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CHAPTER XVI: CHOICE OF LAW IN TORTS AND

CRIMES

E. Distinguishing between torts and crimes

Tort
An act or omission producing an injury to
another without any previous existing lawful relation
of which the act or omission may be said to be a
natural outgrowth or incident.

Tort
Transitory in character
and as such, liability is
deemed personal to the
tortfeasor and makes
him amenable to suit in
whatever jurisdiction he
is found
Injury to an individual
who may be situated in
any place
Assign liability to the
perpetrators in order to
indemnify the victim for
injuries he sustained

A. Policies behind conflicts tort law

1. To deter socially undesirable or wrongful
conduct
2. To rectify the consequences of the tortious
act by distributing the losses that result from
accident and products liability
B. Lex loci delicti commissi
-

Law of the place where the alleged tort was

committed determines the tort liability in
matters affecting conduct and safety.

F.

D. Foreign tort claims

1. Conditions for the enforcement of tort claims
In general, claims for damages arising from
torts committed abroad may be given due
course in the forum court, if:
a. The foreign tort is based on a civil action
and not on a crime
b. The foreign tort is not contrary to the
public policy of the forum
c. The judicial machinery of the forum is
adequate to satisfy the claim
2. Products liability of the foreign manufacturer
3. The alien tort act
4. Philippine rule on foreign torts
- English rule: the tort committed abroad is
actionable in the country where it was
committed and also under Philippine law

Injury to the state where

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

Lex loci delicti

Three exceptions to the territorial rule:

C. Modern theories of foreign tort liability

1. Most significant relationship considers the
states contacts with the occurrence and the
parties
2. Interest analysis considers the relevant
concerns the state may have in the case and
its interest in having its law applied on that
issue
3. Cavers principle of preference deals with
rules that sanction some kinds of conduct
engaged in by a defendant in one state and
extends the benefit of this higher standard
of conduct and financial protection to the
plaintiff even if the state of injury does not
create analogous liabilities

Crimes
Local
in
that
the
perpetrator of the wrong
can be sued only on the
state
wherein
he
commits the crime

G.

a. Crimes committed by state officials,

diplomatic representatives and officials of
recognized international organizations
b. Crimes committed on board a foreign vessel
even if it is within the territorial waters of the
coastal state.
c. Crimes which, although committed by
Philippine nationals abroad, are punishable
under Philippine law

CHAPTER XVII: CHOICE OF LAW AFFECTING

CORPORATIONS AND OTHER JUDICIAL ENTITIES
Corporations
-

Artificial being created by operation of law,

having the right of succession and the
powers, attributes and properties expressly
authorized by law or incident to its existence

1. Personal law of a corporation law of the

state where it is incorporated
M.E. Gray vs. Insular Lumber Company
Bank of Augusta vs. Earle
2. Exceptions to the rule of incorporation test
a. Constitutional and Statutory Restrictions
Article XII, Section 2
Palting vs. San Jose Petroleum
b. Control test during war

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3. Domicile or residence of foreign corporations
Article 51, Civil Code
State Investment House, Inc. vs. Citibank
4. Jurisdiction over foreign corporations
The dictum in Bank of Augusta vs. Earle has
been abandoned due to the expansion of
investments made in many countries.
The prevailing rule is that with the consent
of a state, a foreign corporation shall be
recognized and will be allowed to transact
business in any state which gives its
consent.
a. Foreign corporations doing business are
bound by Philippine law
Article 129 of the Corporation Code
5. Right of foreign corporation to bring suit
6. Exceptions to the License requirement
a. Isolated transactions one which is
occasional, incidental, and casual, not of
a character to indicate a purpose to
engage in business
b. Action to protect trademark, trade name,
goodwill, patent or for unfair competition
c.

Agreements fully transacted outside the

Philippines

d. Petition filed is merely

defense in a suit against it
7. Definition
business

and

scope

of

corollary

transacting

A foreign corporation can do business

therein, the state consent being presumed,
except:
a. Where it is prohibited by express
statutory authority or constitutional
enactment
b. Where it is seeking to perform acts which
are contrary to the public policy of the
state
c. Where it is seeking to exercise
extraordinary and special franchises
d. Where it is seeking to perform acts which
are not authorized by law of the state of
its corporation
The following enumerate
constitute doing business:

the

acts

that

includes
soliciting
orders,
service
contracts, opening offices, whether
called liaison offices or branches;
appointing
representatives
or
distributors domiciled in the Philippines
or who in any calendar year stay in the
country for a period or periods totaling
180 days or more; participating in the
management, supervision or control of
any domestic business, firm, entity or
corporation in the Philippines; and any
other act or acts that imply a continuity
of commercial dealings or arrangements,
and contemplate to the extent of the
performance of acts or works, or the
exercise of some of the functions
normally incident thereto, and in
progressive prosecution of, commercial
gain or for the purpose and object of the
business
organization;
provided
however, that the phrase doing
business shall not be deemed to include
mere investment as a shareholder by a
foreign entity in domestic corporations
duly registered to do business, and/or
the exercise of rights as such investor; or
having a nominee director or officer to
represent interests in such corporation;
nor appointing a representative or
distributor domiciled in the Philippines
which transacts business in its own name
and for its own accounts.
Revocation of License to transact business
a. Failure to appoint and maintain a
resident agent in the Philippines as
required
b. Failure, after change of its resident agent
or of his address to submit to the SEC a
statement of such change as required
c. Transacting business in the Philippines
outside of the purpose or purposes for
which such corporation is authorized
under its license
d. Transacting business in the Philippines as
agent or acting for and in behalf of any
foreign corporation or entity not duly
licensed to do business in the Philippines
e. Any other grounds as would render it
unfit to transact business in the
Philippines
Effect of failure to secure license to transact
business
a. The foreign corporation has no right to
sue, but can still be sued
b. The contracts entered into may be valid
between the parties but may not be
enforced in the Philippine courts

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B.

jurisdiction over the parties and the case in

the proper judicial proceedings.

Special corporations
1. Religious societies and corporation sole
2. Transnational corporations
3. partnerships
CHAPTER
XVIII:
RECOGNITION
ENFORCEMENT OF FOREIGN JUDGMENTS
A. Distinction
enforcement

between

recognition

NOA vs. CA extraterritorial service made

upon the defendant is valid not only because
of processual presumption but also because
of presumption of regularity of performance
of duty
AND
and

Foreign judgment
Refers to all decisions rendered outside the
forum and encompasses judgments, decrees
and orders of courts of foreign countries as well
as those of sister states in a federal system of
government.
Recognition
Passive act of giving effect to a judgment of
Forum 1 without necessary filing an action in
Forum 2
B. Bases of recognition and enforcement of foreign
judgments
Theory of comity
Is legal reciprocitythe principle that one
jurisdiction will extend certain courtesies to
other nations (or other jurisdictions within the
same nation), particularly by recognizing the
validity and effect of their executive, legislative,
and judicial acts.
C. Policies underlying recognition and enforcement
Merger
Considers the plaintiffs cause of action as
merged in the judgment and as a result, he may
not relitigate that exact claim
Bar
Refers to a situation where a successful
defendant interposes the judgment in his favor
to avert a second action by the plaintiff on the
same claim
Doctrine of collateral estoppel
A doctrine by which an earlier decision
rendered by a court in a lawsuit between parties
is conclusive as to the issues or controverted
points so that they cannot be relitigated in
subsequent proceedings involving the same
parties.
D. Requisites for recognition or enforcement
1. The foreign judgment was rendered by a
judicial or a quasi-judicial tribunal which had

2. The judgment must be valid under the laws

of the court that rendered it
3. The judgment must be final and executory to
constitute res judicata in another action
4. The state where the foreign judgment was
obtained allows recognition or enforcement
of Philippine judgments
5. The judgment must be for a fixed sum of
money unless the foreign judgment
specifies performance or delivery, there is
nothing for the forum court to enforce.
6. The foreign judgment must not be contrary
to the public policy or the good morals of the
country where it is to be enforced
7. The judgment must not have been obtained
by fraud, collusion, mistake of fact or
mistake of law
E. Grounds for non-recognition
1. A foreign judgment is not conclusive if
a. The judgment was rendered under a
system which does not provide impartial
tribunals or procedures compatible with
the requirements of due process of law
b. The foreign court did not have
jurisdiction over the subject matter
c.

The foreign court did not have personal

jurisdiction over the defendant

2. A foreign judgment need not be recognized if

a. The defendant in the proceedings in the

foreign court did not receive notice of
the proceedings in sufficient time to
enable him to defend
b. The judgment was obtained by fraud
c.

The cause of action or claim for relief on

which the judgment is based is
repugnant to the public policy of this
state

d. The foreign judgment conflicts with

another final and conclusive judgment
e. The proceeding in the foreign country
was contrary to an agreement between

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the parties under which the dispute in
question settled otherwise than the
proceeding in that court
f.

In the case of jurisdiction based only on

personal service, the foreign court was a
seriously inconvenient forum for the trial
of the action

F.

Modern developments in enforcement or foreign

judgments

G. Procedure for enforcement