CONFLICT OF LAWS_CASE DIGEST
HONGKONG SHANGAI BANKING CORPORATION v. SHERMAN inconvenience, than to have a Philippine court try and resolve the
G.R. No. 72494 August 11, 1989
FACTS In 1981, Eastern Book Supply Service PTE, Ltd., (Eastern) a
company incorporated in Singapore applied w/, & was granted by the
Singapore branch of HSBC an overdraft facility in the max amount of
Singapore $200,000 (w/c amount was subsequently increased to
Singapore $375,000) w/ interest at 3% over HSBC prime rate, payable
monthly, on amounts due under said overdraft facility. As a security
for the repayment by Eastern of sums advanced by HSBC to it through
the aforesaid overdraft facility, in 1982, Jack Sherman, Dodato Reloj,
and a Robin de Clive Lowe, all of whom were directors of Eastern at
such time, executed a Joint and Several Guarantee in favor of HSBC
whereby Sherman, Reloj and Lowe agreed to pay, jointly and severally,
on demand all sums owed by Eastern to HSBC under the aforestated
overdraft facility.
The Joint and Several Guarantee provides that: “This guarantee and all
rights, obligations and liabilities arising hereunder shall be construed
and determined under and may be enforced in accordance with the
laws of the Republic of Singapore. We hereby agree that the Courts of
Singapore shall have jurisdiction over all disputes arising under this
guarantee.”
Eastern failed to pay its obligation. Thus, HSBC demanded payment of
the obligation from Sherman & Reloj, conformably w/ the provisions
of the Joint and Several Guarantee. Inasmuch as Sherman & Reloj still
failed to pay, HSBC filed a complaint for collection of a sum of money
against them. Sherman & Reloj filed a motion to dismiss on the
grounds that (1) the court has no jurisdiction over the subject matter
of the complaint, and (2) the court has no jurisdiction over the person
of the defendants.
ISSUE: W/N Philippine courts should have jurisdiction over the
suit.
RULING YES. While it is true that "the transaction took place in
Singaporean setting" and that the Joint and Several Guarantee
contains a choice-of-forum clause, the very essence of due process
dictates that the stipulation that "this guarantee and all rights,
obligations & liabilities arising hereunder shall be construed &
determined under & may be enforced in accordance w/ the laws of
the Republic of Singapore. We hereby agree that the Courts in
Singapore shall have jurisdiction over all disputes arising under this
guarantee" be liberally construed. One basic principle underlies all
rules of jurisdiction in International Law: a State does not have
jurisdiction in the absence of some reasonable basis for exercising it,
whether the proceedings are in rem quasi in rem or in personam. To
be reasonable, the jurisdiction must be based on some minimum
contacts that will not offend traditional notions of fair play and
substantial justice. Indeed, as pointed-out by HSBC at the outset, the
instant case presents a very odd situation. In the ordinary habits of
life, anyone would be disinclined to litigate before a foreign tribunal,
w/ more reason as a defendant. However, in this case, Sherman &
Reloj are Philippine residents (a fact which was not disputed by them)
who would rather face a complaint against them before a foreign
court and in the process incur considerable expenses, not to mention
Issues:
case. Their stance is hardly comprehensible, unless their ultimate
intent is to evade, or at least delay, the payment of a just obligation.
The defense of Sherman & Reloj that the complaint should have been
filed in Singapore is based merely on technicality. They did not even
claim, much less prove, that the filing of the action here will cause
them any unnecessary trouble, damage, or expense. On the other
hand, there is no showing that petitioner BANK filed the action here
just to harass Sherman & Reloj.
The parties did not thereby 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 Philippine courts of jurisdiction. In
International Law, jurisdiction is often defined as the light of a State to
exercise authority over persons and things w/in its boundaries subject
to certain exceptions. Thus, a State does not assume jurisdiction over
travelling sovereigns, ambassadors and diplomatic representatives of
other States, and foreign military units stationed in or marching
through State territory w/ the permission of the latter's authorities.
This authority, which finds its source in the concept of sovereignty, is
exclusive w/in and throughout the domain of the State. A State is
competent to take hold of any judicial matter it sees fit by making its
courts and agencies assume jurisdiction over all kinds of cases brought
before them.
Adong vs Cheong Seng Gee
43 Phil 43 [GR No. 18081 March 3, 1922]
Facts: Cheong Boo, a native of China, died intestate in
Zamboanga, Philippine Islands, on August 5, 1919. He left property
worth nearly P100,000. The estate of the deceased was claimed, on
the one hand, by Cheong Seng Gee, who alleged that he was a
legitimate child by a marriage contracted by Cheong Boo with Tan Dit
in China in 1895. The estate was claimed, on the other hand, by the
Mora Adong who alleged that she had been lawfully married to
Cheong Boo in 1896 in Basilan, Philippine Islands, and her daughters,
Payang, married to Cheng Bian Chay, and Rosalia Cheong Boo,
unmarried. The conflicting claims to the estate of Cheong Boo were
ventilated in the Court of First Instance of Zamboanga. The trial judge,
the Honorable Quirico Abeto, after hearing the evidence presented by
both sides, reached the conclusion, with reference to the allegations
of Cheong Seng Gee, that the proof did not sufficiently establish the
Chinese marriage, but that because Cheong Seng Gee had been
admitted to the Philippine Islands as the son of the deceased, he
should share in the estate as a natural child. With reference to the
allegations of the Mora Adong and her daughters Payang and Rosalia,
the trial judge reached the conclusion that the marriage between the
Mora Adong and the deceased had been adequately proved but that
under the laws of the Philippine Islands it could not be held to be a
lawful marriage; accordingly, the daughters Payang and Rosalia would
inherit as natural children. The order of the trial judge, following these
conclusions, was that there should be a partition of the property of the
deceased Cheong Boo between the natural children, Cheong Seng
Gee, Payang, and Rosalia.
1
Whether or not the chinese marriage is valid and
recognizable in the Philippines.
Whether or not the mohammedan marriage is valid.
Held: No. Section IV of the Marriage Law (General Order No. 68)
provides that “All marriages contracted without these Islands, which
would be valid by the laws of the country in which the same were
contracted, are valid in these Islands.” To establish a valid foreign
marriage pursuant to this comity provision, it is first necessary to
prove before the courts of the Islands the existence of the foreign law
as a question of fact, and it is then necessary to prove the alleged
foreign marriage by convincing evidence.
In the case at bar there is no competent testimony as to what the laws
of China in the Province of Amoy concerning marriage were in 1895.
As in the Encarnacion case, there is lacking proof so clear, strong, and
unequivocal as to produce a moral conviction of the existence of the
alleged prior Chinese marriage. Substitute twenty-three years for forty
years and the two cases are the same.
Yes. The basis of human society throughout the civilized world is that
of marriage. Marriage in this jurisdiction is not only a civil contract,
but, it is a new relation, an institution in the maintenance of which the
public is deeply interested. Consequently, every intendment of the law
leans toward legalizing matrimony. Persons dwelling together in
apparent matrimony are presumed, in the absence of any counter-
presumption or evidence special to the case, to be in fact married. The
reason is that such is the common order of society, and if the parties
were not what they thus hold themselves out as being, they would be
living in the constant violation of decency and of law. A presumption
established by our Code of Civil Procedure is “that a man and woman
deporting themselves as husband and wife have entered into a lawful
contract of marriage.”
Section IX of the Marriage Law is in the nature of a curative provision
intended to safeguard society by legalizing prior marriages. We can
see no substantial reason for denying to the legislative power the right
to remove impediments to an effectual marriage. If the legislative
power can declare what shall be valid marriages, it can render valid,
marriages which, when they took place, were against the law. Public
policy should aid acts intended to validate marriages and should retard
acts intended to invalidate marriages.
The courts can properly incline the scales of their decisions in favors of
that solution which will mot effectively promote the public policy. That
is the true construction which will best carry legislative intention into
effect. And here the consequences, entailed in holding that the
marriage of the Mora Adong and the deceased Cheong Boo, in
conformity with the Mohammedan religion and Moro customs, was
void, would be far reaching in disastrous result. The last census shows
that there are at least one hundred fifty thousand Moros who have
been married according to local custom. We then have it within our
power either to nullify or to validate all of these marriages; either to
make all of the children born of these unions bastards or to make
them legitimate; either to proclaim immorality or to sanction morality;
CONFLICT OF LAWS_CASE DIGEST
either to block or to advance settled governmental policy. Our duty is private international law of forum non conveniens,” even as it noted Second, while it is within the discretion of the trial court to abstain
a obvious as the law is plain. that Ducat was not a party in the U.S. case. from assuming jurisdiction on this ground, it should do so only after
“vital facts are established, to determine whether special
We regard the evidence as producing a moral conviction of the Petitioners appealed to the CA, arguing that the trial court erred in circumstances” require the court’s desistance.
existence of the Mohammedan marriage. We regard the provisions of applying the principle of litis pendentia and forum non conveniens.
section IX of the Marriage law as validating marriages performed
according to the rites of the Mohammedan religion. The CA affirmed the dismissal of Civil Case against Ducat, 1488, Inc.,
and Daic on the ground of litis pendentia. PIONEER CONCRETE PHILIPPINES v. TODARO
254 SCRA 153 June 8, 2007
Cayetano Lim vs The Insular Collector of Customs ISSUE: Is the Civil Case in the RTC-Makati barred by the judgment
GR No.L-11759, March 16, 1917 of the U.S. court? FACTS: Antonio D. Todaro (Todaro) filed with the RTC of Makati
City, a complaint for Sum of Money and Damages with Preliminary
HELD: CA reversed. Case remanded to RTC-Makati Attachment against Pioneer International Limited (PIL), Pioneer
PHILSEC INVESTMENT et al vs.CA et al
NO Concrete Philippines, Inc. (PCPI), Pioneer Philippines Holdings, Inc.
G.R. No. 103493 June 19, 1997
(PPHI), John G. McDonald (McDonald) and Philip J. Klepzig (Klepzig).
FACTS: Private respondent Ducat obtained separate loans from While this Court has given the effect of res judicata to foreign
judgments in several cases, it was after the parties opposed to the Todaro alleged that PIL is a corporation duly organized and existing
petitioners Ayala International Finance Limited (AYALA) and Philsec
judgment had been given ample opportunity to repel them on grounds under the laws of Australia and is principally engaged in the ready-mix
Investment Corp (PHILSEC), secured by shares of stock owned by
allowed under the law. This is because in this jurisdiction, with respect concrete and concrete aggregates business; PPHI is the company
Ducat.
to actions in personam, as distinguished from actions in rem, a foreign established by PIL to own and hold the stocks of its operating company
judgment merely constitutes prima facie evidence of the justness of in the Philippines; PCPI is the company established by PIL to undertake
In order to facilitate the payment of the loans, private respondent
the claim of a party and, as such, is subject to proof to the contrary. its business of ready-mix concrete, concrete aggregates and quarrying
1488, Inc., through its president, private respondent Daic, assumed
Rule 39, §50 provides: operations in the Philippines; McDonald is the Chief Executive of the
Ducat’s obligation under an Agreement, whereby 1488, Inc. executed
Hongkong office of PIL; and, Klepzig is the President and Managing
a Warranty Deed with Vendor’s Lien by which it sold to petitioner
Sec. 50. Effect of foreign judgments. — The effect of a judgment of a Director of PPHI and PCPI; Todaro has been the managing director of
Athona Holdings, N.V. (ATHONA) a parcel of land in Texas, U.S.A.,
tribunal of a foreign country, having jurisdiction to pronounce the Betonval Readyconcrete, Inc. (Betonval), a company engaged in pre-
while PHILSEC and AYALA extended a loan to ATHONA as initial
judgment is as follows: mixed concrete and concrete aggregate production; he resigned from
payment of the purchase price. The balance was to be paid by means
Betonval in February 1996; in May 1996, PIL contacted Todaro and
of a promissory note executed by ATHONA in favor of 1488, Inc.
(a) In case of a judgment upon a specific thing, the judgment is asked him if he was available to join them in connection with their
Subsequently, upon their receipt of the money from 1488, Inc.,
conclusive upon the title to the thing; intention to establish a ready-mix concrete plant and other related
PHILSEC and AYALA released Ducat from his indebtedness and
operations in the Philippines; Todaro informed PIL of his availability
delivered to 1488, Inc. all the shares of stock in their possession
(b) In case of a judgment against a person, the judgment is and interest to join them; subsequently, PIL and Todaro came to an
belonging to Ducat.
presumptive evidence of a right as between the parties and their agreement wherein the former consented to engage the services of
successors in interest by a subsequent title; but the judgment may be the latter as a consultant for two to three months, after which, he
As ATHONA failed to pay the interest on the balance, the entire
repelled by evidence of a want of jurisdiction, want of notice to the would be employed as the manager of PIL's ready-mix concrete
amount covered by the note became due and demandable.
party, collusion, fraud, or clear mistake of law or fact. operations should the company decide to invest in the Philippines;
Accordingly, private respondent 1488, Inc. sued petitioners PHILSEC,
subsequently, PIL started its operations in the Philippines; however, it
AYALA, and ATHONA in the United States for payment of the balance
In the case at bar, it cannot be said that petitioners were given the refused to comply with its undertaking to employ Todaro on a
and for damages for breach of contract and for fraud allegedly
opportunity to challenge the judgment of the U.S. court as basis for permanent basis. Instead of filing an Answer, PPHI, PCPI and Klepzig
perpetrated by petitioners in misrepresenting the marketability of the
declaring it res judicata or conclusive of the rights of private separately moved to dismiss the complaint on the grounds that the
shares of stock delivered to 1488, Inc. under the Agreement.
respondents. The proceedings in the trial court were summary. complaint states no cause of action, that the RTC has no jurisdiction
Neither the trial court nor the appellate court was even furnished over the subject matter of the complaint, as the same is within the
While the Civil Case was pending in the United States, petitioners filed
copies of the pleadings in the U.S. court or apprised of the evidence jurisdiction of the NLRC, and that the complaint should be dismissed
a complaint “For Sum of Money with Damages and Writ of Preliminary
presented thereat, to assure a proper determination of whether the on the basis of the doctrine of forum non conveniens. RTC dismissed
Attachment” against private respondents in the RTC Makati. The
issues then being litigated in the U.S. court were exactly the issues the MTD which was affirmed by the CA.
complaint reiterated the allegation of petitioners in their respective
counterclaims in the Civil Action in the United States District Court of raised in this case such that the judgment that might be rendered
would constitute res judicata. ISSUE: W/N the RTC should have dismissed the case on the basis
Southern Texas that private respondents committed fraud by selling
of forum non conveniens due to a presence of a foreign element
the property at a price 400 percent more than its true value.
Second. Nor is the trial court’s refusal to take cognizance of the case
justifiable under the principle of forum non conveniens: RULING: NO. Whether a suit should be entertained or dismissed on
Ducat moved to dismiss the Civil Case in the RTC-Makati on the
the basis of said doctrine depends largely upon the facts of the
grounds of (1) litis pendentia, vis-a-vis the Civil Action in the U.S., (2)
First, a MTD is limited to the grounds under Rule 16, sec.1, which does particular case and is addressed to the sound discretion of the trial
forum non conveniens, and (3) failure of petitioners PHILSEC and BPI-
not include forum non conveniens. The propriety of dismissing a case court. In the case of Communication Materials and Design, Inc. vs.
IFL to state a cause of action.
based on this principle requires a factual determination, hence, it is Court of Appeals, this Court held that "xxx [a] Philippine Court may
more properly considered a matter of defense. assume jurisdiction over the case if it chooses to do so; provided, that
The trial court granted Ducat’s MTD, stating that “the evidentiary
the following requisites are met: (1) that the Philippine Court is one to
requirements of the controversy may be more suitably tried before
which the parties may conveniently resort to; (2) that the Philippine
the forum of the litis pendentia in the U.S., under the principle in
Court is in a position to make an intelligent decision as to the law and
2
CONFLICT OF LAWS_CASE DIGEST
the facts; and, (3) that the Philippine Court has or is likely to have
power to enforce its decision."
The doctrine of forum non conveniens should not be used as a ground
for a motion to dismiss because Sec. 1, Rule 16 of the Rules of Court
does not include said doctrine as a ground. This Court further ruled
that while it is within the discretion of the trial court to abstain from
assuming jurisdiction on this ground, it should do so only after vital
facts are established, to determine whether special circumstances
require the court’s desistance; and that 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.
Note: the case was also being dismissed on the ground that there was
no cause of action but SC held that there was cause of action, to
sustain a motion to dismiss for lack of cause of action, the complaint
must show that the claim for relief does not exist, rather than that a
claim has been defectively stated, or is ambiguous, indefinite or
uncertain. And it was also argued in this case that jurisdiction is with
the NLRC and not with the RTC. SC held it was with RTC, SC has
consistently held that where no employer-employee relationship
exists between the parties and no issue is involved which may be
resolved by reference to the Labor Code, other labor statutes or any
collective bargaining agreement, it is the RTC that has jurisdiction.
Menandro B. Laureano, petitioner, versus Court of Appeals and
Singapore Airlines Limited, respondents
February 2, 2000
Facts: In 1978, plaintiff Menandro B. Laureano, then Director of
Flight Operations and Chief Pilot of Air Manila, applied for
employment with defendant company through its Area Manager in
Manila. Plaintiff’s appointment was confirmed effective July 21, 1979.
On the said date, the defendant also offered plaintiff an extension of
his two-year contract to five (5) years effective January 21, 1979 to
January 20,1984 subject to the terms and conditions set forth in the
contract of employment, which the latter accepted.
Sometime in 1982, defendant initiated cost-cutting measures due to
recession. Seventeen (17) expatriate captains in the Airbus fleet were
found in excess of the defendant’s requirements. Defendant informed
its expatriate pilots including plaintiff of the situation and advised
them to take advance leaves. It did not however immediately
terminate A-300 pilots. It reviewed their qualifications for possible
promotion to the B-747 fleet. Among the 17 Airbus pilots reviewed, 12
were found qualified. Unfortunately, plaintiff was not one of the 12.
On October 5, 1982, defendant informed plaintiff of his termination
effective November 1, 1982 and that he will be paid three (3) months
salary in lieu of three months notice but defendant gave only two (2)
months notice and one (1) month salary.
Aggrieved, plaintiff on June 29, 1983, instituted a case for illegal
dismissal before the Labor Arbiter. Defendant on February 11, 1987
filed a motion to dismiss on jurisdictional grounds since the plaintiff
was employed in Singapore and all other aspects of his employment
contract were executed in Singapore, therefore, Singapore laws should
apply.
Issue: Whether or not art.3 of the civil code is applicable in the
case bar.
Held: Yes, the parties are charged with full knowledge of the
existing laws at the time they entered into a contract and at the time it
is to be operative –and , a person is presumed to be more
knowledgeable about his own state law than his alien or foreign
comtemporary.
All these considered, the supreme court found sufficient factual and
legal basis to conclude that petitioners unlawful termination was for
an authorized cause, for which he was given ample notice and
opportunity to be heard by respondent
Wildvalley Shipping Co., Ltd. vs Court of Appeals
FACTS: In the Orinoco River in Venezuela, it is a rule that ships
passing through it must be piloted by pilots familiar to the river.
Hence, in 1988 Captain Nicandro Colon, master of Philippine Roxas, a
ship owned by Philippine President Lines, Inc. (PPL), obtained the
services of Ezzar Vasquez, a duly accredited pilot in Venezuela to pilot
the ship in the Orinoco River. Unfortunately, Philippine Roxas ran
aground in the Orinoco River while being piloted by Vasquez. As a
result, the stranded ship blocked other vessels. One such vessel was
owned Wildvalley Shipping Co., Ltd. (WSC). The blockade caused
$400k worth of losses to WSC as its ship was not able to make its
delivery. Subsequently, WSC sued PPL in the RTC of Manila. It averred
that PPL is liable for the losses it incurred under the laws of Venezuela,
to wit: Reglamento General de la Ley de Pilotaje and Reglamento Para
la Zona de Pilotaje No 1 del Orinoco. These two laws provide that the
master and owner of the ship is liable for the negligence of the pilot of
the ship. Vasquez was proven to be negligent when he failed to check
on certain vibrations that the ship was experiencing while traversing
the river.
ISSUE: Whether or not Philippine President Lines, Inc. is liable
under the said Venezuelan laws.
HELD: No. The two Venezuelan Laws were not duly proven as fact
before the court. Only mere photocopies of the laws were presented
as evidence. For a copy of a foreign public document to be admissible,
the following requisites are mandatory:
(1) It must be attested by the officer having legal custody of the
records or by his deputy; and
(2) It must be accompanied by a certificate by a secretary of the
embassy or legation, consul general, consul, vice consular or consular
agent or foreign service officer, and with the seal of his office.
And in case of unwritten foreign laws, the oral testimony of expert
witnesses is admissible, as are printed and published books of reports
of decisions of the courts of the country concerned if proved to be
commonly admitted in such courts.
3
Failure to prove the foreign laws gives rise to processual presumption
where the foreign law is deemed to be the same as Philippine laws.
Under Philippine laws, PPL nor Captain Colon cannot be held liable for
the negligence of Vasquez. PPL and Colon had shown due diligence in
selecting Vasquez to pilot the vessel. Vasquez is competent and was a
duly accredited pilot in Venezuela in good standing when he was
engaged.
Augusto Santos III vs Northwest Orient Airlines
FACTS: Augusto Benedicto Santos III is a minor represented by his dad.
In October 1986, he bought a round trip ticket from Northwest Orient
Airlines (NOA) in San Francisco. His flight would be from San Francisco
to Manila via Tokyo and back to San Francisco. His scheduled flight was
in December. A day before his departure he checked with NOA and
NOA said he made no reservation and that he bought no ticket. The
next year, due to the incident, he sued NOA for damages. He sued
NOA in Manila. NOA argued that Philippine courts have no jurisdiction
over the matter pursuant to Article 28(1) of the Warsaw Convention,
which provides that complaints against international carriers can only
be instituted in:
1. the court of the domicile of the carrier (NOA’s domicile is in the
USA);
2. the court of its principal place of business (which is San Francisco,
USA);
3. the court where it has a place of business through which the
contract had been made (ticket was purchased in San Francisco so
that’s where the contract was made);
4. the court of the place of destination (Santos bought a round trip
ticket which final destination is San Francisco).
The lower court ruled in favor of NOA. Santos III averred that
Philippine courts have jurisdiction over the case and he questioned the
constitutionality of Article 28 (1) of the Warsaw Convention.
ISSUE: Whether or not Philippine courts have jurisdiction over the
matter to conduct judicial review.
HELD: No. The Supreme Court ruled that they cannot rule over the
matter for the SC is bound by the provisions of the Warsaw
Convention which was ratified by the Senate. Until & unless there
would be amendment to the Warsaw Convention, the only remedy for
Santos III is to sue in any of the place indicated in the Convention such
as in San Francisco, USA.
The SC cannot rule upon the constitutionality of Article 28(1) of the
Warsaw Convention. In the first place, it is a treaty which was a joint
act by the legislative and the executive. The presumption is that it was
first carefully studied and determined to be constitutional before it
was adopted and given the force of law in this country. In this case,
Santos was not able to offer any compelling argument to overcome
the presumption.
International Shoe Co. v. Washington
CONFLICT OF LAWS_CASE DIGEST
Facts International Shoe Co., Defendant, was a company based
in Delaware with an office in St. Louis, Missouri. Defendant employed
salesmen that resided in Washington to sell their product in the state
of Washington. Defendant regularly shipped orders to the salesmen
who accepted them, the salesmen would display the products at
places in Washington, and the salesmen were compensated by
commission for sale of the products. The salesmen were also
reimbursed for the cost of renting the places of business in
Washington. Washington sued Defendant after Defendant failed to
make contributions to an unemployment compensation fund exacted
by state statutes. The Washington statute said that the commissioner
could issue personal service if Defendant was found within the state,
or by mailing it to Defendant if Defendant was not in the state. The
notice of assessment was served upon Defendant’s salesperson and a
copy of the notice was mailed to Defendant. Defendant appeared
specially, moving to set aside the order that service upon the
salesperson was proper service. Defendant also argued that it did not
“do business” in the state, that there was no agent upon which service
could be made, and that Defendant did not furnish employment within
the meaning of the statute. Defendant also argued that the statute
violated the Due Process Clause of the Fourteenth Amendment and
imposed a prohibitive burden of interstate commerce. The trial court
found for Washington and the Supreme Court of Washington affirmed,
reasoning that the continuous flow of Defendant’s product into
Washington was sufficient to establish personal jurisdiction.
Defendant appealed
Issue Is service of process upon Defendant’s agent sufficient
notice when the corporation’s activities result in a large volume of
interstate business so that the corporation receives the protection of
the laws of the state and the suit is related to the activities which
make the corporation present?
Brief Fact Summary Defendant was an out of state company that
employed salesmen within the state of Washington. Washington sued
Defendant to recover unpaid unemployment taxes and served
Defendant in two ways: (1) by mail and (2) by serving one of its
salesmen within the state. Defendant appealed from a verdict for
Washington, claiming that Washington had no personal jurisdiction
over Defendant.
Synopsis of Rule of Law In order for a state to exercise
personal jurisdiction over a defendant, the defendant must have such
minimum contacts with the state so that exercising jurisdiction over
the defendant would not offend “traditional notions of fair play and
substantial justice.
El Banco Espanol-Filipino vs. Palanca
G.R. No. L-11390, March 26, 1918
* JURISDICTION, HOW ACQUIRED: Jurisdiction over the property which
is the subject of the litigation may result either from a seizure of the
property under legal process, whereby it is brought into the actual
custody of the law, or it may result from the institution of legal
proceedings wherein, under special provisions of law, the power of the
court over the property is recognized and made effective.
* The action to foreclose a mortgage is said to be a proceeding quasi in
rem, by which is expressed the idea that while it is not strictly speaking
an action in rem yet it partakes of that nature and is substantially such.
* DUE PROCESS IN FORECLOSURE PROCEEDINGS: Property is always
assumed to be in the possession of its owner, in person or by agent;
and he may be safely held, under certain conditions, to be affected
with knowledge that proceedings have been instituted for its
condemnation and sale.
FACTS: Engracio Palanca Tanquinyeng y Limquingco mortgaged
various parcels of real property in Manila to El Banco Espanol-Filipino.
Afterwards, Engracio returned to China and there he died on January
29, 1810 without returning again to the Philippines. The mortgagor
then instituted foreclosure proceeding but since defendant is a non-
resident, it was necessary to give notice by publication. The Clerk of
Court was also directed to send copy of the summons to the
defendant’s last known address, which is in Amoy, China. It is not
shown whether the Clerk complied with this requirement.
Nevertheless, after publication in a newspaper of the City of Manila,
the cause proceeded and judgment by default was rendered. The
decision was likewise published and afterwards sale by public auction
was held with the bank as the highest bidder. On August 7, 1908, this
sale was confirmed by the court. However, about seven years after the
confirmation of this sale, a motion was made by Vicente Palanca, as
administrator of the estate of the original defendant, wherein the
applicant requested the court to set aside the order of default and the
judgment, and to vacate all the proceedings subsequent thereto. The
basis of this application was that the order of default and the
judgment rendered thereon were void because the court had never
acquired jurisdiction over the defendant or over the subject of the
action.
ISSUE:
* Whether or not the lower court acquired jurisdiction over the
defendant and the subject matter of the action
* Whether or not due process of law was observed
RULING:
On Jurisdiction
The word “jurisdiction” is used in several different, though related,
senses since it may have reference (1) to the authority of the court to
entertain a particular kind of action or to administer a particular kind
of relief, or it may refer to the power of the court over the parties, or
(2) over the property which is the subject to the litigation.
The sovereign authority which organizes a court determines the
nature and extent of its powers in general and thus fixes its
competency or jurisdiction with reference to the actions which it may
entertain and the relief it may grant.
How Jurisdiction is Acquired
4
Jurisdiction over the person is acquired by the voluntary appearance
of a party in court and his submission to its authority, or it is acquired
by the coercive power of legal process exerted over the person.
Jurisdiction over the property which is the subject of the litigation may
result either from a seizure of the property under legal process,
whereby it is brought into the actual custody of the law, or it may
result from the institution of legal proceedings wherein, under special
provisions of law, the power of the court over the property is
recognized and made effective. In the latter case the property, though
at all times within the potential power of the court, may never be
taken into actual custody at all. An illustration of the jurisdiction
acquired by actual seizure is found in attachment proceedings, where
the property is seized at the beginning of the action, or some
subsequent stage of its progress, and held to abide the final event of
the litigation. An illustration of what we term potential jurisdiction
over the res, is found in the proceeding to register the title of land
under our system for the registration of land. Here the court, without
taking actual physical control over the property assumes, at the
instance of some person claiming to be owner, to exercise a
jurisdiction in rem over the property and to adjudicate the title in
favor of the petitioner against all the world.
In the terminology of American law the action to foreclose a mortgage
is said to be a proceeding quasi in rem, by which is expressed the idea
that while it is not strictly speaking an action in rem yet it partakes of
that nature and is substantially such. The expression "action in rem" is,
in its narrow application, used only with reference to certain
proceedings in courts of admiralty wherein the property alone is
treated as responsible for the claim or obligation upon which the
proceedings are based. The action quasi rem differs from the true
action in rem in the circumstance that in the former an individual is
named as defendant, and the purpose of the proceeding is to subject
his interest therein to the obligation or lien burdening the property. All
proceedings having for their sole object the sale or other disposition of
the property of the defendant, whether by attachment, foreclosure, or
other form of remedy, are in a general way thus designated. The
judgment entered in these proceedings is conclusive only between the
parties.
It is true that in proceedings of this character, if the defendant for
whom publication is made appears, the action becomes as to him a
personal action and is conducted as such. This, however, does not
affect the proposition that where the defendant fails to appear the
action is quasi in rem; and it should therefore be considered with
reference to the principles governing actions in rem.
Gemperle vs. Schenker
G.R. No. L-18164; January 23, 1967
Facts: This case was the result of William Gemperle’s retaliatory
act when respondent spouses Paul and Helen Schenker filed a case
against him for the enforcement of Schenker's allegedly initial
subscription to the shares of stock of the Philippines-Swiss Trading Co.,
Inc. and the exercise of his alleged pre-emptive rights to the then
unissued original capital stock of said corporation and the increase
thereof, as well as for an accounting and damages. Petitioner alleged
CONFLICT OF LAWS_CASE DIGEST
that the said complaint tainted his name as a businessman. He then
filed a complaint for damages and prays for the retraction of
statements made by Helen Schenker.
Summons was personally served to Helen Schenker but not to Paul
Schenker. Helen then filed an answer with a counterclaim, but Paul
Schenker filed a motion to dismiss arguing that the court never
acquired jurisdiction over his person since admittedly, he is a Swiss
citizen, residing in Zurich, Switzerland, and has not been actually
served with summons in the Philippines.
Issue: Whether or not the court acquired jurisdiction over the
person of Paul Schenker.
Ruling: Yes, although as a rule, when the defendant is a non-
resident and in an accion in personam, jurisdiction over the person of
the defendant can be acquired only through voluntary appearance or
personal service of summons. But this case is an exception to the said
rule. The Supreme ratiocinated:
“We hold that the lower court had acquired jurisdiction over said
defendant, through service of the summons addressed to him upon
Mrs. Schenker, it appearing from said answer that she is the
representative and attorney-in-fact of her husband aforementioned
civil case No. Q-2796, which apparently was filed at her behest, in her
aforementioned representative capacity. In other words, Mrs.
Schenker had authority to sue, and had actually sued on behalf of her
husband, so that she was, also, empowered to represent him in suits
filed against him, particularly in a case, like the of the one at bar,
which is consequence of the action brought by her on his behalf.”
Briefly, in an accion in personam where the defendant is a non-
resident, substituted service of summons does not apply. However, by
way of exception, substituted service of summons may be effected, if
the following requisites are present:
1. The summons is served to the spouse of the defendant
2. The spouse must be residing in the Philippines
3. The spouse is appointed as attorney-in-fact of the spouse
defendant in a previous case involving the non-resident spouse.
Victoria Regner vs Cynthia Logarta
FACTS: Cynthia Logarta and Teresa Tormis were the daughters of
Luis Regner in his first marriage with Anicita Regner. Victoria Regner is
the second wife of Luis.
In 1999, Victoria alleged that Cynthia and Teresa with the help of
another sibling defrauded Luis, who was then very ill and was unable
to write, into placing his thumbmark into a Deed of Donation. In said
Deed, Luis purportedly donated a Proprietary Ownership Certificate
pertaining to membership shares in the Cebu Country Club. Victoria
alleged that said Deed is void because the placing of thumbmark by
Luis was done without the latter’s free will and voluntariness
considering his physical state; that it was done without Luis’s lawyer;
that the ratification made by Luis before he died is likewise void
because of similar circumstances.
In the same year, Victoria filed a complaint to annul said deed with the
RTC of Cebu. The sheriff could not deliver the summonses against
Cynthia and Teresa because apparently, although they are Filipinos,
they are not residing here; they are residing in California. It was only in
the year 2000 that one of the summonses was served to one of the
sisters, Teresa, when she came back to the Philippines.
Teresa immediately filed a motion to dismiss on the ground that
Victoria failed to prosecute her case for an unreasonable length of
time. Naturally, Victoria opposed the MTD. Teresa, in her rejoinder,
alleged that the case should be dismissed because Cynthia, who is an
indispensable party, was not issued any summons, hence, since an
indispensable party is not served with summons, without her who has
such an interest in the controversy or subject matter there can be no
proper determination of the case. The trial court ruled in favor of
Teresa; this was affirmed by the Court of Appeals.
ISSUE: Whether or not the dismissal of Victoria’s complaint is
correct.
HELD: Yes. The Supreme Court agreed with the arguments
presented by Teresa. The Supreme Court also emphasized:
There are generally two types of actions: actions in rem and actions in
personam. An action in personam is an action against a person on the
basis of his personal liability, while an action in rem is an action against
the thing itself, instead of against the person.
The certificate, subject of the donation, is a personal property. The
action filed by Victoria is therefore a personal action. So in order for
the court to acquire jurisdiction over the respondents, summons must
be served upon them. Further, the certificate is indivisible, Cynthia’s
and Teresa’s interests thereto can only be determined if both are
summoned in court.
In personal actions, if the respondents are residents of the Philippines,
they may be served summons in the following order:
1. Personal Service;
2. If (1) is not possible, Substituted Service;
3. If respondent can’t be found because he is abroad but still a
resident of the Philippines, by publication with leave of
court.
In personal actions still, if the respondents are non-residents, they
may be served summons in the following manner:
1. Personal service through the Philippine embassy;
2. By publication in a newspaper of general circulation in such places
and for such time as the court may order, in which case a copy of
the summons and order of the court should be sent by registered
mail to the last known address of the defendant; or
3. in any other manner which the court may deem sufficient.
The above must be with leave of court.
In the case at bar, Cynthia was never served any summons in any of
the manners authorized by the Rules of Court. The summons served to
Teresa cannot bind Cynthia. It is incumbent upon Victoria to compel
5
the court to authorize the extraterritorial service of summons against
Cynthia. Her failure to do so for a long period of time constitutes a
failure to prosecute on her part.
xxx
What if the petition is an action in rem? What are the applicable rules?
If the action is in rem or quasi in rem, jurisdiction over the person of
the defendant is not essential for giving the court jurisdiction so long
as the court acquires jurisdiction over the res. If the defendant is a
nonresident and he is not found in the country, summons may be
served extraterritorially in the following instances:
1. when the action affects the personal status of the plaintiff;
2. when the action relates to, or the subject of which is property
within the Philippines, on which the defendant claims a lien or an
interest, actual or contingent;
3. when the relief demanded in such action consists, wholly or in
part, in excluding the defendant from any interest in property
located in the Philippines; and
4. when the defendant non-resident’s property has been attached
within the Philippines.
In the above instances, summons may be effected by:
1. personal service out of the country, with leave of court;
2. publication, also with leave of court; or
3. any other manner the court may deem sufficient.
European Resources and Technologies, Inc vs Ingenieuburo Birkhahn
GR No. 159586, July 26, 2004
Erie Railroad Co. v. Tompkins
Facts & Procedural History
Plaintiff, a Pennsylvania citizen, was walking along the railroad tracks
of the Erie Railroad in Pennsylvania when a train passed and an open
door on a car struck him resulting in injury. He sued the railroad, a
New York corporation, in federal district court in New York. Under
Pennsylvania law, plaintiff was a trespasser and the railroad was
therefore only liable for wanton negligence. The judge, relying on
Swift v. Tyson, instructed the jury according to “general law” under
which the railroad was liable even for ordinary negligence. The jury
returned a verdict for plaintiff, which was upheld by the Second
Circuit.
Issue
Is a federal district court exercising diversity jurisdiction over a state
law-based cause of action required to apply the common law of the
state?
Holding / Rule
(Brandeis) Yes. Reversed and remanded. Federal district courts sitting
in diversity jurisdiction must apply both statutory and judge-man
common law of the states where it does not conflict with federal law.
Reasoning
The Court overruled Swift v. Tyson, which held that federal courts
exercising diversity jurisdiction over a state law action were under no
CONFLICT OF LAWS_CASE DIGEST
obligation to apply the non-statutory or judge-made law of that state,
but instead had the power to apply federal common law or “general
law.” The Swift doctrine encouraged forum shopping by litigants to
have different substantive law applied. It actually prevented
uniformity and caused discrimination by non-citizens against citizens,
as non-citizens had the privilege of deciding whether to have the case
heard in state or federal court and thus whether federal common law
would apply. Moreover, except in matters of federal law, the law to
be applied in any case is the law of the state, and it is irrelevant
whether that law is declared by the state’s legislature or high court.
There is no federal general common law that exists outside of any
particular state, yet is applicable to the states unless changed by
statute. Neither Congress nor federal courts have authority to declare
substantive rules of common law applicable to the states, which
interferes with the rights reserved to the states by the Constitution.
Reed concurred in the judgment, stating that Swift should be
overturned not because of the unconstitutionality of the federal
common law approach, but because that case misinterpreted the term
“the laws” in the Rules of Decision Act as excluding state court
decisions.
Butler (joined by McReynolds) dissented, arguing that the
constitutional validity of the Swift doctrine was not raised by the
parties nor necessary to resolving the case and should not have been
considered.
K.K. SHELL SEKIYU OSAKA HATSUBAISHO and FU HING OIL CO., LTD.,
petitioners, vs.THE HONORABLE COURT OF APPEALS, ATLANTIC
VENUS CO., S.A., and THE VESSEL M/V "ESTELLA", respondents.
Facts: Kumagai Kaiun Kaisha, Ltd., a corporation formed and
existing under the laws of Japan, filed a complaint for the collection of
a sum of money with preliminary attachment against Atlantic Venus
Co., S.A., a corporation registered in Panama, the vessel MV Estella
and Crestamonte Shipping Corporation, a Philippine corporation.
Atlantic is the owner of the MV Estella.
The complaint alleged that Crestamonte, as bareboat charterer and
operator of the MV Estella, appointed N.S. Shipping Corporation as its
general agent in Japan. The appointment was formalized in an Agency
Agreement. NSS in turn appointed Kumagai as its local agent in Osaka,
Japan. Kumagai supplied the MV Estella with supplies and services but
despite repeated demands Crestamonte failed to pay the amounts
due.
Petitioner Fu Hing Oil Co., Ltd., a corporation organized in Hong Kong
and not doing business in the Philippines, filed a motion for leave to
intervene with an attached complaint-in-intervention, alleging that Fu
Hing supplied marine diesel oil/fuel to the MV Estella and incurred
barge expenses for the total sum of US$152,412.5, but such has
remained unpaid. The issuance of a writ of attachment was also
prayed for.
Petitioner K.K. Shell Sekiyu Osaka Hatsubaisho, a corporation
organized in Japan and not doing business in the Philippines, likewise
filed a motion to intervene with an attached complaint-in-
intervention, alleging that upon request of NSS, Crestamonte's general
agent in Japan, K.K. Shell provided and supplied marine diesel oil/fuel
to the W Estella at the ports of Tokyo and Mutsure in Japan and that
despite previous demands Crestamonte has failed to pay the amounts
of US$16,996.96 and Y1,000,000.00, and that K.K. Shell's claim
constitutes a maritime lien on the MV Estella. The complaint-in-
intervention sought the issuance of a writ of preliminary attachment.
Trial court allowed the intervention and preliminary attachments were
issued upon the posting of bonds. Thereafter, respondents posted a
counterbond which discharged the earlier issued writ of attachment.
Respondents moved to dismiss the complaints-in- intervention filed by
Fu Hing and K.K. Shell.
Thereafter, CA annulled the orders of the trial court and directed it to
cease and desist from proceeding with the case. According to the
Court of Appeals, Fu Hing and K.K. Shell were not suppliers but sub-
agents of NSS, hence they were bound by the Agency Agreement
between Crestamonte and NSS, particularly, the choice of forum
clause, which provides that any matter of dispute shalle be resolved in
the district courts of Japan.
Issue: WON the CA made an error of disallowing the motion for
intervention filed by herein Petitioners
Ruling: Yes. Court finds reversible error on the part of the Court of
Appeals in so far as it disallowed petitioners' intervention in the case
before the trial court and ordered the latter to cease and desist from
proceeding with the case. A reading of the Agency Agreement fails to
support the conclusion that K.K. Shell is a sub-agent of NSS and is,
therefore, bound by the agreement.No express reference to the
contracting of sub-agents or the applicability of the terms of the
agreement, particularly the choice-of-forum clause, to sub-agents is
made in the text of the agreement. What the contract clearly states
are NSS' principal duties, i.e., that it shall provide for the necessary
services required for the husbanding of Crestamonte's vessels in
Japanese portsand shall be responsible for fixing southbound cargoes
with revenues sufficient to cover ordinary expenses
Moreover, the complaint-in-intervention filed by K.K. Shell merely
alleges that it provided and supplied the MV Estella with marine diesel
oil/fuel, upon request of NSS who was acting for and as duly appointed
agent of Crestamonte. There is thus no basis for the Court of Appeal's
findingthat "the sub-agents admitted in their pleadings that they were
appointed as local agent/sub-agent or representatives by NSS by virtue
of said Agency Agreement" The allegation of herein Petitioners do not
conclusively establish a sub-agency between NSS and K.K. Shell. It is
therefore surprising how the Court of Appeals could have come to the
conclusion, just on the basis of the Agency Agreement and the
pleadings filed in the trial court, that "Crestamonte is the principal,
NSS is the agent and ... Fu Hing and K.K Shell are the sub-agents."
In the same vein, as the choice-of-forum clause in the agreement has
not been conclusively shown to be binding upon K.K. Shell, additional
evidence would also still have to be presented to establish this
6
defense, K.K. Shell cannot therefore, as of yet, be barred from
instituting an action in the Philippines.
Private respondents argued that the doctrine of forum non conveniens
would be a valid ground to cause the dismissal of K.K. Shell's
complaint-in-intervention.K.K. Shell counters this argument by
invoking its right as maritime lienholder - Any person furnishing
repairs, supplies, to wage, use of dry dock or marine railway, or other
necessaries, to any vessel, whether foreign or domestic, upon the
order of the owner of such vessel, or of a person authorized by the
owner, shall have a maritime lien on the vessel, which may be
enforced by suit in rem, and it shall be necessary to allege or prove
that credit was given to the vessel.
Private respondents on the other hand argue that even if P.D. No.
1521 is applicable, K.K. Shell cannot rely on the maritime lien because
the fuel was provided not exclusively for the benefit of the MV Estella,
but for the benefit of Crestamonte in general. Under the law it must
be established that the credit was extended to the vessel itself. Now,
this is a defense that calls precisely for a factual determination by the
trial court of who benefitted from the delivery of the fuel. Hence,
again, the necessity for the reception of evidence before the trial
court.
In other words, considering the dearth of evidence due to the fact that
the private respondents have yet to file their answer in the
proceedings below and trial on the merits is still to be conducted,
whether or not petitioners are indeed maritime lienholders and as
such may enforce the lien against the MV Estella are matters that still
have to be established.
Neither are we ready to rule on the private respondents' invocation of
the doctrine of forum non conveniens, as the exact nature of the
relationship of the parties is still to be established. We leave this
matter to the sound discretion of the trial court judge who is in the
best position, after some vital facts are established, to determine
whether special circumstances require that his court desist from
assuming jurisdiction over the suit.
Heine v. New York Life Insurance Company
Facts The New York Life Insurance Company and the Guardian
Insurance Company ("the insurance companies") were corporations
created in New York, USA. As conditions to be allowed to conduct
business in Germany, they were made to agree to be supervised by
German authorities, to invest the proceeds of policies in German
securities, and to establish a local agency to whom summons may be
served. The insurance companies were later sued before courts in
both the US and Germany for the recovery on some 240 life insurance
policies issued in Germany to German nationals, payable in German
currency.
Arguments for the Plaintiff
As the US courts have jurisdiction over the subject matter and the
parties, they have no choice but to try the case.
CONFLICT OF LAWS_CASE DIGEST
Issue Whether or not the US courts may dismiss the case on the
ground of forum non conveniens.
Held Yes. Under the circumstances, the case may be more
suitably tried before German courts.
Ratio Decidendi
The courts in both jurisdictions are competent to try the case and
summons may be served upon the insurance companies in both
jurisdictions. Requiring the insurance companies to defend their
interests in the US would subject them to great and unnecessary
inconvenience and expenses, including the possibility of having to
bring documentary evidence all the way from their office in Germany.
Moreover, trying the case in the US additionally burden the courts in
that jurisdiction, to the detriment of other litigants. The assumption of
jurisdiction over a case the cause of action of which arose from
another jurisdiction and wherein both parties are non-residents is
discretionary upon the court.
G.R. No. L-32636 March 17, 1930
In the matter Estate of Edward Randolph Hix, deceased.
A.W. FLUEMER, petitioner-appellant, vs. ANNIE COUSHING HIX,
oppositor-appellee.
FACTS: Fleumer, the special administrator of the estate of Edward
Randolph Hix appealed from a decision of Judge of First Instance
Tuason denying the probate of the document alleged to by the last will
and testament of the deceased. Appellee is not authorized to carry on
this appeal. We think, however, that the appellant, who appears to
have been the moving party in these proceedings, was a "person
interested in the allowance or disallowance of a will by a Court of First
Instance," and so should be permitted to appeal to the Supreme Court
from the disallowance of the will (Code of Civil Procedure, sec. 781, as
amended; Villanueva vs. De Leon [1925], 42 Phil., 780).
It is theory of the petitioner that the alleged will was executed in
Elkins, West Virginia, on November 3, 1925, by Hix who had his
residence in that jurisdiction, and that the laws of West Verginia Code,
Annotated, by Hogg, Charles E., and as certified to by the Director of
the National Library, should govern.
ISSUE: Whether or not the laws of West Virginia should govern.
RULING: The laws of a foreign jurisdiction do not prove themselves
in our courts. the courts of the Philippine Islands are not authorized to
take American Union. Such laws must be proved as facts.(In re Estate
of Johnson [1918], 39 Phil., 156.) Here the requirements of the law
were not met. There was no was printed or published under the
authority of the State of West Virginia, as provided in section 300 of
the Code of Civil Procedure. Nor was the extract from the law attested
by the certificate of the officer having charge of the original, under the
sale of the State of West Virginia, as provided in section 301 of the
Code of Civil Procedure. No evidence was introduced to show that the
extract from the laws of West Virginia was in force at the time the
alleged will was executed.
Note: In addition, the due execution of the will was not established.
The only evidence on this point is to be found in the testimony of the
petitioner. Aside from this, there was nothing to indicate that the will
was acknowledged by the testator in the presence of two competent
witnesses, of that these witnesses subscribed the will in the presence
of the testator and of each other as the law of West Virginia seems to
require. On the supposition that the witnesses to the will reside
without the Philippine Islands, it would then the duty of the petitioner
to prove execution by some other means (Code of Civil Procedure, sec.
633.)
It was also necessary for the petitioner to prove that the testator had
his domicile in West Virginia and not establish this fact consisted of the
recitals in the CATHY will and the testimony of the petitioner. Also in
beginning administration proceedings originally in the Philippine
Islands, the petitioner violated his own theory by attempting to have
the principal administration in the Philippine Islands.
While the appeal pending submission in this court, the attorney for the
appellant presented an unverified petition asking the court to accept
as part of the evidence the documents attached to the petition. One of
these documents discloses that a paper writing purporting to be the
was presented for probate on June 8, 1929, to the clerk of Randolph
Country, State of West Virginia, in vacation, and was duly proven by
the oaths of Dana Wamsley and Joseph L. MAdden, the subscribing
witnesses thereto , and ordered to be recorded and filed. It was shown
by another document that, in vacation, on June 8, 1929, the clerk of
court of Randolph Country, West Virginia, appointed Claude W.
Maxwell as administrator, cum testamento annexo, of the estate of
Edward Randolph Hix, deceased. In this connection, it is to be noted
that the application for the probate of the will in the Philippines was
filed on February 20, 1929, while the proceedings in West Virginia
appear to have been initiated on June 8, 1929. These facts are strongly
indicative of an intention to make the Philippines the principal
administration and West Virginia the ancillary administration.
However this may be, no attempt has been made to comply with Civil
Procedure, for no hearing on the question of the allowance of a will
said to have been proved and allowed in West Virginia has been
requested. There is no showing that the deceased left any property at
any place other than the Philippine Islands and no contention that he
left any in West Virginia.
Reference has been made by the parties to a divorce purported to
have been awarded Edward Randolph Hix from Annie Cousins Hix on
October 8, 1925, in the State of West specific pronouncements on the
validity or validity of this alleged divorce.
For all of the foregoing, the judgment appealed from will be affirmed,
with the costs of this instance against the appellant.
TESTATE ESTATE OF C.O BOHANAN ,PHILIPPINE TRUST CO. v.
BOHANAN
DOCTRINE: The validity of testamentary dispositions are to
be governed by the national law of the testator, provided that the law
must be proved in courts.
7
QUICK FACTS: Decedent Bohanan was a US citizen. Nevada
law allows a testator to dispose of all his property according to his will.
His ex-wife and children oppose the project of partition filed by the
executor-petitioner, saying they were deprived of their legitimes.
According to them, Philippine law must prevail, requiring decedent to
reserve the legitime for surviving spouse and children.
CONFLICT LAWS: Old CC Art. 10(2), now NCC Art. 16(2)
“Nevertheless, legal and testamentary successions, in respect to the
order of succession as well as to the extent of the successional rights to
personal property are to be earned by the national law of the person
whose succession is in question.”
Nevada Compiled Laws of 1925, Sec. 9905
“Every person over the age of 18 years, of sound mind, may, by last
will, dispose of all his or her estate, real and personal, the same being
chargeable with the payment of the testator’s debts.”
FACTS: Testator Bohanan was born in Nebraska and was a US
citizen. He has some properties in California. Despite his long
residence in the Philippines, his stay was found by the CFI to be merely
temporary, and he remained to be a US citizen. The CFI declared his
will as fully in accordance with the laws of Nevada and admitted it to
probate. The Philippine Trust Co. was named executor of the will.
A project of partition was filed by Phil Trust which distributed the
residuary estate into 3: 1) ½ to his grandson, 2) ½ to his brother and
sister, to be distributed equally, 3) legacies of P6,000 each to his son
and daughter, and 4) legacies to other people.
Respondent Magdalena Bohanan, his ex-wife, questions the validity of
the partition, claiming that she and her children were deprived of their
legitimes. (It must be noted that Magdalena and decedent C.O.
Bohanan were married in 1909 but he divorced her in 1922. She re-
married in 1925 and this marriage was subsisting at the time of the
death of decedent.)
ISSUE 1: W/N Magdalena is entitled to legitime as surviving spouse
HELD: NO.There is no right to share in the inheritance in favor of
a divorced wife in the State of Nevada. There is also no conjugal
property between her and decedent.
Moreover, during the proceedings of the case, Magdalena filed a
motion to withdraw P20,000 from the estate funds, chargeable against
her share in the conjugal property. But the Court found that there is
no community property.
ISSUE 2: W/N the children are entitled to their legitime
HELD: NO.
1) The CFI has correctly held that the law to be applied is Nevada law,
because the decedent was a US citizen.
2) The children do not dispute the provision.
3) While Sec. 9905 was not introduced as evidence in the hearing of
the project of partition, it was introduced during the hearing of the
 CONFLICT OF LAWS_CASE DIGEST
motion to withdraw filed by Magdalena. The Court took judicial notice
of the law and deemed it unnecessary to prove the law at the hearing
of the project of partition.
DISPOSITIVE: As in accordance with Art. 10 of the old Civil
Code, the validity of testamentary dispositions are to be governed by
the national law of the testator, and as it has been decided and it is
not disputed that the national law of the testator is that of the State of
Nevada, already indicated above, which allows a testator to dispose of
all his property according to his will, as in the case at bar, the order of
the court approving the project of partition made in accordance with
the testamentary provisions, must be, as it is hereby affirmed, with
costs against appellants.
Mijares v. Ranada (2005)
FACTS:
 May 9 1991: a complaint was filed by ten Filipino citizens
representing a class of 10,000 members who each alleged having
suffered human rights abuses such as arbitrary detention, torture
and rape in the hands of police or military forces during the
Marcos regime with the United States District Court (US District
Court), District of Hawaii, against the Estate of former Philippine
President Ferdinand E. Marcos (Marcos Estate)
 US District Court and Affirmed by US CA: awarded them
$1,964,005,859.90
 Petitioners filed Complaint with Makati RTC for the enforcement
of the Final Judgment
 Marcos Estate filed a motion to dismiss, raising, among others, the
non-payment of the correct filing fees paying only P410
 Petitioners claimed that an action for the enforcement of a foreign
judgment is not capable of pecuniary estimation
 RTC: estimated the proper amount of filing fees was
approximately P472 and dismissing the case without prejudice
 Petition for Certiorari under Rule 65
ISSUE: W/N the enforcement of a foreign judgment is incapable
of pecuniary estimation
HELD: NO. (But belongs to "other actions not involving property")
petition is GRANTED.
 There is an evident distinction between a foreign judgment in an
action in rem and one in personam. For an action in rem, the
foreign judgment is deemed conclusive upon the title to the thing,
while in an action in personam, the foreign judgment is
presumptive, and not conclusive, of a right as between the parties
and their successors in interest by a subsequent title
 However, in both cases, the foreign judgment is susceptible to
impeachment in our local courts on the grounds of want of
jurisdiction or notice to the party, collusion, fraud, or clear mistake
of law or fact. Thus, the party aggrieved by the foreign judgment is
entitled to defend against the enforcement of such decision in the
local forum. It is essential that there should be an opportunity to
challenge the foreign judgment, in order for the court in this
jurisdiction to properly determine its efficacy even if such
judgment has conclusive effect as in the case of in rem actions, if
only for the purpose of allowing the losing party an opportunity to
challenge the foreign judgment. Consequently, the party attacking
a foreign judgment has the burden of overcoming the
presumption of its validity. Absent perhaps a statutory grant of
jurisdiction to a quasi-judicial body, the claim for enforcement of
judgment must be brought before the regular courts.
 There are distinctions, nuanced but discernible, between the
cause of action arising from the enforcement of a foreign
judgment, and that arising from the facts or allegations that
occasioned the foreign judgment. They may pertain to the same
set of facts, but there is an essential difference in the right-duty
correlatives that are sought to be vindicated. Extensive litigation is
thus conducted on the facts, and from there the right to and
amount of damages are assessed. On the other hand, in an action
to enforce a foreign judgment, the matter left for proof is the
foreign judgment itself, and not the facts from which it prescinds.
 As stated in Section 48, Rule 39, the actionable issues are generally
restricted to a review of jurisdiction of the foreign court, the
service of personal notice, collusion, fraud, or mistake of fact or
law. The limitations on review is in consonance with a strong and
pervasive policy in all legal systems to limit repetitive litigation on
claims and issues. Otherwise known as the policy of preclusion, it
seeks to protect party expectations resulting from previous
litigation, to safeguard against the harassment of defendants, to
insure that the task of courts not be increased by never-ending
litigation of the same disputes, and in a larger sense to promote
what Lord Coke in the Ferrer's Case of 1599 stated to be the goal
of all law: "rest and quietness." If every judgment of a foreign
court were reviewable on the merits, the plaintiff would be forced
back on his/her original cause of action, rendering immaterial the
previously concluded litigation.
 Marcos Estate cites Singsong v. Isabela Sawmill and Raymundo v.
Court of Appeals:
 In determining whether an action is one the subject matter of
which is not capable of pecuniary estimation this Court has
adopted the criterion of first ascertaining the nature of the
principal action or remedy sought. If it is primarily for the
recovery of a sum of money, the claim is considered capable of
pecuniary estimation, and whether jurisdiction is in the municipal
courts or in the courts of first instance would depend on the
amount of the claim. However, where the basic issue is something
other than the right to recover a sum of money, where the money
claim is purely incidental to, or a consequence of, the principal
relief sought, this Court has considered such actions as cases
where the subject of the litigation may not be estimated in terms
of money, and are cognizable exclusively by courts of first instance
(now Regional Trial Courts).
 An examination of Section 19(6), B.P. 129 reveals that the instant
complaint for enforcement of a foreign judgment, even if capable
of pecuniary estimation, would fall under the jurisdiction of the
Regional Trial Courts
 The complaint to enforce the US District Court judgment is one
capable of pecuniary estimation. But at the same time, it is also an
action based on judgment against an estate, thus placing it beyond
8
the ambit of Section 7(a) of Rule 141. It is covered by Section
7(b)(3), involving as it does, "other actions not involving
property." The petitioners thus paid the correct amount of filing
fees, and it was a grave abuse of discretion for respondent judge
to have applied instead a clearly inapplicable rule and dismissed
the complaint.
Pennoyer v. Neff
Brief Fact Summary. Defendant Neff was being sued by Mitchell in
Oregon for unpaid legal fees. A default judgment was entered against
Defendant for his failure to come to court or otherwise resist the
lawsuit, despite the fact that he was not personally served with
process, nor was a resident of Oregon. Later, in an attempt to collect
upon his judgment, Mitchell attached land located in Oregon
belonging to Defendant, and had it sold to Plaintiff Pennoyer through a
Sheriff’s sale.
Synopsis of Rule of Law. Proceedings in a court of law to determine
the personal rights and obligations of parties over whom the court has
not jurisdiction are invalid for want of due process of law.
Facts. Mitchell, a lawyer, sued Defendant, his client, in Oregon state
court for unpaid legal fees. At the time Defendant was a non-resident
of the state who was not personally served with process. Constructive
service was issued upon Defendant by publication. Defendant did not
come to court or otherwise resist the lawsuit, and default judgment
was entered against him. After the default judgment, Defendant
acquired 300 acres of land in Oregon. To satisfy his judgment against
Defendant, Mitchell had the sheriff seize and sell Defendant’s land.
The land was purchased by Plaintiff, who received a sheriff’s deed as
evidence of title. The sheriff then turned the sale proceeds over to
Mitchell. Shortly after the sheriff’s sale, Defendant discovered what
had happened to his land and brought suit against Plaintiff to recover
the land. This appeal followed after Defendant lost his suit against
Plaintiff.
Issue. Can judgments obtained against non-residents who fail to
appear in court be sustained by default judgments where service of
process is accomplished solely through publication (i.e. constructive
service)?
Is constructive service sufficient notice to attach property within the
forum state owned by a non-resident?
Mullane v. Central Hanover Bank & Trust Co
Brief Fact Summary. Appellee, a bank located in New York, set up a
trust covering 113 participants and sent notice by publication to all
known and unknown beneficiaries regarding Appellee’s application for
judicial settlement of the trust, as required under a New York statute.
Upon first distribution of the trust, Appellee would mail notice to
known beneficiaries that could benefit from the interest or principal.
Appellant, guardian of the beneficiaries, appealed, arguing that notice
by publication alone violated the beneficiaries’ due process rights
under the Fourteenth Amendment.
CONFLICT OF LAWS_CASE DIGEST
Synopsis of Rule of Law. Notice must be “reasonably calculated under
all the circumstances, to apprise interested parties of the action and
give them an opportunity to object.
Facts. Appellee, Central Hanover Bank & Trust, set up common fund
pursuant to a New York statute allowing the creation of common
funds for distribution of judicial settlement trusts. There were 113
participating trusts. Appellee petitioned for settlement of its first
account as common trustee. Some of the beneficiaries were not
residents of New York. “Notice” was by publication for four weeks in a
local newspaper. Appellee had notified those people by mail that were
of full age and sound mind who would be entitled to share in the
principal if the interest they held became distributable. Appellant was
appointed as special guardian and attorney for all persons known or
unknown not otherwise appearing who had or might thereafter have
any interest in the income of the common trust fund. Appellee was
appointed to represent those interested in the principal. Appellant
appeared specially, objecting that notice by publication, permitted
under the applicable statute was inadequate to afford t
he beneficiaries due process under the Fourteenth Amendment and
that therefore jurisdiction was lacking.
Issue. Is notice by publication of a judicial settlement to unknown
beneficiaries of a common trust reasonable notice under the due
process requirements of the Fourteenth Amendment?
Is notice by publication to all of the beneficiaries of a common trust
whose residences are known reasonable notice under the due process
requirements of the Fourteenth Amendment?
Shaffer v. Heitner
Brief Fact Summary. Plaintiff stockholder brought a shareholder’s
derivative action in Delaware state court against Defendants,
corporations incorporated in Delaware with their principal place of
business in Arizona, and corporate officers of the corporations
(Defendants). Plaintiff moved to sequester Defendants’ property,
which was stock in the company, located in Delaware as defined by
the Delaware statute. Defendants moved to quash the summons and
to vacate the sequestration order, arguing that both exercising
personal jurisdiction and seizing Defendants’ property violated due
process.
Synopsis of Rule of Law. When the only contact the defendant has
with the forum state is the location of property as defined by statute
in the forum state, the forum lacks personal jurisdiction over the
defendant unless the minimum contacts test of International Shoe is
satisfied.
Facts. Plaintiff, a stockholder for Greyhound Corp., a company
incorporated in Delaware with its principal place of business in
Arizona, sued Greyhound Corp., Greyhound Lines, Inc., (a subsidiary of
Greyhound Corp.) and present and former officers of the two
companies for violating duties to Greyhound Corp. by causing it to be
liable for damages in an antitrust suit and a fine in a criminal contempt
action in Oregon. Plaintiff filed a motion for sequestration of the
officers’ stock. Under a Delaware statute, Delaware is the situs of all
stock in Delaware corporations. The stock was seized. Defendants
were notified by certified mail of the sequestration and notice was
published in a Delaware newspaper. Defendants entered a special
appearance so they could move to quash service of process and vacate
the sequestration order. Defendant argued that the order violated due
process and therefore the property could not be attached in Delaware.
In addition, Defendants argued that they did not have the minimum
contacts with Delaware required to establish jurisdiction under
International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90
L.Ed. 95 (1945). In addition, Defendants argued that the sequestration
procedures were inconsistent with the Sniadach cases (see Sniadach v.
Family Finance Corp., 395 U.S. 337, 89 S.Ct. 1820, 23 L.Ed.2d 349
(1969)). The Court of Chancery found for Plaintiff and the Supreme
Court of Delaware affirmed the Court of Chancery. The Supreme Court
of Delaware reasoned that the Sniadach cases involved default
judgments and not compelling a party to appear. This court furthered
reasoned that sequestration procedures help to adjudicate claims of
mismanagement against Delaware companies, and do not cause
permanent deprivation of property to their shareholders. Defendants
appealed.
Issue. In order for the forum state to exercise in rem jurisdiction on a
nonresident, must the nonresident have minimum contacts with the
forum state such that the defendant has purposefully availed itself of
the benefits of that state’s laws? If so, must the cause of action be
sufficiently related to the contacts the nonresident has with the forum
state?
IDONAH PERKINS vs. ROXAS ET AL.
GRN 47517, June 27, 1941
FACTS: July 5, 1938, respondent Eugene Perkins filed a complaint
in the CFI- Manila against the Benguet Consolidated Mining Company
for the recovery of a sum consisting of dividends which have been
declared and made payable on shares of stock registered in his name,
payment of which was being withheld by the company, and for the
recognition of his right to the control and disposal of said shares to the
exclusion of all others. The company alleged, by way of defense that
the withholding of plaintiff’s right to the disposal and control of the
shares was due to certain demands made with respect to said shares
by the petitioner Idonah Perkins, and by one Engelhard.
Eugene Perkins included in his modified complaint as parties
defendants petitioner, Idonah Perkins, and Engelhard. Eugene Perkins
prayed that petitioner Idonah Perkins and H. Engelhard be adjudged
without interest in the shares of stock in question and excluded from
any claim they assert thereon. Summons by publication were served
upon the nonresident defendants Idonah Perkins and Engelhard.
Engelhard filed his answer. Petitioner filed her answer with a
crosscomplaint in which she sets up a judgment allegedly obtained by
her against respondent Eugene Perkins, from the SC of the State of
New York, wherein it is declared that she is the sole legal owner and
entitled to the possession and control of the shares of stock in
question with all the cash dividends declared thereon by the Benguet
Consolidated Mining Company.
Idonah Perkins filed a demurrer thereto on the ground that “the court
has no jurisdiction of the subject of the action,” because the alleged
judgment of the SC of the State of New York is res judicata.
Petitioner’s demurrer was overruled, thus this petition.
ISSUE: WON in view of the alleged judgment entered in favor of
the petitioner by the SC of New York and which is claimed by her to be
res judicata on all questions raised by the respondent, Eugene Perkins,
the local court has jurisdiction over the subject matter of the action.
RULING: By jurisdiction over the subject matter is meant the nature
of the cause of action and of the relief sought, and this is conferred by
the sovereign authority which organizes the court, and is to be sought
for in general nature of its powers, or in authority specially conferred.
In the present case, the amended complaint filed by the respondent,
Eugene Perkins alleged calls for the adjudication of title to certain
shares of stock of the Benguet Consolidated Mining Company and the
granting of affirmative reliefs, which fall within the general jurisdiction
of the CFI- Manila. Similarly CFI- Manila is empowered to adjudicate
the several demands contained in petitioner’s crosscomplaint.
Idonah Perkins in her crosscomplaint brought suit against Eugene
Perkins and the Benguet Consolidated Mining Company upon the
alleged judgment of the SC of the State of New York and asked the
court below to render judgment enforcing that New York judgment,
and to issue execution thereon. This is a form of action recognized by
section 309 of the Code of Civil Procedure (now section 47, Rule 39,
Rules of Court) and which falls within the general jurisdiction of the
CFI- Manila, to adjudicate, settle and determine.
The petitioner expresses the fear that the respondent judge may
render judgment “annulling the final, subsisting, valid judgment
rendered and entered in this petitioner’s favor by the courts of the
State of New York, which decision is res judicata on all the questions
constituting the subject matter of civil case” and argues on the
assumption that the respondent judge is without jurisdiction to take
cognizance of the cause. Whether or not the respondent judge in the
course of the proceedings will give validity and efficacy to the New
York judgment set up by the petitioner 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
or power of the court. The test of jurisdiction is 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. If its decision is
erroneous, its judgment can be reversed on appeal; but its
determination of the question, which the petitioner here anticipates
and seeks to prevent, is the exercise by that court and the rightful
exercise of its jurisdiction.
Petition denied.