some of the significant facts occurred in
two or more states; and (2) to what extent should the chosen legal system
regulate the situation. 53
Several theories have been propounded in order to identify the legal
system that should ultimately control. Although ideally, all choice-of-law
theories should intrinsically advance both notions of justice and
predictability, they do not always do so. The forum is then faced with the
problem of deciding which of these two important values should be
stressed. 54
Before a choice can be made, it is necessary for us to determine under
what category a certain set of facts or rules fall. This process is known as
"characterization", or the "doctrine of qualification". It is the "process of
deciding whether or not the facts relate to the kind of question specified
in a conflicts rule." 55 The purpose of "characterization" is to enable the
forum to select the proper law. 56
Our starting point of analysis here is not a legal relation, but a factual
situation, event, or operative fact. 57 An essential element of conflict rules
is the indication of a "test" or "connecting factor" or "point of contact".
Choice-of-law rules invariably consist of a factual relationship (such as
property right, contract claim) and a connecting factor or point of contact,
such as the situs of the res, the place of celebration, the place of
performance, or the place of wrongdoing. 58
Note that one or more circumstances may be present to serve as the
possible test for the determination of the applicable law. 59 These "test
factors" or "points of contact" or "connecting factors" could be any of the
following:
(1) The nationality of a person, his domicile, his residence, his place of sojourn, or
his origin;
(2) the seat of a legal or juridical person, such as a corporation;
(3) the situs of a thing, that is, the place where a thing is, or is deemed to be
situated. In particular, the lex situs is decisive when real rights are involved;
(4) the place where an act has been done, the locus actus, such as the place where a
contract has been made, a marriage celebrated, a will signed or a tort committed.
The lex loci actus is particularly important in contracts and torts;
(5) the place where an act is intended to come into effect, e.g., the place of
performance of contractual duties, or the place where a power of attorney is to be
exercised;
(6) the intention of the contracting parties as to the law that should govern their
agreement, the lex loci intentionis;
(7) the place where judicial or administrative proceedings are instituted or done.
The lex fori the law of the forum is particularly important because, as we
have seen earlier, matters of "procedure" not going to the substance of the claim
involved are governed by it; and because the lex fori applies whenever the content
of the otherwise applicable foreign law is excluded from application in a given
case for the reason that it falls under one of the exceptions to the applications of
foreign law; and
(8) the flag of a ship, which in many cases is decisive of practically all legal
relationships of the ship and of its master or owner as such. It also covers
contractual relationships particularly contracts of affreightment. 60 (Emphasis
ours.)
After a careful study of the pleadings on record, including allegations in
the Amended Complaint deemed admitted for purposes of the motion to
dismiss, we are convinced that there is reasonable basis for private
respondent's assertion that although she was already working in Manila,
petitioner brought her to Jeddah on the pretense that she would merely
testify in an investigation of the charges she made against the two
SAUDIA crew members for the attack on her person while they were in
Jakarta. As it turned out, she was the one made to face trial for very
serious charges, including adultery and violation of Islamic laws and
tradition.
There is likewise logical basis on record for the claim that the "handing
over" or "turning over" of the person of private respondent to Jeddah
officials, petitioner may have acted beyond its duties as employer.
Petitioner's purported act contributed to and amplified or even
proximately caused additional humiliation, misery and suffering of
private respondent. Petitioner thereby allegedly facilitated the arrest,
detention and prosecution of private respondent under the guise of
petitioner's authority as employer, taking advantage of the trust,
confidence and faith she reposed upon it. As purportedly found by the
Prince of Makkah, the alleged conviction and imprisonment of private
respondent was wrongful. But these capped the injury or harm allegedly
inflicted upon her person and reputation, for which petitioner could be
liable as claimed, to provide compensation or redress for the wrongs done,
once duly proven.
Considering that the complaint in the court a quo is one involving torts,
the "connecting factor" or "point of contact" could be the place or places
where the tortious conduct or lex loci actus occurred. And applying the
torts principle in a conflicts case, we find that the Philippines could be
said as a situs of the tort (the place where the alleged tortious conduct
took place). This is because it is in the Philippines where petitioner
allegedly deceived private respondent, a Filipina residing and working
here. According to her, she had honestly believed that petitioner would, in
the exercise of its rights and in the performance of its duties, "act with
justice, give her due and observe honesty and good faith." Instead,
petitioner failed to protect her, she claimed. That certain acts or parts of
the injury allegedly occurred in another country is of no moment. For in
our view what is important here is the place where the over-all harm or
the totality of the alleged injury to the person, reputation, social standing
and human rights of complainant, had lodged, according to the plaintiff
below (herein private respondent). All told, it is not without basis to
identify the Philippines as the situs of the alleged tort.
Moreover, with the widespread criticism of the traditional rule of lex loci
delicti commissi, modern theories and rules on tort liability 61 have been
advanced to offer fresh judicial approaches to arrive at just results. In
keeping abreast with the modern theories on tort liability, we find here
an occasion to apply the "State of the most significant relationship" rule,
which in our view should be appropriate to apply now, given the factual
context of this case.
In applying said principle to determine the State which has the most
significant relationship, the following contacts are to be taken into
account and evaluated according to their relative importance with respect
to the particular issue: (a) the place where the injury occurred; (b) the
place where the conduct causing the injury occurred; (c) the domicile,
residence, nationality, place of incorporation and place of business of the
parties, and (d) the place where the relationship, if any, between the
parties is centered. 62
As already discussed, there is basis for the claim that over-all injury
occurred and lodged in the Philippines. There is likewise no question that
private respondent is a resident Filipina national, working with
petitioner, a resident foreign corporation engaged here in the business of
international air carriage. Thus, the "relationship" between the parties
was centered here, although it should be stressed that this suit is not
based on mere labor law violations. From the record, the claim that the
Philippines has the most significant contact with the matter in this
dispute, 63 raised by private respondent as plaintiff below against
defendant (herein petitioner), in our view, has been properly established.
Prescinding from this premise that the Philippines is the situs of the tort
complained of and the place "having the most interest in the problem", we
find, by way of recapitulation, that the Philippine law on tort liability
should have paramount application to and control in the resolution of the
legal issues arising out of this case. Further, we hold that the respondent
Regional Trial Court has jurisdiction over the parties and the subject
matter of the complaint; the appropriate venue is in Quezon City, which
could properly apply Philippine law. Moreover, we find untenable
petitioner's insistence that "[s]ince private respondent instituted this
suit, she has the burden of pleading and proving the applicable Saudi law
on the matter." 64 As aptly said by private respondent, she has "no
obligation to plead and prove the law of the Kingdom of Saudi Arabia
since her cause of action is based on Articles 19 and 21" of the Civil Code
of the Philippines. In her Amended Complaint and subsequent pleadings,
she never alleged that Saudi law should govern this case. 65 And as
correctly held by the respondent appellate court, "considering that it was
the petitioner who was invoking the applicability of the law of Saudi
Arabia, then the burden was on it [petitioner] to plead and to establish
what the law of Saudi Arabia is". 66

Lastly, no error could be imputed to the respondent appellate court in

upholding the trial court's denial of defendant's (herein petitioner's)
motion to dismiss the case. Not only was jurisdiction in order and venue
properly laid, but appeal after trial was obviously available, and
expeditious trial itself indicated by the nature of the case at hand.
Indubitably, the Philippines is the state intimately concerned with the
ultimate outcome of the case below, not just for the benefit of all the
litigants, but also for the vindication of the country's system of law and
justice in a transnational setting. With these guidelines in mind, the trial
court must proceed to try and adjudge the case in the light of relevant
Philippine law, with due consideration of the foreign element or elements
involved. Nothing said herein, of course, should be construed as
prejudging the results of the case in any manner whatsoever.

WHEREFORE, the instant petition for certiorari is hereby DISMISSED.

Civil Case No. Q-93-18394 entitled "Milagros P. Morada vs. Saudi Arabia
Airlines" is hereby REMANDED to Regional Trial Court of Quezon City,
Branch 89 for further proceedings.

SO ORDERED.

Davide, Jr., Bellosillo, Vitug and Panganiban, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 149177 November 23, 2007
KAZUHIRO HASEGAWA and NIPPON ENGINEERING
CONSULTANTS CO., LTD., Petitioners,
vs.
MINORU KITAMURA, Respondent.
NACHURA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the
Rules of Court assailing the April 18, 2001 Decision 1 of the Court of
Appeals (CA) in CA-G.R. SP No. 60827, and the July 25, 2001 Resolution 2
denying the motion for reconsideration thereof.
On March 30, 1999, petitioner Nippon Engineering Consultants Co., Ltd.
(Nippon), a Japanese consultancy firm providing technical and
management support in the infrastructure projects of foreign
governments,3 entered into an Independent Contractor Agreement (ICA)
with respondent Minoru Kitamura, a Japanese national permanently
residing in the Philippines.4 The agreement provides that respondent was
to extend professional services to Nippon for a year starting on April 1,
1999.5 Nippon then assigned respondent to work as the project manager
of the Southern Tagalog Access Road (STAR) Project in the Philippines,
following the company's consultancy contract with the Philippine
Government.6
When the STAR Project was near completion, the Department of Public
Works and Highways (DPWH) engaged the consultancy services of
Nippon, on January 28, 2000, this time for the detailed engineering and
construction supervision of the Bongabon-Baler Road Improvement
(BBRI) Project.7 Respondent was named as the project manager in the
contract's Appendix 3.1.8
On February 28, 2000, petitioner Kazuhiro Hasegawa, Nippon's general
manager for its International Division, informed respondent that the
company had no more intention of automatically renewing his ICA. His
services would be engaged by the company only up to the substantial
completion of the STAR Project on March 31, 2000, just in time for the
ICA's expiry.9
Threatened with impending unemployment, respondent, through his
lawyer, requested a negotiation conference and demanded that he be
assigned to the BBRI project. Nippon insisted that respondents contract
was for a fixed term that had already expired, and refused to negotiate
for the renewal of the ICA.10
As he was not able to generate a positive response from the petitioners,
respondent consequently initiated on June 1, 2000 Civil Case No. 00-0264
for specific performance and damages with the Regional Trial Court of
Lipa City.11
For their part, petitioners, contending that the ICA had been perfected in
Japan and executed by and between Japanese nationals, moved to
dismiss the complaint for lack of jurisdiction. They asserted that the
claim for improper pre-termination of respondent's ICA could only be
heard and ventilated in the proper courts of Japan following the
principles of lex loci celebrationis and lex contractus.12
In the meantime, on June 20, 2000, the DPWH approved Nippon's
request for the replacement of Kitamura by a certain Y. Kotake as project
manager of the BBRI Project.13
On June 29, 2000, the RTC, invoking our ruling in Insular Government v.
Frank14 that matters connected with the performance of contracts are
regulated by the law prevailing at the place of performance, 15 denied the
motion to dismiss.16 The trial court subsequently denied petitioners'
motion for reconsideration,17 prompting them to file with the appellate
court, on August 14, 2000, their first Petition for Certiorari under Rule
65 [docketed as CA-G.R. SP No. 60205].18 On August 23, 2000, the CA
resolved to dismiss the petition on procedural groundsfor lack of
statement of material dates and for insufficient verification and
certification against forum shopping.19 An Entry of Judgment was later
issued by the appellate court on September 20, 2000.20
Aggrieved by this development, petitioners filed with the CA, on
September 19, 2000, still within the reglementary period, a second
Petition for Certiorari under Rule 65 already stating therein the material
dates and attaching thereto the proper verification and certification. This
second petition, which substantially raised the same issues as those in
the first, was docketed as CA-G.R. SP No. 60827.21
Ruling on the merits of the second petition, the appellate court rendered
the assailed April 18, 2001 Decision22 finding no grave abuse of discretion
in the trial court's denial of the motion to dismiss. The CA ruled, among
others, that the principle of lex loci celebrationis was not applicable to the
case, because nowhere in the pleadings was the validity of the written
agreement put in issue. The CA thus declared that the trial court was
correct in applying instead the principle of lex loci solutionis.23
Petitioners' motion for reconsideration was subsequently denied by the
CA in the assailed July 25, 2001 Resolution.24
Remaining steadfast in their stance despite the series of denials,
petitioners instituted the instant Petition for Review on Certiorari25
imputing the following errors to the appellate court:
A. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN FINDING
THAT THE TRIAL COURT VALIDLY EXERCISED JURISDICTION OVER THE
INSTANT CONTROVERSY, DESPITE THE FACT THAT THE CONTRACT
SUBJECT MATTER OF THE PROCEEDINGS A QUO WAS ENTERED INTO
BY AND BETWEEN TWO JAPANESE NATIONALS, WRITTEN WHOLLY IN
THE JAPANESE LANGUAGE AND EXECUTED IN TOKYO, JAPAN.
B. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN
OVERLOOKING THE NEED TO REVIEW OUR ADHERENCE TO THE
PRINCIPLE OF LEX LOCI SOLUTIONIS IN THE LIGHT OF RECENT
DEVELOPMENT[S] IN PRIVATE INTERNATIONAL LAWS.26
The pivotal question that this Court is called upon to resolve is whether
the subject matter jurisdiction of Philippine courts in civil cases for
specific performance and damages involving contracts executed outside
the country by foreign nationals may be assailed on the principles of lex
loci celebrationis, lex contractus, the "state of the most significant
relationship rule," or forum non conveniens.
However, before ruling on this issue, we must first dispose of the
procedural matters raised by the respondent.
Kitamura contends that the finality of the appellate court's decision in
CA-G.R. SP No. 60205 has already barred the filing of the second petition
docketed as CA-G.R. SP No. 60827 (fundamentally raising the same
issues as those in the first one) and the instant petition for review
thereof.
We do not agree. When the CA dismissed CA-G.R. SP No. 60205 on
account of the petition's defective certification of non-forum shopping, it
was a dismissal without prejudice.27 The same holds true in the CA's
dismissal of the said case due to defects in the formal requirement of
verification28 and in the other requirement in Rule 46 of the Rules of
Court on the statement of the material dates. 29 The dismissal being
without prejudice, petitioners can re-file the petition, or file a second
petition attaching thereto the appropriate verification and certification
as they, in fact didand stating therein the material dates, within the
prescribed period30 in Section 4, Rule 65 of the said Rules.31
The dismissal of a case without prejudice signifies the absence of a
decision on the merits and leaves the parties free to litigate the matter in
a subsequent action as though the dismissed action had not been
commenced. In other words, the termination of a case not on the merits
does not bar another action involving the same parties, on the same
subject matter and theory.32
Necessarily, because the said dismissal is without prejudice and has no
res judicata effect, and even if petitioners still indicated in the
verification and certification of the second certiorari petition that the first
had already been dismissed on procedural grounds, 33 petitioners are no
longer required by the Rules to indicate in their certification of non-forum
shopping in the instant petition for review of the second certiorari petition,
the status of the aforesaid first petition before the CA. In any case, an
omission in the certificate of non-forum shopping about any event that
will not constitute res judicata and litis pendentia, as in the present case,
is not a fatal defect. It will not warrant the dismissal and nullification of
the entire proceedings, considering that the evils sought to be prevented
by the said certificate are no longer present.34
The Court also finds no merit in respondent's contention that petitioner
Hasegawa is only authorized to verify and certify, on behalf of Nippon,
the certiorari petition filed with the CA and not the instant petition.
True, the Authorization35 dated September 4, 2000, which is attached to
the second certiorari petition and which is also attached to the instant
petition for review, is limited in scopeits wordings indicate that
Hasegawa is given the authority to sign for and act on behalf of the
company only in the petition filed with the appellate court, and that
authority cannot extend to the instant petition for review. 36 In a plethora
of cases, however, this Court has liberally applied the Rules or even
suspended its application whenever a satisfactory explanation and a
subsequent fulfillment of the requirements have been made.37 Given that
petitioners herein sufficiently explained their misgivings on this point
and appended to their Reply38 an updated Authorization39 for Hasegawa
to act on behalf of the company in the instant petition, the Court finds the
same as sufficient compliance with the Rules.
However, the Court cannot extend the same liberal treatment to the
defect in the verification and certification. As respondent pointed out, and
to which we agree, Hasegawa is truly not authorized to act on behalf of
Nippon in this case. The aforesaid September 4, 2000 Authorization and
even the subsequent August 17, 2001 Authorization were issued only by
Nippon's president and chief executive officer, not by the company's board
of directors. In not a few cases, we have ruled that corporate powers are
exercised by the board of directors; thus, no person, not even its officers,
can bind the corporation, in the absence of authority from the board. 40
Considering that Hasegawa verified and certified the petition only on his
behalf and not on behalf of the other petitioner, the petition has to be
denied pursuant to Loquias v. Office of the Ombudsman.41 Substantial
compliance will not suffice in a matter that demands strict observance of
the Rules.42 While technical rules of procedure are designed not to
frustrate the ends of justice, nonetheless, they are intended to effect the
proper and orderly disposition of cases and effectively prevent the
clogging of court dockets.43
Further, the Court has observed that petitioners incorrectly filed a Rule
65 petition to question the trial court's denial of their motion to dismiss.
It is a well-established rule that an order denying a motion to dismiss is
interlocutory, and cannot be the subject of the extraordinary petition for
certiorari or mandamus. The appropriate recourse is to file an answer
and to interpose as defenses the objections raised in the motion, to
proceed to trial, and, in case of an adverse decision, to elevate the entire
case by appeal in due course.44 While there are recognized exceptions to
this rule,45 petitioners' case does not fall among them.
This brings us to the discussion of the substantive issue of the case.
Asserting that the RTC of Lipa City is an inconvenient forum, petitioners
question its jurisdiction to hear and resolve the civil case for specific
performance and damages filed by the respondent. The ICA subject of the
litigation was entered into and perfected in Tokyo, Japan, by Japanese
nationals, and written wholly in the Japanese language. Thus, petitioners
posit that local courts have no substantial relationship to the parties 46
following the [state of the] most significant relationship rule in Private
International Law.47
The Court notes that petitioners adopted an additional but different
theory when they elevated the case to the appellate court. In the Motion
to Dismiss48 filed with the trial court, petitioners never contended that
the RTC is an inconvenient forum. They merely argued that the
applicable law which will determine the validity or invalidity of
respondent's claim is that of Japan, following the principles of lex loci
celebrationis and lex contractus.49 While not abandoning this stance in
their petition before the appellate court, petitioners on certiorari
significantly invoked the defense of forum non conveniens.50 On petition
for review before this Court, petitioners dropped their other arguments,
maintained the forum non conveniens defense, and introduced their new
argument that the applicable principle is the [state of the] most
significant relationship rule.51
Be that as it may, this Court is not inclined to deny this petition merely
on the basis of the change in theory, as explained in Philippine Ports
Authority v. City of Iloilo.52 We only pointed out petitioners' inconstancy
in their arguments to emphasize their incorrect assertion of conflict of
laws principles.
To elucidate, in the judicial resolution of conflicts problems, three
consecutive phases are involved: jurisdiction, choice of law, and
recognition and enforcement of judgments. Corresponding to these phases
are the following questions: (1) Where can or should litigation be
initiated? (2) Which law will the court apply? and (3) Where can the
resulting judgment be enforced?53
Analytically, jurisdiction and choice of law are two distinct concepts.54
Jurisdiction considers whether it is fair to cause a defendant to travel to
this state; choice of law asks the further question whether the application
of a substantive law which will determine the merits of the case is fair to
both parties. The power to exercise jurisdiction does not automatically
give a state constitutional authority to apply forum law. While
jurisdiction and the choice of the lex fori will often coincide, the
"minimum contacts" for one do not always provide the necessary
"significant contacts" for the other.55 The question of whether the law of a
state can be applied to a transaction is different from the question of
whether the courts of that state have jurisdiction to enter a judgment. 56
In this case, only the first phase is at issuejurisdiction.1wphi1
Jurisdiction, however, has various aspects. For a court to validly exercise
its power to adjudicate a controversy, it must have jurisdiction over the
plaintiff or the petitioner, over the defendant or the respondent, over the
subject matter, over the issues of the case and, in cases involving
property, over the res or the thing which is the subject of the litigation. 57
In assailing the trial court's jurisdiction herein, petitioners are actually
referring to subject matter jurisdiction.
Jurisdiction over the subject matter in a judicial proceeding is conferred
by the sovereign authority which establishes and organizes the court. It is
given only by law and in the manner prescribed by law. 58 It is further
determined by the allegations of the complaint irrespective of whether
the plaintiff is entitled to all or some of the claims asserted therein. 59 To
succeed in its motion for the dismissal of an action for lack of jurisdiction
over the subject matter of the claim,60 the movant must show that the
court or tribunal cannot act on the matter submitted to it because no law
grants it the power to adjudicate the claims. 61
In the instant case, petitioners, in their motion to dismiss, do not claim
that the trial court is not properly vested by law with jurisdiction to hear
the subject controversy for, indeed, Civil Case No. 00-0264 for specific
performance and damages is one not capable of pecuniary estimation and
is properly cognizable by the RTC of Lipa City. 62 What they rather raise
as grounds to question subject matter jurisdiction are the principles of lex
loci celebrationis and lex contractus, and the "state of the most significant
relationship rule."
The Court finds the invocation of these grounds unsound.
Lex loci celebrationis relates to the "law of the place of the ceremony" 63 or
the law of the place where a contract is made. 64 The doctrine of lex
contractus or lex loci contractus means the "law of the place where a
contract is executed or to be performed."65 It controls the nature,
construction, and validity of the contract66 and it may pertain to the law
voluntarily agreed upon by the parties or the law intended by them either
expressly or implicitly.67 Under the "state of the most significant
relationship rule," to ascertain what state law to apply to a dispute, the
court should determine which state has the most substantial connection
to the occurrence and the parties. In a case involving a contract, the court
should consider where the contract was made, was negotiated, was to be
performed, and the domicile, place of business, or place of incorporation of
the parties.68 This rule takes into account several contacts and evaluates
them according to their relative importance with respect to the particular
issue to be resolved.69
Since these three principles in conflict of laws make reference to the law
applicable to a dispute, they are rules proper for the second phase, the
choice of law.70 They determine which state's law is to be applied in
resolving the substantive issues of a conflicts problem. 71 Necessarily, as
the only issue in this case is that of jurisdiction, choice-of-law rules are
not only inapplicable but also not yet called for.
Further, petitioners' premature invocation of choice-of-law rules is
exposed by the fact that they have not yet pointed out any conflict
between the laws of Japan and ours. Before determining which law
should apply, first there should exist a conflict of laws situation requiring
the application of the conflict of laws rules.72 Also, when the law of a
foreign country is invoked to provide the proper rules for the solution of a
case, the existence of such law must be pleaded and proved. 73
It should be noted that when a conflicts case, one involving a foreign
element, is brought before a court or administrative agency, there are
three alternatives open to the latter in disposing of it: (1) dismiss the
case, either because of lack of jurisdiction or refusal to assume
jurisdiction over the case; (2) assume jurisdiction over the case and apply
the internal law of the forum; or (3) assume jurisdiction over the case and
take into account or apply the law of some other State or States. 74 The
courts power to hear cases and controversies is derived from the
Constitution and the laws. While it may choose to recognize laws of
foreign nations, the court is not limited by foreign sovereign law short of
treaties or other formal agreements, even in matters regarding rights
provided by foreign sovereigns.75
Neither can the other ground raised, forum non conveniens,76 be used to
deprive the trial court of its jurisdiction herein. First, it is not a proper
basis for a motion to dismiss because Section 1, Rule 16 of the Rules of
Court does not include it as a ground.77 Second, whether a suit should be
entertained or dismissed on the basis of the said doctrine depends largely
upon the facts of the particular case and is addressed to the sound
discretion of the trial court.78 In this case, the RTC decided to assume
jurisdiction. Third, the propriety of dismissing a case based on this
principle requires a factual determination; hence, this conflicts principle
is more properly considered a matter of defense.79
Accordingly, since the RTC is vested by law with the power to entertain
and hear the civil case filed by respondent and the grounds raised by
petitioners to assail that jurisdiction are inappropriate, the trial and
appellate courts correctly denied the petitioners motion to dismiss.
WHEREFORE, premises considered, the petition for review on certiorari is DENIED.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA
Associate Justice