Asiavest Limited v.

CA Digest
Facts:

1. The plaintiff Asiavest Limited filed a complaint against the defendant Antonio Heras praying that said
defendant be ordered to pay to the plaintiff the amounts awarded by the Hong Kong Court Judgment. The
action filed in Hong Kong against Heras was in personam, since it was based on his personal guarantee of
the obligation of the principal debtor.
2. The trial court concluded that the Hong Kong court judgment should be recognized and given effect in
this jurisdiction for failure of HERAS to overcome the legal presumption in favor of the foreign judgment.
3. Asiavest moved for the reconsideration of the decision. It sought an award of judicial costs and an
increase in attorney's fees with interest until full payment of the said obligations. On the other hand,
Heras no longer opposed the motion and instead appealed the decision to CA.
4. The Court of Appeals (CA) agreed with Heras that notice sent outside the state to a non-resident is
unavailing to give jurisdiction in an action against him personally for money recovery. Summons should
have been personally served on Heras in Hong Kong,
Issue: Whether or not the judgment of the Hong Kong Court has been repelled by evidence of want of
jurisdiction due to improper notice to the party
YES.

1. Asiavest cannot now claim that Heras was a resident of Hong Kong at the time since the stipulated
fact that Heras "is a resident of New Manila, Quezon City, Philippines" refers to his residence at the time
jurisdiction over his person was being sought by the Hong Kong court. Accordingly, since Heras was not a
resident of Hong Kong and the action against him was, ne in personam, summons should have been
personally served on him in Hong Kong.
The extraterritorial service in the Philippines was therefore invalid and did not confer on the Hong Kong
court jurisdiction over his person. It follows that the Hong Kong court judgment cannot be given force and
effect here in the Philippines for having been rendered without jurisdiction.
2. On the same note, Heras was also an absentee,hence, he should have been served with summons in
the same manner as a non-resident not found in Hong Kong. Section 17, Rule 14 of the Rules of Court
providing for extraterritorial service will not apply because the suit against him was in personam. Neither
can we apply Section 18, which allows extraterritorial service on a resident defendant who is temporarily
absent from the country, because even if Heras be considered as a resident of Hong Kong, the undisputed
fact remains that he left Hong Kong not only temporarily but for good.

SAUDIAA v CA
Milagros Morada was working as a stewardess for Saudia Arabian Airlines. In 1990, while
she and some co-workers were in a lay-over in Jakarta, Indonesia, an Arab co-worker tried
to rape her in a hotel room. Fortunately, a roomboy heard her cry for help and two of her Arab
co-workers were arrested and detained in Indonesia. Later, Saudia Airlines re-assigned her
to work in their Manila office. While working in Manila, Saudia Airlines advised her to meet
with a Saudia Airlines officer in Saudi. She did but to her surprise, she was brought to a Saudi
court where she was interrogated and eventually sentenced to 5 months imprisonment and
289 lashes; she allegedly violated Muslim customs by partying with males. The Prince of
Makkah got wind of her conviction and the Prince determined that she was wrongfully
convicted hence the Prince absolved her and sent her back to the Philippines. Saudia Airlines
later on dismissed Morada. Morada then sued Saudia Airlines for damages under Article 19
and 21 of the Civil Code. Saudia Airlines filed a motion to dismiss on the ground that the RTC
has no jurisdiction over the case because the applicable law should be the law of Saudi
Arabia. Saudia Airlines also prayed for other reliefs under the premises.
ISSUE: Whether or not Saudia Airlines contention is correct.
HELD: No. Firstly, the RTC has acquired jurisdiction over Saudia Airlines when the latter filed
a motion to dismiss with petition for other reliefs. The asking for other reliefs effectively asked
the court to make a determination of Saudia Airliness rights hence a submission to the courts
jurisdiction.
Secondly, the RTC has acquired jurisdiction over the case because as alleged in the
complaint of Morada, she is bringing the suit for damages under the provisions of our Civil
Law and not of the Arabian Law. Morada then has the right to file it in the QC RTC because
under the Rules of Court, a plaintiff may elect whether to file an action in personam (case at
bar) in the place where she resides or where the defendant resides. Obviously, it is well within
her right to file the case here because if shell file it in Saudi Arabia, it will be very
disadvantageous for her (and of course, again, Philippine Civil Law is the law invoked).
Thirdly, one important test factor to determine where to file a case, if there is a foreign element
involved, is the so called locus actus or where an act has been done. In the case at bar,
Morada was already working in Manila when she was summoned by her superior to go to
Saudi Arabia to meet with a Saudia Airlines officer. She was not informed that she was going
to appear in a court trial. Clearly, she was defrauded into appearing before a court trial which
led to her wrongful conviction. The act of defrauding, which is tortuous, was committed in
Manila and this led to her humiliation, misery, and suffering. And applying the torts principle
in a conflicts case, the SC finds that the Philippines could be said as a situs of the tort (the
place where the alleged tortious conduct took place).

BANCO DO BRASIL V CA

In 1989, Cesar Urbino, Sr. sued Poro Point Shipping Services for damages the former
incurred when one of the latters ship ran aground causing losses to Urbino. Urbino impleaded
Banco Do Brasil (BDB), a foreign corporation not engaged in business in the Philippines nor
does it have any office here or any agent. BDB was impleaded simply because it has a claim
over the sunken ship. BDB however failed to appear multiple times. Eventually, a judgment
was rendered and BDB was adjudged to pay $300,000.00 in damages in favor of Urbino for
BDB being a nuisance defendant.
BDB assailed the said decision as it argued that there was no valid service of summons
because the summons was issued to the ambassador of Brazil. Further, the other summons
which were made through publication is not applicable to BDB as it alleged that the action
against them is in personam.
ISSUE: Whether or not the court acquired jurisdiction over Banco Do Brasil.
HELD: No. Banco Do Brasil is correct. Although the suit is originally in rem as it was BDBs
claim on the sunken ship which was used as the basis for it being impleaded, the action
nevertheless became an in personam one when Urbino asked for damages in the said
amount. As such, only a personal service of summons would have vested the court
jurisdiction over BDB. Where the action is in personam, one brought against a person on the
basis of his personal liability, jurisdiction over the person of the defendant is necessary for
the court to validly try and decide the case. When the defendant is a non-resident, personal
service of summons within the state is essential to the acquisition of jurisdiction over the
person. This cannot be done, however, if the defendant is not physically present in the
country, and thus, the court cannot acquire jurisdiction over his person and therefore cannot
validly try and decide the case against him.

HASEGAWA V KITAMURA

In March 1999, Nippon Engineering Consultants Co., Ltd, a Japanese firm, was contracted
by the Department of Public Works and Highways (DPWH) to supervise the construction of
the Southern Tagalog Access Road. In April 1999, Nippon entered into an independent
contractor agreement (ICA) with Minoru Kitamura for the latter to head the said project. The
ICA was entered into in Japan and is effective for a period of 1 year (so until April 2000). In
January 2000, DPWH awarded the Bongabon-Baler Road project to Nippon. Nippon
subsequently assigned Kitamura to head the road project. But in February 2000, Kazuhiro
Hasegawa, the general manager of Nippon informed Kitamura that they are pre-terminating
his contract. Kitamura sought Nippon to reconsider but Nippon refused to negotiate. Kitamura
then filed a complaint for specific performance and damages against Nippon in the RTC of
Lipa.
Hasegawa filed a motion to dismiss on the ground that the contract was entered in Japan
hence, applying the principle of lex loci celebracionis, cases arising from the contract should
be cognizable only by Japanese courts. The trial court denied the motion. Eventually, Nippon
filed a petition for certiorari with the Supreme Court.
Hasegawa, on appeal significantly changed its theory, this time invoking forum non
conveniens; that the RTC is an inconvenient forum because the parties are Japanese
nationals who entered into a contract in Japan. Kitamura on the other hand invokes the trial
courts ruling which states that matters connected with the performance of contracts are
regulated by the law prevailing at the place of performance, so since the obligations in the
ICA are executed in the Philippines, courts here have jurisdiction.
ISSUE: Whether or not the complaint against Nippon should be dismissed.
HELD: No. The trial court did the proper thing in taking cognizance of it.
In the first place, the case filed by Kitamura is a complaint for specific performance and
damages. Such case is incapable of pecuniary estimation; such cases are within the
jurisdiction of the regional trial court.
Hasegawa filed his motion to dismiss on the ground of forum non conveniens. However, such
ground is not one of those provided for by the Rules as a ground for dismissing a civil case.
The Supreme Court also emphasized that the contention that Japanese laws should apply is
premature. In conflicts cases, there are three phases and each next phase commences when
one is settled, to wit:

1. Jurisdiction Where should litigation be initiated? Court must have jurisdiction over the
subject matter, the parties, the issues, the property, the res. Also considers, whether it is fair
to cause a defendant to travel to this state; choice of law asks the further question whether
the application of a substantive law which will determine the merits of the case is fair to both
parties.
2. Choice of Law Which law will the court apply? Once a local court takes cognizance, it does
not mean that the local laws must automatically apply. The court must determine which
substantive law when applied to the merits will be fair to both parties.
3. Recognition and Enforcement of Judgment Where can the resulting judgment be
enforced?
This case is not yet in the second phase because upon the RTCs taking cognizance of the
case, Hasegawa immediately filed a motion to dismiss, which was denied. He filed a motion
for reconsideration, which was also denied. Then he bypassed the proper procedure by
immediately filing a petition for certiorari. The question of which law should be applied should
have been settled in the trial court had Hasegawa not improperly appealed the interlocutory
order denying his MFR.

REGNER V LOGARTA

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 latters free will and
voluntariness considering his physical state; that it was done without Luiss 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 Victorias 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,
Cynthias and Teresas 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 cant 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 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.

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-residents 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.