SECOND DIVISION

[G.R. No. 133876. December 29, 1999]

BANK OF AMERICA, NT and SA, petitioner,
vs. AMERICAN REALTY CORPORATION and
COURT OF APPEALS, respondents.

borrowers signed and entered into restructuring

agreements. As additional security for the
restructured loans, private respondent ARC as
third party mortgagor executed two real estate
mortgages,[4] dated 17 February 1983 and 20
July 1984, over its parcels of land including
improvements thereon, located at Barrio Sto.
Cristo, San Jose Del Monte, Bulacan, and which
are covered by Transfer Certificate of Title Nos.
T-78759, T-78760, T-78761, T-78762 and T78763.

DECISION
BUENA, J.:
Does a mortgage-creditor waive its remedy to
foreclose the real estate mortgage constituted
over a third party mortgagors property situated
in the Philippines by filing an action for the
collection of the principal loan before foreign
courts?
Sought to be reversed in the instant petition for
review on certiorari under Rule 45 of the Rules
of Court are the decision[1]of public respondent
Court of Appeals in CA G.R. CV No. 51094,
promulgated on 30 September 1997 and its
resolution,[2] dated 22 May 1998, denying
petitioners motion for reconsideration.
Petitioner Bank of America NT & SA (BANTSA) is
an international banking and financing
institution duly licensed to do business in the
Philippines, organized and existing under and
by virtue of the laws of the State of California,
United States of America while private
respondent American Realty Corporation (ARC)
is a domestic corporation.
Bank of America International Limited (BAIL), on
the other hand, is a limited liability company
organized and existing under the laws of
England.
As borne by the records, BANTSA and BAIL on
several occasions granted three major multimillion United States (US) Dollar loans to the
following corporate borrowers: (1) Liberian
Transport Navigation, S.A.; (2) El Challenger S.A.
and (3) Eshley Compania Naviera S.A.
(hereinafter collectively referred to as
borrowers), all of which are existing under and
by virtue of the laws of the Republic of Panama
and are foreign affiliates of private respondent.
[3]
Due to the default in the payment of the loan
amortizations, BANTSA and the corporate

Eventually, the corporate borrowers defaulted in

the payment of the restructured loans
prompting petitioner BANTSA to file civil
actions[5] before foreign courts for the
collection of the principal loan, to wit:
a) In England, in its High Court of Justice,
Queens Bench Division, Commercial Court
(1992-Folio No. 2098) against Liberian Transport
Navigation S.A., Eshley Compania Naviera S.A.,
El Challenger S.A., Espriona Shipping Company
S.A., Eddie Navigation Corp., S.A., Eduardo
Katipunan Litonjua and Aurelio Katipunan
Litonjua on June 17, 1992.
b) In England, in its High Court of Justice,
Queens Bench Division, Commercial Court
(1992-Folio No. 2245) against El Challenger
S.A., Espriona Shipping Company S.A., Eduardo
Katipuan Litonjua & Aurelio Katipunan Litonjua
on July 2, 1992;
c) In Hongkong, in the Supreme Court of
Hongkong High Court (Action No. 4039 of 1992)
against Eshley Compania Naviera S.A., El
Challenger S.A., Espriona Shipping Company
S.A. Pacific Navigators Corporation, Eddie
Navigation Corporation S.A., Litonjua Chartering
(Edyship) Co., Inc., Aurelio Katipunan Litonjua,
Jr. and Eduardo Katipunan Litonjua on
November 19, 1992; and
d) In Hongkong, in the Supreme Court of
Hongkong High Court (Action No. 4040 of 1992)
against Eshley Compania Naviera S.A., El
Challenger S.A., Espriona Shipping Company,
S.A., Pacific Navigators Corporation, Eddie
Navigation Corporation S.A., Litonjua Chartering
(Edyship) Co., Jr. and Eduardo Katipunan
Litonjua on November 21, 1992.
In the civil suits instituted before the foreign
courts, private respondent ARC, being a third
party mortgagor, was not impleaded as partydefendant.

On 16 December 1992, petitioner BANTSA filed

before the Office of the Provincial Sheriff of
Bulacan, Philippines, an application for
extrajudicial foreclosure[6] of real estate
mortgage.
On 22 January 1993, after due publication and
notice, the mortgaged real properties were sold
at public auction in an extrajudicial foreclosure
sale, with Integrated Credit and Corporation
Services Co. (ICCS) as the highest bidder for the
sum of Twenty Four Million Pesos
(P24,000,000.00).[7]
On 12 February 1993, private respondent filed
before the Pasig Regional Trial Court, Branch
159, an action for damages[8]against the
petitioner, for the latters act of foreclosing
extrajudicially the real estate mortgages
despite the pendency of civil suits before
foreign courts for the collection of the principal
loan.
In its answer[9] petitioner alleged that the rule
prohibiting the mortgagee from foreclosing the
mortgage after an ordinary suit for collection
has been filed, is not applicable in the present
case, claiming that:
a) The plaintiff, being a mere third party
mortgagor and not a party to the principal
restructuring agreements, was never made a
party defendant in the civil cases filed in
Hongkong and England;
b) There is actually no civil suit for sum of
money filed in the Philippines since the civil
actions were filed in Hongkong and England. As
such, any decisions (sic) which may be rendered
in the abovementioned courts are not (sic)
enforceable in the Philippines unless a separate
action to enforce the foreign judgments is first
filed in the Philippines, pursuant to Rule 39,
Section 50 of the Revised Rules of Court.
c) Under English Law, which is the governing
law under the principal agreements, the
mortgagee does not lose its security interest by
filing civil actions for sums of money.
On 14 December 1993, private respondent filed
a motion for suspension[10] of the redemption
period on the ground that it cannot exercise
said right of redemption without at the same
time waiving or contradicting its contentions in
the case that the foreclosure of the mortgage
on its properties is legally improper and
therefore invalid.

In an order[11] dated 28 January 1994, the trial

court granted the private respondents motion
for suspension after which a copy of said order
was duly received by the Register of Deeds of
Meycauayan, Bulacan.
On 07 February 1994, ICCS, the purchaser of
the mortgaged properties at the foreclosure
sale, consolidated its ownership over the real
properties, resulting to the issuance of Transfer
Certificate of Title Nos. T-18627, T-186272, T186273, T-16471 and T-16472 in its name.
On 18 March 1994, after the consolidation of
ownership in its favor, ICCS sold the real
properties to Stateland Investment Corporation
for the amount of Thirty Nine Million Pesos
(P39,000,000.00).[12] Accordingly, Transfer
Certificate of Title Nos. T-187781(m), T187782(m), T-187783(m), T-16653P(m) and T16652P(m) were issued in the latters name.
After trial, the lower court rendered a
decision[13] in favor of private respondent ARC
dated 12 May 1993, the decretal portion of
which reads:
WHEREFORE, judgment is hereby rendered
declaring that the filing in foreign courts by the
defendant of collection suits against the
principal debtors operated as a waiver of the
security of the mortgages. Consequently, the
plaintiffs rights as owner and possessor of the
properties then covered by Transfer Certificates
of Title Nos. T-78759, T-78762, T-78763, T78760 and T-78761, all of the Register of Deeds
of Meycauayan, Bulacan, Philippines, were
violated when the defendant caused the
extrajudicial foreclosure of the mortgages
constituted thereon.
Accordingly, the defendant is hereby ordered to
pay the plaintiff the following sums, all with
legal interest thereon from the date of the filing
of the complaint up to the date of actual
payment:
1) Actual or compensatory damages in the
amount of Ninety Nine Million Pesos
(P99,000,000.00);
2) Exemplary damages in the amount of Five
Million Pesos (P5,000,000.00); and
3) Costs of suit.

SO ORDERED.
On appeal, the Court of Appeals affirmed the
assailed decision of the lower court prompting
petitioner to file a motion for reconsideration
which the appellate court denied.
Hence, the instant petition for
review[14] on certiorari where herein petitioner
BANTSA ascribes to the Court of Appeals the
following assignment of errors:
1. The Honorable Court of Appeals disregarded
the doctrines laid down by this Hon. Supreme
Court in the cases of Caltex Philippines, Inc. vs.
Intermediate Appellate Court docketed as G.R.
No. 74730 promulgated on August 25, 1989
andPhilippine Commercial International Bank vs.
IAC, 196 SCRA 29 (1991 case), although said
cases were duly cited, extensively discussed
and specifically mentioned, as one of the issues
in the assignment of errors found on page 5 of
the decision dated September 30, 1997.
2. The Hon. Court of Appeals acted with grave
abuse of discretion when it awarded the private
respondent actual and exemplary damages
totalling P171,600,000.00, as of July 12, 1998
although such huge amount was not asked nor
prayed for in private respondents complaint, is
contrary to law and is totally unsupported by
evidence (sic).
In fine, this Court is called upon to resolve two
main issues:
1. Whether or not the petitioners act of filing a
collection suit against the principal debtors for
the recovery of the loan before foreign courts
constituted a waiver of the remedy of
foreclosure.
2. Whether or not the award by the lower court
of actual and exemplary damages in favor of
private respondent ARC, as third-party
mortgagor, is proper.
The petition is bereft of merit.
First, as to the issue of availability of remedies,
petitioner submits that a waiver of the remedy
of foreclosure requires the concurrence of two
requisites: an ordinary civil action for collection
should be filed and subsequently a final
judgment be correspondingly rendered therein.

According to petitioner, the mere filing of a

personal action to collect the principal loan
does not suffice; a final judgment must be
secured and obtained in the personal action so
that waiver of the remedy of foreclosure may be
appreciated. To put it differently, absent any of
the two requisites, the mortgagee-creditor is
deemed not to have waived the remedy of
foreclosure.
We do not agree.
Certainly, this Court finds petitioners arguments
untenable and upholds the jurisprudence laid
down in Bachrach[15] and similar cases
adjudicated thereafter, thus:
In the absence of express statutory provisions,
a mortgage creditor may institute against the
mortgage debtor either a personal action for
debt or a real action to foreclose the
mortgage. In other words, he may pursue either
of the two remedies, but not both. By such
election, his cause of action can by no means
be impaired, for each of the two remedies is
complete in itself. Thus, an election to bring a
personal action will leave open to him all the
properties of the debtor for attachment and
execution, even including the mortgaged
property itself. And, if he waives such personal
action and pursues his remedy against the
mortgaged property, an unsatisfied judgment
thereon would still give him the right to sue for
a deficiency judgment, in which case, all the
properties of the defendant, other than the
mortgaged property, are again open to him for
the satisfaction of the deficiency. In either case,
his remedy is complete, his cause of action
undiminished, and any advantages attendant to
the pursuit of one or the other remedy are
purely accidental and are all under his right of
election. On the other hand, a rule that would
authorize the plaintiff to bring a personal action
against the debtor and simultaneously or
successively another action against the
mortgaged property, would result not only in
multiplicity of suits so offensive to justice
(Soriano vs. Enriques, 24 Phil. 584) and
obnoxious to law and equity (Osorio vs. San
Agustin, 25 Phil., 404), but also in subjecting the
defendant to the vexation of being sued in the
place of his residence or of the residence of the
plaintiff, and then again in the place where the
property lies.
In Danao vs. Court of Appeals[16] this Court,
reiterating jurisprudence enunciated in Manila
Trading and Supply Co. vs. Co
Kim[17]and Movido vs. RFC[18] invariably held:

x x x The rule is now settled that a mortgage

creditor may elect to waive his security and
bring, instead, an ordinary action to recover the
indebtedness with the right to execute a
judgment thereon on all the properties of the
debtor, including the subject matter of the
mortgage x x x, subject to the qualification that
if he fails in the remedy by him elected, he
cannot pursue further the remedy he has
waived. (Underscoring Ours)
Anent real properties in particular, the Court
has laid down the rule that a mortgage creditor
may institute against the mortgage debtor
either a personal action for debt or a real action
to foreclose the mortgage.[19]
In our jurisdiction, the remedies available to the
mortgage creditor are deemed alternative and
not cumulative. Notably, an election of one
remedy operates as a waiver of the other. For
this purpose, a remedy is deemed chosen upon
the filing of the suit for collection or upon the
filing of the complaint in an action for
foreclosure of mortgage, pursuant to the
provision of Rule 68 of the 1997 Rules of Civil
Procedure. As to extrajudicial foreclosure, such
remedy is deemed elected by the mortgage
creditor upon filing of the petition not with any
court of justice but with the Office of the Sheriff
of the province where the sale is to be made, in
accordance with the provisions of Act No. 3135,
as amended by Act No. 4118.
In the case at bench, private respondent ARC
constituted real estate mortgages over its
properties as security for the debt of the
principal debtors. By doing so, private
respondent subjected itself to the liabilities of a
third party mortgagor. Under the law, third
persons who are not parties to a loan may
secure the latter by pledging or mortgaging
their own property.[20]
Notwithstanding, there is no legal provision nor
jurisprudence in our jurisdiction which makes a
third person who secures the fulfillment of
anothers obligation by mortgaging his own
property, to be solidarily bound with the
principal obligor. The signatory to the principal
contractloanremains to be primarily bound. It is
only upon default of the latter that the creditor
may have recourse on the mortgagors by
foreclosing the mortgaged properties in lieu of
an action for the recovery of the amount of the
loan.[21]
In the instant case, petitioners contention that
the requisites of filing the action for collection

and rendition of final judgment therein should

concur, is untenable.
Thus, in Cerna vs. Court of Appeals[22] we
agreed with the petitioner in said case, that
the of a collection suit barred the foreclosure of
the mortgage:
A mortgagee who files a suit for collection
abandons the remedy of foreclosure of the
chattel mortgage constituted over the personal
property as security for the debt or value of the
promissory note when he seeks to recover in
the said collection suit.
x x x When the mortgagee elects to file a suit
for collection, not foreclosure, thereby
abandoning the chattel mortgage as basis for
relief, he clearly manifests his lack of desire and
interest to go after the mortgaged property as
security for the promissory note x x x.
Contrary to petitioners arguments, we therefore
reiterate the rule, for clarity and emphasis, that
the mere act of filing of an ordinary action for
collection operates as a waiver of the mortgagecreditors remedy to foreclose the mortgage. By
the mere filing of the ordinary action for
collection against the principal debtors, the
petitioner in the present case is deemed to
have elected a remedy, as a result of which a
waiver of the other necessarily must
arise. Corollarily, no final judgment in the
collection suit is required for the rule on waiver
to apply.
Hence, in Caltex Philippines, Inc. vs.
Intermediate Appellate Court[23] a case relied
upon by petitioner, supposedly to buttress its
contention, this Court had occasion to rule that
the mere act of a collection suit for the
recovery of a debt secured by a mortgage
constitutes waiver of the other remedy of
foreclosure.
In the case at bar, petitioner BANTSA only has
one cause of action which is non-payment of
the debt. Nevertheless, alternative remedies
are available for its enjoyment and
exercise. Petitioner then may opt to exercise
only one of two remedies so as not to violate
the rule against splitting a cause of action.
As elucidated by this Court in the landmark
case of Bachrach Motor Co., Inc. vs.
Icarangal[24]

For non-payment of a note secured by

mortgage, the creditor has a single cause of
action against the debtor. This single cause of
action consists in the recovery of the credit with
execution of the security. In other words, the
creditor in his action may make two demands,
the payment of the debt and the foreclosure of
his mortgage. But both demands arise from the
same cause, the non-payment of the debt, and
for that reason, they constitute a single cause
of action. Though the debt and the mortgage
constitute separate agreements, the latter is
subsidiary to the former, and both refer to one
and the same obligation. Consequently, there
exists only one cause of action for a single
breach of that obligation. Plaintiff, then, by
applying the rules above stated, cannot split up
his single cause of action by filing a complaint
for payment of the debt, and thereafter another
complaint for foreclosure of the mortgage. If he
does so, the filing of the first complaint will bar
the subsequent complaint. By allowing the
creditor to file two separate complaints
simultaneously or successively, one to recover
his credit and another to foreclose his
mortgage, we will, in effect, be authorizing him
plural redress for a single breach of contract at
so much cost to the courts and with so much
vexation and oppression to the debtor.
Petitioner further faults the Court of Appeals for
allegedly disregarding the doctrine enunciated
in Caltex, wherein this High Court relaxed the
application of the general rules to wit:
In the present case, however, we shall not
follow this rule to the letter but declare that it is
the collection suit which was waived and/or
abandoned. This ruling is more in harmony with
the principles underlying our judicial system. It
is of no moment that the collection suit was
filed ahead, what is determinative is the fact
that the foreclosure proceedings ended even
before the decision in the collection suit was
rendered. x x x
Notably, though, petitioner took the Caltex
ruling out of context. We must stress that the
Caltex case was never intended to overrule the
well-entrenched doctrine enunciated in
Bachrach, which to our mind still finds
applicability in cases of this sort.To reiterate,
Bachrach is still good law.

said case, the Supreme Court chastised Caltex

for making x x x a mockery of our judicial
system when it initially filed a collection suit
then, during the pendency thereof, foreclosed
extrajudicially the mortgaged property which
secured the indebtedness, and still pursued the
collection suit to the end. Thus, to prevent a
mockery of our judicial system, the collection
suit had to be nullified because the foreclosure
proceedings have already been pursued to their
end and can no longer be undone.
xxxxxxxxx
In the case at bar, it has not been shown
whether the defendant pursued to the end or
are still pursuing the collection suits filed in
foreign courts. There is no occasion, therefore,
for this court to apply the exception laid down
by the Supreme Court in Caltex, by nullifying
the collection suits. Quite obviously, too, the
aforesaid collection suits are beyond the reach
of this Court. Thus the only way the court may
prevent the spector of a creditor having plural
redress for a single breach of contract is by
holding, as the Court hereby holds, that the
defendant has waived the right to foreclose the
mortgages constituted by the plaintiff on its
properties originally covered by Transfer
Certificates of Title Nos. T-78759, T-78762, T78760 and T-78761. (RTC Decision pp., 10-11)
In this light, the actuations of Caltex are
deserving of severe criticism, to say the least.
[26]
Moreover, petitioner attempts to mislead this
Court by citing the case of PCIB vs.
IAC[27] Again, petitioner tried to fit a square
peg in a round hole. It must be stressed that far
from overturning the doctrine laid down in
Bachrach, this Court in PCIB buttressed its firm
stand on this issue by declaring:
While the law allows a mortgage creditor to
either institute a personal action for the debt or
a real action to foreclosure the mortgage, he
cannot pursue both remedies simultaneously or
successively as was done by PCIB in this case.
xxxxxxxxx

We then quote the decision[25]of the trial court,

in the present case, thus:
The aforequoted ruling in Caltex is the
exception rather than the rule, dictated by the
peculiar circumstances obtaining therein. In the

Thus, when the PCIB filed Civil Case No. 29392

to enforce payment of the 1.3 million
promissory note secured by real estate
mortgages and subsequently filed a petition for
extrajudicial foreclosure, it violates the rule
against splitting a cause of action.

Accordingly, applying the foregoing rules, we

hold that petitioner, by the expediency of filing
four civil suits before foreign courts, necessarily
abandoned the remedy to foreclose the real
estate mortgages constituted over the
properties of third-party mortgagor and herein
private respondent ARC. Moreover, by filing the
four civil actions and by eventually foreclosing
extrajudicially the mortgages, petitioner in
effect transgressed the rules against splitting a
cause of action well-enshrined in jurisprudence
and our statute books.
In Bachrach, this Court resolved to deny the
creditor the remedy of foreclosure after the
collection suit was filed, considering that the
creditor should not be afforded plural redress
for a single breach of contract. For cause of
action should not be confused with the remedy
created for its enforcement.[28]
Notably, it is not the nature of the redress which
is crucial but the efficacy of the remedy chosen
in addressing the creditors cause. Hence, a suit
brought before a foreign court having
competence and jurisdiction to entertain the
action is deemed, for this purpose, to be within
the contemplation of the remedy available to
the mortgagee-creditor. This pronouncement
would best serve the interest of justice and fair
play and further discourage the noxious
practice of splitting up a lone cause of action.
Incidentally, BANTSA alleges that under English
Law, which according to petitioner is the
governing law with regard to the principal
agreements, the mortgagee does not lose its
security interest by simply filing civil actions for
sums of money.[29]
We rule in the negative.
This argument shows desperation on the part of
petitioner to rivet its crumbling cause. In the
case at bench, Philippine law shall apply
notwithstanding the evidence presented by
petitioner to prove the English law on the
matter.
In a long line of decisions, this Court adopted
the well-imbedded principle in our jurisdiction
that there is no judicial notice of any foreign
law. A foreign law must be properly pleaded and
proved as a fact.[30] Thus, if the foreign law
involved is not properly pleaded and proved,
our courts will presume that the foreign law is
the same as our local or domestic or internal

law.[31] This is what we refer to as the doctrine

of processual presumption.
In the instant case, assuming arguendo that the
English Law on the matter were properly
pleaded and proved in accordance with Section
24, Rule 132 of the Rules of Court and the
jurisprudence laid down in Yao Kee, et al. vs. SyGonzales[32] said foreign law would still not
find applicability.
Thus, when the foreign law, judgment or
contract is contrary to a sound and established
public policy of the forum, the said foreign law,
judgment or order shall not be applied.[33]
Additionally, prohibitive laws concerning
persons, their acts or property, and those which
have for their object public order, public policy
and good customs shall not be rendered
ineffective by laws or judgments promulgated,
or by determinations or conventions agreed
upon in a foreign country.[34]
The public policy sought to be protected in the
instant case is the principle imbedded in our
jurisdiction proscribing the splitting up of a
single cause of action.
Section 4, Rule 2 of the 1997 Rules of Civil
Procedure is pertinent If two or more suits are instituted on the basis
of the same cause of action, the filing of one or
a judgment upon the merits in any one is
available as a ground for the dismissal of the
others.
Moreover, foreign law should not be applied
when its application would work undeniable
injustice to the citizens or residents of the
forum. To give justice is the most important
function of law; hence, a law, or judgment or
contract that is obviously unjust negates the
fundamental principles of Conflict of Laws.[35]
Clearly then, English Law is not applicable.
As to the second pivotal issue, we hold that the
private respondent is entitled to the award of
actual or compensatory damages inasmuch as
the act of petitioner BANTSA in extrajudicially
foreclosing the real estate mortgages
constituted a clear violation of the rights of
herein private respondent ARC, as third-party
mortgagor.

Actual or compensatory damages are those

recoverable because of pecuniary loss in
business, trade, property, profession, job or
occupation and the same must be proved,
otherwise if the proof is flimsy and nonsubstantial, no damages will be given.
[36] Indeed, the question of the value of
property is always a difficult one to settle as
valuation of real property is an imprecise
process since real estate has no inherent value
readily ascertainable by an appraiser or by the
court.[37] The opinions of men vary so much
concerning the real value of property that the
best the courts can do is hear all of the
witnesses which the respective parties desire to
present, and then, by carefully weighing that
testimony, arrive at a conclusion which is just
and equitable.[38]
In the instant case, petitioner assails the Court
of Appeals for relying heavily on the valuation
made by Philippine Appraisal Company. In
effect, BANTSA questions the act of the
appellate court in giving due weight to the
appraisal report composed of twenty three
pages, signed by Mr. Lauro Marquez and
submitted as evidence by private
respondent. The appraisal report, as the records
would readily show, was corroborated by the
testimony of Mr. Reynaldo Flores, witness for
private respondent.
On this matter, the trial court observed:
The record herein reveals that plaintiff-appellee
formally offered as evidence the appraisal
report dated March 29, 1993 (Exhibit J, Records,
p. 409), consisting of twenty three (23) pages
which set out in detail the valuation of the
property to determine its fair market value
(TSN, April 22, 1994, p. 4), in the amount of
P99,986,592.00 (TSN, ibid., p. 5), together with
the corroborative testimony of one Mr. Reynaldo
F. Flores, an appraiser and director of Philippine
Appraisal Company, Inc. (TSN, ibid., p. 3). The
latters testimony was subjected to extensive
cross-examination by counsel for defendantappellant (TSN, April 22, 1994, pp. 6-22).[39]
In the matter of credibility of witnesses, the
Court reiterates the familiar and wellentrenched rule that the factual findings of the
trial court should be respected.[40] The timetested jurisprudence is that the findings and
conclusions of the trial court on the credibility of
witnesses enjoy a badge of respect for the
reason that trial courts have the advantage of
observing the demeanor of witnesses as they
testify.[41]

This Court will not alter the findings of the trial

court on the credibility of witnesses, principally
because they are in a better position to assess
the same than the appellate court.[42] Besides,
trial courts are in a better position to examine
real evidence as well as observe the demeanor
of witnesses.[43]
Similarly, the appreciation of evidence and the
assessment of the credibility of witnesses rest
primarily with the trial court.[44] In the case at
bar, we see no reason that would justify this
Court to disturb the factual findings of the trial
court, as affirmed by the Court of Appeals, with
regard to the award of actual damages.
In arriving at the amount of actual damages,
the trial court justified the award by presenting
the following ratiocination in its assailed
decision[45], to wit:
Indeed, the Court has its own mind in the
matter of valuation. The size of the subject real
properties are (sic) set forth in their individual
titles, and the Court itself has seen the
character and nature of said properties during
the ocular inspection it conducted. Based
principally on the foregoing, the Court makes
the following observations:
1. The properties consist of about 39 hectares in
Bo. Sto. Cristo, San Jose del Monte, Bulacan,
which is (sic) not distant from Metro Manila the
biggest urban center in the Philippines and are
easily accessible through well-paved roads;
2. The properties are suitable for development
into a subdivision for low cost housing, as
admitted by defendants own appraiser (TSN,
May 30, 1994, p. 31);
3. The pigpens which used to exist in the
property have already been demolished. Houses
of strong materials are found in the vicinity of
the property (Exhs. 2, 2-1 to 2-7), and the
vicinity is a growing community. It has even
been shown that the house of the Barangay
Chairman is located adjacent to the property in
question (Exh. 27), and the only remaining
piggery (named Cherry Farm) in the vicinity is
about 2 kilometers away from the western
boundary of the property in question (TSN,
November 19, p. 3);
4. It will not be hard to find interested buyers of
the property, as indubitably shown by the fact
that on March 18, 1994, ICCS (the buyer during

the foreclosure sale) sold the consolidated real

estate properties to Stateland Investment
Corporation, in whose favor new titles were
issued, i.e., TCT Nos. T-187781(m); T187782(m), T-187783(m); T-16653P(m) and T166521(m) by the Register of Deeds of
Meycauayan (sic), Bulacan;
5. The fact that ICCS was able to sell the subject
properties to Stateland Investment Corporation
for Thirty Nine Million (P39,000,000.00) Pesos,
which is more than triple defendants appraisal
(Exh. 2) clearly shows that the Court cannot rely
on defendants aforesaid estimate (Decision,
Records, p. 603).
It is a fundamental legal aphorism that the
conclusions of the trial judge on the credibility
of witnesses command great respect and
consideration especially when the conclusions
are supported by the evidence on record.
[46] Applying the foregoing principle, we
therefore hold that the trial court committed no
palpable error in giving credence to the
testimony of Reynaldo Flores, who according to
the records, is a licensed real estate broker,
appraiser and director of Philippine Appraisal
Company, Inc. since 1990.[47] As the records
show, Flores had been with the company for 26
years at the time of his testimony.
Of equal importance is the fact that the trial
court did not confine itself to the appraisal
report dated 29 March 1993, and the testimony
given by Mr. Reynaldo Flores, in determining the
fair market value of the real property. Above all
these, the record would likewise show that the
trial judge in order to appraise himself of the
characteristics and condition of the property,
conducted an ocular inspection where the
opposing parties appeared and were duly
represented.
Based on these considerations and the evidence
submitted, we affirm the ruling of the trial court
as regards the valuation of the property
x x x a valuation of Ninety Nine Million Pesos
(P99,000,000.00) for the 39-hectare properties
(sic) translates to just about Two Hundred Fifty
Four Pesos (P254.00) per square meter. This
appears to be, as the court so holds, a better
approximation of the fair market value of the
subject properties. This is the amount which
should be restituted by the defendant
to the plaintiff by way of
actual orcompensatory damages x x x.[48]

Further, petitioner ascribes error to the lower

court for awarding an amount allegedly not
asked nor prayed for in private respondents
complaint.
Notwithstanding the fact that the award of
actual and compensatory damages by the lower
court exceeded that prayed for in the
complaint, the same is nonetheless valid,
subject to certain qualifications.
On this issue, Rule 10, Section 5 of the Rules of
Court is pertinent:
Amendment to conform to or authorize
presentation of evidence. When issues not
raised by the pleadings are tried with the
express or implied consent of the parties, they
shall be treated in all respects as if they had
been raised in the pleadings. Such amendment
of the pleadings as may be necessary to cause
them to conform to the evidence and to raise
these issues may be made upon motion of any
party at any time, even after judgement; but
failure to amend does not affect the result of
the trial of these issues. If evidence is objected
to at the trial on the ground that it is not within
the issues made by the pleadings, the court
may allow the pleadings to be amended and
shall do so with liberality if the presentation of
the merits of the action and the ends of
substantial justice will be subserved
thereby. The court may grant a continuance to
enable the amendment to be made.
The jurisprudence enunciated in Talisay-Silay
Milling Co., Inc. vs. Asociacion de Agricultures
de Talisay-Silay, Inc.[49]citing Northern Cement
Corporation vs. Intermediate Appellate
Court [50] is enlightening:
There have been instances where the Court has
held that even without the necessary
amendment, the amount proved at the trial
may be validly awarded, as in Tuazon v.
Bolanos (95 Phil. 106), where we said that if the
facts shown entitled plaintiff to relief other than
that asked for, no amendment to the complaint
was necessary, especially where defendant had
himself raised the point on which recovery was
based. The appellate court could treat the
pleading as amended to conform to the
evidence although the pleadings were actually
not amended. Amendment is also unnecessary
when only clerical error or non substantial
matters are involved, as we held inBank of the
Philippine Islands vs. Laguna (48 Phil. 5). In Co
Tiamco vs. Diaz (75 Phil. 672), we stressed that
the rule on amendment need not be applied
rigidly, particularly where no surprise or

prejudice is caused the objecting party. And in

the recent case of National Power Corporation
vs. Court of Appeals (113 SCRA 556), we held
that where there is a variance in the defendants
pleadings and the evidence adduced by it at the
trial, the Court may treat the pleading as
amended to conform with the evidence.
It is the view of the Court that pursuant to the
above-mentioned rule and in light of the
decisions cited, the trial court should not be
precluded from awarding an amount higher
than that claimed in the pleading
notwithstanding the absence of the
required amendment.But it is upon the
condition that the evidence of such higher
amount has been presented properly, with full
opportunity on the part of the opposing parties
to support their respective contentions and to
refute each others evidence.
The failure of a party to amend a pleading to
conform to the evidence adduced during trial
does not preclude an adjudication by the court
on the basis of such evidence which may
embody new issues not raised in the pleadings,
or serve as a basis for a higher award of
damages. Although the pleading may not have
been amended to conform to the evidence
submitted during trial, judgment may
nonetheless be rendered, not simply on the
basis of the issues alleged but also on the basis
of issues discussed and the assertions of fact
proved in the course of trial. The court may
treat the pleading as if it had been amended to
conform to the evidence, although it had not
been actually so amended. Former Chief Justice
Moran put the matter in this way:
`When evidence is presented by one party, with
the expressed or implied consent of the adverse
party, as to issues not alleged in the pleadings,
judgment may be rendered validly as regards
those issues, which shall be considered as if
they have been raised in the pleadings. There is
implied consent to the evidence thus presented
when the adverse party fails to object thereto.
Clearly, a court may rule and render judgment
on the basis of the evidence before it even
though the relevant pleading had not been
previously amended, so long as no surprise or
prejudice is thereby caused to the adverse
party. Put a little differently, so long as the basis
requirements of fair play had been met, as
where litigants were given full opportunity to
support their respective contentions and to
object to or refute each others evidence, the
court may validly treat the pleadings as if they
had been amended to conform to the evidence

and proceed to adjudicate on the basis of all the

evidence before it.
In the instant case, inasmuch as the petitioner
was afforded the opportunity to refute and
object to the evidence, both documentary and
testimonial, formally offered by private
respondent, the rudiments of fair play are
deemed satisfied. In fact, the testimony of
Reynaldo Flores was put under scrutiny during
the course of the cross-examination. Under
these circumstances, the court acted within the
bounds of its jurisdiction and committed no
reversible error in awarding actual damages the
amount of which is higher than that prayed
for. Verily, the lower courts actuations are
sanctioned by the Rules and supported by
jurisprudence.
Similarly, we affirm the grant of exemplary
damages although the amount of Five Million
Pesos (P5,000,000.00) awarded, being
excessive, is subject to reduction. Exemplary or
corrective damages are imposed, by way of
example or correction for the public good, in
addition to the moral, temperate, liquidated or
compensatory damages.[51] Considering its
purpose, it must be fair and reasonable in every
case and should not be awarded to unjustly
enrich a prevailing party.[52] In our view, an
award of P50,000.00 as exemplary damages in
the present case qualifies the test of
reasonableness.
WHEREFORE, premises considered, the instant
petition is DENIED for lack of merit. The decision
of the Court of Appeals is hereby AFFIRMED with
MODIFICATION of the amount awarded as
exemplary damages. Accordingly, petitioner is
hereby ordered to pay private respondent the
sum of P99,000,000.00 as actual or
compensatory damages; P50,000.00 as
exemplary damage and the costs of suit.
SO ORDERED.

FIRST DIVISION
[G.R. No. 122191. October 8, 1998]
SAUDI ARABIAN AIRLINES, petitioner vs. COURT
OF APPEALS, MILAGROS P. MORADA and HON.
RODOLFO A. ORTIZ, in his capacity as Presiding
Judge of Branch 89, Regional Trial Court of
Quezon City, respondents.

DECISION
QUISUMBING, J.:
This petition for certiorari pursuant to Rule 45 of
the Rules of Court seeks to annul and set aside
the Resolution[1] dated September 27, 1995
and the Decision[2] dated April 10, 1996 of the
Court of Appeals[3] in CA-G.R. SP No. 36533,
[4] and the Orders[5] dated August 29,
1994[6] and February 2, 1995[7] that were
issued by the trial court in Civil Case No. Q-9318394.[8]
The pertinent antecedent facts which gave rise
to the instant petition, as stated in the
questioned Decision[9], are as follows:
On January 21, 1988 defendant SAUDIA hired
plaintiff as a Flight Attendant for its airlines
based in Jeddah, Saudi Arabia. x x x
On April 27, 1990, while on a lay-over in Jakarta,
Indonesia, plaintiff went to a disco dance with
fellow crew members Thamer Al-Gazzawi and
Allah Al-Gazzawi, both Saudi nationals. Because
it was almost morning when they returned to
their hotels, they agreed to have breakfast
together at the room of Thamer. When they
were in te (sic) room, Allah left on some
pretext. Shortly after he did, Thamer attempted
to rape plaintiff. Fortunately, a roomboy and
several security personnel heard her cries for
help and rescued her. Later, the Indonesian
police came and arrested Thamer and Allah AlGazzawi, the latter as an accomplice.
When plaintiff returned to Jeddah a few days
later, several SAUDIA officials interrogated her
about the Jakarta incident. They then requested
her to go back to Jakarta to help arrange the
release of Thamer and Allah. In Jakarta, SAUDIA
Legal Officer Sirah Akkad and base manager
Baharini negotiated with the police for the
immediate release of the detained crew
members but did not succeed because plaintiff
refused to cooperate. She was afraid that she
might be tricked into something she did not
want because of her inability to understand the
local dialect. She also declined to sign a blank
paper and a document written in the local
dialect. Eventually, SAUDIA allowed plaintiff to
return to Jeddah but barred her from the Jakarta
flights.
Plaintiff learned that, through the intercession
of the Saudi Arabian government, the
Indonesian authorities agreed to deport Thamer

and Allah after two weeks of

detention. Eventually, they were again put in
service by defendant SAUDI (sic). In September
1990, defendant SAUDIA transferred plaintiff to
Manila.
On January 14, 1992, just when plaintiff thought
that the Jakarta incident was already behind
her, her superiors requested her to see Mr. Ali
Meniewy, Chief Legal Officer of SAUDIA, in
Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the
police took her passport and questioned her
about the Jakarta incident. Miniewy simply
stood by as the police put pressure on her to
make a statement dropping the case against
Thamer and Allah. Not until she agreed to do so
did the police return her passport and allowed
her to catch the afternoon flight out of Jeddah.
One year and a half later or on June 16, 1993, in
Riyadh, Saudi Arabia, a few minutes before the
departure of her flight to Manila, plaintiff was
not allowed to board the plane and instead
ordered to take a later flight to Jeddah to see
Mr. Miniewy, the Chief Legal Officer of
SAUDIA. When she did, a certain Khalid of the
SAUDIA office brought her to a Saudi court
where she was asked to sign a document
written in Arabic. They told her that this was
necessary to close the case against Thamer and
Allah. As it turned out, plaintiff signed a notice
to her to appear before the court on June 27,
1993. Plaintiff then returned to Manila.
Shortly afterwards, defendant SAUDIA
summoned plaintiff to report to Jeddah once
again and see Miniewy on June 27, 1993 for
further investigation. Plaintiff did so after
receiving assurance from SAUDIAs Manila
manager, Aslam Saleemi, that the investigation
was routinary and that it posed no danger to
her.
In Jeddah, a SAUDIA legal officer brought
plaintiff to the same Saudi court on June 27,
1993. Nothing happened then but on June 28,
1993, a Saudi judge interrogated plaintiff
through an interpreter about the Jakarta
incident. After one hour of interrogation, they
let her go. At the airport, however, just as her
plane was about to take off, a SAUDIA officer
told her that the airline had forbidden her to
take flight. At the Inflight Service Office where
she was told to go, the secretary of Mr. Yahya
Saddick took away her passport and told her to
remain in Jeddah, at the crew quarters, until
further orders.

On July 3, 1993 a SAUDIA legal officer again

escorted plaintiff to the same court where the
judge, to her astonishment and shock, rendered
a decision, translated to her in English,
sentencing her to five months imprisonment
and to 286 lashes. Only then did she realize
that the Saudi court had tried her, together with
Thamer and Allah, for what happened in
Jakarta. The court found plaintiff guilty of (1)
adultery; (2) going to a disco, dancing and
listening to the music in violation of Islamic
laws; and (3) socializing with the male crew, in
contravention of Islamic tradition.[10]
Facing conviction, private respondent sought
the help of her employer, petitioner
SAUDIA. Unfortunately, she was denied any
assistance. She then asked the Philippine
Embassy in Jeddah to help her while her case is
on appeal. Meanwhile, to pay for her upkeep,
she worked on the domestic flight of SAUDIA,
while Thamer and Allah continued to serve in
the international flights.[11]
Because she was wrongfully convicted, the
Prince of Makkah dismissed the case against
her and allowed her to leave Saudi
Arabia. Shortly before her return to Manila,
[12] she was terminated from the service by
SAUDIA, without her being informed of the
cause.
On November 23, 1993, Morada filed a
Complaint[13] for damages against SAUDIA,
and Khaled Al-Balawi (Al- Balawi), its country
manager.
On January 19, 1994, SAUDIA filed an Omnibus
Motion To Dismiss[14] which raised the
following grounds, to wit: (1) that the Complaint
states no cause of action against Saudia; (2)
that defendant Al-Balawi is not a real party in
interest; (3) that the claim or demand set forth
in the Complaint has been waived, abandoned
or otherwise extinguished; and (4) that the trial
court has no jurisdiction to try the case.
On February 10, 1994, Morada filed her
Opposition (To Motion to Dismiss)[15] Saudia
filed a reply[16] thereto on March 3, 1994.
On June 23, 1994, Morada filed an Amended
Complaint[17] wherein Al-Balawi was dropped
as party defendant. On August 11, 1994, Saudia
filed its Manifestation and Motion to Dismiss
Amended Complaint[18].

The trial court issued an Order[19] dated

August 29, 1994 denying the Motion to Dismiss
Amended Complaint filed by Saudia.
From the Order of respondent
Judge[20] denying the Motion to Dismiss,
SAUDIA filed on September 20, 1994, its Motion
for Reconsideration[21] of the Order dated
August 29, 1994. It alleged that the trial court
has no jurisdiction to hear and try the case on
the basis of Article 21 of the Civil Code, since
the proper law applicable is the law of the
Kingdom of Saudi Arabia. On October 14, 1994,
Morada filed her Opposition[22] (To Defendants
Motion for Reconsideration).
In the Reply[23] filed with the trial court on
October 24, 1994, SAUDIA alleged that since its
Motion for Reconsideration raised lack of
jurisdiction as its cause of action, the Omnibus
Motion Rule does not apply, even if that ground
is raised for the first time on
appeal.Additionally, SAUDIA alleged that the
Philippines does not have any substantial
interest in the prosecution of the instant case,
and hence, without jurisdiction to adjudicate the
same.
Respondent Judge subsequently issued another
Order[24] dated February 2, 1995, denying
SAUDIAs Motion for Reconsideration.The
pertinent portion of the assailed Order reads as
follows:
Acting on the Motion for Reconsideration of
defendant Saudi Arabian Airlines filed, thru
counsel, on September 20, 1994, and the
Opposition thereto of the plaintiff filed, thru
counsel, on October 14, 1994, as well as the
Reply therewith of defendant Saudi Arabian
Airlines filed, thru counsel, on October 24, 1994,
considering that a perusal of the plaintiffs
Amended Complaint, which is one for the
recovery of actual, moral and exemplary
damages plus attorneys fees, upon the basis of
the applicable Philippine law, Article 21 of the
New Civil Code of the Philippines, is, clearly,
within the jurisdiction of this Court as regards
the subject matter, and there being nothing
new of substance which might cause the
reversal or modification of the order sought to
be reconsidered, the motion for reconsideration
of the defendant, is DENIED.
SO ORDERED.[25]
Consequently, on February 20, 1995, SAUDIA
filed its Petition for Certiorari and Prohibition
with Prayer for Issuance of Writ of Preliminary

Injunction and/or Temporary Restraining

Order[26] with the Court of Appeals.
Respondent Court of Appeals promulgated a
Resolution with Temporary Restraining
Order[27] dated February 23, 1995, prohibiting
the respondent Judge from further conducting
any proceeding, unless otherwise directed, in
the interim.
In another Resolution[28] promulgated on
September 27, 1995, now assailed, the
appellate court denied SAUDIAs Petition for the
Issuance of a Writ of Preliminary Injunction
dated February 18, 1995, to wit:
The Petition for the Issuance of a Writ of
Preliminary Injunction is hereby DENIED, after
considering the Answer, with Prayer to Deny
Writ of Preliminary Injunction (Rollo, p. 135) the
Reply and Rejoinder, it appearing that herein
petitioner is not clearly entitled thereto
(Unciano Paramedical College, et. Al., v. Court of
Appeals, et. Al., 100335, April 7, 1993, Second
Division).

I
The trial court has no jurisdiction to hear and try
Civil Case No. Q-93-18394 based on Article 21
of the New Civil Code since the proper law
applicable is the law of the Kingdom of Saudi
Arabia inasmuch as this case involves what is
known in private international law as a conflicts
problem. Otherwise, the Republic of the
Philippines will sit in judgment of the acts done
by another sovereign state which is abhorred.
II.
Leave of court before filing a supplemental
pleading is not a jurisdictional
requirement. Besides, the matter as to absence
of leave of court is now moot and academic
when this Honorable Court required the
respondents to comment on petitioners April
30, 1996 Supplemental Petition For Review With
Prayer For A Temporary Restraining Order Within
Ten (10) Days From Notice Thereof. Further, the
Revised Rules of Court should be construed with
liberality pursuant to Section 2, Rule 1 thereof.

SO ORDERED.
III.
On October 20, 1995, SAUDIA filed with this
Honorable Court the instant Petition[29] for
Review with Prayer for Temporary Restraining
Order dated October 13, 1995.
However, during the pendency of the instant
Petition, respondent Court of Appeals rendered
the Decision[30] dated April 10, 1996, now also
assailed. It ruled that the Philippines is an
appropriate forum considering that the
Amended Complaints basis for recovery of
damages is Article 21 of the Civil Code, and
thus, clearly within the jurisdiction of
respondent Court. It further held
that certiorari is not the proper remedy in a
denial of a Motion to Dismiss, inasmuch as the
petitioner should have proceeded to trial, and in
case of an adverse ruling, find recourse in an
appeal.
On May 7, 1996, SAUDIA filed its Supplemental
Petition for Review with Prayer for Temporary
Restraining Order[31] dated April 30, 1996,
given due course by this Court. After both
parties submitted their Memoranda,[32] the
instant case is now deemed submitted for
decision.
Petitioner SAUDIA raised the following issues:

Petitioner received on April 22, 1996 the April

10, 1996 decision in CA-G.R. SP NO. 36533
entitled Saudi Arabian Airlines v. Hon. Rodolfo A.
Ortiz, et al. and filed its April 30, 1996
Supplemental Petition For Review With Prayer
For A Temporary Restraining Order on May 7,
1996 at 10:29 a.m. or within the 15-day
reglementary period as provided for under
Section 1, Rule 45 of the Revised Rules of
Court. Therefore, the decision in CA-G.R. SP NO.
36533 has not yet become final and executory
and this Honorable Court can take cognizance
of this case.[33]
From the foregoing factual and procedural
antecedents, the following issues emerge for
our resolution:
I.
WHETHER RESPONDENT APPELLATE COURT
ERRED IN HOLDING THAT THE REGIONAL TRIAL
COURT OF QUEZON CITY HAS JURISDICTION TO
HEAR AND TRY CIVIL CASE NO. Q-93-18394
ENTITLED MILAGROS P. MORADA V. SAUDI
ARABIAN AIRLINES.

II.
WHETHER RESPONDENT APPELLATE COURT
ERRED IN RULING THAT IN THE CASE PHILIPPINE
LAW SHOULD GOVERN.
Petitioner SAUDIA claims that before us is a
conflict of laws that must be settled at the
outset. It maintains that private respondents
claim for alleged abuse of rights occurred in the
Kingdom of Saudi Arabia. It alleges that the
existence of a foreign element qualifies the
instant case for the application of the law of the
Kingdom of Saudi Arabia, by virtue of the lex
loci delicti commissirule.[34]
On the other hand, private respondent contends
that since her Amended Complaint is based on
Articles 19[35] and 21[36] of the Civil Code,
then the instant case is properly a matter of
domestic law.[37]
Under the factual antecedents obtaining in this
case, there is no dispute that the interplay of
events occurred in two states, the Philippines
and Saudi Arabia.
As stated by private respondent in her
Amended Complaint[38] dated June 23, 1994:
2. Defendant SAUDI ARABIAN AIRLINES or
SAUDIA is a foreign airlines corporation doing
business in the Philippines. It may be served
with summons and other court processes at
Travel Wide Associated Sales (Phils.), Inc.,
3rd Floor, Cougar Building, 114 Valero St.,
Salcedo Village, Makati, Metro Manila.
xxxxxxxxx
6. Plaintiff learned that, through the
intercession of the Saudi Arabian government,
the Indonesian authorities agreed to deport
Thamer and Allah after two weeks of
detention. Eventually, they were again put in
service by defendant SAUDIA. In September
1990, defendant SAUDIA transferred plaintiff to
Manila.
7. On January 14, 1992, just when plaintiff
thought that the Jakarta incident was already
behind her, her superiors requested her to see
MR. Ali Meniewy, Chief Legal Officer of SAUDIA,
in Jeddah, Saudi Arabia. When she saw him, he
brought her to the police station where the
police took her passport and questioned her

about the Jakarta incident. Miniewy simply

stood by as the police put pressure on her to
make a statement dropping the case against
Thamer and Allah. Not until she agreed to do so
did the police return her passport and allowed
her to catch the afternoon flight out of Jeddah.
8. One year and a half later or on June 16, 1993,
in Riyadh, Saudi Arabia, a few minutes before
the departure of her flight to Manila, plaintiff
was not allowed to board the plane and instead
ordered to take a later flight to Jeddah to see
Mr. Meniewy, the Chief Legal Officer of
SAUDIA. When she did, a certain Khalid of the
SAUDIA office brought her to a Saudi court
where she was asked to sign a document
written in Arabic. They told her that this was
necessary to close the case against Thamer and
Allah.As it turned out, plaintiff signed a notice to
her to appear before the court on June 27,
1993. Plaintiff then returned to Manila.
9. Shortly afterwards, defendant SAUDIA
summoned plaintiff to report to Jeddah once
again and see Miniewy on June 27, 1993 for
further investigation. Plaintiff did so after
receiving assurance from SAUDIAs Manila
manager, Aslam Saleemi, that the investigation
was routinary and that it posed no danger to
her.
10. In Jeddah, a SAUDIA legal officer brought
plaintiff to the same Saudi court on June 27,
1993. Nothing happened then but on June 28,
1993, a Saudi judge interrogated plaintiff
through an interpreter about the Jakarta
incident. After one hour of interrogation, they
let her go. At the airport, however, just as her
plane was about to take off, a SAUDIA officer
told her that the airline had forbidden her to
take that flight. At the Inflight Service Office
where she was told to go, the secretary of Mr.
Yahya Saddick took away her passport and told
her to remain in Jeddah, at the crew quarters,
until further orders.
11. On July 3, 1993 a SAUDIA legal officer again
escorted plaintiff to the same court where the
judge, to her astonishment and shock, rendered
a decision, translated to her in English,
sentencing her to five months imprisonment
and to 286 lashes. Only then did she realize
that the Saudi court had tried her, together with
Thamer and Allah, for what happened in
Jakarta. The court found plaintiff guilty of (1)
adultery; (2) going to a disco, dancing, and
listening to the music in violation of Islamic
laws; (3) socializing with the male crew, in
contravention of Islamic tradition.

12. Because SAUDIA refused to lend her a hand

in the case, plaintiff sought the help of the
Philippine Embassy in Jeddah. The latter helped
her pursue an appeal from the decision of the
court. To pay for her upkeep, she worked on the
domestic flights of defendant SAUDIA while,
ironically, Thamer and Allah freely served the
international flights.[39]
Where the factual antecedents satisfactorily
establish the existence of a foreign element, we
agree with petitioner that the problem herein
could present a conflicts case.
A factual situation that cuts across territorial
lines and is affected by the diverse laws of two
or more states is said to contain a foreign
element. The presence of a foreign element is
inevitable since social and economic affairs of
individuals and associations are rarely confined
to the geographic limits of their birth or
conception.[40]
The forms in which this foreign element may
appear are many.[41] The foreign element may
simply consist in the fact that one of the parties
to a contract is an alien or has a foreign
domicile, or that a contract between nationals
of one State involves properties situated in
another State. In other cases, the foreign
element may assume a complex form.[42]
In the instant case, the foreign element
consisted in the fact that private respondent
Morada is a resident Philippine national, and
that petitioner SAUDIA is a resident foreign
corporation. Also, by virtue of the employment
of Morada with the petitioner Saudia as a flight
stewardess, events did transpire during her
many occasions of travel across national
borders, particularly from Manila, Philippines to
Jeddah, Saudi Arabia, and vice versa, that
caused a conflicts situation to arise.
We thus find private respondents assertion that
the case is purely domestic,
imprecise. A conflicts problem presents itself
here, and the question of
jurisdiction[43] confronts the court a quo.
After a careful study of the private respondents
Amended Complaint,[44] and the Comment
thereon, we note that she aptly predicated her
cause of action on Articles 19 and 21 of the New
Civil Code.
On one hand, Article 19 of the New Civil Code
provides;

Art. 19. Every person must, in the exercise of

his rights and in the performance of his duties,
act with justice give everyone his due and
observe honesty and good faith.
On the other hand, Article 21 of the New Civil
Code provides:
Art. 21. Any person who willfully causes loss or
injury to another in a manner that is contrary to
morals, good customs or public policy shall
compensate the latter for damages.
Thus, in Philippine National Bank (PNB) vs.
Court of Appeals,[45] this Court held that:
The aforecited provisions on human relations
were intended to expand the concept of torts in
this jurisdiction by granting adequate legal
remedy for the untold number of moral wrongs
which is impossible for human foresight to
specifically provide in the statutes.
Although Article 19 merely declares a principle
of law, Article 21 gives flesh to its
provisions. Thus, we agree with private
respondents assertion that violations of Articles
19 and 21 are actionable, with judicially
enforceable remedies in the municipal forum.
Based on the allegations[46] in the Amended
Complaint, read in the light of the Rules of Court
on jurisdiction[47] we find that the Regional
Trial Court (RTC) of Quezon City possesses
jurisdiction over the subject matter of the suit.
[48] Its authority to try and hear the case is
provided for under Section 1 of Republic Act No.
7691, to wit:
Section 1. Section 19 of Batas Pambansa Blg.
129, otherwise known as the Judiciary
Reorganization Act of 1980, is hereby amended
to read as follows:
SEC. 19. Jurisdiction in Civil Cases. Regional Trial
Courts shall exercise exclusive jurisdiction:
xxxxxxxxx
(8) In all other cases in which
demand, exclusive of interest, damages of
whatever kind, attorneys fees, litigation
expenses, and costs or the value of the property
in controversy exceeds One hundred thousand

pesos (P100,000.00) or, in such other cases in

Metro Manila, where the demand, exclusive of
the above-mentioned items exceeds Two
hundred Thousand pesos
(P200,000.00). (Emphasis ours)
xxxxxxxxx
And following Section 2 (b), Rule 4 of the
Revised Rules of Courtthe venue, Quezon City,
is appropriate:
SEC. 2 Venue in Courts of First Instance. [Now
Regional Trial Court]
(a) x x x x x x x x x
(b) Personal actions. All other actions may be
commenced and tried where the defendant or
any of the defendants resides or may be found,
or where the plaintiff or any of the plaintiff
resides, at the election of the plaintiff.
Pragmatic considerations, including the
convenience of the parties, also weigh heavily
in favor of the RTC Quezon City assuming
jurisdiction. Paramount is the private interest of
the litigant. Enforceability of a judgment if one
is obtained is quite obvious. Relative
advantages and obstacles to a fair trial are
equally important. Plaintiff may not, by choice
of an inconvenient forum, vex, harass, or
oppress the defendant, e.g. by inflicting upon
him needless expense or disturbance. But
unless the balance is strongly in favor of the
defendant, the plaintiffs choice of forum should
rarely be disturbed.[49]
Weighing the relative claims of the parties, the
court a quo found it best to hear the case in the
Philippines. Had it refused to take cognizance of
the case, it would be forcing plaintiff (private
respondent now) to seek remedial action
elsewhere, i.e. in the Kingdom of Saudi Arabia
where she no longer maintains substantial
connections. That would have caused a
fundamental unfairness to her.
Moreover, by hearing the case in the Philippines
no unnecessary difficulties and inconvenience
have been shown by either of the parties. The
choice of forum of the plaintiff (now private
respondent) should be upheld.
Similarly, the trial court also possesses
jurisdiction over the persons of the parties

herein. By filing her Complaint and Amended

Complaint with the trial court, private
respondent has voluntary submitted herself to
the jurisdiction of the court.
The records show that petitioner SAUDIA has
filed several motions[50] praying for the
dismissal of Moradas Amended
Complaint.SAUDIA also filed an Answer In Ex
Abundante Cautelam dated February 20,
1995. What is very patent and explicit from the
motions filed, is that SAUDIA prayed for other
reliefs under the premises. Undeniably,
petitioner SAUDIA has effectively submitted to
the trial courts jurisdiction by praying for the
dismissal of the Amended Complaint on grounds
other than lack of jurisdiction.
As held by this Court in Republic vs. Ker and
Company, Ltd.:[51]
We observe that the motion to dismiss filed on
April 14, 1962, aside from disputing the lower
courts jurisdiction over defendants person,
prayed for dismissal of the complaint on the
ground that plaintiffs cause of action has
prescribed. By interposing such second ground
in its motion to dismiss, Ker and Co., Ltd.
availed of an affirmative defense on the basis of
which it prayed the court to resolve controversy
in its favor. For the court to validly decide the
said plea of defendant Ker & Co., Ltd., it
necessarily had to acquire jurisdiction upon the
latters person, who, being the proponent of the
affirmative defense, should be deemed to have
abandoned its special appearance and
voluntarily submitted itself to the jurisdiction of
the court.
Similarly, the case of De Midgely vs. Ferandos,
held that:
When the appearance is by motion for the
purpose of objecting to the jurisdiction of the
court over the person, it must be for the sole
and separate purpose of objecting to the
jurisdiction of the court. If his motion is for any
other purpose than to object to the jurisdiction
of the court over his person, he thereby submits
himself to the jurisdiction of the court. A special
appearance by motion made for the purpose of
objecting to the jurisdiction of the court over
the person will be held to be a general
appearance, if the party in said motion should,
for example, ask for a dismissal of the action
upon the further ground that the court had no
jurisdiction over the subject matter.[52]

Clearly, petitioner had submitted to the

jurisdiction of the Regional Trial Court of Quezon
City. Thus, we find that the trial court has
jurisdiction over the case and that its exercise
thereof, justified.
As to the choice of applicable law, we note that
choice-of-law problems seek to answer two
important questions: (1) What legal system
should control a given situation where some of
the significant facts occurred in two or more
states; and (2) to what extent should the
chosen legal system regulate the situation.[53]
Several theories have been propounded in order
to identify the legal system that should
ultimately control. Although ideally, all choiceof-law theories should intrinsically advance both
notions of justice and predictability, they do not
always do so. The forum is then faced with the
problem of deciding which of these two
important values should be stressed.[54]
Before a choice can be made, it is necessary for
us to determine under what category a certain
set of facts or rules fall. This process is known
as characterization, or the doctrine of
qualification. It is the process of deciding
whether or not the facts relate to the kind of
question specified in a conflicts rule.[55] The
purpose of characterization is to enable the
forum to select the proper law.[56]
Our starting point of analysis here is not a legal
relation, but a factual situation, event, or
operative fact.[57] An essential element of
conflict rules is the indication of a test or
connecting factor or point of contact. Choice-oflaw rules invariably consist of a factual
relationship (such as property right, contract
claim) and a connecting factor or point of
contact, such as the situs of the res, the place
of celebration, the place of performance, or the
place of wrongdoing.[58]
Note that one or more circumstances may be
present to serve as the possible test for the
determination of the applicable law.[59]These
test factors or points of contact or connecting
factors could be any of the following:
(1) The nationality of a person, his domicile, his
residence, his place of sojourn, or his origin;
(2) the seat of a legal or juridical person, such
as a corporation;

(3) the situs of a thing, that is, the place where

a thing is, or is deemed to be situated. In
particular, the lex situs is decisive when real
rights are involved;
(4) the place where an act has been done,
the locus actus, such as the place where a
contract has been made, a marriage celebrated,
a will signed or a tort committed. The lex loci
actus is particularly important in contracts and
torts;
(5) the place where an act is intended to come
into effect, e.g., the place of performance of
contractual duties, or the place where a power
of attorney is to be exercised;
(6) the intention of the contracting parties as to
the law that should govern their agreement,
the lex loci intentionis;
(7) the place where judicial or administrative
proceedings are instituted or done. The lex
forithe law of the forumis particularly important
because, as we have seen earlier, matters of
procedure not going to the substance of the
claim involved are governed by it; and because
the lex fori applies whenever the content of the
otherwise applicable foreign law is excluded
from application in a given case for the reason
that it falls under one of the exceptions to the
applications of foreign law; and
(8) the flag of a ship, which in many cases is
decisive of practically all legal relationships of
the ship and of its master or owner as such. It
also covers contractual relationships particularly
contracts of affreightment.[60] (Underscoring
ours.)
After a careful study of the pleadings on record,
including allegations in the Amended Complaint
deemed submitted for purposes of the motion
to dismiss, we are convinced that there is
reasonable basis for private respondents
assertion that although she was already
working in Manila, petitioner brought her to
Jeddah on the pretense that she would merely
testify in an investigation of the charges she
made against the two SAUDIA crew members
for the attack on her person while they were in
Jakarta. As it turned out, she was the one made
to face trial for very serious charges, including
adultery and violation of Islamic laws and
tradition.
There is likewise logical basis on record for the
claim that the handing over or turning over of

the person of private respondent to Jeddah

officials, petitioner may have acted beyond its
duties as employer. Petitioners purported act
contributed to and amplified or even
proximately caused additional humiliation,
misery and suffering of private
respondent. Petitioner thereby allegedly
facilitated the arrest, detention and prosecution
of private respondent under the guise of
petitioners authority as employer, taking
advantage of the trust, confidence and faith she
reposed upon it. As purportedly found by the
Prince of Makkah, the alleged conviction and
imprisonment of private respondent was
wrongful. But these capped the injury or harm
allegedly inflicted upon her person and
reputation, for which petitioner could be liable
as claimed, to provide compensation or redress
for the wrongs done, once duly proven.
Considering that the complaint in the
court a quo is one involving torts, the
connecting factor or point of contact could be
the place or places where the tortious conduct
or lex loci actus occurred. And applying the
torts principle in a conflicts case, we find that
the Philippines could be said as a situs of the
tort (the place where the alleged tortious
conduct took place). This is because it is in the
Philippines where petitioner allegedly deceived
private respondent, a Filipina residing and
working here. According to her, she had
honestly believed that petitioner would, in the
exercise of its rights and in the performance of
its duties, act with justice, give her her due and
observe honesty and good faith. Instead,
petitioner failed to protect her, she
claimed. That certain acts or parts of the injury
allegedly occurred in another country is of no
moment. For in our view what is important here
is the place where the over-all harm or the
fatality of the alleged injury to the person,
reputation, social standing and human rights of
complainant, had lodged, according to the
plaintiff below (herein private respondent). All
told, it is not without basis to identify the
Philippines as the situs of the alleged tort.
Moreover, with the widespread criticism of the
traditional rule of lex loci delicti commissi,
modern theories and rules on tort
liability[61] have been advanced to offer fresh
judicial approaches to arrive at just results. In
keeping abreast with the modern theories on
tort liability, we find here an occasion to apply
the State of the most significant relationship
rule, which in our view should be appropriate to
apply now, given the factual context of this
case.
In applying said principle to determine the State
which has the most significant relationship, the

following contacts are to be taken into account

and evaluated according to their relative
importance with respect to the particular issue:
(a) the place where the injury occurred; (b) the
place where the conduct causing the injury
occurred; (c) the domicile, residence,
nationality, place of incorporation and place of
business of the parties, and (d) the place where
the relationship, if any, between the parties is
centered.[62]
As already discussed, there is basis for the
claim that over-all injury occurred and lodged in
the Philippines. There is likewise no question
that private respondent is a resident Filipina
national, working with petitioner, a resident
foreign corporation engaged here in the
business of international air carriage. Thus, the
relationship between the parties was centered
here, although it should be stressed that this
suit is not based on mere labor law
violations. From the record, the claim that the
Philippines has the most significant contact with
the matter in this dispute,[63] raised by private
respondent as plaintiff below against defendant
(herein petitioner), in our view, has been
properly established.
Prescinding from this premise that the
Philippines is the situs of the tort complaint of
and the place having the most interest in the
problem, we find, by way of recapitulation, that
the Philippine law on tort liability should have
paramount application to and control in the
resolution of the legal issues arising out of this
case. Further, we hold that the respondent
Regional Trial Court has jurisdiction over the
parties and the subject matter of the complaint;
the appropriate venue is in Quezon City, which
could properly apply Philippine law.Moreover,
we find untenable petitioners insistence that
[s]ince private respondent instituted this suit,
she has the burden of pleading and proving the
applicable Saudi law on the matter.[64] As aptly
said by private respondent, she has no
obligation to plead and prove the law of the
Kingdom of Saudi Arabia since her cause of
action is based on Articles 19 and 21 of the Civil
Code of the Philippines. In her Amended
Complaint and subsequent pleadings she never
alleged that Saudi law should govern this case.
[65] And as correctly held by the respondent
appellate court, considering that it was the
petitioner who was invoking the applicability of
the law of Saudi Arabia, thus the burden was on
it [petitioner] to plead and to establish what the
law of Saudi Arabia is.[66]
Lastly, no error could be imputed to the
respondent appellate court in upholding the trial
courts denial of defendants (herein petitioners)
motion to dismiss the case. Not only was

jurisdiction in order and venue properly laid, but

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

National Labor Relations Commission (NLRC)s

June 29, 2001 Resolution,[4] affirming Labor
Arbiter Joel S. Lustrias January 18, 2000
Decision.[5]
The assailed CA Resolution denied herein
petitioners Motion for Reconsideration.
The Facts
The facts are narrated by the Court of Appeals
as follows:

DECISION

In late 1998, [herein Respondent Florence

Cabansag] arrived in Singapore as a tourist. She
applied for employment, with the Singapore
Branch of the Philippine National Bank, a private
banking corporation organized and existing
under the laws of the Philippines, with principal
offices at the PNB Financial Center, Roxas
Boulevard, Manila. At the time, the Singapore
PNB Branch was under the helm of Ruben C.
Tobias, a lawyer, as General Manager, with the
rank of Vice-President of the Bank. At the time,
too, the Branch Office had two (2) types of
employees: (a) expatriates or the regular
employees, hired in Manila and assigned abroad
including Singapore, and (b) locally (direct)
hired. She applied for employment as Branch
Credit Officer, at a total monthly package of
$SG4,500.00, effective upon assumption of
duties after approval. Ruben C. Tobias found her
eminently qualified and wrote on October 26,
1998, a letter to the President of the Bank in
Manila, recommending the appointment of
Florence O. Cabansag, for the position.

PANGANIBAN, J.:

xxxxxxxxx

The Court reiterates the basic policy that all

Filipino workers, whether employed locally or
overseas, enjoy the protective mantle of
Philippine labor and social legislations. Our
labor statutes may not be rendered ineffective
by laws or judgments promulgated, or
stipulations agreed upon, in a foreign country.

The President of the Bank was impressed with

the credentials of Florence O. Cabansag that he
approved the recommendation of Ruben C.
Tobias. She then filed an Application, with the
Ministry of Manpower of the Government of
Singapore, for the issuance of anEmployment
Pass as an employee of the Singapore PNB
Branch. Her application was approved for a
period of two (2) years.

WHEREFORE, the instant petition for certiorari is

hereby DISMISSED. Civil Case No. Q-93-18394
entitled Milagros P. Morada vs. Saudi Arabia
Airlines is hereby REMANDED to Regional Trial
Court of Quezon City, Branch 89 for further
proceedings.
SO ORDERED.
THIRD DIVISION
[G.R. No. 157010. June 21, 2005]
PHILIPPINE NATIONAL BANK, petitioner, vs.
FLORENCE O. CABANSAG, respondent.

The Case
Before us is a Petition for Review
on Certiorari[1] under Rule 45 of the Rules of
Court, seeking to reverse and set aside the July
16, 2002 Decision[2] and the January 29, 2003
Resolution[3] of the Court of Appeals (CA) in CAGR SP No. 68403. The assailed Decision
dismissed the CA Petition (filed by herein
petitioner), which had sought to reverse the

On December 7, 1998, Ruben C. Tobias wrote a

letter to Florence O. Cabansag offering her a
temporary appointment, as Credit Officer, at a
basic salary of Singapore Dollars 4,500.00, a
month and, upon her successful completion of
her probation to be determined solely, by the
Bank, she may be extended at the discretion of
the Bank, a permanent appointment and that
her temporary appointment was subject to the
following terms and conditions:
1. You will be on probation for a period of three
(3) consecutive months from the date of your
assumption of duty.
2. You will observe the Banks rules and
regulations and those that may be adopted
from time to time.
3. You will keep in strictest confidence all
matters related to transactions between the
Bank and its clients.
4. You will devote your full time during business
hours in promoting the business and interest of
the Bank.
5. You will not, without prior written consent of
the Bank, be employed in anyway for any
purpose whatsoever outside business hours by
any person, firm or company.
6. Termination of your employment with the
Bank may be made by either party after notice
of one (1) day in writing during probation, one
month notice upon confirmation or the
equivalent of one (1) days or months salary in
lieu of notice.
Florence O. Cabansag accepted the position and
assumed office. In the meantime, the Philippine
Embassy in Singapore processed the
employment contract of Florence O. Cabansag
and, on March 8, 1999, she was issued by the
Philippine Overseas Employment
Administration, an Overseas Employment
Certificate, certifying that she was a bona fide
contract worker for Singapore.
xxxxxxxxx
Barely three (3) months in office, Florence O.
Cabansag submitted to Ruben C. Tobias, on
March 9, 1999, her initial Performance Report.
Ruben C. Tobias was so impressed with
the Report that he made a notation and, on

said Report: GOOD WORK. However, in the

evening of April 14, 1999, while Florence O.
Cabansag was in the flat, which she and Cecilia
Aquino, the Assistant Vice-President and Deputy
General Manager of the Branch and Rosanna
Sarmiento, the Chief Dealer of the said Branch,
rented, she was told by the two (2) that Ruben
C. Tobias has asked them to tell Florence O.
Cabansag to resign from her job. Florence O.
Cabansag was perplexed at the sudden turn of
events and the runabout way Ruben C. Tobias
procured her resignation from the Bank. The
next day, Florence O. Cabansag talked to Ruben
C. Tobias and inquired if what Cecilia Aquino
and Rosanna Sarmiento had told her was true.
Ruben C. Tobias confirmed the veracity of the
information, with the explanation that her
resignation was imperative as a cost-cutting
measure of the Bank. Ruben C. Tobias, likewise,
told Florence O. Cabansag that the PNB
Singapore Branch will be sold or transformed
into a remittance office and that, in either way,
Florence O. Cabansag had to resign from her
employment. The more Florence O. Cabansag
was perplexed. She then asked Ruben C. Tobias
that she be furnished with a Formal Advice from
the PNB Head Office in Manila. However, Ruben
C. Tobias flatly refused. Florence O. Cabansag
did not submit any letter of resignation.
On April 16, 1999, Ruben C. Tobias again
summoned Florence O. Cabansag to his office
and demanded that she submit her letter of
resignation, with the pretext that he needed a
Chinese-speaking Credit Officer to penetrate the
local market, with the information that a
Chinese-speaking Credit Officer had already
been hired and will be reporting for work soon.
She was warned that, unless she submitted her
letter of resignation, her employment record will
be blemished with the
notation DISMISSED spread thereon. Without
giving any definitive answer, Florence O.
Cabansag asked Ruben C. Tobias that she be
given sufficient time to look for another job.
Ruben C. Tobias told her that she should be out
of her employment by May 15, 1999.
However, on April 19, 1999, Ruben C. Tobias
again summoned Florence O. Cabansag and
adamantly ordered her to submit her letter of
resignation. She refused. On April 20, 1999, she
received a letter from Ruben C. Tobias
terminating her employment with the Bank.
xxxxxxxxx
On January 18, 2000, the Labor Arbiter rendered
judgment in favor of the Complainant and
against the Respondents, the decretal portion of
which reads as follows:

WHEREFORE, considering the foregoing

premises, judgment is hereby rendered finding
respondents guilty of Illegal dismissal and
devoid of due process, and are hereby ordered:

4. To pay complainant the amount of SGD

5,039.81 or its equivalent in Philippine Currency
at the time of payment, representing attorneys
fees.
SO ORDERED. [6] [Emphasis in the original.]

1. To reinstate complainant to her former or

substantially equivalent position without loss of
seniority rights, benefits and privileges;
2. Solidarily liable to pay complainant as
follows:
a) To pay complainant her backwages from 16
April 1999 up to her actual reinstatement. Her
backwages as of the date of the promulgation of
this decision amounted to SGD 40,500.00 or its
equivalent in Philippine Currency at the time of
payment;
b) Mid-year bonus in the amount of SGD
2,250.00 or its equivalent in Philippine Currency
at the time of payment;
c) Allowance for Sunday banking in the amount
of SGD 120.00 or its equivalent in Philippine
Currency at the time of payment;
d) Monetary equivalent of leave credits earned
on Sunday banking in the amount of SGD
1,557.67 or its equivalent in Philippine Currency
at the time of payment;
e) Monetary equivalent of unused sick leave
benefits in the amount of SGD 1,150.60 or its
equivalent in Philippine Currency at the time of
payment.
f) Monetary equivalent of unused vacation leave
benefits in the amount of SGD 319.85 or its
equivalent in Philippine Currency at the time of
payment.
g) 13th month pay in the amount of SGD
4,500.00 or its equivalent in Philippine Currency
at the time of payment;
3. Solidarily to pay complainant actual damages
in the amount of SGD 1,978.00 or its equivalent
in Philippine Currency at the time of payment,
and moral damages in the amount of PhP
200,000.00, exemplary damages in the amount
of PhP 100,000.00;

PNB appealed the labor arbiters Decision to the

NLRC. In a Resolution dated June 29, 2001, the
Commission affirmed that Decision, but reduced
the moral damages to P100,000 and the
exemplary damages to P50,000. In a
subsequent Resolution, the NLRC denied PNBs
Motion for Reconsideration.
Ruling of the Court of Appeals
In disposing of the Petition for Certiorari, the CA
noted that petitioner bank had failed to adduce
in evidence the Singaporean law supposedly
governing the latters employment Contract with
respondent. The appellate court found that the
Contract had actually been processed by the
Philippine Embassy in Singapore and approved
by the Philippine Overseas Employment
Administration (POEA), which then used that
Contract as a basis for issuing an Overseas
Employment Certificate in favor of respondent.
According to the CA, even though respondent
secured an employment pass from the
Singapore Ministry of Employment, she did not
thereby waive Philippine labor laws, or the
jurisdiction of the labor arbiter or the NLRC over
her Complaint for illegal dismissal. In so doing,
neither did she submit herself solely to the
Ministry of Manpower of Singapores jurisdiction
over disputes arising from her employment. The
appellate court further noted that a cursory
reading of the Ministrys letter will readily show
that no such waiver or submission is stated or
implied.
Finally, the CA held that petitioner had failed to
establish a just cause for the dismissal of
respondent. The bank had also failed to give her
sufficient notice and an opportunity to be heard
and to defend herself. The CA ruled that she
was consequently entitled to reinstatement and
back wages, computed from the time of her
dismissal up to the time of her reinstatement.
Hence, this Petition.[7]
Issues

Petitioner submits the following issues for our

consideration:
1. Whether or not the arbitration branch of the
NLRC in the National Capital Region has
jurisdiction over the instant controversy;

The Courts Ruling

The Petition has no merit.
First Issue:

2. Whether or not the arbitration of the NLRC in

the National Capital Region is the most
convenient venue or forum to hear and decide
the instant controversy; and
3. Whether or not the respondent was illegally
dismissed, and therefore, entitled to recover
moral and exemplary damages and attorneys
fees.[8]
In addition, respondent assails, in her Comment,
[9] the propriety of Rule 45 as the procedural
mode for seeking a review of the CA Decision
affirming the NLRC Resolution. Such issue
deserves scant consideration. Respondent
miscomprehends the Courts discourse in St.
Martin Funeral Home v. NLRC,[10] which has
indeed affirmed that the proper mode of review
of NLRC decisions, resolutions or orders is by a
special civil action for certiorari under Rule 65
of the Rules of Court. The Supreme Court and
the Court of Appeals
haveconcurrent original jurisdiction over such
petitions for certiorari. Thus, in observance of
the doctrine on the hierarchy of courts, these
petitions should be initially filed with the CA.
[11]
Rightly, the bank elevated the NLRC Resolution
to the CA by way of a Petition for Certiorari. In
seeking a review by this Court of the CA
Decision -- on questions of jurisdiction, venue
and validity of employment termination -petitioner is likewise correct in invoking Rule 45.
[12]
It is true, however, that in a petition for review
on certiorari, the scope of the Supreme Courts
judicial review of decisions of the Court of
Appeals is generally confined only to errors of
law. It does not extend to questions of fact. This
doctrine applies with greater force in labor
cases. Factual questions are for the labor
tribunals to resolve. [13] In the present case,
the labor arbiter and the NLRC have already
determined the factual issues. Their findings,
which are supported by substantial evidence,
were affirmed by the CA. Thus, they are entitled
to great respect and are rendered conclusive
upon this Court, absent a clear showing of
palpable error or arbitrary disregard of
evidence.[14]

Jurisdiction
The jurisdiction of labor arbiters and the NLRC is
specified in Article 217 of the Labor Code as
follows:
ART. 217. Jurisdiction of Labor Arbiters and the
Commission. (a) Except as otherwise provided
under this Code the Labor Arbiters shall have
original and exclusive jurisdiction to hear and
decide, within thirty (30) calendar days after the
submission of the case by the parties for
decision without extension, even in the absence
of stenographic notes, the following cases
involving all workers, whether agricultural or
non-agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for
reinstatement, those cases that workers may
file involving wage, rates of pay, hours of work
and other terms and conditions of employment
4. Claims for actual, moral, exemplary and other
forms of damages arising from the employeremployee relations;
5. Cases arising from any violation of Article 264
of this Code, including questions involving the
legality of strikes and lockouts; and
6. Except claims for Employees Compensation,
Social Security, Medicare and maternity
benefits, all other claims, arising from employeremployee relations, including those of persons
in domestic or household service, involving an
amount of exceeding five thousand pesos
(P5,000.00) regardless of whether accompanied
with a claim for reinstatement.
(b) The commission shall have exclusive
appellate jurisdiction over all cases decided by
Labor Arbiters.

x x x x x x x x x.
More specifically, Section 10 of RA 8042 reads
in part:
SECTION 10. Money Claims. Notwithstanding
any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within
ninety (90) calendar days after the filing of the
complaint, the claims arising out of an
employer-employee relationship or by virtue of
any law or contract involving Filipino workers for
overseas deployment including claims for
actual, moral, exemplary and other forms of
damages.
xxxxxxxxx
Based on the foregoing provisions, labor
arbiters clearly have original and
exclusive jurisdiction over claims arising from
employer-employee relations,
including termination
disputes involving all workers, among whom are
overseas Filipino workers (OFW).[15]
We are not unmindful of the fact that
respondent was directly hired, while on a tourist
status in Singapore, by the PNB branch in that
city state. Prior to employing respondent,
petitioner had to obtain an employment pass for
her from the Singapore Ministry of Manpower.
Securing the pass was a regulatory requirement
pursuant to the immigration regulations of that
country.[16]
Similarly, the Philippine government requires
non-Filipinos working in the country to first
obtain a local work permit in order to be legally
employed here. That permit, however, does not
automatically mean that the non-citizen is
thereby bound by local laws only, as averred by
petitioner. It does not at all imply a waiver of
ones national laws on labor. Absent any clear
and convincing evidence to the contrary, such
permit simply means that its holder has a legal
status as a worker in the issuing country.
Noteworthy is the fact that respondent likewise
applied for and secured an Overseas
Employment Certificate from the POEA through
the Philippine Embassy in Singapore. The
Certificate, issued on March 8, 1999, declared
her a bona fide contract worker for Singapore.
Under Philippine law, this document authorized

her working status in a foreign country and

entitled her to all benefits and processes under
our statutes. Thus, even
assuming arguendo that she was considered at
the start of her employment as a direct hire
governed by and subject to the laws, common
practices and customs prevailing in
Singapore[17] she subsequently became a
contract worker or an OFW who was covered by
Philippine labor laws and policies upon
certification by the POEA. At the time her
employment was illegally terminated, she
already possessed the POEA employment
Certificate.
Moreover, petitioner admits that it is a
Philippine corporation doing business through a
branch office in Singapore.[18]Significantly,
respondents employment by the Singapore
branch office had to be approved by Benjamin P.
Palma Gil,[19] the president of the bank whose
principal offices were in Manila. This
circumstance militates against petitioners
contention that respondent was locally hired;
and totally governed by and subject to the laws,
common practices and customs of Singapore,
not of the Philippines. Instead, with more reason
does this fact reinforce the presumption that
respondent falls under the legal definition
of migrant worker, in this case one deployed in
Singapore. Hence, petitioner cannot escape the
application of Philippine laws or the jurisdiction
of the NLRC and the labor arbiter.
In any event, we recall the following policy
pronouncement of the Court in Royal Crown
Internationale v. NLRC:[20]
x x x. Whether employed locally or overseas, all
Filipino workers enjoy the protective mantle of
Philippine labor and social legislation, contract
stipulations to the contrary notwithstanding.
This pronouncement is in keeping with the basic
public policy of the State to afford protection to
labor, promote full employment, ensure equal
work opportunities regardless of sex, race or
creed, and regulate the relations between
workers and employers. For the State assures
the basic rights of all workers to selforganization, collective bargaining, security of
tenure, and just and humane conditions of work
[Article 3 of the Labor Code of the
Philippines; See also Section 18, Article II and
Section 3, Article XIII, 1987 Constitution]. This
ruling is likewise rendered imperative by Article
17 of the Civil Code which states that laws
which have for their object public order, public
policy and good customs shall not be rendered
ineffective by laws or judgments promulgated,
or by determination or conventions agreed upon
in a foreign country.

Second Issue:

Third Issue:

Proper Venue

Illegal Dismissal

Section 1(a) of Rule IV of the NLRC Rules of

Procedure reads:

The appellate court was correct in holding that

respondent was already a regular employee at
the time of her dismissal, because her threemonth probationary period of employment had
already ended. This ruling is in accordance with
Article 281 of the Labor Code: An employee who
is allowed to work after a probationary period
shall be considered a regular employee. Indeed,
petitioner recognized respondent as such at the
time it dismissed her, by giving her one months
salary in lieu of a one-month notice, consistent
with provision No. 6 of her employment
Contract.

Section 1. Venue (a) All cases which Labor

Arbiters have authority to hear and decide may
be filed in the Regional Arbitration Branch
having jurisdiction over the workplace of the
complainant/petitioner; Provided, however that
cases of Overseas Filipino Worker (OFW) shall
be filed before the Regional Arbitration Branch
where the complainant resides or where the
principal office of the respondent/employer is
situated, at the option of the complainant.

Notice and Hearing

For purposes of venue, workplace shall be
understood as the place or locality where the
employee is regularly assigned when the cause
of action arose. It shall include the place where
the employee is supposed to report back after a
temporary detail, assignment or travel. In the
case of field employees, as well as ambulant or
itinerant workers, their workplace is where they
are regularly assigned, or where they are
supposed to regularly receive their
salaries/wages or work instructions from, and
report the results of their assignment to their
employers.
Under the Migrant Workers and Overseas
Filipinos Act of 1995 (RA 8042), a migrant
worker refers to a person who is to be engaged,
is engaged or has been engaged in a
remunerated activity in a state of which he or
she is not a legal resident; to be used
interchangeably with overseas Filipino worker.
[21] Undeniably, respondent was employed by
petitioner in its branch office in Singapore.
Admittedly, she is a Filipino and not a legal
resident of that state. She thus falls within the
category of migrant worker or overseas Filipino
worker.
As such, it is her option to choose the venue of
her Complaint against petitioner for illegal
dismissal. The law gives her two choices: (1) at
the Regional Arbitration Branch (RAB) where
she resides or (2) at the RAB where the principal
office of her employer is situated. Since her
dismissal by petitioner, respondent has
returned to the Philippines -- specifically to her
residence at Filinvest II, Quezon City. Thus, in
filing her Complaint before the RAB office in
Quezon City, she has made a valid choice of
proper venue.

Not Complied With

As a regular employee, respondent was entitled
to all rights, benefits and privileges provided
under our labor laws. One of her fundamental
rights is that she may not be dismissed without
due process of law. The twin requirements of
notice and hearing constitute the essential
elements of procedural due process, and
neither of these elements can be eliminated
without running afoul of the constitutional
guarantee.[22]
In dismissing employees, the employer must
furnish them two written notices: 1) one to
apprise them of the particular acts or omissions
for which their dismissal is sought; and 2) the
other to inform them of the decision to dismiss
them. As to the requirement of a hearing, its
essence lies simply in the opportunity to be
heard.[23]
The evidence in this case is crystal-clear.
Respondent was not notified of the specific act
or omission for which her dismissal was being
sought. Neither was she given any chance to be
heard, as required by law. At any rate, even if
she were given the opportunity to be heard, she
could not have defended herself effectively, for
she knew no cause to answer to.
All that petitioner tendered to respondent was a
notice of her employment termination effective
the very same day, together with the equivalent
of a one-month pay. This Court has already held
that nothing in the law gives an employer the
option to substitute the required prior notice

and opportunity to be heard with the mere

payment of 30 days salary.[24]
Well-settled is the rule that the employer shall
be sanctioned for noncompliance with the
requirements of, or for failure to observe, due
process that must be observed in dismissing an
employee.[25]

Basic in our jurisprudence is the principle that

when there is no showing of any clear, valid,
and legal cause for the termination of
employment, the law considers the matter a
case of illegal dismissal.[33]
Awards for Damages
Justified

No Valid Cause
for Dismissal
Moreover, Articles 282,[26] 283[27] and
284[28] of the Labor Code provide the valid
grounds or causes for an employees dismissal.
The employer has the burden of proving that it
was done for any of those just or authorized
causes. The failure to discharge this burden
means that the dismissal was not justified, and
that the employee is entitled to reinstatement
and back wages.[29]
Notably, petitioner has not asserted any of the
grounds provided by law as a valid reason for
terminating the employment of respondent. It
merely insists that her dismissal was validly
effected pursuant to the provisions of her
employment Contract, which she had
voluntarily agreed to be bound to.
Truly, the contracting parties may establish
such stipulations, clauses, terms and conditions
as they want, and their agreement would have
the force of law between them. However,
petitioner overlooks the qualification that those
terms and conditions agreed upon must not be
contrary to law, morals, customs, public policy
or public order.[30] As explained earlier, the
employment Contract between petitioner and
respondent is governed by Philippine labor laws.
Hence, the stipulations, clauses, and terms and
conditions of the Contract must not contravene
our labor law provisions.
Moreover, a contract of employment is imbued
with public interest. The Court has time and
time again reminded parties that they are not at
liberty to insulate themselves and their
relationships from the impact of labor laws and
regulations by simply contractingwith each
other.[31] Also, while a contract is the law
between the parties, the provisions of positive
law that regulate such contracts are deemed
included and shall limit and govern the relations
between the parties.[32]

Finally, moral damages are recoverable when

the dismissal of an employee is attended by
bad faith or constitutes an act oppressive to
labor or is done in a manner contrary to morals,
good customs or public policy.[34] Awards for
moral and exemplary damages would be proper
if the employee was harassed and arbitrarily
dismissed by the employer.[35]
In affirming the awards of moral and exemplary
damages, we quote with approval the following
ratiocination of the labor arbiter:
The records also show that [respondents]
dismissal was effected by [petitioners]
capricious and high-handed manner, anti-social
and oppressive, fraudulent and in bad faith, and
contrary to morals, good customs and public
policy. Bad faith and fraud are shown in the acts
committed by [petitioners] before, during and
after [respondents] dismissal in addition to the
manner by which she was dismissed. First,
[respondent] was pressured to resign for two
different and contradictory reasons, namely,
cost-cutting and the need for a
Chinese[-]speaking credit officer, for which no
written advice was given despite complainants
request. Such wavering stance or vacillating
position indicates bad faith and a dishonest
purpose. Second, she was employed on account
of her qualifications, experience and readiness
for the position of credit officer and pressured to
resign a month after she was commended for
her good work. Third, the demand for
[respondents] instant resignation on 19 April
1999 to give way to her replacement who was
allegedly reporting soonest, is whimsical,
fraudulent and in bad faith, because on 16 April
1999 she was given a period of [sic] until 15
May 1999 within which to leave. Fourth, the
pressures made on her to resign were highly
oppressive, anti-social and caused her absolute
torture, as [petitioners] disregarded her
situation as an overseas worker away from
home and family, with no prospect for another
job. She was not even provided with a return
trip fare. Fifth, the notice of termination is an
utter manifestation of bad faith and whim as it
totally disregards [respondents] right to security
of tenure and due process. Such notice together

with the demands for [respondents] resignation

contravenes the fundamental guarantee and
public policy of the Philippine government on
security of tenure.
[Respondent] likewise established that as a
proximate result of her dismissal and prior
demands for resignation, she suffered and
continues to suffer mental anguish, fright,
serious anxiety, besmirched reputation,
wounded feelings, moral shock and social
humiliation. Her standing in the social and
business community as well as prospects for
employment with other entities have been
adversely affected by her dismissal.
[Petitioners] are thus liable for moral damages
under Article 2217 of the Civil Code.

GERBERT R. CORPUZ,
Petitioner,

xxxxxxxxx
[Petitioners] likewise acted in a wanton,
oppressive or malevolent manner in terminating
[respondents] employment and are therefore
liable for exemplary damages. This should
served [sic] as protection to other employees of
[petitioner] company, and by way of example or
correction for the public good so that persons
similarly minded as [petitioners] would be
deterred from committing the same acts.[36]

versus -

The Court also affirms the award of attorneys

fees. It is settled that when an action is
instituted for the recovery of wages, or when
employees are forced to litigate and
consequently incur expenses to protect their
rights and interests, the grant of attorneys fees
is legally justifiable.[37]
, the Petition is DENIED and the assailed
Decision and Resolution AFFIRMED. Costs
against petitioner.

DAISYLYN TIROL STO. TOMAS and The

SOLICITOR GENERAL,
Respondents. -- -

SO ORDERED.
G.R. No. 186571 Present:
Republic of the Philippines
Supreme Court
CARPIO MORALES, J., Chairperson,
Manila
BRION,
BERSAMIN,
THIRD DIVISION
*ABAD, and

VILLARAMA, JR., JJ.

Promulgated:
August 11, 2010

Two years after the divorce, Gerbert has moved

on and has found another Filipina to
love. Desirous of marrying his new Filipina
fiance in the Philippines, Gerbert went to the
Pasig City Civil Registry Office and registered
the Canadian divorce decree on his and
Daisylyns marriage certificate. Despite the
registration of the divorce decree, an official of
the National Statistics Office (NSO) informed
Gerbert that the marriage between him and
Daisylyn still subsists under Philippine law; to be
enforceable, the foreign divorce decree must
first be judicially recognized by a competent
Philippine court, pursuant to NSO Circular No. 4,
series of 1982.[6]

x-------------------------------------------------------------------------------------------------------------x
DECISION
BRION, J.:

Before the Court is a direct appeal from the

decision[1] of the Regional Trial Court (RTC)
of LaoagCity, Branch 11, elevated via a petition
for review on certiorari[2] under Rule 45 of the
Rules of Court (present petition).

Petitioner Gerbert R. Corpuz was a former

Filipino citizen who acquired Canadian
citizenship through naturalization on November
29, 2000.[3] On January 18, 2005, Gerbert
married respondent Daisylyn T. Sto. Tomas, a
Filipina, in Pasig City.[4] Due to work and other
professional commitments, Gerbert left
for Canada soon after the wedding. He returned
to the Philippines sometime in April 2005 to
surprise Daisylyn, but was shocked to discover
that his wife was having an affair with another
man. Hurt and disappointed, Gerbert returned
to Canada and filed a petition for divorce. The
Superior Court of
Justice, Windsor, Ontario, Canada granted
Gerberts petition for divorce on December 8,
2005. The divorce decree took effect a month
later, on January 8, 2006.[5]

Accordingly, Gerbert filed a petition for judicial

recognition of foreign divorce and/or declaration
of marriage as dissolved ) with the
RTC. Although summoned, Daisylyn did not file
any responsive pleading but submitted instead
a notarized letter/manifestation to the trial
court. She offered no opposition to Gerberts
petition and, in fact, alleged her desire to file a
similar case herself but was prevented by
financial and personal circumstances. She, thus,
requested that she be considered as a party-ininterest with a similar prayer to Gerberts.

In its October 30, 2008 decision,[7] the RTC

denied Gerberts petition. The RTC concluded
that Gerbert was not the proper party to
institute the action for judicial recognition of the
foreign divorce decree as he is a naturalized
Canadian citizen. It ruled that only the Filipino
spouse can avail of the remedy, under the
second paragraph of Article 26 of the Family
Code,[8] in order for him or her to be able to
remarry under Philippine law.[9] Article 26 of
the Family Code reads:

Art. 26. All marriages solemnized outside

the Philippines, in accordance with the laws in
force in the country where they were
solemnized, and valid there as such, shall also
be valid in this country, except those prohibited
under Articles 35(1), (4), (5) and (6), 36, 37 and
38.

Where a marriage between a Filipino citizen and

a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien
spouse capacitating him or her to remarry, the
Filipino spouse shall likewise have capacity to
remarry under Philippine law.

Essentially, the petition raises the issue

of whether the second paragraph of Article 26
of the Family Code extends to aliens the right to
petition a court of this jurisdiction for the
recognition of a foreign divorce decree.
THE COURTS RULING

This conclusion, the RTC stated, is consistent

with the legislative intent behind the enactment
of the second paragraph of Article 26 of the
Family Code, as determined by the Court
in Republic v. Orbecido III;[10] the provision was
enacted to avoid the absurd situation where the
Filipino spouse remains married to the alien
spouse who, after obtaining a divorce, is no
longer married to the Filipino spouse.[11]

THE PETITION

From the RTCs ruling,[12] Gerbert filed the

present petition.[13]
Gerbert asserts that his petition before the RTC
is essentially for declaratory relief, similar to
that filed in Orbecido; he, thus, similarly asks
for a determination of his rights under the
second paragraph of Article 26 of the Family
Code. Taking into account the rationale behind
the second paragraph of Article 26 of the Family
Code, he contends that the provision applies as
well to the benefit of the alien spouse. He
claims that the RTC ruling unduly stretched the
doctrine in Orbecido by limiting the standing to
file the petition only to the Filipino spouse an
interpretation he claims to be contrary to the
essence of the second paragraph of Article 26
of the Family Code. He considers himself as a
proper party, vested with sufficient legal
interest, to institute the case, as there is a
possibility that he might be prosecuted for
bigamy if he marries his Filipina fiance in the
Philippines since two marriage certificates,
involving him, would be on file with the Civil
Registry Office. The Office of the Solicitor
General and Daisylyn, in their respective
Comments,[14] both support Gerberts position.

The alien spouse can claim no right under the

second paragraph of Article 26 of the Family
Code as the substantive right it establishes is in
favor of the Filipino spouse

The resolution of the issue requires a review of

the legislative history and intent behind the
second paragraph of Article 26 of the Family
Code.

The Family Code recognizes only two types of

defective marriages void[15] and
voidable[16] marriages. In both cases, the basis
for the judicial declaration of absolute nullity or
annulment of the marriage existsbefore or at
the time of the marriage. Divorce, on the other
hand, contemplates the dissolution of the lawful
union for cause arising after the marriage.
[17] Our family laws do not recognize absolute
divorce between Filipino citizens.[18]
Recognizing the reality that divorce is a
possibility in marriages between a Filipino and
an alien, President Corazon C. Aquino, in the
exercise of her legislative powers under the
Freedom Constitution,[19]enacted Executive
Order No. (EO) 227, amending Article 26 of the
Family Code to its present wording, as follows:

Art. 26. All marriages solemnized outside

the Philippines, in accordance with the laws in
force in the country where they were
solemnized, and valid there as such, shall also
be valid in this country, except those prohibited
under Articles 35(1), (4), (5) and (6), 36, 37 and
38.

Where a marriage between a Filipino citizen and

a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien
spouse capacitating him or her to remarry, the
Filipino spouse shall likewise have capacity to
remarry under Philippine law.

Through the second paragraph of Article 26 of

the Family Code, EO 227 effectively
incorporated into the law this Courts holding
in Van Dorn v. Romillo, Jr.[20] and Pilapil v. IbaySomera.[21] In both cases, the Court refused to
acknowledge the alien spouses assertion of
marital rights after a foreign courts divorce
decree between the alien and the Filipino. The
Court, thus, recognized that the foreign divorce
had already severed the marital bond between
the spouses. The Court reasoned in Van Dorn v.
Romillo that:

To maintain x x x that, under our laws, [the

Filipino spouse] has to be considered still
married to [the alien spouse] and still subject to
a wife's obligations x x x cannot be just. [The
Filipino spouse] should not be obliged to live
together with, observe respect and fidelity, and
render support to [the alien spouse]. The latter
should not continue to be one of her heirs with
possible rights to conjugal property. She should
not be discriminated against in her own country
if the ends of justice are to be served.[22]

As the RTC correctly stated, the provision was

included in the law to avoid the absurd situation
where the Filipino spouse remains married to
the alien spouse who, after obtaining a divorce,
is no longer married to the Filipino spouse.
[23] The legislative intent is for the benefit of
the Filipino spouse, by clarifying his or her
marital status, settling the doubts created by
the divorce decree. Essentially, the second
paragraph of Article 26 of the Family Code
provided the Filipino spouse a substantive right
to have his or her marriage to the alien spouse
considered as dissolved, capacitating him or her
to remarry.[24] Without the second paragraph
of Article 26 of the Family Code, the judicial
recognition of the foreign decree of divorce,
whether in a proceeding instituted precisely for

that purpose or as a related issue in another

proceeding, would be of no significance to the
Filipino spouse since our laws do not recognize
divorce as a mode of severing the marital bond;
[25] Article 17 of the Civil Code provides that
the policy against absolute divorces cannot be
subverted by judgments promulgated in a
foreign country. The inclusion of the second
paragraph in Article 26 of the Family Code
provides the direct exception to this rule and
serves as basis for recognizing the dissolution of
the marriage between the Filipino spouse and
his or her alien spouse.

Additionally, an action based on the second

paragraph of Article 26 of the Family Code is not
limited to the recognition of the foreign divorce
decree. If the court finds that the decree
capacitated the alien spouse to remarry, the
courts can declare that the Filipino spouse is
likewise capacitated to contract another
marriage. No court in this jurisdiction, however,
can make a similar declaration for the alien
spouse (other than that already established by
the decree), whose status and legal capacity
are generally governed by his national law.[26]

Given the rationale and intent behind the

enactment, and the purpose of the second
paragraph of Article 26 of the Family Code, the
RTC was correct in limiting the applicability of
the provision for the benefit of the Filipino
spouse. In other words, only the Filipino spouse
can invoke the second paragraph of Article 26
of the Family Code; the alien spouse can claim
no right under this provision.

The foreign divorce decree is presumptive

evidence of a right that clothes the party with
legal interest to petition for its recognition in
this jurisdiction

We qualify our above conclusion i.e., that the

second paragraph of Article 26 of the Family
Code bestows no rights in favor of aliens with
the complementary statement that this

conclusion is not sufficient basis to dismiss

Gerberts petition before the RTC. In other
words, the unavailability of the second
paragraph of Article 26 of the Family Code to
aliens does not necessarily strip Gerbert of legal
interest to petition the RTC for the recognition of
his foreign divorce decree. The foreign divorce
decree itself, after its authenticity and
conformity with the aliens national law have
been duly proven according to our rules of
evidence, serves as a presumptive evidence of
right in favor of Gerbert, pursuant to Section 48,
Rule 39 of the Rules of Court which provides for
the effect of foreign judgments. This Section
states:

SEC. 48. Effect of foreign judgments or final

orders.The effect of a judgment or final order of
a tribunal of a foreign country, having
jurisdiction to render the judgment or final order
is as follows:

(a)
In case of a judgment or final order
upon a specific thing, the judgment or final
order is conclusive upon the title of the thing;
and

(b)
In case of a judgment or final order
against a person, the judgment or final order is
presumptive evidence of a right as between the
parties and their successors in interest by a
subsequent title.

In either case, the judgment or final order may

be repelled by evidence of a want of
jurisdiction, want of notice to the party,
collusion, fraud, or clear mistake of law or fact.

To our mind, direct involvement or being the

subject of the foreign judgment is sufficient to
clothe a party with the requisite interest to
institute an action before our courts for the
recognition of the foreign judgment. In a divorce
situation, we have declared, no less, that the
divorce obtained by an alien abroad may be

recognized in the Philippines, provided the

divorce is valid according to his or her national
law.[27]

The starting point in any recognition of a foreign

divorce judgment is the acknowledgment that
our courts do not take judicial notice of foreign
judgments and laws. Justice Herrera explained
that, as a rule, no sovereign is bound to give
effect within its dominion to a judgment
rendered by a tribunal of another country.
[28] This means that the foreign judgment and
its authenticity must be proven as facts under
our rules on evidence, together with the aliens
applicable national law to show the effect of the
judgment on the alien himself or herself.
[29] The recognition may be made in an action
instituted specifically for the purpose or in
another action where a party invokes the
foreign decree as an integral aspect of his claim
or defense.

In Gerberts case, since both the foreign divorce

decree and the national law of the alien,
recognizing his or her capacity to obtain a
divorce, purport to be official acts of a sovereign
authority, Section 24, Rule 132 of the Rules of
Court comes into play. This Section requires
proof, either by (1) official publications or (2)
copies attested by the officer having legal
custody of the documents. If the copies of
official records are not kept in the Philippines,
these must be (a) accompanied by a certificate
issued by the proper diplomatic or consular
officer in the Philippine foreign service stationed
in the foreign country in which the record is
kept and (b) authenticated by the seal of his
office.

The records show that Gerbert attached to his

petition a copy of the divorce decree, as well as
the required certificates proving its authenticity,
[30] but failed to include a copy of the Canadian
law on divorce.[31] Under this situation, we can,
at this point, simply dismiss the petition for
insufficiency of supporting evidence, unless we
deem it more appropriate to remand the case to
the RTC to determine whether the divorce
decree is consistent with the Canadian divorce
law.

We deem it more appropriate to take this latter

course of action, given the Article 26 interests
that will be served and the Filipina wifes
(Daisylyns) obvious conformity with the
petition. A remand, at the same time, will allow
other interested parties to oppose the foreign
judgment and overcome a petitioners
presumptive evidence of a right by proving
want of jurisdiction, want of notice to a party,
collusion, fraud, or clear mistake of law or
fact. Needless to state, every precaution must
be taken to ensure conformity with our laws
before a recognition is made, as the foreign
judgment, once recognized, shall have the
effect of res judicata[32] between the parties,
as provided in Section 48, Rule 39 of the Rules
of Court.[33]

permanent in nature, not ordinarily terminable

at his own will, such as his being legitimate or
illegitimate, or his being married or not.[35]

A judgment of divorce is a judicial decree,

although a foreign one, affecting a persons legal
capacity and status that must be recorded. In
fact, Act No. 3753 or the Law on Registry of Civil
Status specifically requires the registration of
divorce decrees in the civil registry:

Sec. 1. Civil Register. A civil register is

established for recording the civil status of
persons, in which shall be entered:
In fact, more than the principle of comity that is
served by the practice of reciprocal recognition
of foreign judgments between nations, the res
judicata effect of the foreign judgments of
divorce serves as the deeper basis for
extending judicial recognition and for
considering the alien spouse bound by its
terms. This same effect, as discussed above,
will not obtain for the Filipino spouse were it not
for the substantive rule that the second
paragraph of Article 26 of the Family Code
provides.

(a)

births;

(b) deaths;
(c)

marriages;

(d) annulments of marriages;

Considerations beyond the recognition of the

foreign divorce decree
As a matter of housekeeping concern, we note
that the Pasig City Civil Registry Office has
already recorded the divorce decree on Gerbert
and Daisylyns marriage certificate based on the
mere presentation of the decree.[34] We
consider the recording to be legally improper;
hence, the need to draw attention of the bench
and the bar to what had been done.

Article 407 of the Civil Code states that [a]cts,

events and judicial decrees concerning the civil
status of persons shall be recorded in the civil
register. The law requires the entry in the civil
registry of judicial decrees that produce legal
consequences touching upon a persons legal
capacity and status, i.e., those affecting all his
personal qualities and relations, more or less

(e)

divorces;

(f)

legitimations;

(g) adoptions;
(h) acknowledgment of natural children;
(i)

naturalization; and

(j)

changes of name.

xxxx

Sec. 4. Civil Register Books. The local registrars

shall keep and preserve in their offices the
following books, in which they shall,
respectively make the proper entries concerning
the civil status of persons:

(1) Birth and death register;

(2) Marriage register, in which shall be

entered not only the marriages solemnized but
also divorces and dissolved marriages.

(3) Legitimation, acknowledgment, adoption,

change of name and naturalization register.

But while the law requires the entry of the

divorce decree in the civil registry, the law and
the submission of the decree by themselves do
not ipso facto authorize the
decrees registration. The law should be read in
relation with the requirement of a judicial
recognition of the foreign judgment before it
can be givenres judicata effect. In the context of
the present case, no judicial order as yet exists
recognizing the foreign divorce decree. Thus,
the Pasig City Civil Registry Office acted totally
out of turn and without authority of law when it
annotated the Canadian divorce decree on
Gerbert and Daisylyns marriage certificate, on
the strength alone of the foreign decree
presented by Gerbert.

Evidently, the Pasig City Civil Registry Office

was aware of the requirement of a court
recognition, as it cited NSO Circular No. 4, series
of 1982,[36] and Department of Justice Opinion
No. 181, series of 1982[37] both of which
required a final order from a competent
Philippine court before a foreign judgment,
dissolving a marriage, can be registered in the
civil registry, but it, nonetheless, allowed the
registration of the decree. For being contrary to

law, the registration of the foreign divorce

decree without the requisite judicial recognition
is patently void and cannot produce any legal
effect.

Another point we wish to draw attention to is

that the recognition that the RTC may extend to
the Canadian divorce decree does not, by itself,
authorize the cancellation of the entry in the
civil registry. A petition for recognition of a
foreign judgment is not the proper proceeding,
contemplated under the Rules of Court, for the
cancellation of entries in the civil registry.

Article 412 of the Civil Code declares that no

entry in a civil register shall be changed or
corrected, without judicial order. The Rules of
Court supplements Article 412 of the Civil Code
by specifically providing for a special remedial
proceeding by which entries in the civil registry
may be judicially cancelled or corrected. Rule
108 of the Rules of Court sets in detail the
jurisdictional and procedural requirements that
must be complied with before a judgment,
authorizing the cancellation or correction, may
be annotated in the civil registry. It also
requires, among others, that the verified
petition must be filed with the RTC of the
province where the corresponding civil registry
is located;[38] that the civil registrar and all
persons who have or claim any interest must be
made parties to the proceedings;[39] and that
the time and place for hearing must be
published in a newspaper of general circulation.
[40] As these basic jurisdictional requirements
have not been met in the present case, we
cannot consider the petition Gerbert filed with
the RTC as one filed under Rule 108 of the Rules
of Court.

We hasten to point out, however, that this ruling

should not be construed as requiring two
separate proceedings for the registration of a
foreign divorce decree in the civil registry one
for recognition of the foreign decree and
another specifically for cancellation of the entry
under Rule 108 of the Rules of Court.The
recognition of the foreign divorce decree may
be made in a Rule 108 proceeding itself, as the
object of special proceedings (such as that in
Rule 108 of the Rules of Court) is precisely to
establish the status or right of a party or a
particular fact. Moreover, Rule 108 of the Rules

of Court can serve as the appropriate

adversarial proceeding[41] by which the
applicability of the foreign judgment can be
measured and tested in terms of jurisdictional
infirmities, want of notice to the party, collusion,
fraud, or clear mistake of law or fact.

WHEREFORE, we GRANT the petition for review

on certiorari, and REVERSE the October 30,
2008decision of
the Regional Trial Court of Laoag City, Branch
11, as well as its February 17, 2009 order. We
order the REMAND of the case to the trial court
for further proceedings in accordance with our
ruling above. Let a copy of this Decision be
furnished the Civil Registrar General. No costs.

SO ORDERED.

Republic of the Philippines

Manila
SECOND DIVISION
PETITIONER,
vs.
RESPONDENTS.
DECISION
J.:
The Case
This is a direct recourse to this Court from the
Regional Trial Court (RTC), Branch 107, Quezon
City, through a petition for review
on certiorari under Rule 45 of the Rules of Court
on a pure question of law. The petition assails
the Order1 dated 31 January 2011 of the RTC in
Civil Case No. Q-11-68582 and its Resolution
dated 2 March 2011 denying petitioners Motion
for Reconsideration. The RTC dismissed the
petition for "Judicial Recognition of Foreign

Judgment (or Decree of Absolute Nullity of

Marriage)" based on improper venue and the
lack of personality of petitioner, Minoru Fujiki, to
file the petition.
The FactsPetitioner Minoru Fujiki (Fujiki) is a
Japanese national who married respondent
Maria Paz Galela Marinay (Marinay) in the
Philippines2 on 23 January 2004. The marriage
did not sit well with petitioners parents. Thus,
Fujiki could not bring his wife to Japan where he
resides. Eventually, they lost contact with each
other.
In 2008, Marinay met another Japanese,
Shinichi Maekara (Maekara). Without the first
marriage being dissolved, Marinay and Maekara
were married on 15 May 2008 in Quezon City,
Philippines. Maekara brought Marinay to Japan.
However, Marinay allegedly suffered physical
abuse from Maekara. She left Maekara and
started to contact Fujiki.3
Fujiki and Marinay met in Japan and they were
able to reestablish their relationship. In 2010,
Fujiki helped Marinay obtain a judgment from a
family court in Japan which declared the
marriage between Marinay and Maekara void on
the ground of bigamy.4 On 14 January 2011,
Fujiki filed a petition in the RTC entitled: "Judicial
Recognition of Foreign Judgment (or Decree of
Absolute Nullity of Marriage)." Fujiki prayed that
(1) the Japanese Family Court judgment be
recognized; (2) that the bigamous marriage
between Marinay and Maekara be declared
void ab initiounder Articles 35(4) and 41 of the
Family Code of the Philippines;5 and (3) for the
RTC to direct the Local Civil Registrar of Quezon
City to annotate the Japanese Family Court
judgment on the Certificate of Marriage
between Marinay and Maekara and to endorse
such annotation to the Office of the
Administrator and Civil Registrar General in the
National Statistics Office (NSO).6
The Ruling of the Regional Trial CourtA few days
after the filing of the petition, the RTC
immediately issued an Order dismissing the
petition and withdrawing the case from its
active civil docket.7 The RTC cited the following
provisions of the Rule on Declaration of
Absolute Nullity of Void Marriages and
Annulment of Voidable Marriages (A.M. No. 0211-10-SC):
Sec. 2. Petition for declaration of absolute
nullity of void marriages.

(a) Who may file. A petition for declaration of

absolute nullity of void marriage may be filed
solely by the husband or the wife.
xxxx
Sec. 4. Venue. The petition shall be filed in the
Family Court of the province or city where the
petitioner or the respondent has been residing
for at least six months prior to the date of filing,
or in the case of a non-resident respondent,
where he may be found in the Philippines, at
the election of the petitioner. x x x
The RTC ruled, without further explanation, that
the petition was in "gross violation" of the
above provisions. The trial court based its
dismissal on Section 5(4) of A.M. No. 02-11-10SC which provides that "[f]ailure to comply with
any of the preceding requirements may be a
ground for immediate dismissal of the
petition."8 Apparently, the RTC took the view
that only "the husband or the wife," in this case
either Maekara or Marinay, can file the petition
to declare their marriage void, and not Fujiki.
Fujiki moved that the Order be reconsidered. He
argued that A.M. No. 02-11-10-SC contemplated
ordinary civil actions for declaration of nullity
and annulment of marriage. Thus, A.M. No. 0211-10-SC does not apply. A petition for
recognition of foreign judgment is a special
proceeding, which "seeks to establish a status,
a right or a particular fact,"9 and not a civil
action which is "for the enforcement or
protection of a right, or the prevention or
redress of a wrong."10 In other words, the
petition in the RTC sought to establish (1) the
status and concomitant rights of Fujiki and
Marinay as husband and wife and (2) the fact of
the rendition of the Japanese Family Court
judgment declaring the marriage between
Marinay and Maekara as void on the ground of
bigamy. The petitioner contended that the
Japanese judgment was consistent with Article
35(4) of the Family Code of the Philippines11 on
bigamy and was therefore entitled to
recognition by Philippine courts.12
In any case, it was also Fujikis view that A.M.
No. 02-11-10-SC applied only to void marriages
under Article 36 of the Family Code on the
ground of psychological incapacity.13 Thus,
Section 2(a) of A.M. No. 02-11-10-SC provides
that "a petition for declaration of absolute
nullity of void marriages may be filed solely by
the husband or the wife." To apply Section 2(a)
in bigamy would be absurd because only the
guilty parties would be permitted to sue. In the
words of Fujiki, "[i]t is not, of course, difficult to

realize that the party interested in having a

bigamous marriage declared a nullity would be
the husband in the prior, pre-existing
marriage."14 Fujiki had material interest and
therefore the personality to nullify a bigamous
marriage.
Fujiki argued that Rule 108 (Cancellation or
Correction of Entries in the Civil Registry) of the
Rules of Court is applicable. Rule 108 is the
"procedural implementation" of the Civil
Register Law (Act No. 3753)15 in relation to
Article 413 of the Civil Code.16 The Civil
Register Law imposes a duty on the "successful
petitioner for divorce or annulment of marriage
to send a copy of the final decree of the court to
the local registrar of the municipality where the
dissolved or annulled marriage was
solemnized."17 Section 2 of Rule 108 provides
that entries in the civil registry relating to
"marriages," "judgments of annulments of
marriage" and "judgments declaring marriages
void from the beginning" are subject to
cancellation or correction.18 The petition in the
RTC sought (among others) to annotate the
judgment of the Japanese Family Court on the
certificate of marriage between Marinay and
Maekara.
Fujikis motion for reconsideration in the RTC
also asserted that the trial court "gravely erred"
when, on its own, it dismissed the petition
based on improper venue. Fujiki stated that the
RTC may be confusing the concept of venue
with the concept of jurisdiction, because it is
lack of jurisdiction which allows a court to
dismiss a case on its own. Fujiki cited Dacoycoy
v. Intermediate Appellate Court19 which held
that the "trial court cannot pre-empt the
defendants prerogative to object to the
improper laying of the venue by motu proprio
dismissing the case."20Moreover, petitioner
alleged that the trial court should not have
"immediately dismissed" the petition under
Section 5 of A.M. No. 02-11-10-SC because he
substantially complied with the provision.
On 2 March 2011, the RTC resolved to deny
petitioners motion for reconsideration. In its
Resolution, the RTC stated that A.M. No. 02-1110-SC applies because the petitioner, in effect,
prays for a decree of absolute nullity of
marriage.21 The trial court reiterated its two
grounds for dismissal, i.e. lack of personality to
sue and improper venue under Sections 2(a)
and 4 of A.M. No. 02-11-10-SC. The RTC
considered Fujiki as a "third person"22 in the
proceeding because he "is not the husband in
the decree of divorce issued by the Japanese
Family Court, which he now seeks to be
judicially recognized, x x x."23 On the other
hand, the RTC did not explain its ground of

impropriety of venue. It only said that

"[a]lthough the Court cited Sec. 4 (Venue) x x x
as a ground for dismissal of this case[,] it should
be taken together with the other ground cited
by the Court x x x which is Sec. 2(a) x x x."24
The RTC further justified its motu proprio
dismissal of the petition based on Braza v. The
City Civil Registrar of Himamaylan City, Negros
Occidental.25 The Court in Braza ruled that "[i]n
a special proceeding for correction of entry
under Rule 108 (Cancellation or Correction of
Entries in the Original Registry), the trial court
has no jurisdiction to nullify marriages x x
x."26 Braza emphasized that the "validity of
marriages as well as legitimacy and filiation can
be questioned only in a direct action seasonably
filed by the proper party, and not through a
collateral attack such as [a] petition [for
correction of entry] x x x."27
The RTC considered the petition as a collateral
attack on the validity of marriage between
Marinay and Maekara. The trial court held that
this is a "jurisdictional ground" to dismiss the
petition.28 Moreover, the verification and
certification against forum shopping of the
petition was not authenticated as required
under Section 529 of A.M. No. 02-11-10-SC.
Hence, this also warranted the "immediate
dismissal" of the petition under the same
provision.
The Manifestation and Motion of the Office of
the Solicitor General and the Letters of Marinay
and MaekaraOn 30 May 2011, the Court
required respondents to file their comment on
the petition for review.30 The public
respondents, the Local Civil Registrar of Quezon
City and the Administrator and Civil Registrar
General of the NSO, participated through the
Office of the Solicitor General. Instead of a
comment, the Solicitor General filed a
Manifestation and Motion.31
The Solicitor General agreed with the petition.
He prayed that the RTCs "pronouncement that
the petitioner failed to comply with x x x A.M.
No. 02-11-10-SC x x x be set aside" and that the
case be reinstated in the trial court for further
proceedings.32 The Solicitor General argued
that Fujiki, as the spouse of the first marriage, is
an injured party who can sue to declare the
bigamous marriage between Marinay and
Maekara void. The Solicitor General
cited Juliano-Llave v. Republic33 which held that
Section 2(a) of A.M. No. 02-11-10-SC does not
apply in cases of bigamy. In Juliano-Llave, this
Court explained:

[t]he subsequent spouse may only be expected

to take action if he or she had only discovered
during the connubial period that the marriage
was bigamous, and especially if the conjugal
bliss had already vanished. Should parties in a
subsequent marriage benefit from the bigamous
marriage, it would not be expected that they
would file an action to declare the marriage void
and thus, in such circumstance, the "injured
spouse" who should be given a legal remedy is
the one in a subsisting previous marriage. The
latter is clearly the aggrieved party as the
bigamous marriage not only threatens the
financial and the property ownership aspect of
the prior marriage but most of all, it causes an
emotional burden to the prior spouse. The
subsequent marriage will always be a reminder
of the infidelity of the spouse and the disregard
of the prior marriage which sanctity is protected
by the Constitution.34
The Solicitor General contended that the
petition to recognize the Japanese Family Court
judgment may be made in a Rule 108
proceeding.35 In Corpuz v. Santo Tomas36 this
Court held that "[t]he recognition of the foreign
divorce decree may be made in a Rule 108
proceeding itself, as the object of special
proceedings (such as that in Rule 108 of the
Rules of Court) is precisely to establish the
status or right of a party or a particular
fact."37 While Corpuzconcerned a foreign
divorce decree, in the present case the
Japanese Family Court judgment also affected
the civil status of the parties, especially
Marinay, who is a Filipino citizen.
The Solicitor General asserted that Rule 108 of
the Rules of Court is the procedure to record
"[a]cts, events and judicial decrees concerning
the civil status of persons" in the civil registry
as required by Article 407 of the Civil Code. In
other words, "[t]he law requires the entry in the
civil registry of judicial decrees that produce
legal consequences upon a persons legal
capacity and status x x x."38 The Japanese
Family Court judgment directly bears on the
civil status of a Filipino citizen and should
therefore be proven as a fact in a Rule 108
proceeding.
Moreover, the Solicitor General argued that
there is no jurisdictional infirmity in assailing a
void marriage under Rule 108, citing De Castro
v. De Castro39 and Nial v. Bayadog40 which
declared that "[t]he validity of a void marriage
may be collaterally attacked."41
Marinay and Maekara individually sent letters to
the Court to comply with the directive for them
to comment on the petition.42 Maekara wrote

that Marinay concealed from him the fact that

she was previously married to Fujiki.43Maekara
also denied that he inflicted any form of
violence on Marinay.44 On the other hand,
Marinay wrote that she had no reason to oppose
the petition.45 She would like to maintain her
silence for fear that anything she say might
cause misunderstanding between her and
Fujiki.46
The IssuesPetitioner raises the following legal
issues:
(1) Whether the Rule on Declaration of Absolute
Nullity of Void Marriages and Annulment of
Voidable Marriages (A.M. No. 02-11-10-SC) is
applicable.
(2) Whether a husband or wife of a prior
marriage can file a petition to recognize a
foreign judgment nullifying the subsequent
marriage between his or her spouse and a
foreign citizen on the ground of bigamy.
(3) Whether the Regional Trial Court can
recognize the foreign judgment in a proceeding
for cancellation or correction of entries in the
Civil Registry under Rule 108 of the Rules of
Court.

judgment. If the office which has custody is in a

foreign country such as Japan, the certification
may be made by the proper diplomatic or
consular officer of the Philippine foreign service
in Japan and authenticated by the seal of
office.50
To hold that A.M. No. 02-11-10-SC applies to a
petition for recognition of foreign judgment
would mean that the trial court and the parties
should follow its provisions, including the form
and contents of the petition,51 the service of
summons,52 the investigation of the public
prosecutor,53 the setting of pre-trial,54 the
trial55 and the judgment of the trial
court.56 This is absurd because it will litigate
the case anew. It will defeat the purpose of
recognizing foreign judgments, which is "to limit
repetitive litigation on claims and
issues."57 The interpretation of the RTC is
tantamount to relitigating the case on the
merits. In Mijares v. Raada58 this Court
explained that "[i]f 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."59

The Rule on Declaration of Absolute Nullity of

Void Marriages and Annulment of Voidable
Marriages (A.M. No. 02-11-10-SC) does not
apply in a petition to recognize a foreign
judgment relating to the status of a marriage
where one of the parties is a citizen of a foreign
country. Moreover, in Juliano-Llave v.
Republic47 this Court held that the rule in A.M.
No. 02-11-10-SC that only the husband or wife
can file a declaration of nullity or annulment of
marriage "does not apply if the reason behind
the petition is bigamy."48

A foreign judgment relating to the status of a

marriage affects the civil status, condition and
legal capacity of its parties. However, the effect
of a foreign judgment is not automatic. To
extend the effect of a foreign judgment in the
Philippines, Philippine courts must determine if
the foreign judgment is consistent with
domestic public policy and other mandatory
laws.60 Article 15 of the Civil Code provides
that "[l]aws relating to family rights and duties,
or to the status, condition and legal capacity of
persons are binding upon citizens of the
Philippines, even though living abroad." This is
the rule of lex nationalii in private international
law. Thus, the Philippine State may require, for
effectivity in the Philippines, recognition by
Philippine courts of a foreign judgment affecting
its citizen, over whom it exercises personal
jurisdiction relating to the status, condition and
legal capacity of such citizen.

For Philippine courts to recognize a foreign

judgment relating to the status of a marriage
where one of the parties is a citizen of a foreign
country, the petitioner only needs to prove the
foreign judgment as a fact under the Rules of
Court. To be more specific, a copy of the foreign
judgment may be admitted in evidence and
proven as a fact under Rule 132, Sections 24
and 25, in relation to Rule 39, Section 48(b) of
the Rules of Court.49 Petitioner may prove the
Japanese Family Court judgment through (1) an
official publication or (2) a certification or copy
attested by the officer who has custody of the

A petition to recognize a foreign judgment

declaring a marriage void does not require
relitigation under a Philippine court of the case
as if it were a new petition for declaration of
nullity of marriage. Philippine courts cannot
presume to know the foreign laws under which
the foreign judgment was rendered. They
cannot substitute their judgment on the status,
condition and legal capacity of the foreign
citizen who is under the jurisdiction of another
state. Thus, Philippine courts can only recognize
the foreign judgment according to the rules of
evidence.

The Ruling of the CourtWe grant the petition.

Section 48(b), Rule 39 of the Rules of Court

provides that a foreign judgment or final order
against a person creates a "presumptive
evidence of a right as between the parties and
their successors in interest by a subsequent
title." Moreover, Section 48 of the Rules of Court
states that "the judgment or final order may be
repelled by evidence of a want of jurisdiction,
want of notice to the party, collusion, fraud, or
clear mistake of law or fact." Thus, Philippine
courts exercise limited review on foreign
judgments. Courts are not allowed to delve into
the merits of a foreign judgment. Once a foreign
judgment is admitted and proven in a Philippine
court, it can only be repelled on grounds
external to its merits, i.e. , "want of jurisdiction,
want of notice to the party, collusion, fraud, or
clear mistake of law or fact." The rule on limited
review embodies the policy of efficiency and the
protection of party expectations,61 as well as
respecting the jurisdiction of other states.62
Since 1922 in Adong v. Cheong Seng
Gee,63 Philippine courts have recognized
foreign divorce decrees between a Filipino and a
foreign citizen if they are successfully proven
under the rules of evidence.64 Divorce involves
the dissolution of a marriage, but the
recognition of a foreign divorce decree does not
involve the extended procedure under A.M. No.
02-11-10-SC or the rules of ordinary trial. While
the Philippines does not have a divorce law,
Philippine courts may, however, recognize a
foreign divorce decree under the second
paragraph of Article 26 of the Family Code, to
capacitate a Filipino citizen to remarry when his
or her foreign spouse obtained a divorce decree
abroad.65
There is therefore no reason to disallow Fujiki to
simply prove as a fact the Japanese Family
Court judgment nullifying the marriage between
Marinay and Maekara on the ground of bigamy.
While the Philippines has no divorce law, the
Japanese Family Court judgment is fully
consistent with Philippine public policy, as
bigamous marriages are declared void from the
beginning under Article 35(4) of the Family
Code. Bigamy is a crime under Article 349 of
the Revised Penal Code. Thus, Fujiki can prove
the existence of the Japanese Family Court
judgment in accordance with Rule 132, Sections
24 and 25, in relation to Rule 39, Section 48(b)
of the Rules of Court.
Since the recognition of a foreign judgment only
requires proof of fact of the judgment, it may be
made in a special proceeding for cancellation or
correction of entries in the civil registry under
Rule 108 of the Rules of Court. Rule 1, Section 3
of the Rules of Court provides that "[a] special

proceeding is a remedy by which a party seeks

to establish a status, a right, or a particular
fact." Rule 108 creates a remedy to rectify facts
of a persons life which are recorded by the
State pursuant to the Civil Register Law or Act
No. 3753. These are facts of public
consequence such as birth, death or
marriage,66 which the State has an interest in
recording. As noted by the Solicitor General,
in Corpuz v. Sto. Tomas this Court declared that
"[t]he recognition of the foreign divorce decree
may be made in a Rule 108 proceeding itself, as
the object of special proceedings (such as that
in Rule 108 of the Rules of Court) is precisely to
establish the status or right of a party or a
particular fact."67
Rule 108, Section 1 of the Rules of Court states:
Sec. 1. Who may file petition. Any person in
any concerning the may file a verified petition
for the cancellation or correction of any entry
relating thereto, with the Regional Trial Court of
the province where the corresponding civil
registry is located. (Emphasis supplied)
Fujiki has the personality to file a petition to
recognize the Japanese Family Court judgment
nullifying the marriage between Marinay and
Maekara on the ground of bigamy because the
judgment concerns his civil status as married to
Marinay. For the same reason he has the
personality to file a petition under Rule 108 to
cancel the entry of marriage between Marinay
and Maekara in the civil registry on the basis of
the decree of the Japanese Family Court.
There is no doubt that the prior spouse has a
personal and material interest in maintaining
the integrity of the marriage he contracted and
the property relations arising from it. There is
also no doubt that he is interested in the
cancellation of an entry of a bigamous marriage
in the civil registry, which compromises the
public record of his marriage. The interest
derives from the substantive right of the spouse
not only to preserve (or dissolve, in limited
instances68) his most intimate human relation,
but also to protect his property interests that
arise by operation of law the moment he
contracts marriage.69 These property interests
in marriage include the right to be supported "in
keeping with the financial capacity of the
family"70 and preserving the property regime of
the marriage.71
Property rights are already substantive rights
protected by the Constitution,72 but a spouses
right in a marriage extends further to relational
rights recognized under Title III ("Rights and

Obligations between Husband and Wife") of the

Family Code.73 A.M. No. 02-11-10-SC cannot
"diminish, increase, or modify" the substantive
right of the spouse to maintain the integrity of
his marriage.74 In any case, Section 2(a) of A.M.
No. 02-11-10-SC preserves this substantive
right by limiting the personality to sue to the
husband or the wife of the union recognized by
law.
Section 2(a) of A.M. No. 02-11-10-SC does not
preclude a spouse of a subsisting marriage to
question the validity of a subsequent marriage
on the ground of bigamy. On the contrary, when
Section 2(a) states that "[a] petition for
declaration of absolute nullity of void marriage
may be filed "75it refers to the husband or the
wife of the subsisting marriage. Under Article
35(4) of the Family Code, bigamous marriages
are void from the beginning. Thus, the parties in
a bigamous marriage are neither the husband
nor the wife under the law. The husband or the
wife of the prior subsisting marriage is the one
who has the personality to file a petition for
declaration of absolute nullity of void marriage
under Section 2(a) of A.M. No. 02-11-10-SC.
Article 35(4) of the Family Code, which declares
bigamous marriages void from the beginning, is
the civil aspect of Article 349 of the Revised
Penal Code,76 which penalizes bigamy. Bigamy
is a public crime. Thus, anyone can initiate
prosecution for bigamy because any citizen has
an interest in the prosecution and prevention of
crimes.77 If anyone can file a criminal action
which leads to the declaration of nullity of a
bigamous marriage,78 there is more reason to
confer personality to sue on the husband or the
wife of a subsisting marriage. The prior spouse
does not only share in the public interest of
prosecuting and preventing crimes, he is also
personally interested in the purely civil aspect
of protecting his marriage.
When the right of the spouse to protect his
marriage is violated, the spouse is clearly an
injured party and is therefore interested in the
judgment of the suit.79 Juliano-Llave ruled that
the prior spouse "is clearly the aggrieved party
as the bigamous marriage not only threatens
the financial and the property ownership aspect
of the prior marriage but most of all, it causes
an emotional burden to the prior
spouse."80 Being a real party in interest, the
prior spouse is entitled to sue in order to
declare a bigamous marriage void. For this
purpose, he can petition a court to recognize a
foreign judgment nullifying the bigamous
marriage and judicially declare as a fact that
such judgment is effective in the Philippines.
Once established, there should be no more

impediment to cancel the entry of the bigamous

marriage in the civil registry.
In Braza v. The City Civil Registrar of
Himamaylan City, Negros Occidental, this Court
held that a "trial court has no jurisdiction to
nullify marriages" in a special proceeding for
cancellation or correction of entry under Rule
108 of the Rules of Court.81 Thus, the "validity
of marriage[] x x x can be questioned only in a
direct action" to nullify the marriage.82 The RTC
relied on Braza in dismissing the petition for
recognition of foreign judgment as a collateral
attack on the marriage between Marinay and
Maekara.
Braza is not applicable because Braza does not
involve a recognition of a foreign judgment
nullifying a bigamous marriage where one of
the parties is a citizen of the foreign country.
To be sure, a petition for correction or
cancellation of an entry in the civil registry
cannot substitute for an action to invalidate a
marriage. A direct action is necessary to
prevent circumvention of the substantive and
procedural safeguards of marriage under the
Family Code, A.M. No. 02-11-10-SC and other
related laws. Among these safeguards are the
requirement of proving the limited grounds for
the dissolution of marriage,83 support pendente
lite of the spouses and children,84 the
liquidation, partition and distribution of the
properties of the spouses,85 and the
investigation of the public prosecutor to
determine collusion.86 A direct action for
declaration of nullity or annulment of marriage
is also necessary to prevent circumvention of
the jurisdiction of the Family Courts under the
Family Courts Act of 1997 (Republic Act No.
8369), as a petition for cancellation or
correction of entries in the civil registry may be
filed in the Regional Trial Court "where the
corresponding civil registry is located."87 In
other words, a Filipino citizen cannot dissolve
his marriage by the mere expedient of changing
his entry of marriage in the civil registry.
However, this does not apply in a petition for
correction or cancellation of a civil registry entry
based on the recognition of a foreign judgment
annulling a marriage where one of the parties is
a citizen of the foreign country. There is neither
circumvention of the substantive and
procedural safeguards of marriage under
Philippine law, nor of the jurisdiction of Family
Courts under R.A. No. 8369. A recognition of a
foreign judgment is not an action to nullify a
marriage. It is an action for Philippine courts to
recognize the effectivity of a foreign judgment, .
The procedure in A.M. No. 02-11-10-SC does not

apply in a petition to recognize a foreign

judgment annulling a bigamous marriage where
one of the parties is a citizen of the foreign
country. Neither can R.A. No. 8369 define the
jurisdiction of the foreign court.

remarry under the laws of his or her country. If

the foreign judgment is not recognized in the
Philippines, the Filipino spouse will be
discriminatedthe foreign spouse can remarry
while the Filipino spouse cannot remarry.

Article 26 of the Family Code confers jurisdiction

on Philippine courts to extend the effect of a
foreign divorce decree to a Filipino spouse
without undergoing trial to determine the
validity of the dissolution of the marriage. The
second paragraph of Article 26 of the Family
Code provides that "[w]here a marriage
between a Filipino citizen and a foreigner is
validly celebrated and a divorce is thereafter
validly obtained abroad by the alien spouse
capacitating him or her to remarry, the Filipino
spouse shall have capacity to remarry under
Philippine law." In Republic v. Orbecido88 this
Court recognized the legislative intent of the
second paragraph of Article 26 which is "to
avoid the absurd situation where the Filipino
spouse remains married to the alien spouse
who, after obtaining a divorce, is no longer
married to the Filipino spouse"89 under the laws
of his or her country. The second paragraph of
Article 26 of the Family Code only authorizes
Philippine courts to adopt the effects of a
foreign divorce decree precisely because the
Philippines does not allow divorce. Philippine
courts cannot try the case on the merits
because it is tantamount to trying a case for
divorce.

Under the second paragraph of Article 26 of the

Family Code, Philippine courts are empowered
to correct a situation where the Filipino spouse
is still tied to the marriage while the foreign
spouse is free to marry. Moreover,
notwithstanding Article 26 of the Family Code,
Philippine courts already have jurisdiction to
extend the effect of a foreign judgment in the
Philippines to the extent that the foreign
judgment does not contravene domestic public
policy. A critical difference between the case of
a foreign divorce decree and a foreign judgment
nullifying a bigamous marriage is that bigamy,
as a ground for the nullity of marriage, is fully
consistent with Philippine public policy as
expressed in Article 35(4) of the Family Code
and Article 349 of the Revised Penal Code. The
Filipino spouse has the option to undergo full
trial by filing a petition for declaration of nullity
of marriage under A.M. No. 02-11-10-SC, but
this is not the only remedy available to him or
her. Philippine courts have jurisdiction to
recognize a foreign judgment nullifying a
bigamous marriage, without prejudice to a
criminal prosecution for bigamy.

The second paragraph of Article 26 is only a

corrective measure to address the anomaly that
results from a marriage between a Filipino,
whose laws do not allow divorce, and a foreign
citizen, whose laws allow divorce. The anomaly
consists in the Filipino spouse being tied to the
marriage while the foreign spouse is free to
marry under the laws of his or her country. The
correction is made by extending in the
Philippines the effect of the foreign divorce
decree, which is already effective in the country
where it was rendered. The second paragraph of
Article 26 of the Family Code is based on this
Courts decision in Van Dorn v. Romillo90 which
declared that the Filipino spouse "should not be
discriminated against in her own country if the
ends of justice are to be served."91
The principle in Article 26 of the Family Code
applies in a marriage between a Filipino and a
foreign citizen who obtains a foreign judgment
nullifying the marriage on the ground of bigamy.
The Filipino spouse may file a petition abroad to
declare the marriage void on the ground of
bigamy. The principle in the second paragraph
of Article 26 of the Family Code applies because
the foreign spouse, after the foreign judgment
nullifying the marriage, is capacitated to

In the recognition of foreign judgments,

Philippine courts are incompetent to substitute
their judgment on how a case was decided
under foreign law. They cannot decide on the
"family rights and duties, or on the status,
condition and legal capacity" of the foreign
citizen who is a party to the foreign judgment.
Thus, Philippine courts are limited to the
question of whether to extend the effect of a
foreign judgment in the Philippines. In a foreign
judgment relating to the status of a marriage
involving a citizen of a foreign country,
Philippine courts only decide whether to extend
its effect to the Filipino party, under the rule
of lex nationalii expressed in Article 15 of the
Civil Code.
For this purpose, Philippine courts will only
determine (1) whether the foreign judgment is
inconsistent with an overriding public policy in
the Philippines; and (2) whether any alleging
party is able to prove an extrinsic ground to
repel the foreign judgment, i.e. want of
jurisdiction, want of notice to the party,
collusion, fraud, or clear mistake of law or fact.
If there is neither inconsistency with public
policy nor adequate proof to repel the
judgment, Philippine courts should, by default,
recognize the foreign judgment as part of the
comity of nations. Section 48(b), Rule 39 of the

Rules of Court states that the foreign judgment

is already "presumptive evidence of a right
between the parties." Upon recognition of the
foreign judgment, this right becomes conclusive
and the judgment serves as the basis for the
correction or cancellation of entry in the civil
registry. The recognition of the foreign judgment
nullifying a bigamous marriage is a subsequent
event that establishes a new status, right and
fact92 that needs to be reflected in the civil
registry. Otherwise, there will be an
inconsistency between the recognition of the
effectivity of the foreign judgment and the
public records in the Philippines.1wphi1
However, the recognition of a foreign judgment
nullifying a bigamous marriage is without
prejudice to prosecution for bigamy under
Article 349 of the Revised Penal Code.93 The
recognition of a foreign judgment nullifying a
bigamous marriage is not a ground for
extinction of criminal liability under Articles 89
and 94 of the Revised Penal Code. Moreover,
under Article 91 of the Revised Penal Code,
"[t]he term of prescription [of the crime of
bigamy] shall not run when the offender is
absent from the Philippine archipelago."
Since A.M. No. 02-11-10-SC is inapplicable, the
Court no longer sees the need to address the
questions on venue and the contents and form
of the petition under Sections 4 and 5,
respectively, of A.M. No. 02-11-10-SC.
, we the petition. The Order dated 31 January
2011 and the Resolution dated 2 March 2011 of
the Regional Trial Court, Branch 107, Quezon
City, in Civil Case No. Q-11-68582 are and . The
Regional Trial Court is to the petition for
further proceedings in accordance with this
Decision.
SECOND DIVISION
[G.R. No. 108538. January 22, 1996]
LOURDES A. VALMONTE and ALFREDO D.
VALMONTE, petitioners, vs. THE HONORABLE
COURT OF APPEALS, THIRD DIVISION and
ROSITA DIMALANTA, respondents.
DECISION
MENDOZA, J.:

Petitioner Lourdes A. Valmonte is a foreign

resident. The question is whether in an action
for partition filed against her and her husband,
who is also her attorney, summons intended for
her may be served on her husband, who has a
law office in the Philippines. The Regional Trial
Court of Manila, Branch 48, said no and refused
to declare Lourdes A. Valmonte in default, but
the Court of Appeals said yes. Hence this
petition for review on certiorari.
The facts of the case are as follows:
Petitioners Lourdes A. Valmonte and Alfredo D.
Valmonte are husband and wife. They are both
residents of 90222 Carkeek Drive South Seattle,
Washington, U.S.A. Petitioner Alfredo D.
Valmonte, who is a member of the Philippine
bar, however, practices his profession in the
Philippines, commuting for this purpose
between his residence in the state of
Washington and Manila, where he holds office at
S-304 Gedisco Centre, 1564 A. Mabini, Ermita,
Manila.
On March 9, 1992, private respondent Rosita
Dimalanta, who is the sister of petitioner
Lourdes A. Valmonte, filed a complaint for
partition of real property and accounting of
rentals against petitioners Lourdes A. Valmonte
and Alfredo D. Valmonte before the Regional
Trial Court of Manila, Branch 48. The subject of
the action is a three-door apartment located in
Paco, Manila.
In her Complaint, private respondent alleged:
The plaintiff is of legal age, a widow and is at
present a resident of 14823 Conway Road,
Chesterfield, Missouri, U.S.A., while the
defendants are spouses, of legal age and at
present residents of 90222 Carkeek Drive,
South Seattle, Washington, U.S.A., but, for
purposes of this complaint may be served with
summons at Gedisco Center, Unit 304, 1564 A.
Mabini St., Ermita, Manila where defendant
Alfredo D. Valmonte as defendant Lourdes
Arreola Valmontes spouse holds office and
where he can be found.
Apparently, the foregoing averments were
made on the basis of a letter previously sent by
petitioner Lourdes A. Valmonte to private
respondents counsel
in which, in regard to the partition of the
property in question, she referred private
respondents counsel to her husband as the

party to whom all communications intended for

her should be sent. The letter reads:

prohibition and mandamus with the Court of

Appeals.

July 4, 1991

On December 29, 1992, the Court of Appeals

rendered a decision granting the petition and
declaring Lourdes A. Valmonte in default. A copy
of the appellate courts decision was received by
petitioner Alfredo D. Valmonte
on January 15, 1993 at his Manila office and
on January 21, 1993 in Seattle, Washington.
Hence, this petition.

Dear Atty. Balgos:

This is in response to your letter, dated 20 June
1991, which I received on 3 July 1991. Please
address all communications to my lawyer, Atty.
Alfredo D. Valmonte, whose address, telephone
and fax numbers appear below.
c/o Prime Marine
Gedisco Center, Unit 304
1564 A. Mabini, Ermita
Metro Manila
Telephone: 521-1736
Fax: 21-2095
Service of summons was then made upon
petitioner Alfredo D. Valmonte, who at the time,
was at his office in Manila. Petitioner Alfredo D.
Valmonte accepted the summons, insofar as he
was concerned, but refused to accept the
summons for his wife, Lourdes A. Valmonte, on
the ground that he was not authorized to accept
the process on her behalf. Accordingly the
process server left without leaving a copy of the
summons and complaint for petitioner Lourdes
A. Valmonte.
Petitioner Alfredo D. Valmonte thereafter filed
his Answer with Counterclaim. Petitioner
Lourdes A. Valmonte, however, did not file her
Answer. For this reason private respondent
moved to declare her in default. Petitioner
Alfredo D. Valmonte entered a special
appearance in behalf of his wife and opposed
the private respondents motion.
In its Order dated July 3, 1992, the trial court,
denied private respondents motion to declare
petitioner Lourdes A. Valmonte in default. A
motion for reconsideration was similarly denied
on September 23, 1992. Whereupon, private
respondent filed a petition for certiorari,

The issue at bar is whether in light of the facts

set forth above, petitioner Lourdes A. Valmonte
was validly served with summons. In holding
that she had been, the Court of Appeals stated:
[1]
[I]n her above-quoted reply, Mrs. Valmonte
clearly and unequivocally directed the
aforementioned counsel of Dimalanta to
address all communications (evidently referring
to her controversy with her sister Mrs.
Dimalanta over the Paco property, now the
subject of the instant case) to her lawyer who
happens also to be her husband. Such directive
was made without any qualification just as was
her choice/designation of her husband Atty.
Valmonte as her lawyer likewise made without
any qualification or reservation. Any disclaimer
therefore on the part of Atty. Valmonte as to his
being his wifes attorney (at least with regard to
the dispute vis-a-vis [sic] the Paco property)
would appear to be feeble or trifling, if not
incredible.
This view is bolstered by Atty. Valmontes
subsequent alleged special appearance made
on behalf of his wife. Whereas Mrs. Valmonte
had manifestly authorized her husband to serve
as her lawyer relative to her dispute with her
sister over the Paco property and to receive all
communications regarding the same and
subsequently to appear on her behalf by way of
a so-called special appearance, she would
nonetheless now insist that the same husband
would nonetheless had absolutely no authority
to receive summons on her behalf. In effect, she
is asserting that representation by her lawyer
(who is also her husband) as far as the Paco
property controversy is concerned, should only
be made by him when such representation
would be favorable to her but not otherwise. It
would obviously be inequitable for this Court to
allow private respondent Lourdes A. Valmonte
to hold that her husband has the authority to
represent her when an advantage is to be
obtained by her and to deny such authority
when it would turn out to be her disadvantage.
If this be allowed, Our Rules of Court, instead of

being an instrument to promote justice would

be made use of to thwart or frustrate the same.
xxx xxx xxx
Turning to another point, it would not do for Us
to overlook the fact that the disputed summons
was served not upon just an ordinary lawyer of
private respondent Lourdes A. Valmonte, but
upon her lawyer husband. But that is not all, the
same lawyer/husband happens to be also her
co-defendant in the instant case which involves
real property which, according to her
lawyer/husband/ co-defendant, belongs to the
conjugal partnership of the defendants (the
spouses Valmonte). It is highly inconceivable
and certainly it would be contrary to human
nature for the lawyer/husband/co-defendant to
keep to himself the fact that they (the spouses
Valmonte) had been sued with regard to a
property which he claims to be conjugal.
Parenthetically, there is nothing in the records
of the case before Us regarding any
manifestation by private respondent Lourdes A.
Valmonte about her lack of knowledge about
the case instituted against her and her
lawyer/husband/co-defendant by her sister
Rosita.
PREMISES CONSIDERED, the instant petition for
certiorari, prohibition and mandamus is given
due course. This Court hereby Resolves to
nullify the orders of the court a quo dated July
3, 1992 and September 23, 1992 and further
declares private respondent Lourdes Arreola
Valmonte as having been properly served with
summons.
Petitioners assail the aforequoted decision,
alleging that the Court of Appeals erred (1) in
refusing to apply the provisions of Rule 14, 17 of
the Revised Rules of Court and applying instead
Rule 14, 8 when the fact is that petitioner
Lourdes A. Valmonte is a nonresident
defendant; and (2) because even if Rule 14, 8 is
the applicable provision, there was no valid
substituted service as there was no strict
compliance with the requirement by leaving a
copy of the summons and complaint with
petitioner Alfredo D. Valmonte. Private
respondent, upon the other hand, asserts that
petitioners are invoking a technicality and that
strict adherence to the rules would only result in
a useless ceremony.
We hold that there was no valid service of
process on Lourdes A. Valmonte.

To provide perspective, it will be helpful to

determine first the nature of the action filed
against petitioners Lourdes A. Valmonte and
Alfredo D. Valmonte by private respondent,
whether it is an action in personam, in rem or
quasi in rem. This is because the rules on
service of summons embodied in Rule 14 apply
according to whether an action is one or the
other of these actions.
In an action in personam, personal service of
summons or, if this is not possible and he
cannot be personally served, substituted
service, as provided in Rule 14, 7-8[2] is
essential for the acquisition by the court of
jurisdiction over the person of a defendant who
does not voluntarily submit himself to the
authority of the court.[3] If defendant cannot be
served with summons because he is temporarily
abroad, but otherwise he is a Philippine
resident, service of summons may, by leave of
court, be made by publication.[4]Otherwise
stated, a resident defendant in an action in
personam, who cannot be personally served
with summons, may be summoned either by
means of substituted service in accordance with
Rule 14, 8 or by publication as provided in 17
and 18 of the same Rule.[5]
In all of these cases, it should be noted,
defendant must be a resident of the Philippines,
otherwise an action in personam cannot be
brought because jurisdiction over his person is
essential to make a binding decision.
On the other hand, 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
accordance with Rule 14, 17, which provides:
17. Extraterritorial service. - When the
defendant does not reside and is not found in
the Philippines and the action affects the
personal status of the plaintiff or relates to, or
the subject of which is, property within the
Philippines, in which the defendant has or
claims a lien or interest, actual or contingent, or
in which the relief demanded consists, wholly or
in part, in excluding the defendant from any
interest therein, or the property of the
defendant has been attached within the
Philippines, service may, by leave of court, be
effected out of the Philippines by personal
service as under Section 7; or 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 shall be sent by registered

mail to the last known address of the
defendant, or in any other manner the court
may deem sufficient. Any order granting such
leave shall specify a reasonable time, which
shall not be less than sixty (60) days after
notice, within which the defendant must
answer.
In such cases, what gives the court jurisdiction
in an action in rem or quasi in rem is that it has
jurisdiction over the res, i.e. the personal status
of the plaintiff who is domiciled in the
Philippines or the property litigated or attached.
Service of summons in the manner provided in
17 is not for the purpose of vesting it with
jurisdiction but for complying with the
requirements of fair play or due process, so that
he will be informed of the pendency of the
action against him and the possibility that
property in the Philippines belonging to him or
in which he has an interest may be subjected to
a judgment in favor of the plaintiff and he can
thereby take steps to protect his interest if he is
so minded.[6]
Applying the foregoing rules to the case at bar,
private respondents action, which is for
partition and accounting under Rule 69, is in the
nature of an action quasi in rem. Such an action
is essentially for the purpose of affecting the
defendants interest in a specific property and
not to render a judgment against him. As
explained in the leading case of Banco Espaol
Filipino v. Palanca :[7]
[An action quasi in rem is] an action which while
not strictly speaking an action in rem partakes
of that nature and is substantially such. . . . The
action quasi in 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.
As petitioner Lourdes A. Valmonte is a
nonresident who is not found in the Philippines,
service of summons on her must be in
accordance with Rule 14, 17. Such service, to
be effective outside the Philippines, must be
made either (1) by personal service; (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.
Since in the case at bar, the service of
summons upon petitioner Lourdes A. Valmonte
was not done by means of any of the first two
modes, the question is whether the service on
her attorney, petitioner Alfredo D. Valmonte,
can be justified under the third mode, namely,
in any . . . manner the court may deem
sufficient.
We hold it cannot. This mode of service, like the
first two, must be made outside the Philippines,
such as through the Philippine Embassy in the
foreign country where the defendant resides.
[8] Moreover, there are several reasons why the
service of summons on Atty. Alfredo D.
Valmonte cannot be considered a valid service
of summons on petitioner Lourdes A. Valmonte.
In the first place, service of summons on
petitioner Alfredo D. Valmonte was not made
upon the order of the court as required by Rule
14, 17 and certainly was not a mode deemed
sufficient by the court which in fact refused to
consider the service to be valid and on that
basis declare petitioner Lourdes A. Valmonte in
default for her failure to file an answer.
In the second place, service in the attempted
manner on petitioner was not made upon prior
leave of the trial court as required also in Rule
14, 17. As provided in 19, such leave must be
applied for by motion in writing, supported by
affidavit of the plaintiff or some person on his
behalf and setting forth the grounds for the
application.
Finally, and most importantly, because there
was no order granting such leave, petitioner
Lourdes A. Valmonte was not given ample time
to file her Answer which, according to the rules,
shall be not less than sixty (60) days after
notice. It must be noted that the period to file
an Answer in an action against a resident
defendant differs from the period given in an
action filed against a nonresident defendant
who is not found in the Philippines. In the
former, the period is fifteen (15) days from
service of summons, while in the latter, it is at
least sixty (60) days from notice.
Strict compliance with these requirements alone
can assure observance of due process. That is
why in one case,[9] although the Court
considered publication in the Philippines of the
summons (against the contention that it should
be made in the foreign state where defendant

was residing) sufficient, nonetheless the service

was considered insufficient because no copy of
the summons was sent to the last known
correct address in the Philippines.
Private respondent cites the ruling in De Leon v.
Hontanosas, 67 SCRA 458,462-463 (1975), in
which it was held that service of summons upon
the defendants husband was binding on her.
But the ruling in that case is justified because
summons were served upon defendants
husband in their conjugal home in Cebu City
and the wife was only temporarily absent,
having gone to Dumaguete City for a vacation.
The action was for collection of a sum of money.
In accordance with Rule 14, 8, substituted
service could be made on any person of
sufficient discretion in the dwelling place of the
defendant, and certainly defendants husband,
who was there, was competent to receive the
summons on her behalf. In any event, it appears
that defendant in that case submitted to the
jurisdiction of the court by instructing her
husband to move for the dissolution of the writ
of attachment issued in that case.
On the other hand, in the case of Gemperle v.
Schenker,[10] it was held that service on the
wife of a nonresident defendant was found
sufficient because the defendant had appointed
his wife as his attorney-in-fact. It was held that
although defendant Paul Schenker was a Swiss
citizen and resident of Switzerland, service of
summons upon his wife Helen Schenker who
was in the Philippines was sufficient because
she was her husbands representative and
attorney-in-fact in a civil case, which he had
earlier filed against William Gemperle. In fact
Gemperles action was for damages arising from
allegedly derogatory statements contained in
the complaint filed in the first case. As this
Court said, i]n 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 one
at bar, which is a consequence of the action
brought by her on his behalf.[11] Indeed, if
instead of filing an independent action
Gemperle filed a counterclaim in the action
brought by Mr. Schenker against him, there
would have been no doubt that the trial court
could have acquired jurisdiction over Mr.
Schenker through his agent and attorney-infact, Mrs. Schenker.
In contrast, in the case at bar, petitioner
Lourdes A. Valmonte did not appoint her
husband as her attorney-in-fact. Although she
wrote private respondent s attorney that all
communications intended for her should be
addressed to her husband who is also her

lawyer at the latters address in Manila, no

power of attorney to receive summons for her
can be inferred therefrom. In fact the letter was
written seven months before the filing of this
case below, and it appears that it was written in
connection with the negotiations between her
and her sister, respondent Rosita Dimalanta,
concerning the partition of the property in
question. As is usual in negotiations of this kind,
the exchange of correspondence was carried on
by counsel for the parties. But the authority
given to petitioners husband in these
negotiations certainly cannot be construed as
also including an authority to represent her in
any litigation.
For the foregoing reasons, we hold that there
was no valid service on petitioner Lourdes A.
Valmonte in this case.
, the decision appealed from is and the orders
dated July 3, 1992 and September 23, 1992 of
the Regional Trial Court of Manila, Branch 48
are .
SO ORDERED.
Republic of the Philippines
Manila
EN BANC
plaintiff-appellant,
vs.
defendant-appellee.
Jaime R. Nuevas for plaintiff and appellee.
Rafael Jose for defendant and appellant.
C.J.:Appeal from a decision of the Court of
Juvenile and Domestic Relations.
Plaintiff Lazaro Rayray seeks the annulment of
his marriage to defendant Chae Kyung Lee.
Inasmuch as, the latter's whereabouts is
unknown, and she was formerly a resident of
Pusan, Korea, summons was served by
publication, as provided in the Rules of Court.
Thereafter, plaintiff moved that defendant be
declared in default, she not having filed an
answer, and that a date be set for the reception
of his evidence. Before acting on this motion,
the lower court referred the case to the City

Fiscal of Manila pursuant to Articles 88 and 101

of the Civil Code of the Philippines, for the
purpose of determining whether or not a
collusion between the parties exists. Said officer
having found no such collusion, the case was
heard on the merits. In due course, thereafter,
decision was rendered dismissing plaintiff's
complaint, without costs, upon the ground: (1)
that the court could not nullify a marriage
contracted abroad; and (2) that the facts proven
do not warrant the relief prayed for. A
reconsideration of this decision having been
denied, plaintiff appealed to the Court of
Appeals, which certified the case to the
Supreme Court, the jurisdiction of the lower
court being in issue in the appeal.

affects two persons. One is married, never in

abstract or a vacuum, but, always to somebody
else. Hence, a judicial decree on the marriage
status of a person necessarily reflects upon the
status of another and the relation between
them. The prevailing rule is, accordingly, that a
court has jurisdiction over the res, in an action
for annulment of marriage, provided, at least,
one of the parties is domiciled in, or a national
of, the forum.8 Since plaintiff is a Filipino,
domiciled in the Philippines, it follows that the
lower court had jurisdiction over the res, in
addition to its jurisdiction over the subjectmatter and the parties. In other words, it could
validly inquire into the legality of the marriage
between the parties herein.

In relation thereto, the court a quo found that it

had no jurisdiction to pass upon the validity of
plaintiff's marriage to the defendant, it having
been solemnized in Seoul, Korea. Said
conclusion is erroneous. In order that a given
case could be validly decided by a court of
justice, it must have jurisdiction over (1) the
subject-matter of the litigation; (2) the person
of the parties therein; and (3) in actions in rem
or quasi-in-rem, the res.1

As regards the substantial validity of said

marriage, plaintiff testified that he met the
defendant in Pusan Korea, sometime in 1952,
where she was operating a nightclub; that they
lived together from November 1952 to April
1955; that they were married in Pusan Korea, on
March 15, 1953, as attested to by their
marriage certificate Exhibit D; that before the
wedding she obtained the "police clearance"
Exhibit A, written in Korean language, and dated
February 16, 1953, which was necessary in
order that she could contract marriage; that on
June 30, 1953, he proceeded to India and left
the defendant, then in advanced stage of
pregnancy, in Korea; that in October, 1953, she
joined him in India, bringing with her said
Exhibit A, and its translation into English,
Exhibit B; that he then noticed that, on February
16, 1958, defendant was already married,
according to said Exhibit B; that as he
confronted the defendant with the contents of
this document, her reply was that it is not
unusual for a Korean girl to marry twice in
Korea; that when he inquired about her status
on March 15, 1953, defendant confided to him
that she had lived with about two (2) Americans
and a Korean, adding, however, that there was
no impediment to her contracting marriage with
him; and that, later on, they were separated
and her whereabouts are now unknown to him.

The subject-matter of the present case is the

annulment of plaintiff's marriage to the
defendant, which is within the jurisdiction of our
courts of first instance,2 and, in Manila, of its
Court of Juvenile and Domestic Relations.3
The same acquired jurisdiction over plaintiff
herein by his submission thereto in
consequence of the filing of the complaint
herein.4 Defendant was placed under the
jurisdiction of said court, upon the service of
summons by publication.5
This is an action in rem, for it concerns the
status of the parties herein, and status affects
or binds the whole word. The res in the present
case is the relation between said parties, or
their marriage tie.6 Jurisdiction over the same
depends upon the nationality or domicile of the
parties, not the place of celebration of
marriage, or the locus celebrationis.7 Plaintiff
here is a citizen of the Philippines, domiciled
therein. His status is, therefore, subject to our
jurisdiction, on both counts. True that defendant
was and under plaintiff's theory still is a
non-resident alien. But, this fact does not
deprive the lower court of its jurisdiction to pass
upon the validity of her marriage to plaintiff
herein.
Indeed, marriage is one of the cases of double
status, in that the status therein involves and

The lower court considered plaintiffs evidence

insufficient to establish that defendant was
married to another person prior to March 15,
1953, and we agree with this conclusion. To
begin with, Exhibit A is not signed. It merely
purports to bear the seal of the Chief of Pusan
National Police. Secondly, the record does not
show who prepared it, much less that he had
personal knowledge of the truth of the entry
therein concerning defendant's status on
February 15, 1953. It should be noted, that
defendant was a native, not of Pusan but of
Seoul, Korea. Hence, Exhibit A could, at best, be
no more than hearsay evidence. Again, when
plaintiff allegedly confronted the defendant with
the contents of Exhibit B, defendant did not say

that she had been married before. Plaintiff

declared that she admitted having
previously lived with several other men, adding,
however, that she had no impediment, thus, in
effect, negating the alleged previous marriage.
Thirdly, if Exhibit A was obtained on February
16, 1953, in order to establish defendant's
qualification to contract marriage, why is it that
the wedding took place, despite the entry in
said document to the effect that defendant was
married already? There is no competent
evidence to the effect that Korean laws permit
bigamy or polygamy. Moreover, the
presumption is that the foreign law is identical
to the lex fori, or, in the case at bar, the
Philippine Law.9 In fact, the statement, imputed
by plaintiff to the defendant, to the effect that,
although she had cohabited before with other
men, there was no impediment to her marrying
him, clearly suggests that a previous marriage
on her part would have been, in her opinion, a
legal obstacle to her marriage with the
plaintiffs. Then too, the marriage certificate
Exhibit D contains spaces for the entry of data
on whether any of the contracting parties had
been previously married; whether the prior
marriage had been dissolved by a decree of
divorce; and, if there had been such decree, the
date thereof. Surely, these data would be
absolutely irrelevant if polygamy were
sanctioned in Korea. And, again, why is it that
Exhibit D states that defendant had
had no previous marriage?
Last, but not least, plaintiff cannot possibly
secure the relief prayed for unless full faith and
credence are given to his testimony, but we
cannot believe him for the records show that he
would not hesitate to lie when it suits his
purpose. Thus, for instance, when plaintiff
contracted marriage with the defendant, he said
that he was single, although, he admitted, this
was a lie, because, sometime in 1940, he
married in Baguio, one Adelaida Melecio or
Valdez.10 But, then he would, also, have us
believe that his marriage with the latter was
illegal or fictitious, because Adelaida and he did
no more than sign, on a small window in the
City Hall of Baguio, certain documents the
contents of which he did not read.
WHEREFORE, the decision appealed from should
be, as it is hereby, affirmed, with the costs of
this instance against plaintiff-appellant. It is so
ordered.
Republic of the Philippines
Manila

petitioner,
vs.
respondent.
J.:Before this Court is a petition for review on
certiorari under Rule 45 of the 1997 Rules of
Civil Procedure which seeks the reversal of the
Decision1 and Resolution2 of the Court of
Appeals in CA-G.R. SP No. 67001 and the
dismissal of the civil case filed by respondent
against petitioner with the trial court.
As culled from the records of the case, the
following antecedents appear:
Sometime in 1990, Brand Marine Services, Inc.
(BMSI), a corporation duly organized and
existing under the laws of the State of
Connecticut, United States of America, and
respondent Stockton W. Rouzie, Jr., an American
citizen, entered into a contract whereby BMSI
hired respondent as its representative to
negotiate the sale of services in several
government projects in the Philippines for an
agreed remuneration of 10% of the gross
receipts. On 11 March 1992, respondent
secured a service contract with the Republic of
the Philippines on behalf of BMSI for the
dredging of rivers affected by the Mt. Pinatubo
eruption and mudflows.3
On 16 July 1994, respondent filed before the
Arbitration Branch of the National Labor
Relations Commission (NLRC) a suit against
BMSI and Rust International, Inc. (RUST),
Rodney C. Gilbert and Walter G. Browning for
alleged nonpayment of commissions, illegal
termination and breach of employment
contract.4 On 28 September 1995, Labor Arbiter
Pablo C. Espiritu, Jr. rendered judgment ordering
BMSI and RUST to pay respondents money
claims.5 Upon appeal by BMSI, the NLRC
reversed the decision of the Labor Arbiter and
dismissed respondents complaint on the
ground of lack of jurisdiction.6 Respondent
elevated the case to this Court but was
dismissed in a Resolution dated 26 November
1997. The Resolution became final and
executory on 09 November 1998.
On 8 January 1999, respondent, then a resident
of La Union, instituted an action for damages
before the Regional Trial Court (RTC) of Bauang,
La Union. The Complaint,7 docketed as Civil
Case No. 1192-BG, named as defendants herein
petitioner Raytheon International, Inc. as well as
BMSI and RUST, the two corporations impleaded
in the earlier labor case. The complaint

essentially reiterated the allegations in the

labor case that BMSI verbally employed
respondent to negotiate the sale of services in
government projects and that respondent was
not paid the commissions due him from the
Pinatubo dredging project which he secured on
behalf of BMSI. The complaint also averred that
BMSI and RUST as well as petitioner itself had
combined and functioned as one company.
In its Answer,8 petitioner alleged that contrary
to respondents claim, it was a foreign
corporation duly licensed to do business in the
Philippines and denied entering into any
arrangement with respondent or paying the
latter any sum of money. Petitioner also denied
combining with BMSI and RUST for the purpose
of assuming the alleged obligation of the said
companies.9 Petitioner also referred to the
NLRC decision which disclosed that per the
written agreement between respondent and
BMSI and RUST, denominated as "Special Sales
Representative Agreement," the rights and
obligations of the parties shall be governed by
the laws of the State of Connecticut.10Petitioner
sought the dismissal of the complaint on
grounds of failure to state a cause of action
and forum non conveniens and prayed for
damages by way of compulsory counterclaim.11
On 18 May 1999, petitioner filed an Omnibus
Motion for Preliminary Hearing Based on
Affirmative Defenses and for Summary
Judgment12 seeking the dismissal of the
complaint on grounds of forum non
conveniens and failure to state a cause of
action. Respondent opposed the same. Pending
the resolution of the omnibus motion, the
deposition of Walter Browning was taken before
the Philippine Consulate General in Chicago.13
In an Order14 dated 13 September 2000, the
RTC denied petitioners omnibus motion. The
trial court held that the factual allegations in
the complaint, assuming the same to be
admitted, were sufficient for the trial court to
render a valid judgment thereon. It also ruled
that the principle of forum non conveniens was
inapplicable because the trial court could
enforce judgment on petitioner, it being a
foreign corporation licensed to do business in
the Philippines.15
Petitioner filed a Motion for
Reconsideration16 of the order, which motion
was opposed by respondent.17 In an Order
dated 31 July 2001,18 the trial court denied
petitioners motion. Thus, it filed a Rule 65
Petition19 with the Court of Appeals praying for
the issuance of a writ of certiorari and a writ of
injunction to set aside the twin orders of the

trial court dated 13 September 2000 and 31 July

2001 and to enjoin the trial court from
conducting further proceedings.20
On 28 August 2003, the Court of Appeals
rendered the assailed Decision21 denying the
petition for certiorari for lack of merit. It also
denied petitioners motion for reconsideration in
the assailed Resolution issued on 10 March
2004.22
The appellate court held that although the trial
court should not have confined itself to the
allegations in the complaint and should have
also considered evidence aliunde in resolving
petitioners omnibus motion, it found the
evidence presented by petitioner, that is, the
deposition of Walter Browning, insufficient for
purposes of determining whether the complaint
failed to state a cause of action. The appellate
court also stated that it could not rule one way
or the other on the issue of whether the
corporations, including petitioner, named as
defendants in the case had indeed merged
together based solely on the evidence
presented by respondent. Thus, it held that the
issue should be threshed out during
trial.23 Moreover, the appellate court deferred
to the discretion of the trial court when the
latter decided not to desist from assuming
jurisdiction on the ground of the inapplicability
of the principle offorum non conveniens.
Hence, this petition raising the following issues:
WHETHER OR NOT THE COURT OF APPEALS
ERRED IN REFUSING TO DISMISS THE
COMPLAINT FOR FAILURE TO STATE A CAUSE OF
ACTION AGAINST RAYTHEON INTERNATIONAL,
INC.
WHETHER OR NOT THE COURT OF APPEALS
ERRED IN REFUSING TO DISMISS THE
COMPLAINT ON THE GROUND OF FORUM NON
CONVENIENS24
Incidentally, respondent failed to file a comment
despite repeated notices. The Ceferino Padua
Law Office, counsel on record for respondent,
manifested that the lawyer handling the case,
Atty. Rogelio Karagdag, had severed relations
with the law firm even before the filing of the
instant petition and that it could no longer find
the whereabouts of Atty. Karagdag or of
respondent despite diligent efforts. In a
Resolution25 dated 20 November 2006, the
Court resolved to dispense with the filing of a
comment.

The instant petition lacks merit.

Petitioner mainly asserts that the written
contract between respondent and BMSI
included a valid choice of law clause, that is,
that the contract shall be governed by the laws
of the State of Connecticut. It also mentions the
presence of foreign elements in the dispute
namely, the parties and witnesses involved are
American corporations and citizens and the
evidence to be presented is located outside the
Philippines that renders our local courts
inconvenient forums. Petitioner theorizes that
the foreign elements of the dispute necessitate
the immediate application of the doctrine
of forum non conveniens.
Recently in Hasegawa v. Kitamura26 the Court
outlined three consecutive phases involved in
judicial resolution of conflicts-of-laws problems,
namely: jurisdiction, choice of law, and
recognition and enforcement of judgments.
Thus, in the instances27 where the Court held
that the local judicial machinery was adequate
to resolve controversies with a foreign element,
the following requisites had to be proved: (1)
that the Philippine Court is one to which the
parties may conveniently resort; (2) that the
Philippine Court is in a position to make an
intelligent decision as to the law and the facts;
and (3) that the Philippine Court has or is likely
to have the power to enforce its decision.28
On the matter of jurisdiction over a conflicts-oflaws problem where the case is filed in a
Philippine court and where the court has
jurisdiction over the subject matter, the parties
and the res, it may or can proceed to try the
case even if the rules of conflict-of-laws or the
convenience of the parties point to a foreign
forum. This is an exercise of sovereign
prerogative of the country where the case is
filed.29
Jurisdiction over the nature and subject matter
of an action is conferred by the Constitution and
the law30 and by the material allegations in the
complaint, irrespective of whether or not the
plaintiff is entitled to recover all or some of the
claims or reliefs sought therein.31 Civil Case No.
1192-BG is an action for damages arising from
an alleged breach of contract. Undoubtedly, the
nature of the action and the amount of
damages prayed are within the jurisdiction of
the RTC.
As regards jurisdiction over the parties, the trial
court acquired jurisdiction over herein
respondent (as party plaintiff) upon the filing of
the complaint. On the other hand, jurisdiction

over the person of petitioner (as party

defendant) was acquired by its voluntary
appearance in court.32
That the subject contract included a stipulation
that the same shall be governed by the laws of
the State of Connecticut does not suggest that
the Philippine courts, or any other foreign
tribunal for that matter, are precluded from
hearing the civil action. Jurisdiction and choice
of law are two distinct concepts. Jurisdiction
considers whether it is fair to cause a defendant
to travel to this state; choice of law asks the
further question whether the application of a
substantive law which will determine the merits
of the case is fair to both parties.33 The choice
of law stipulation will become relevant only
when the substantive issues of the instant case
develop, that is, after hearing on the merits
proceeds before the trial court.
Under the doctrine of forum non conveniens, a
court, in conflicts-of-laws cases, may refuse
impositions on its jurisdiction where it is not the
most "convenient" or available forum and the
parties are not precluded from seeking
remedies elsewhere.34 Petitioners averments
of the foreign elements in the instant case are
not sufficient to oust the trial court of its
jurisdiction over Civil Case No. No. 1192-BG and
the parties involved.
Moreover, the propriety of dismissing a case
based on the principle of forum non
conveniens requires a factual determination;
hence, it is more properly considered as a
matter of defense. 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 courts desistance.35
Finding no grave abuse of discretion on the trial
court, the Court of Appeals respected its
conclusion that it can assume jurisdiction over
the dispute notwithstanding its foreign
elements. In the same manner, the Court defers
to the sound discretion of the lower courts
because their findings are binding on this Court.
Petitioner also contends that the complaint in
Civil Case No. 1192-BG failed to state a cause of
action against petitioner. Failure to state a
cause of action refers to the insufficiency of
allegation in the pleading.36 As a general rule,
the elementary test for failure to state a cause
of action is whether the complaint alleges facts
which if true would justify the relief
demanded.37

The complaint alleged that petitioner had

combined with BMSI and RUST to function as
one company. Petitioner contends that the
deposition of Walter Browning rebutted this
allegation. On this score, the resolution of the
Court of Appeals is instructive, thus:
- versus x x x Our examination of the deposition of Mr.
Walter Browning as well as other documents
produced in the hearing shows that these
evidence aliunde are not quite sufficient for us
to mete a ruling that the complaint fails to state
a cause of action.
Annexes "A" to "E" by themselves are not
substantial, convincing and conclusive proofs
that Raytheon Engineers and Constructors, Inc.
(REC) assumed the warranty obligations of
defendant Rust International in the Makar Port
Project in General Santos City, after Rust
International ceased to exist after being
absorbed by REC. Other documents already
submitted in evidence are likewise meager to
preponderantly conclude that Raytheon
International, Inc., Rust International[,] Inc. and
Brand Marine Service, Inc. have combined into
one company, so much so that Raytheon
International, Inc., the surviving company (if at
all) may be held liable for the obligation of BMSI
to respondent Rouzie for unpaid commissions.
Neither these documents clearly speak
otherwise.38
As correctly pointed out by the Court of
Appeals, the question of whether petitioner,
BMSI and RUST merged together requires the
presentation of further evidence, which only a
full-blown trial on the merits can afford.
the instant petition for review on certiorari
is The Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 67001 are
hereby Costs against petitioner.
THIRD DIVISION

MINORU KITAMURA,
Respondent.
G.R. No. 149177

Present:

YNARES-SANTIAGO, J.,
Chairperson,
AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and

KAZUHIRO HASEGAWA and NIPPON

ENGINEERING CONSULTANTS CO., LTD.,

REYES, JJ.

Petitioners,
Promulgated:

following the company's consultancy contract

with the Philippine Government.[6]
November 23, 2007

x-----------------------------------------------------------------------------------x

When the STAR Project was near completion,

the Department of Public Works and Highways
(DPWH) engaged the consultancy services
of Nippon, on January 28, 2000, this time for the
detailed engineering and construction
supervision of the Bongabon-Baler Road
Improvement (BBRI) Project.[7] Respondent was
named as the project manager in the contract's
Appendix 3.1.[8]

DECISION

NACHURA, J.:

Before the Court is a petition for review

on certiorari under Rule 45 of the Rules of Court
assailing the April 18, 2001 Decision[1] of the
Court of Appeals (CA) in CA-G.R. SP No. 60827,
and the July 25, 2001 Resolution[2] denying the
motion for reconsideration thereof.

On March 30, 1999, petitioner Nippon

Engineering Consultants Co., Ltd. (Nippon), a
Japanese consultancy firm providing technical
and management support in the infrastructure
projects of foreign governments,[3] entered into
an Independent Contractor Agreement (ICA)
with respondent Minoru Kitamura, a Japanese
national permanently residing in the Philippines.
[4] The agreement provides that respondent
was to extend professional services
to Nippon for a year starting on April 1, 1999.
[5] Nipponthen assigned respondent to work as
the project manager of the Southern Tagalog
Access Road (STAR) Project in the Philippines,

On February 28, 2000, petitioner Kazuhiro

Hasegawa, Nippon's general manager for its
International Division, informed respondent that
the company had no more intention of
automatically renewing hisICA. His services
would be engaged by the company only up to
the substantial completion of the STAR Project
on March 31, 2000, just in time for the ICA's
expiry.[9]

Threatened with impending unemployment,

respondent, through his lawyer, requested a
negotiation conference and demanded that he
be assigned to the BBRI project. Nippon insisted
that respondents contract was for a fixed term
that had already expired, and refused to
negotiate for the renewal of theICA.[10]

As he was not able to generate a positive

response from the petitioners, respondent
consequently initiated on June 1, 2000 Civil
Case No. 00-0264 for specific performance and
damages with
the Regional Trial Courtof Lipa City.[11]

For their part, petitioners, contending that

the ICA had been perfected in Japan and
executed by and between Japanese nationals,
moved to dismiss the complaint for lack of
jurisdiction. They asserted that the claim for
improper pre-termination of
respondent's ICA could only be heard and

ventilated in the proper courts

of Japan following the principles of lex loci
celebrationis and lex contractus.[12]
Petitioners' motion for reconsideration was
subsequently denied by the CA in the
assailed July 25, 2001Resolution.[24]
In the meantime, on June 20, 2000, the DPWH
approved Nippon's request for the replacement
of Kitamura by a certain Y. Kotake as project
manager of the BBRI Project.[13]

On June 29, 2000, the RTC, invoking our ruling

in Insular Government v. Frank[14] that matters
connected with the performance of contracts
are regulated by the law prevailing at the place
of performance,[15]denied the motion to
dismiss.[16] The trial court subsequently denied
petitioners' motion for reconsideration,
[17] prompting them to file with the appellate
court, on August 14, 2000, their Petition
for Certiorari under Rule 65 [docketed as CAG.R. SP No. 60205].[18] On August 23, 2000,
the CA resolved to dismiss the petition on
procedural groundsfor lack of statement of
material dates and for insufficient verification
and certification against forum shopping.[19] An
Entry of Judgment was later issued by the
appellate court on September 20, 2000.[20]

Aggrieved by this development, petitioners filed

with the CA, on September 19, 2000, still within
the reglementary period, a second Petition
for Certiorari under Rule 65 already stating
therein the material dates and attaching thereto
the proper verification and certification. This
second petition, which substantially raised the
same issues as those in the first, was docketed
as CA-G.R. SP No. .[21]

Ruling on the merits of the second petition, the

appellate court rendered the assailed April 18,
2001Decision[22] finding no grave abuse of
discretion in the trial court's denial of the
motion to dismiss. The CA ruled, among others,
that the principle of lex loci celebrationis was
not applicable to the case, because nowhere in
the pleadings was the validity of the written
agreement put in issue. The CA thus declared
that the trial court was correct in applying
instead the principle of lex loci solutionis.[23]

Remaining steadfast in their stance despite the

series of denials, petitioners instituted the
instant Petition for Review
on Certiorari[25] imputing the following errors
to the appellate court:

A. THE HONORABLE COURT OF APPEALS

GRAVELY ERRED IN FINDING THAT THE TRIAL
COURT VALIDLY EXERCISED JURISDICTION OVER
THE INSTANT CONTROVERSY, DESPITE THE FACT
THAT THE CONTRACT SUBJECT MATTER OF THE
PROCEEDINGS A QUO WAS ENTERED INTO BY
AND BETWEEN TWO JAPANESE NATIONALS,
WRITTEN WHOLLY IN THE JAPANESE LANGUAGE
AND EXECUTED IN TOKYO, JAPAN.

B. THE HONORABLE COURT OF APPEALS

GRAVELY ERRED IN OVERLOOKING THE NEED TO
REVIEW OUR ADHERENCE TO THE PRINCIPLE
OF LEX LOCI SOLUTIONIS IN THE LIGHT OF
RECENT DEVELOPMENT[S] IN PRIVATE
INTERNATIONAL LAWS.[26]

The pivotal question that this Court is called

upon to resolve is whether the subject matter
jurisdiction of Philippine courts in civil cases for
specific performance and damages involving
contracts executed outside the country by
foreign nationals may be assailed on the
principles of lex loci celebrationis, lex
contractus, the state of the most significant
relationship rule, or forum non conveniens.

However, before ruling on this issue, we must

first dispose of the procedural matters raised by
the respondent.

Kitamura contends that the finality of the

appellate court's decision in CA-G.R. SP No.
60205 has already barred the filing of the
second petition docketed as CA-G.R. SP No.
60827 (fundamentally raising the same issues
as those in the first one) and the instant petition
for review thereof.

We do not agree. When the CA dismissed CAG.R. SP No. 60205 on account of the petition's
defective certification of non-forum shopping, it
was a dismissal without prejudice.[27] The
same holds true in the CA's dismissal of the said
case due to defects in the formal requirement of
verification[28] and in the other requirement in
Rule 46 of the Rules of Court on the statement
of the material dates.[29] The dismissal being
without prejudice, petitioners can re-file the
petition, or file a second petition attaching
thereto the appropriate verification and
certificationas they, in fact didand stating
therein the material dates, within the prescribed
period[30] in Section 4, Rule 65 of the said
Rules.[31]

The dismissal of a case without prejudice

signifies the absence of a decision on the merits
and leaves the parties free to litigate the matter
in a subsequent action as though the dismissed
action had not been commenced. In other
words, the termination of a case not on the
merits does not bar another action involving the
same parties, on the same subject matter and
theory.[32]

Necessarily, because the said dismissal is

without prejudice and has no res judicata effect,
and even if petitioners still indicated in the
verification and certification of the
second certiorari petition that the first had
already been dismissed on procedural grounds,
[33] petitioners are no longer required by the
Rules to indicate in their certification of nonforum shopping in the instant petition for review
of the second certiorari petition, the status of

the aforesaid first petition before the CA. In any

case, an omission in the certificate of non-forum
shopping about any event that will not
constitute res judicata and litis pendentia,as in
the present case, is not a fatal defect. It will not
warrant the dismissal and nullification of the
entire proceedings, considering that the evils
sought to be prevented by the said certificate
are no longer present.[34]

The Court also finds no merit in respondent's

contention that petitioner Hasegawa is only
authorized to verify and certify, on behalf
of Nippon, the certiorari petition filed with the
CA and not the instant petition. True, the
Authorization[35] dated September 4, 2000,
which is attached to the
second certioraripetition and which is also
attached to the instant petition for review, is
limited in scopeits wordings indicate that
Hasegawa is given the authority to sign for and
act on behalf of the company only in the
petition filed with the appellate court, and that
authority cannot extend to the instant petition
for review.[36] In a plethora of cases, however,
this Court has liberally applied the Rules or even
suspended its application whenever a
satisfactory explanation and a subsequent
fulfillment of the requirements have been
made.[37] Given that petitioners herein
sufficiently explained their misgivings on this
point and appended to their Reply[38] an
updated Authorization[39] for Hasegawa to act
on behalf of the company in the instant petition,
the Court finds the same as sufficient
compliance with the Rules.

However, the Court cannot extend the same

liberal treatment to the defect in the verification
and certification. As respondent pointed out,
and to which we agree, Hasegawa is truly not
authorized to act on behalf of Nippon in this
case. The aforesaid September 4, 2000
Authorization and even the subsequent August
17, 2001 Authorization were issued only by
Nippon's president and chief executive officer,
not by the company's board of directors. In not
a few cases, we have ruled that corporate
powers are exercised by the board of directors;
thus, no person, not even its officers, can bind
the corporation, in the absence of authority
from the board.[40] Considering that Hasegawa
verified and certified the petition only on his
behalf and not on behalf of the other petitioner,
the petition has to be denied pursuant
to Loquias v. Office of the Ombudsman.
[41] Substantial compliance will not suffice in a

matter that demands strict observance of the

Rules.[42] While technical rules of procedure
are designed not to frustrate the ends of justice,
nonetheless, they are intended to effect the
proper and orderly disposition of cases and
effectively prevent the clogging of court
dockets.[43]

Further, the Court has observed that petitioners

incorrectly filed a Rule 65 petition to question
the trial court's denial of their motion to
dismiss. It is a well-established rule that an
order denying a motion dismiss is interlocutory,
and cannot be the subject of the extraordinary
petition for certiorari ormandamus. The
appropriate recourse is to file an answer and to
interpose as defenses the objections raised in
the motion, to proceed to trial, and, in case of
an adverse decision, to elevate the entire case
by appeal in due course.[44] While there are
recognized exceptions to this rule,
[45] petitioners' case does not fall among them.

This brings us to the discussion of the

substantive issue of the case.

Asserting that the RTC of Lipa City is an

inconvenient forum, petitioners question its
jurisdiction to hear and resolve the civil case for
specific performance and damages filed by the
respondent. The ICA subject of the litigation was
entered into and perfected in Tokyo, Japan, by
Japanese nationals, and written wholly in the
Japanese language. Thus, petitioners posit that
local courts have no substantial relationship to
the parties[46] following the [state of the] most
significant relationship rule in Private
International Law.[47]

The Court notes that petitioners adopted an

additional but different theory when they
elevated the case to the appellate court. In the
Motion to Dismiss[48] filed with the trial court,
petitioners never contended that the RTC is an
inconvenient forum. They merely argued that
the applicable law which will determine the
validity or invalidity of respondent's claim is
that of Japan, following the principles of lex loci
celebrationis and lex contractus.[49] While not

abandoning this stance in their petition before

the appellate court, petitioners
on certiorari significantly invoked the defense
of forum non conveniens.[50]On petition for
review before this Court, petitioners dropped
their other arguments, maintained the forum
non conveniens defense, and introduced their
new argument that the applicable principle is
the [state of the] most significant relationship
rule.[51]

Be that as it may, this Court is not inclined to

deny this petition merely on the basis of the
change in theory, as explained in Philippine
Ports Authority v. City of Iloilo.[52] We only
pointed out petitioners' inconstancy in their
arguments to emphasize their incorrect
assertion of conflict of laws principles.

To elucidate, in the judicial resolution of

conflicts problems, three consecutive phases
are involved: jurisdiction, choice of law, and
recognition and enforcement of judgments.
Corresponding to these phases are the following
questions: (1) Where can or should litigation be
initiated? (2) Which law will the court apply?
and (3) Where can the resulting judgment be
enforced?[53]

Analytically, jurisdiction and choice of law are

two distinct concepts.[54] Jurisdiction considers
whether it is fair to cause a defendant to travel
to this state; choice of law asks the further
question whether the application of a
substantive law which will determine the merits
of the case is fair to both parties. The power to
exercise jurisdiction does not automatically give
a state constitutional authority to apply forum
law. While jurisdiction and the choice of the lex
fori will often coincide, the minimum contacts
for one do not always provide the necessary
significant contacts for the other.[55] The
question of whether the law of a state can be
applied to a transaction is different from the
question of whether the courts of that state
have jurisdiction to enter a judgment.[56]

In this case, only the first phase is at

issuejurisdiction. Jurisdiction, however, has

various aspects. For a court to validly exercise

its power to adjudicate a controversy, it must
have jurisdiction over the plaintiff or the
petitioner, over the defendant or the
respondent, over the subject matter, over the
issues of the case and, in cases involving
property, over the res or the thing which is the
subject of the litigation.[57] In assailing the trial
court's jurisdiction herein, petitioners are
actually referring to subject matter jurisdiction.

Jurisdiction over the subject matter in a judicial

proceeding is conferred by the sovereign
authority which establishes and organizes the
court. It is given only by law and in the manner
prescribed by law.[58] It is further determined
by the allegations of the complaint irrespective
of whether the plaintiff is entitled to all or some
of the claims asserted therein.[59] To succeed
in its motion for the dismissal of an action for
lack of jurisdiction over the subject matter of
the claim,[60] the movant must show that the
court or tribunal cannot act on the matter
submitted to it because no law grants it the
power to adjudicate the claims.[61]

In the instant case, petitioners, in their motion

to dismiss, do not claim that the trial court is
not properly vested by law with jurisdiction to
hear the subject controversy for, indeed, Civil
Case No. 00-0264 for specific performance and
damages is one not capable of pecuniary
estimation and is properly cognizable by the
RTC of Lipa City.[62] What they rather raise as
grounds to question subject matter jurisdiction
are the principles of lex loci
celebrationis and lex contractus and the state of
the most significant relationship rule.

The Court finds the invocation of these grounds

unsound.
Lex loci celebrationis relates to the law of the
place of the ceremony[63] or the law of the
place where a contract is made.[64] The
doctrine of lex contractus or lex loci
contractus means the law of the place where a
contract is executed or to be performed.[65] It
controls the nature, construction, and validity of
the contract[66] and it may pertain to the law
voluntarily agreed upon by the parties or the
law intended by them either expressly or

implicitly.[67] Under the state of the most

significant relationship rule, to ascertain what
state law to apply to a dispute, the court should
determine which state has the most substantial
connection to the occurrence and the parties. In
a case involving a contract, the court should
consider where the contract was made, was
negotiated, was to be performed, and the
domicile, place of business, or place of
incorporation of the parties.[68] This rule takes
into account several contacts and evaluates
them according to their relative importance with
respect to the particular issue to be resolved.
[69]

Since these three principles in conflict of laws

make reference to the law applicable to a
dispute, they are rules proper for the second
phase, the choice of law.[70] They determine
which state's law is to be applied in resolving
the substantive issues of a conflicts problem.
[71] Necessarily, as the only issue in this case is
that of jurisdiction, choice-of-law rules are not
only inapplicable but also not yet called for.

Further, petitioners' premature invocation of

choice-of-law rules is exposed by the fact that
they have not yet pointed out any conflict
between the laws of Japan and ours. Before
determining which law should apply, first there
should exist a conflict of laws situation requiring
the application of the conflict of laws rules.
[72] Also, when the law of a foreign country is
invoked to provide the proper rules for the
solution of a case, the existence of such law
must be pleaded and proved.[73]

It should be noted that when a conflicts case,

one involving a foreign element, is brought
before a court or administrative agency, there
are three alternatives open to the latter in
disposing of it: (1) dismiss the case, either
because of lack of jurisdiction or refusal to
assume jurisdiction over the case; (2) assume
jurisdiction over the case and apply the internal
law of the forum; or (3) assume jurisdiction over
the case and take into account or apply the law
of some other State or States.[74] The courts
power to hear cases and controversies is
derived from the Constitution and the laws.
While it may choose to recognize laws of foreign
nations, the court is not limited by foreign
sovereign law short of treaties or other formal

agreements, even in matters regarding rights

provided by foreign sovereigns.[75]

Neither can the other ground raised, forum non

conveniens,[76] be used to deprive the trial
court of its jurisdiction herein. First, it is not a
proper basis for a motion to dismiss because
Section 1, Rule 16 of the Rules of Court does not
include it as a ground.[77] Second, whether a
suit should be entertained or dismissed on the
basis of the said doctrine depends largely upon
the facts of the particular case and is addressed
to the sound discretion of the trial court.[78] In
this case, the RTC decided to assume
jurisdiction. Third, the propriety of dismissing a
case based on this principle requires a factual
determination; hence, this conflicts principle is
more properly considered a matter of defense.
[79]
Accordingly, since the RTC is vested by law with
the power to entertain and hear the civil case
filed by respondent and the grounds raised by
petitioners to assail that jurisdiction are
inappropriate, the trial and appellate courts
correctly denied the petitioners motion to
dismiss.
WHEREFORE, premises considered, the petition
for review on certiorari is DENIED

Republic of the Philippines

Manila
EN BANC

CARLOS D'ALMEIDA and IDA JOHANNES, with

her husband, J. E. JOHANNES, relators,
vs.
respondent.
Amzi B. Kelly for relators.
Fisher & Dewitt and Francis B. Mahoney for
respondents.

J.:The relevant facts disclosed by this petition

for certiorari and the return thereto may be
stated as follows:
Mrs. Carmen Theodora Johannes nee Carmen
D'Almeida, died intestate in Singapore, Straits
Settlements, on August 31, 1921. Of her
immediate family there remained the husband,
B. E. Johannes, the brothers, Frederick Charles
D'Almeida and Alfred D'Almeida, and the sister,
Ida D'Almeida Johannes. Of these, the husband,
the brother Frederick, and the sister Ida, were
residents of Singapore, while the brother Alfred
was in Manila. The Singapore heirs apparently
joined in asking that letters of administration be
granted by the Supreme Court of the Straits
Settlements to B. E. Johannes, the lawful
husband of the deceased. At least, on
September 19, 1921, the husband of the
deceased. At least, on September 19, 1921, the
husband was named the administrator of the
property of the deceased wife, which was locally
situate within the jurisdiction of the Supreme
Court of the Straits Settlements. (Under the
British law [22 & 23 Charles II c 10, 29 Charles II
c 3, and James II c 17], it would seem that the
husband is entitled to the whole of the estate of
his wife if she die intestate to the exclusive of
any other next of kin.) On October 1, 1921, the
brother Alfred D' Almeida was, on his petition,
appointed administrator of the Manila estate of
the deceased consisting of P109,732.55. This
sum it appears, was on deposit in the Manila
banks under and by virtue of guardianship
proceedings for the late Carmen Theodora
Johannes, which were finally terminated by the
discharge of the guardian, the Philippine Trust
Company, on January 16, 1922.
The burden of the relator's contention is that
the Honorable George R. Harvey, as judge of
First Instance of the City of Manila, has acted in
excess of his jurisdiction in appointing Alfred
D'Almeida administrator of the funds of the
estate on deposit in the Philippines, and that an
administration in the jurisdiction is unnecessary.
Accordingly, relators pray the court to annul the
appointment of Alfred D'Almeida and to issue
an order directing the Judge of First Instance to
have placed to the credit of B. E. Johannes as
administrator of the estate of Carmen Theodora
Johannes all of the funds of the late Carmen
D'Almeida Johannes, now on deposit and
subject to the order of the court, with P5,000 as
damages. The respondents, Judge Harvey, and
the administrator Alfred D'Almeida, in
compliance with the order to show cause why
the writ should not issue, contend that the
respondent judge has not in any manner acted
in excess of the jurisdiction duly conferred upon
and exercised by him in the manner provided by

law, and that an order appointing an

administrator is a final and appealable order.
Certain general observations may possibly
serve to clarify the situation.
It is often necessary to have more than one
administration of an estate. When a person dies
intestate owning property in the country of his
domicile as well as in a foreign country,
administration is had in both countries. That
which is granted in the jurisdiction of
decedent's last domicile is termed the principal
administration, while any other administration is
termed the ancillary administration. The reason
for the latter is because a grant of
administration does not ex proprio vigore have
any effect beyond the limits of the country in
which it is granted. Hence, an administrator
appointed in a foreign state has no authority in
the United States. The ancillary administration
is proper, whenever a person dies, leaving in a
country other than that of his las domicile,
property to be administered in the nature of
assets of the decedent, liable for his individual
debts or to be distributed among his heirs. (23
C. J., 1010, et seq.; 24 C. J., 1109, et seq.;
Wilkins vs. Ellett [1882], 108 U. S., 256;
Perez vs. Aguerria [1901], 1 Porto Rico Fed.,
443; Vaughn vs. Barret [1833], 5 Vt., 333.)
The principal administration in this instance is
that at the domicile of the late Carmen
Theodora Johannes in Singapore, Straits
Settlements. What is sought in the Philippine
Islands is an ancillary administration subsidiary
to the domiciliary administration, conformable
to the provisions of sections 601, 602, and 603
of the Code of Civil Procedure. The proper
course of procedure would be for the ancillary
administrator to pay the claims of creditors, if
there be any, settle the accounts, and remit the
surplus to the domiciliary jurisdiction, for
distribution among the next of kin. Such
administration appears to be required in this
jurisdiction since the provisions of section 596
of the Code of Civil Procedure, which permit of
the settlement of certain estates without legal
proceedings, have not been met. The decision
of this court in Baldemor vs. Malangyaon
([1916]), 34 Phil., 368), on which relators rely, is
then not in point because predicated directly on
the provisions of the section last cited.
It is almost a universal rule to give the surviving
spouse a preference when an administrator is to
be appointed, unless for strong reasons it is
deemed advisable to name someone else. This
preference has particular force under Spanish
law precedents. (4 Escriche, Diccionario de
Legislacion y Jurisprudencia, 1085.) However,

the Code of Civil Procedure, in section 642,

while naming the surviving husband or wife, as
the case may be, as one to whom
administration can be granted, leaves this to
the discretion of the court to determine, for it
may be found that the surviving spouse is
unsuitable for the responsibility. Moreover,
nonresidence is a factor to be considered in
determining the propriety of the appointment,
and in this connection, it is to be noted that the
husband of the deceased, the administrator of
the principal administration, resides in
Singapore. Undoubtedly, if the husband should
come into this jurisdiction, the court would give
consideration to this petition that he be named
the ancillary administrator for local purposes.
Ancillary letters should ordinarily be granted to
the domicilliary representative, if he applies
therefor, or to his nominee, or attorney; but in
the absence of express statutory requirement
the court may in its discretion appoint some
other person. (24 C. J., 1114.)
There is still another aspect to the case. This is
that pursuant to section 783 of the Code of Civil
Procedure, an order of a Court of First Instance
appointing an administration of the estate of a
deceased person constitutes a final
determination of the rights of the parties
thereunder, within the meaning of the statute,
and is appealable. (Sy Hong Eng vs. Sy Lioc Suy
[1907], 8 Phil., 594.)
As we reach the conclusion that the Court of
First Instance has not acted in excess of its
jurisdiction, and as there in an
appeal, certiorari will not lie. Accordingly, the
writ prayed for cannot be granted. Costs against
the relators. So ordered.
FIRST DIVISION

Petitioner,
G.R. No. 154380

- versus -

Present:

Davide, Jr., C
(Chairman),
Quisumbing,
Ynares-Santiago,

In this petition for review, the Solicitor General

assails the [1] dated May 15, 2002, of the
Regional Trial Court of Molave, Zamboanga del
Sur, Branch 23 and its [2] dated July 4, 2002
denying the motion for reconsideration. The
court a quo had declared that herein
respondent Cipriano Orbecido III is capacitated
to remarry. The fallo of the impugned Decision
reads:
WHEREFORE, by virtue of the provision of the
second paragraph of Art. 26 of the Family Code
and by reason of the divorce decree obtained
against him by his American wife, the petitioner
is given the capacity to remarry under the
Philippine Law.
IT IS SO ORDERED.[3]
The factual antecedents, as narrated by the trial
court, are as follows.

Carpio, and
Azcuna, JJ.
Respondent.

Promulgated:
October 5, 2005

DECISION
QUISUMBING, J.:
Given a valid marriage between two Filipino
citizens, where one party is later naturalized as
a foreign citizen and obtains a valid divorce
decree capacitating him or her to remarry, can
the Filipino spouse likewise remarry under
Philippine law?
Before us is a case of first impression that
behooves the Court to make a definite ruling on
this apparently novel question, presented as a
pure question of law.

On May 24, 1981, Cipriano Orbecido III married

Lady Myros M. Villanueva at the United Church
of Christ in the Philippines in Lam-an, Ozamis
City. Their marriage was blessed with a son and
a daughter, Kristoffer Simbortriz V. Orbecido
and Lady Kimberly V. Orbecido.
In 1986, Ciprianos wife left for the United States
bringing along their son Kristoffer. A few years
later, Cipriano discovered that his wife had been
naturalized as an American citizen.
Sometime in 2000, Cipriano learned from his
son that his wife had obtained a divorce decree
and then married a certain Innocent Stanley.
She, Stanley and her child by him currently live
at 5566 A. Walnut Grove Avenue, San Gabriel,
California.
Cipriano thereafter filed with the trial court a
petition for authority to remarry invoking
Paragraph 2 of Article 26 of the Family Code. No
opposition was filed. Finding merit in the
petition, the court granted the same. The
Republic, herein petitioner, through the Office of
the Solicitor General (OSG), sought
reconsideration but it was denied.
In this petition, the OSG raises a pure question
of law:
WHETHER OR NOT RESPONDENT CAN REMARRY
UNDER ARTICLE 26 OF THE FAMILY CODE[4]

The OSG contends that Paragraph 2 of Article

26 of the Family Code is not applicable to the
instant case because it only applies to a valid
mixed marriage; that is, a marriage celebrated
between a Filipino citizen and an alien. The
proper remedy, according to the OSG, is to file a
petition for annulment or for legal separation.
[5] Furthermore, the OSG argues there is no law
that governs respondents situation. The OSG
posits that this is a matter of legislation and not
of judicial determination.[6]
For his part, respondent admits that Article 26 is
not directly applicable to his case but insists
that when his naturalized alien wife obtained a
divorce decree which capacitated her to
remarry, he is likewise capacitated by operation
of law pursuant to Section 12, Article II of the
Constitution.[7]
At the outset, we note that the petition for
authority to remarry filed before the trial court
actually constituted a petition for declaratory
relief. In this connection, Section 1, Rule 63 of
the Rules of Court provides:
RULE 63

alien citizenship, obtained a divorce decree, and

remarried while in the U.S.A. The interests of
the parties are also adverse, as petitioner
representing the State asserts its duty to
protect the institution of marriage while
respondent, a private citizen, insists on a
declaration of his capacity to remarry.
Respondent, praying for relief, has legal interest
in the controversy. The issue raised is also ripe
for judicial determination inasmuch as when
respondent remarries, litigation ensues and
puts into question the validity of his second
marriage.
Coming now to the substantive issue, does
Paragraph 2 of Article 26 of the Family Code
apply to the case of respondent? Necessarily,
we must dwell on how this provision had come
about in the first place, and what was the intent
of the legislators in its enactment?
Brief Historical Background
On July 6, 1987, then President Corazon Aquino
signed into law Executive Order No. 209,
otherwise known as the Family Code, which
took effect on August 3, 1988. Article 26 thereof
states:

DECLARATORY RELIEF AND SIMILAR REMEDIES

Section 1. Who may file petitionAny person

interested under a deed, will, contract or other
written instrument, or whose rights are affected
by a statute, executive order or regulation,
ordinance, or other governmental regulation
may, before breach or violation thereof, bring
an action in the appropriate Regional Trial Court
to determine any question of construction or
validity arising, and for a declaration of his
rights or duties, thereunder.
...
The requisites of a petition for declaratory relief
are: (1) there must be a justiciable controversy;
(2) the controversy must be between persons
whose interests are adverse; (3) that the party
seeking the relief has a legal interest in the
controversy; and (4) that the issue is ripe for
judicial determination.[8]
This case concerns the applicability of
Paragraph 2 of Article 26 to a marriage between
two Filipino citizens where one later acquired

All marriages solemnized outside the Philippines

in accordance with the laws in force in the
country where they were solemnized, and valid
there as such, shall also be valid in this country,
except those prohibited under Articles 35, 37,
and 38.
On July 17, 1987, shortly after the signing of the
original Family Code, Executive Order No. 227
was likewise signed into law, amending Articles
26, 36, and 39 of the Family Code. A second
paragraph was added to Article 26. As so
amended, it now provides:
ART. 26. All marriages solemnized outside the
Philippines in accordance with the laws in force
in the country where they were solemnized, and
valid there as such, shall also be valid in this
country, except those prohibited under Articles
35(1), (4), (5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and
a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien
spouse capacitating him or her to remarry, the
Filipino spouse shall have capacity to remarry
under Philippine law. (Emphasis supplied)

On its face, the foregoing provision does not

appear to govern the situation presented by the
case at hand. It seems to apply only to cases
where at the time of the celebration of the
marriage, the parties are a Filipino citizen and a
foreigner. The instant case is one where at the
time the marriage was solemnized, the parties
were two Filipino citizens, but later on, the wife
was naturalized as an American citizen and
subsequently obtained a divorce granting her
capacity to remarry, and indeed she remarried
an American citizen while residing in the U.S.A.
Noteworthy, in the Report of the Public
Hearings[9] on the Family Code, the Catholic
Bishops Conference of the Philippines (CBCP)
registered the following objections to Paragraph
2 of Article 26:
1.
The rule is discriminatory. It
discriminates against those whose spouses are
Filipinos who divorce them abroad. These
spouses who are divorced will not be able to remarry, while the spouses of foreigners who
validly divorce them abroad can.
2.
This is the beginning of the
recognition of the validity of divorce even for
Filipino citizens. For those whose foreign
spouses validly divorce them abroad will also be
considered to be validly divorced here and can
re-marry. We propose that this be deleted and
made into law only after more widespread
consultation. (Emphasis supplied.)
Records of the proceedings of the Family Code
deliberations showed that the intent of
Paragraph 2 of Article 26, according to Judge
Alicia Sempio-Diy, a member of the Civil Code
Revision Committee, is to avoid the absurd
situation where the Filipino spouse remains
married to the alien spouse who, after obtaining
a divorce, is no longer married to the Filipino
spouse.
Interestingly, Paragraph 2 of Article 26 traces its
origin to the 1985 case of Van Dorn v.
Romillo[10] The Van Dorn case involved a
marriage between a Filipino citizen and a
foreigner. The Court held therein that a divorce
decree validly obtained by the alien spouse is
valid in the Philippines, and consequently, the
Filipino spouse is capacitated to remarry under
Philippine law.
Does the same principle apply to a case where
at the time of the celebration of the marriage,
the parties were Filipino citizens, but later on,

one of them obtains a foreign citizenship by

naturalization?
The jurisprudential answer lies latent in the
1998 case of Quita v. Court of Appeals.
[11] In Quita, the parties were, as in this case,
Filipino citizens when they got married. The wife
became a naturalized American citizen in 1954
and obtained a divorce in the same year. The
Court therein hinted, by way ofobiter dictum,
that a Filipino divorced by his naturalized
foreign spouse is no longer married under
Philippine law and can thus remarry.
Thus, taking into consideration the legislative
intent and applying the rule of reason, we hold
that Paragraph 2 of Article 26 should be
interpreted to include cases involving parties
who, at the time of the celebration of the
marriage were Filipino citizens, but later on, one
of them becomes naturalized as a foreign
citizen and obtains a divorce decree. The
Filipino spouse should likewise be allowed to
remarry as if the other party were a foreigner at
the time of the solemnization of the marriage.
To rule otherwise would be to sanction absurdity
and injustice. Where the interpretation of a
statute according to its exact and literal import
would lead to mischievous results or contravene
the clear purpose of the legislature, it should be
construed according to its spirit and reason,
disregarding as far as necessary the letter of
the law. A statute may therefore be extended to
cases not within the literal meaning of its terms,
so long as they come within its spirit or intent.
[12]
If we are to give meaning to the legislative
intent to avoid the absurd situation where the
Filipino spouse remains married to the alien
spouse who, after obtaining a divorce is no
longer married to the Filipino spouse, then the
instant case must be deemed as coming within
the contemplation of Paragraph 2 of Article 26.
In view of the foregoing, we state the twin
elements for the application of Paragraph 2 of
Article 26 as follows:
1.
There is a valid marriage that has
been celebrated between a Filipino citizen and a
foreigner; and
2.
A valid divorce is obtained abroad
by the alien spouse capacitating him or her to
remarry.

The reckoning point is not the citizenship of the

parties at the time of the celebration of the
marriage, but their citizenship at the time a
valid divorce is obtained abroad by the alien
spouse capacitating the latter to remarry.
In this case, when Ciprianos wife was
naturalized as an American citizen, there was
still a valid marriage that has been celebrated
between her and Cipriano. As fate would have
it, the naturalized alien wife subsequently
obtained a valid divorce capacitating her to
remarry. Clearly, the twin requisites for the
application of Paragraph 2 of Article 26 are both
present in this case. Thus Cipriano, the divorced
Filipino spouse, should be allowed to remarry.
We are also unable to sustain the OSGs theory
that the proper remedy of the Filipino spouse is
to file either a petition for annulment or a
petition for legal separation. Annulment would
be a long and tedious process, and in this
particular case, not even feasible, considering
that the marriage of the parties appears to have
all the badges of validity. On the other hand,
legal separation would not be a sufficient
remedy for it would not sever the marriage tie;
hence, the legally separated Filipino spouse
would still remain married to the naturalized
alien spouse.

227), should be interpreted to allow a Filipino

citizen, who has been divorced by a spouse who
had acquired foreign citizenship and remarried,
also to remarry. However, considering that in
the present petition there is no sufficient
evidence submitted and on record, we are
unable to declare, based on respondents bare
allegations that his wife, who was naturalized as
an American citizen, had obtained a divorce
decree and had remarried an American, that
respondent is now capacitated to remarry. Such
declaration could only be made properly upon
respondents submission of the aforecited
evidence in his favor.
the petition by the Republic of the Philippines
is . The assailed Decision dated May 15, 2002,
and Resolution dated July 4, 2002, of the
Regional Trial Court of Molave, Zamboanga del
Sur, Branch 23, are hereby .
No pronouncement as to costs.
THIRD DIVISION

However, we note that the records are bereft of

competent evidence duly submitted by
respondent concerning the divorce decree and
the naturalization of respondents wife. It is
settled rule that one who alleges a fact has the
burden of proving it and mere allegation is not
evidence.[13]

EDGAR SAN LUIS, G.R. No. 133743

Accordingly, for his plea to prosper, respondent

herein must prove his allegation that his wife
was naturalized as an American citizen.
Likewise, before a foreign divorce decree can be
recognized by our own courts, the party
pleading it must prove the divorce as a fact and
demonstrate its conformity to the foreign law
allowing it.[14] Such foreign law must also be
proved as our courts cannot take judicial notice
of foreign laws. Like any other fact, such laws
must be alleged and proved.[15] Furthermore,
respondent must also show that the divorce
decree allows his former wife to remarry as
specifically required in Article 26. Otherwise,
there would be no evidence sufficient to declare
that he is capacitated to enter into another
marriage.

- versus - Ynares-Santiago, J. (Chairperson),

Nevertheless, we are unanimous in our holding

that Paragraph 2 of Article 26 of the Family
Code (E.O. No. 209, as amended by E.O. No.

Petitioner,
Present:

Austria-Martinez,
Callejo, Sr., and
Chico-Nazario, JJ
FELICIDAD SAN LUIS,
Respondent.

x ---------------------------------------------------- x

RODOLFO SAN LUIS, G.R. No. 134029

Petitioner,

The instant case involves the settlement of the

estate of Felicisimo T. San Luis (Felicisimo), who
was the former governor of
the Province of Laguna. During his lifetime,
Felicisimo contracted three marriages.His first
marriage was with Virginia Sulit on March 17,
1942 out of which were born six children,
namely: Rodolfo, Mila, Edgar, Linda, Emilita and
Manuel. On August 11,
1963, Virginia predeceased Felicisimo.

- versus Promulgated:
FELICIDAD SAGALONGOS
alias FELICIDAD SAN LUIS,

Five years later, on May 1, 1968, Felicisimo

married Merry Lee Corwin, with whom he had a
son, Tobias. However, on October 15, 1971,
Merry Lee, an American citizen, filed a
Complaint for Divorce[5]before the Family Court
of the First Circuit, State of Hawaii, United
States of America (U.S.A.), which issued a
Decree Granting Absolute Divorce and Awarding
Child Custody on December 14, 1973.[6]

Respondent. February 6, 2007

x
--------------------------------------------------------------------------------------- x
DECISION

YNARES-SANTIAGO, J

Before us are consolidated petitions for review

assailing the February 4, 1998 Decision[1] of
the Court of Appeals in CA-G.R. CV No. 52647,
which reversed and set aside the September 12,
1995[2] and January 31, 1996[3] Resolutions of
the Regional Trial Court of Makati City, Branch
134 in SP. Proc. No. M-3708; and its May 15,
1998 Resolution[4] denying petitioners motion
for reconsideration.

On June 20, 1974, Felicisimo married

respondent Felicidad San Luis, then surnamed
Sagalongos, before Rev. Fr. William Meyer,
Minister of the United Presbyterian at Wilshire
Boulevard, Los Angeles,California, U.S.A.[7] He
had no children with respondent but lived with
her for 18 years from the time of their marriage
up to his death on December 18, 1992.

Thereafter, respondent sought the dissolution of

their conjugal partnership assets and the
settlement of Felicisimos estate. On December
17, 1993, she filed a petition for letters of
administration[8] before
theRegional Trial Court of Makati City, docketed
as SP. Proc. No. M-3708 which was raffled to
Branch 146 thereof.

Respondent alleged that she is the widow of

Felicisimo; that, at the time of his death, the
decedent was residing at 100 San Juanico
Street, New Alabang Village, Alabang, Metro
Manila; that the decedents surviving heirs are
respondent as legal spouse, his six children by
his first marriage, and son by his second
marriage; that the decedent left real properties,
both conjugal and exclusive, valued
atP30,304,178.00 more or less; that the

decedent does not have any unpaid

debts. Respondent prayed that the conjugal
partnership assets be liquidated and that letters
of administration be issued to her.

On February 4, 1994, petitioner Rodolfo San

Luis, one of the children of Felicisimo by his first
marriage, filed a motion to dismiss[9] on the
grounds of improper venue and failure to state
a cause of action.Rodolfo claimed that the
petition for letters of administration should have
been filed in the Province ofLaguna because this
was Felicisimos place of residence prior to his
death. He further claimed that respondent has
no legal personality to file the petition because
she was only a mistress of Felicisimo since the
latter, at the time of his death, was still legally
married to Merry Lee.

On February 15, 1994, Linda invoked the same

grounds and joined her brother Rodolfo in
seeking the dismissal[10] of the
petition. On February 28, 1994, the trial court
issued an Order[11] denying the two motions to
dismiss.

Unaware of the denial of the motions to dismiss,

respondent filed on March 5, 1994 her
opposition[12] thereto. She submitted
documentary evidence showing that while
Felicisimo exercised the powers of his public
office in Laguna, he regularly went home to
their house in New Alabang Village, Alabang,
Metro Manila which they bought sometime in
1982. Further, she presented the decree of
absolute divorce issued by the Family Court of
the First Circuit, State of Hawaii to prove that
the marriage of Felicisimo to Merry Lee had
already been dissolved. Thus, she claimed that
Felicisimo had the legal capacity to marry her
by virtue of paragraph 2,[13] Article 26 of the
Family Code and the doctrine laid down in Van
Dorn v. Romillo, Jr.[14]
Thereafter, Linda, Rodolfo and herein petitioner
Edgar San Luis, separately filed motions for
reconsideration from the Order denying their
motions to dismiss.[15] They asserted that
paragraph 2, Article 26 of the Family Code
cannot be given retroactive effect to validate
respondents bigamous marriage with Felicisimo
because this would impair vested rights in

derogation of Article 256[16] of the Family

Code.

On April 21, 1994, Mila, another daughter of

Felicisimo from his first marriage, filed a motion
to disqualify Acting Presiding Judge Anthony E.
Santos from hearing the case.

On October 24, 1994, the trial court issued an

Order[17] denying the motions for
reconsideration. It ruled that respondent, as
widow of the decedent, possessed the legal
standing to file the petition and that venue was
properly laid. Meanwhile, the motion for
disqualification was deemed moot and
academic[18]because then Acting Presiding
Judge Santos was substituted by Judge Salvador
S. Tensuan pending the resolution of said
motion.

Mila filed a motion for inhibition[19] against

Judge Tensuan on November 16, 1994. On even
date, Edgar also filed a motion for
reconsideration[20] from the Order denying
their motion for reconsideration arguing that it
does not state the facts and law on which it was
based.

On November 25, 1994, Judge Tensuan issued

an Order[21] granting the motion for inhibition.
The case was re-raffled to Branch 134 presided
by Judge Paul T. Arcangel.

On April 24, 1995,[22] the trial court required

the parties to submit their respective position
papers on the twin issues of venue and legal
capacity of respondent to file the
petition. On May 5, 1995, Edgar
manifested[23] that he is adopting the
arguments and evidence set forth in his
previous motion for reconsideration as his
position paper. Respondent and Rodolfo filed
their position papers on June 14,[24]and June
20,[25] 1995, respectively.

On September 12, 1995, the trial court

dismissed the petition for letters of
administration. It held that, at the time of his
death, Felicisimo was the duly elected governor
and a resident of the Province ofLaguna. Hence,
the petition should have been filed in Sta. Cruz,
Laguna and not in Makati City. It also ruled that
respondent was without legal capacity to file
the petition for letters of administration
because her marriage with Felicisimo was
bigamous, thus, void ab initio. It found that the
decree of absolute divorce dissolving Felicisimos
marriage to Merry Lee was not valid in
the Philippines and did not bind Felicisimo who
was a Filipino citizen. It also ruled that
paragraph 2, Article 26 of the Family Code
cannot be retroactively applied because it
would impair the vested rights of Felicisimos
legitimate children.

Respondent moved for reconsideration[26] and

for the disqualification[27] of Judge Arcangel
but said motions were denied.[28]

Respondent appealed to the Court of Appeals

which reversed and set aside the orders of the
trial court in its assailed Decision
dated February 4, 1998, the dispositive portion
of which states:

WHEREFORE, the Orders dated September 12,

1995 and January 31, 1996 are hereby
REVERSED and SET ASIDE; the Orders dated
February 28 and October 24, 1994 are
REINSTATED; and the records of the case is
REMANDED to the trial court for further
proceedings.[29]

The appellante court ruled that under Section 1,

Rule 73 of the Rules of Court, the term place of
residence of the decedent, for purposes of
fixing the venue of the settlement of his estate,
refers to the personal, actual or physical
habitation, or actual residence or place of abode
of a person as distinguished from legal
residence or domicile. It noted that although

Felicisimo discharged his functions as governor

in Laguna, he actually resided in Alabang,
Muntinlupa. Thus, the petition for letters of
administration was properly filed in Makati City.

The Court of Appeals also held that Felicisimo

had legal capacity to marry respondent by
virtue of paragraph 2, Article 26 of the Family
Code and the rulings in Van Dorn v. Romillo, Jr.
[30] and Pilapil v. Ibay-Somera.[31] It found that
the marriage between Felicisimo and Merry Lee
was validly dissolved by virtue of the decree of
absolute divorce issued by the Family Court of
the First Circuit, State of Hawaii. As a result,
under paragraph 2, Article 26, Felicisimo was
capacitated to contract a subsequent marriage
with respondent. Thus

With the well-known rule express mandate of

paragraph 2, Article 26, of the Family Code of
the Philippines, the doctrines in Van Dorn,
Pilapil, and the reason and philosophy behind
the enactment of E.O. No. 227, there is no
justiciable reason to sustain the individual view
sweeping statement of Judge Arc[h]angel, that
Article 26, par. 2 of the Family Code,
contravenes the basic policy of our state
against divorce in any form whatsoever. Indeed,
courts cannot deny what the law grants. All that
the courts should do is to give force and effect
to the express mandate of the law. The foreign
divorce having been obtained by the
Foreigner on December 14, 1992,[32] the
Filipino divorcee, shall x x x have capacity to
remarry under Philippine laws. For this reason,
the marriage between the deceased and
petitioner should not be denominated as a
bigamous marriage.

Therefore, under Article 130 of the Family Code,

the petitioner as the surviving spouse can
institute the judicial proceeding for the
settlement of the estate of the deceased. x x
x[33]

Edgar, Linda, and Rodolfo filed separate

motions for reconsideration[34] which were
denied by the Court of Appeals.

On July 2, 1998, Edgar appealed to this

Court via the instant petition for review
on certiorari.[35]Rodolfo later filed a
manifestation and motion to adopt the said
petition which was granted.[36]
In the instant consolidated petitions, Edgar and
Rodolfo insist that the venue of the subject
petition for letters of administration was
improperly laid because at the time of his
death, Felicisimo was a resident of Sta. Cruz,
Laguna. They contend that pursuant to our
rulings in Nuval v. Guray[37] andRomualdez v.
RTC, Br. 7, Tacloban City,[38] residence is
synonymous with domicile which denotes a
fixed permanent residence to which when
absent, one intends to return. They claim that a
person can only have one domicile at any given
time. Since Felicisimo never changed his
domicile, the petition for letters of
administration should have been filed in Sta.
Cruz, Laguna.

Petitioners also contend that respondents

marriage to Felicisimo was void and bigamous
because it was performed during the
subsistence of the latters marriage to Merry
Lee. They argue that paragraph 2, Article 26
cannot be retroactively applied because it
would impair vested rights and ratify the void
bigamous marriage. As such, respondent cannot
be considered the surviving wife of Felicisimo;
hence, she has no legal capacity to file the
petition for letters of administration.

The issues for resolution: (1) whether venue

was properly laid, and (2) whether respondent
has legal capacity to file the subject petition for
letters of administration.
The petition lacks merit.

Under Section 1,[39] Rule 73 of the Rules of

Court, the petition for letters of administration
of the estate of Felicisimo should be filed in the
Regional Trial Court of the province in which
he resides at the time of his death. In the case
of Garcia Fule v. Court of Appeals,[40] we laid

down the doctrinal rule for determining the

residence as contradistinguished from domicile
of the decedent for purposes of fixing the venue
of the settlement of his estate:

[T]he term resides connotes ex vi termini actual

residence as distinguished from legal residence
or domicile. This term resides, like the terms
residing and residence, is elastic and should be
interpreted in the light of the object or purpose
of the statute or rule in which it is employed. In
the application of venue statutes and rules
Section 1, Rule 73 of the Revised Rules of Court
is of such nature residence rather than domicile
is the significant factor.Even where the statute
uses the word domicile still it is construed as
meaning residence and not domicile in the
technical sense. Some cases make a distinction
between the terms residence and domicile but
as generally used in statutes fixing venue, the
terms are synonymous, and convey the same
meaning as the term inhabitant. In other words,
resides should be viewed or understood in its
popular sense, meaning, the personal, actual or
physical habitation of a person, actual residence
or place of abode. It signifies physical presence
in a place and actual stay thereat. In this
popular sense, the term means merely
residence, that is, personal residence, not legal
residence or domicile. Residence simply
requires bodily presence as an inhabitant in a
given place, while domicile requires bodily
presence in that place and also an intention to
make it ones domicile. No particular length of
time of residence is required though; however,
the residence must be more than temporary.
[41](Emphasis supplied)

It is incorrect for petitioners to argue that

residence, for purposes of fixing the venue of
the settlement of the estate of Felicisimo, is
synonymous with domicile. The rulings
in Nuval and Romualdezare inapplicable to the
instant case because they involve election
cases. Needless to say, there is a distinction
between residence for purposes of election laws
and residence for purposes of fixing the venue
of actions. In election cases, residence and
domicile are treated as synonymous terms, that
is, the fixed permanent residence to which
when absent, one has the intention of returning.
[42] However, for purposes of fixing venue
under the Rules of Court, the residence of a
person is his personal, actual or physical
habitation, or actual residence or place of
abode, which may not necessarily be his legal
residence or domicile provided he resides

therein with continuity and consistency.

[43] Hence, it is possible that a person may
have his residence in one place and domicile in
another.

In the instant case, while petitioners established

that Felicisimo was domiciled in Sta. Cruz,
Laguna, respondent proved that he also
maintained a residence in Alabang, Muntinlupa
from 1982 up to the time of his
death. Respondent submitted in evidence the
Deed of Absolute Sale[44] dated January 5,
1983 showing that the deceased purchased the
aforesaid property. She also presented billing
statements[45]from the Philippine Heart Center
and Chinese General Hospital for the period
August to December 1992 indicating the
address of Felicisimo at 100 San Juanico, Ayala
Alabang, Muntinlupa. Respondent also
presented proof of membership of the deceased
in the Ayala Alabang Village Association[46] and
Ayala Country Club, Inc.,[47] letterenvelopes[48] from 1988 to 1990 sent by the
deceaseds children to him at his Alabang
address, and the deceaseds calling
cards[49] stating that his home/city address is
at 100 San Juanico, Ayala Alabang Village,
Muntinlupa while his office/provincial address is
in Provincial Capitol, Sta. Cruz, Laguna.

From the foregoing, we find that Felicisimo was

a resident of Alabang, Muntinlupa for purposes
of fixing the venue of the settlement of his
estate. Consequently, the subject petition for
letters of administration was validly filed in the
Regional Trial Court[50] which has territorial
jurisdiction over Alabang, Muntinlupa. The
subject petition was filed on December 17,
1993. At that time, Muntinlupa was still a
municipality and the branches of the Regional
Trial Court of the National Capital Judicial Region
which had territorial jurisdiction over
Muntinlupa were then seated in Makati City as
per Supreme Court Administrative Order No. 3.
[51] Thus, the subject petition was validly filed
before the Regional Trial Courtof Makati City.

Anent the issue of respondent Felicidads legal

personality to file the petition for letters of
administration, we must first resolve the issue
of whether a Filipino who is divorced by his alien
spouse abroad may validly remarry under the
Civil Code, considering that Felicidads marriage

to Felicisimo was solemnized on June 20, 1974,

or before the Family Code took effect on August
3, 1988. In resolving this issue, we need not
retroactively apply the provisions of the Family
Code, particularly Art. 26, par. (2) considering
that there is sufficient jurisprudential basis
allowing us to rule in the affirmative.

The case of Van Dorn v. Romillo, Jr.[52] involved

a marriage between a foreigner and his Filipino
wife, which marriage was subsequently
dissolved through a divorce obtained abroad by
the latter.Claiming that the divorce was not
valid under Philippine law, the alien spouse
alleged that his interest in the properties from
their conjugal partnership should be
protected. The Court, however, recognized the
validity of the divorce and held that the alien
spouse had no interest in the properties
acquired by the Filipino wife after the
divorce. Thus:

In this case, the divorce in Nevada released

private respondent from the marriage from the
standards of American law, under which divorce
dissolves the marriage. As stated by the Federal
Supreme Court of the United States in Atherton
vs. Atherton, 45 L. Ed. 794, 799:

The purpose and effect of a decree of divorce

from the bond of matrimony by a competent
jurisdiction are to change the existing status or
domestic relation of husband and wife, and to
free them both from the bond. The marriage tie,
when thus severed as to one party, ceases to
bind either.A husband without a wife, or a wife
without a husband, is unknown to the law. When
the law provides, in the nature of a penalty, that
the guilty party shall not marry again, that
party, as well as the other, is still absolutely
freed from the bond of the former marriage.

Thus, pursuant to his national law, private

respondent is no longer the husband of
petitioner. He would have no standing to sue in
the case below as petitioners husband entitled
to exercise control over conjugal assets.As he is
bound by the Decision of his own countrys
Court, which validly exercised jurisdiction over

him, and whose decision he does not repudiate,

he is estopped by his own representation before
said Court from asserting his right over the
alleged conjugal property.[53]

As to the effect of the divorce on the Filipino

wife, the Court ruled that she should no longer
be considered married to the alien
spouse. Further, she should not be required to
perform her marital duties and obligations. It
held:

still married to private respondent and still

subject to a wife's obligations under Article
109, et. seq. of the Civil Code cannot be
just. Petitioner should not be obliged to live
together with, observe respect and fidelity, and
render support to private respondent. The latter
should not continue to be one of her heirs with
possible rights to conjugal property. .
[54] (Emphasis added)

between parties in a mixed marriage and

capacitating the Filipino spouse to remarry as a
necessary consequence of upholding the
validity of a divorce obtained abroad by the
alien spouse. In his treatise, Dr. Arturo M.
Tolentino cited Van Dorn stating that if the
foreigner obtains a valid foreign divorce, the
Filipino spouse shall have capacity to remarry
under Philippine law.[59] In Garcia v. Recio,
[60] the Court likewise cited the
aforementioned case in relation to Article 26.
[61]

In the recent case of Republic v. Orbecido III,

[62] the historical background and legislative
intent behind paragraph 2, Article 26 of the
Family Code were discussed, to wit:
Brief Historical Background

On July 6, 1987, then President Corazon Aquino

signed into law Executive Order No. 209,
otherwise known as the Family Code, which
took effect on August 3, 1988. Article 26 thereof
states:
This principle was thereafter applied in Pilapil v.
Ibay-Somera[55] where the Court recognized
the validity of a divorce obtained abroad. In the
said case, it was held that the alien spouse is
not a proper party in filing the adultery suit
against his Filipino wife. The Court stated
that the severance of the marital bond had the
effect of dissociating the former spouses from
each other, hence the actuations of one would
not affect or cast obloquy on the other.[56]

Likewise, in Quita v. Court of Appeals,[57] the

Court stated that where a Filipino is divorced by
his naturalized foreign spouse, the ruling in Van
Dorn applies.[58] Although decided
on December 22, 1998, the divorce in the said
case was obtained in 1954 when the Civil Code
provisions were still in effect.

The significance of the Van Dorn case to the

development of limited recognition of divorce in
thePhilippines cannot be denied. The ruling has
long been interpreted as severing marital ties

All marriages solemnized outside the Philippines

in accordance with the laws in force in the
country where they were solemnized, and valid
there as such, shall also be valid in this country,
except those prohibited under Articles 35, 37,
and 38.
On July 17, 1987, shortly after the signing of the
original Family Code, Executive Order No. 227
was likewise signed into law, amending Articles
26, 36, and 39 of the Family Code. A second
paragraph was added to Article 26. As so
amended, it now provides:
ART. 26. All marriages solemnized outside
the Philippines in accordance with the laws in
force in the country where they were
solemnized, and valid there as such, shall also
be valid in this country, except those prohibited
under Articles 35(1), (4), (5) and (6), 36, 37 and
38.

Where a marriage between a Filipino citizen and

a foreigner is validly celebrated and a divorce is
thereafter validly obtained abroad by the alien
spouse capacitating him or her to remarry, the
Filipino spouse shall have capacity to remarry
under Philippine law. (Emphasis supplied)
xxxx

Legislative Intent
Records of the proceedings of the Family Code
deliberations showed that the intent of
Paragraph 2 of Article 26, according to Judge
Alicia Sempio-Diy, a member of the Civil Code
Revision Committee, is to avoid the absurd
situation where the Filipino spouse remains
married to the alien spouse who, after obtaining
a divorce, is no longer married to the Filipino
spouse.

Van Dorn v. Romillo, Jr.The Van Dorn case

involved a marriage between a Filipino citizen
and a foreigner. The Court held therein that a
divorce decree validly obtained by the alien
spouse is valid in the .[63]

As such, the Van Dorn case is sufficient basis in

resolving a situation where a divorce is validly
obtained abroad by the alien spouse. With the
enactment of the Family Code and paragraph 2,
Article 26 thereof, our lawmakers codified the
law already established through judicial
precedent.

Indeed, when the object of a marriage is

defeated by rendering its continuance
intolerable to one of the parties and productive
of no possible good to the community, relief in
some way should be obtainable.[64] Marriage,
being a mutual and shared commitment
between two parties, cannot possibly be
productive of any good to the society where one
is considered released from the marital bond
while the other remains bound to it. Such is the
state of affairs where the alien spouse obtains a

valid divorce abroad against the Filipino spouse,

as in this case.

Petitioners cite Articles 15[65] and 17[66] of the

Civil Code in stating that the divorce is void
under Philippine law insofar as Filipinos are
concerned. However, in light of this Courts
rulings in the cases discussed above, the
Filipino spouse should not be discriminated
against in his own country if the ends of justice
are to be served.[67] In Alonzo v. Intermediate
Appellate Court,[68] the Court stated:

But as has also been aptly observed, we test a

law by its results; and likewise, we may add, by
its purposes. It is a cardinal rule that, in seeking
the meaning of the law, the first concern of the
judge should be to discover in its provisions the
intent of the lawmaker. Unquestionably, the law
should never be interpreted in such a way as to
cause injustice as this is never within the
legislative intent. An indispensable part of that
intent, in fact, for we presume the good motives
of the legislature, is to render justice.

Thus, we interpret and apply the law not

independently of but in consonance with justice.
Law and justice are inseparable, and we must
keep them so. To be sure, there are some laws
that, while generally valid, may seem arbitrary
when applied in a particular case because of its
peculiar circumstances. In such a situation, we
are not bound, because only of our nature and
functions, to apply them just the same, in
slavish obedience to their language. What we
do instead is find a balance between the word
and the will, that justice may be done even as
the law is obeyed.

As judges, we are not automatons. We do not

and must not unfeelingly apply the law as it is
worded, yielding like robots to the literal
command without regard to its cause and
consequence. Courts are apt to err by sticking
too closely to the words of a law, so we are
warned, by Justice Holmes again, where these
words import a policy that goes beyond them.

in Garcia, however, the Court cannot take

judicial notice of foreign laws as they must be
alleged and proved.[73]
xxxx

More than twenty centuries ago, Justinian

defined justice as the constant and perpetual
wish to render every one his due. That wish
continues to motivate this Court when it
assesses the facts and the law in every case
brought to it for decision. Justice is always an
essential ingredient of its decisions. Thus when
the facts warrants, we interpret the law in a way
that will render justice, presuming that it was
the intention of the lawmaker, to begin with,
that the law be dispensed with justice.[69]

Applying the above doctrine in the instant case,

the divorce decree allegedly obtained by Merry
Lee which absolutely allowed Felicisimo to
remarry, would have vested Felicidad with the
legal personality to file the present petition as
Felicisimos surviving spouse. However, the
records show that there is insufficient evidence
to prove the validity of the divorce obtained by
Merry Lee as well as the marriage of respondent
and Felicisimo under the laws of the
U.S.A. In Garcia v. Recio,[70] the Court laid
down the specific guidelines for pleading and
proving foreign law and divorce judgments. It
held that presentation solely of the divorce
decree is insufficient and that proof of its
authenticity and due execution must be
presented. Under Sections 24 and 25 of Rule
132, a writing or document may be proven as a
public or official record of a foreign country by
either (1) an official publication or (2) a copy
thereof attested by the officer having legal
custody of the document. If the record is not
kept in the Philippines, such copy must be (a)
accompanied by a certificate issued by the
proper diplomatic or consular officer in the
Philippine foreign service stationed in the
foreign country in which the record is kept and
(b) authenticated by the seal of his office.[71]

With regard to respondents marriage to

Felicisimo allegedly solemnized
in California, U.S.A., she submitted photocopies
of the Marriage Certificate and the annotated
text[72] of the Family Law Act of California
which purportedly show that their marriage was
done in accordance with the said law. As stated

Therefore, this case should be remanded to the

trial court for further reception of evidence on
the divorce decree obtained by Merry Lee and
the marriage of respondent and Felicisimo.

Even assuming that Felicisimo was not

capacitated to marry respondent in 1974,
nevertheless, we find that the latter has the
legal personality to file the subject petition for
letters of administration, as she may be
considered the co-owner of Felicisimo as
regards the properties that were acquired
through their joint efforts during their
cohabitation.

Section 6,[74] Rule 78 of the Rules of Court

states that letters of administration may be
granted to the surviving spouse of the
decedent. However, Section 2, Rule 79 thereof
also provides in part:

SEC. 2. Contents of petition for letters of

administration. A petition for letters of
administration must be filed by an interested
person and must show, as far as known to the
petitioner: x x x.

An interested person has been defined as one

who would be benefited by the estate, such as
an heir, or one who has a claim against the
estate, such as a creditor. The interest must be
material and direct, and not merely indirect or
contingent.[75]

In the instant case, respondent would qualify as

an interested person who has a direct interest in
the estate of Felicisimo by virtue of their

cohabitation, the existence of which was not

denied by petitioners. If she proves the validity
of the divorce and Felicisimos capacity to
remarry, but fails to prove that her marriage
with him was validly performed under the laws
of the U.S.A., then she may be considered as a
co-owner under Article 144[76] of the Civil
Code. This provision governs the property
relations between parties who live together as
husband and wife without the benefit of
marriage, or their marriage is void from the
beginning. It provides that the property
acquired by either or both of them through their
work or industry or their wages and salaries
shall be governed by the rules on coownership. In a co-ownership, it is not
necessary that the property be acquired
through their joint labor, efforts and
industry. Any property acquired during the
union is prima facie presumed to have been
obtained through their joint efforts. Hence, the
portions belonging to the co-owners shall be
presumed equal, unless the contrary is proven.
[77]

Meanwhile, if respondent fails to prove the

validity of both the divorce and the marriage,
the applicable provision would be Article 148 of
the Family Code which has filled the hiatus in
Article 144 of the Civil Code by expressly
regulating the property relations of couples
living together as husband and wife but are
incapacitated to marry.[78] In Saguid v. Court of
Appeals,[79] we held that even if the
cohabitation or the acquisition of property
occurred before the Family Code took effect,
Article 148 governs.[80] The Court described
the property regime under this provision as
follows:

The regime of limited co-ownership of property

governing the union of parties who are not
legally capacitated to marry each other, but
who nonetheless live together as husband and
wife, applies to properties acquired during said
cohabitation in proportion to their respective
contributions. Co-ownership will only be up to
the extent of the proven actual contribution of
money, property or industry. Absent proof of the
extent thereof, their contributions and
corresponding shares shall be presumed to be
equal.

In the cases of Agapay v. Palang, and Tumlos v.

Fernandez, which involved the issue of coownership of properties acquired by the parties
to a bigamous marriage and an adulterous
relationship, respectively, we ruled that proof of
actual contribution in the acquisition of the
property is essential. x x x

As in other civil cases, the burden of proof rests

upon the party who, as determined by the
pleadings or the nature of the case, asserts an
affirmative issue. Contentions must be proved
by competent evidence and reliance must be
had on the strength of the partys own evidence
and not upon the weakness of the opponents
defense. x x x[81]

In view of the foregoing, we find that

respondents legal capacity to file the subject
petition for letters of administration may arise
from her status as the surviving wife of
Felicisimo or as his co-owner under Article 144
of the Civil Code or Article 148 of the Family
Code.

WHEREFORE, the petition is DENIED. The

Decision of the Court of Appeals reinstating and
affirming the February 28, 1994 Order of the
Regional Trial Court which denied petitioners
motion to dismiss and itsOctober 24,
1994 Order which dismissed petitioners motion
for reconsideration is AFFIRMED. Let this case
be REMANDED to the trial court for further
proceedings.
SO ORDERED.
Republic of the Philippines
Baguio City
SECOND DIVISION

xxxx
Petitioner,
vs.

Respondent.
DECISION
J.:We resolve the petition for review on,
certiorari1 filed by petitioner Tung Ho Steel
Enterprises Corp. (Tung Ho) to challenge the July
5, 2006 decision2 and the March 12, 2008
resolution3 of the Court of Appeals (CA) in CAG.R. SP No. 92828.
The Factual Antecedents
Tung Ho is a foreign corporation organized
under the laws of Taiwan, Republic of
China.4 On the other hand, respondent Ting
Guan Trading Corp. (Ting Guan) is a domestic
corporation organized under the laws of the
Philippines.5
On January 9, 2002, Ting Guan obligated itself
under a contract of sale to deliver heavy metal
scrap iron and steel to Tung Ho. Subsequently,
Tung Ho filed a request for arbitration before the
ICC International Court of Arbitration (ICC) in
Singapore after Ting Guan failed to deliver the
full quantity of the promised heavy metal scrap
iron and steel.6
The ICC ruled in favor of Tung Ho on June 18,
2004 and ordered Ting Guan to pay Tung Ho the
following: (1) actual damages in the amount of
US$ 659,646.15 with interest of 6% per annum
from December 4, 2002 until final payment; (2)
cost of arbitration in the amount of US $
47,000.00; and (3) legal costs and expenses in
the amount of NT $ 761,448.00 and US $
34,552.83.7

RTCs alleged lack of jurisdiction over its person

as additional ground for the dismissal of the
complaint. Ting Guan insisted that Ms. Fe Tejero,
on whom personal service was served, was not
its corporate secretary and was not a person
allowed under Section 11, Rule 14 of the Rules
of Court to receive a summons. It also asserted
that Tung Ho cannot enforce the award in the
Philippines without violating public policy as
Taiwan is not a signatory to the New York
Convention.9
The RTC denied the motion in an order dated
November 21, 2005 and ruled that Ting Guan
had voluntarily submitted to the courts
jurisdiction when it raised other arguments
apart from lack of jurisdiction in its motion to
dismiss.
The Proceedings before the CA
Ting Guan responded to the denials by filing a
petition for certiorari before the CA with an
application for the issuance of a temporary
restraining order and a writ of preliminary
injunction.10
In its Memorandum, Tung Ho argued that a Rule
65 petition is not the proper remedy to assail
the denial of a motion to dismiss. It pointed out
that the proper recourse for Ting Guan was to
file an answer and to subsequently appeal the
case. It also posited that beyond the
reglementary period for filing an answer, Ting
Guan was barred from raising other grounds for
the dismissal of the case. Tung Ho also claimed
that the RTC acquired jurisdiction over the
person of Ting Guan since the return of service
of summons expressly stated that Tejero was a
corporate secretary.11

The Proceedings before the RTC

In its decision dated July 5, 2006, the CA

dismissed the complaint for lack of jurisdiction
over the person of Ting Guan. The CA held that
Tung Ho failed to establish that Tejero was Ting
Guans corporate secretary. The CA also ruled
that a petition for certiorari is the proper
remedy to assail the denial of a motion to
dismiss if the ground raised in the motion is lack
of jurisdiction. Furthermore, any of the grounds
for the dismissal of the case can be raised in a
motion to dismiss provided that the grounds
were raised before the filing of an answer. The
CA likewise ruled that Tung Ho properly filed the
complaint before the RTC-Makati.12

The RTC denied Ting Guans motion to dismiss

in an order dated May 11, 2005. Ting Guan
moved to reconsider the order and raised the

Subsequently, both parties moved to partially

reconsider the CA decision. Tung Ho reiterated
that there was proper service of summons. On

On October 24, 2004, Tung Ho filed an action

against Ting Guan for the recognition and
enforcement of the arbitral award before the
Regional Trial Court (RTC) of Makati, Branch 145.
Ting Guan moved to dismiss the case based on
Tung Hos lack of capacity to sue and for
prematurity. Ting Guan subsequently filed a
supplemental motion to dismiss based on
improper venue. Ting Guan argued that the
complaint should have been filed in Cebu where
its principal place of business was located.8

the other hand, Ting Guan sought to modify the

CA decision with respect to the proper venue of
the case. The CA denied Ting Guans motion for
partial reconsideration in an order dated
December 5, 2006.13
Ting Guan immediately proceeded to file a
petition for review on certiorari before this Court
to question the CAs rulings as discussed below.
In the interim (on February 11, 2008), Tung Ho
(whose motion for reconsideration of the CA
decision was still pending with that court) filed a
"Motion to Supplement and Resolve Motion for
Reconsideration" before the CA. In this motion,
Tung Ho prayed for the issuance of an alias
summons if the service of summons had indeed
been defective, but its motion proved
unsuccessful.14
It was not until March 12, 2008, after the
developments described below, that the CA
finally denied Tung Hos partial motion for
reconsideration for lack of merit.
Ting Guans Petition before this Court
(G.R. No. 176110)
Ting Guans petition before this Court was
docketed as G.R. No. 176110. Ting Guan argued
that the dismissal of the case should be based
on the following additional grounds: first, the
complaint was prematurely filed; second, the
foreign arbitral award is null and void; third, the
venue was improperly laid in Makati; and lastly,
the enforcement of the arbitral award was
against public policy.15
On April 24, 2007, Tung Ho filed its Comment
dated April 24, 2007 in G.R. No. 176110,
touching on the issue of jurisdiction, albeit
lightly. Tung Ho complained in its Comment that
Ting Guan engaged in dilatory tactics when Ting
Guan belatedly raised the issue of jurisdiction in
the motion for reconsideration before the RTC.
However, Tung Ho did not affirmatively seek the
reversal of the July 5, 2006 decision. Instead, it
merely stated that Ting Guans petition "cannot
be dismissed on the ground that the summons
was wrongfully issued as the petitioner can
always move for the issuance of an alias
summons to be served". Furthermore, Tung Ho
only prayed that Ting Guans petition be denied
in G.R. No. 176110 and for other just and
equitable reliefs. In other words, Tung Ho failed
to effectively argue its case on the merits
before the Court in G.R. No. 176110.

On June 18, 2007, we issued our Resolution

denying Ting Guans petition for lack of merit.
On November 12, 2007, we also denied Ting
Guans motion for reconsideration. On January
8, 2008, the Court issued an entry of judgment
in Ting Guans petition, G.R. No. 176110.
After the entry of judgment, we referred the
matter back to the RTC for further proceedings.
On January 16, 2008, the RTC declared the case
closed and terminated. Its order stated:
Upon examination of the entire records of this
case, an answer with caution was actually filed
by the respondent to which a reply was
submitted by the petitioner. Since the answer
was with the qualification that respondent is not
waiving its claim of lack of jurisdiction over its
person on the ground of improper service of
summons upon it and that its petition to this
effect filed before the Court of Appeals was
acted favorably and this case was dismissed on
the aforementioned ground and it appearing
that the Decision as well as the Order denying
the motion for reconsideration of the petitioner
now final and executory, the Order of November
9, 2007 referring this petition to the Court
Annexed Mediation for possible amicable
settlement is recalled it being moot and
academic. This case is now considered closed
and terminated.
On February 6, 2008, Tung Ho moved to
reconsider the RTC order. Nothing in the records
shows whether the RTC granted or denied this
motion for reconsideration.
Tung Hos Petition before this Court
(G.R. No. 182153)
On May 7, 2008, Tung Ho seasonably filed a
petition for review on certiorari to seek the
reversal of the July 5, 2006 decision and the
March 12, 2008 resolution of the CA. This is the
present G.R. No. 182153 now before us.
Tung Ho reiterates that the RTC acquired
jurisdiction over the person of Ting Guan. It also
claims that the return of service of summons is
a prima facie evidence of the recited facts i.e.,
that Tejero is a corporate secretary as stated
therein and that the sheriff is presumed to have
regularly performed his official duties in serving
the summons. In the alternative, Tung Ho
argues that Ting Guans successive motions
before the RTC are equivalent to voluntary
appearance. Tung Ho also prays for the

issuance of alias summons to cure the alleged

defective service of summons.16

and obligations with respect to the causes of

action and the subject matter of the case.20

Respondent Ting Guans Position

Contrary to Ting Guans position, our ruling in

G.R. No. 176110 does not operate as res
judicata on Tung Hos appeal; G.R. No. 176110
did not conclusively rule on all issues raised by
the parties in this case so that this Court would
now be barred from taking cognizance of Tung
Hos petition. Our disposition in G.R. No. 176110
only dwelt on technical or collateral aspects of
the case, and not on its merits. Specifically, we
did not rule on whether Tung Ho may enforce
the foreign arbitral award against Ting Guan in
that case.

(G.R. No. 182153)

In its Comment, Ting Guan submits that the
appeal is already barred by res judicata. It also
stresses that the Court has already affirmed
with finality the dismissal of the
complaint.17 Ting Guan also argues that Tung
Ho raises a factual issue that is beyond the
scope of a petition for review on certiorari under
Rule 45 of the Rules of Court.18

B. The appellate court cannot be ousted of

jurisdiction until it finally disposes of the case

The Issues
This case presents to us the following issues:
1) Whether the present petition is barred by res
judicata; and
2) Whether the trial court acquired jurisdiction
over the person of Ting Guan, specifically:
a) Whether Tejero was the proper person to
receive the summons; and
b) Whether Ting Guan made a voluntary
appearance before the trial court.
The Courts Ruling
We find the petition meritorious.
I. The Court is not precluded from ruling on the
jurisdictional issue raised in the petition
A. The petition is not barred by res judicata
Res judicata refers to the rule that a final
judgment or decree on the merits by a court of
competent jurisdiction is conclusive on the
rights of the parties or their privies in all later
suits on all points and matters determined in
the former suit.19 For res judicata to apply, the
final judgment must be on the merits of the
case which means that the court has
unequivocally determined the parties rights

The courts jurisdiction, once attached, cannot

be ousted until it finally disposes of the case.
When a court has already obtained and is
exercising jurisdiction over a controversy, its
jurisdiction to proceed to the final determination
of the case is retained.21 A judge is competent
to act on the case while its incidents remain
pending for his disposition.
The CA was not ousted of its jurisdiction with
the promulgation of G.R. No. 176110. The July 5,
2006 decision has not yet become final and
executory for the reason that there remained a
pending incident before the CA the resolution
of Tung Hos motion for reconsideration when
this Court promulgated G.R. No. 176110. In this
latter case, on the other hand, we only resolved
procedural issues that are divorced from the
present jurisdictional question before us. Thus,
what became immutable in G.R. No. 176110
was the ruling that Tung Hos complaint is not
dismissible on grounds of prematurity, nullity of
the foreign arbitral award, improper venue, and
the foreign arbitral awards repugnance to local
public policy. This leads us to the conclusion
that in the absence of any ruling on the merits
on the issue of jurisdiction, res judicata on this
point could not have set in.
C. Tung Hos timely filing of a motion for
reconsideration and of a petition for review on
certiorari prevented the July 5, 2006 decision
from attaining finality
Furthermore, under Section 2, Rule 45 of the
Rules of Court, Tung Ho may file a petition for
review on certiorari before the Court within (15)
days from the denial of its motion for
reconsideration filed in due time after notice of
the judgment. Tung Hos timely filing of a

motion for reconsideration before the CA and of

a Rule 45 petition before this Court prevented
the July 5, 2006 CA decision from attaining
finality. For this Court to deny Tung Hos petition
would result in an anomalous situation where a
party litigant is penalized and deprived of his
fair opportunity to appeal the case by faithfully
complying with the Rules of Court.
II. The trial court acquired jurisdiction over the
person of Ting Guan
A. Tejero was not the proper person to receive
the summons
Nonetheless, we see no reason to disturb the
lower courts finding that Tejero was not a
corporate secretary and, therefore, was not the
proper person to receive the summons under
Section 11, Rule 14 of the Rules of Court. This
Court is not a trier of facts; we cannot reexamine, review or re-evaluate the evidence
and the factual review made by the lower
courts. In the absence of compelling reasons,
we will not deviate from the rule that factual
findings of the lower courts are final and binding
on this Court.22
B. Ting Guan voluntarily appeared before the
trial court
However, we cannot agree with the legal
conclusion that the appellate court reached,
given the established facts.23To our mind, Ting
Guan voluntarily appeared before the trial court
in view of the procedural recourse that it took
before that court. Its voluntary appearance is
equivalent to service of summons.24
As a basic principle, courts look with disfavor on
piecemeal arguments in motions filed by the
parties. Under the omnibus motion rule, a
motion attacking a pleading, order, judgment,
or proceeding shall include all objections then
available.25 The purpose of this rule is to
obviate multiplicity of motions and to
discourage dilatory motions and pleadings.
Party litigants should not be allowed to reiterate
identical motions, speculating on the possible
change of opinion of the courts or of the judges
thereof.
In this respect, Section 1, Rule 16 of the Rules of
Court requires the defendant to file a motion to
dismiss within the time for, but before filing the
answer to the complaint or pleading asserting a
claim. Section 1, Rule 11 of the Rules of Court,
on the other hand, commands the defendant to

file his answer within fifteen (15) days after

service of summons, unless a different period is
fixed by the trial court. Once the trial court
denies the motion, the defendant should file his
answer within the balance of fifteen (15) days to
which he was entitled at the time of serving his
motion, but the remaining period cannot be less
than five (5) days computed from his receipt of
the notice of the denial.26
Instead of filing an answer, the defendant may
opt to file a motion for reconsideration. Only
after the trial court shall have denied the
motion for reconsideration does the defendant
become bound to file his answer.27 If the
defendant fails to file an answer within the
reglementary period, the plaintiff may file a
motion to declare the defendant in default. This
motion shall be with notice to the defendant
and shall be supported by proof of the failure.28
The trial courts denial of the motion to dismiss
is not a license for the defendant to file a Rule
65 petition before the CA. An order denying a
motion to dismiss cannot be the subject of a
petition for certiorari as the defendant still has
an adequate remedy before the trial court i.e.,
to file an answer and to subsequently appeal
the case if he loses the case.29 As exceptions,
the defendant may avail of a petition for
certiorari if the ground raised in the motion to
dismiss is lack of jurisdiction over the person of
the defendant30 or over the subject matter.31
We cannot allow and simply passively look at
Ting Guans blatant disregard of the rules of
procedure in the present case. The Rules of
Court only allows the filing of a motion to
dismiss once.32 Ting Guans filing of successive
motions to dismiss, under the guise of
"supplemental motion to dismiss" or "motion for
reconsideration", is not only improper but also
dilatory.33 Ting Guans belated reliance on the
improper service of summons was a mere
afterthought, if not a bad faith ploy to avoid the
foreign arbitral awards enforcement which is
still at its preliminary stage after the lapse of
almost a decade since the filing of the
complaint.
Furthermore, Ting Guans failure to raise the
alleged lack of jurisdiction over its person in the
first motion to dismiss is fatal to its cause. Ting
Guan voluntarily appeared before the RTC when
it filed a motion to dismiss and a "supplemental
motion to dismiss" without raising the RTCs
lack of jurisdiction over its person. In
Anunciacion v. Bocanegra,34 we categorically
stated that the defendant should raise the
affirmative defense of lack of jurisdiction over
his person in the very first motion to dismiss.

Failure to raise the issue of improper service of

summons in the first motion to dismiss is a
waiver of this defense and cannot be belatedly
raised in succeeding motions and pleadings.
Even assuming that Ting Guan did not
voluntarily appear before the RTC, the CA
should have ordered the RTC to issue an alias
summons instead. In Lingner & Fisher GMBH vs.
Intermediate Appellate Court35, we enunciated
the policy that the courts should not dismiss a
case simply because there was an improper
service of summons. The lower courts should be
cautious in haphazardly dismissing complaints
on this ground alone considering that the trial
court can cure this defect and order the
issuance of alias summons on the proper person
in the interest of substantial justice and to
expedite the proceedings.
III. A Final Note
As a final note, we are not unaware that the
present case has been complicated by its
unique development. The complication arose
when the CA, instead of resolving the parties
separate partial motions for reconsideration in
one resolution, proceeded to first resolve and to
deny Ting Guans partial motion. Ting Guan,
therefore, went to this Court via a petition for
review on certiorari while Tung Hos partial
motion for reconsideration was still unresolved.
Expectedly, Ting Guan did not question the
portions of the CA decision favorable to it when
it filed its petition with this Court. Instead, Ting
Guan reiterated that the CA should have
included additional grounds to justify the
dismissal of Tung Hos complaint with the RTC.
The Court denied Ting Guans petition, leading
to the entry of judgment that improvidently
followed. Later, the CA denied Tung Hos partial
motion for reconsideration, prompting Tung Hos
own petition with this Court, which is the
present G.R. No. 182153.
Under the Rules of Court, entry of judgment
may only be made if no appeal or motion for
reconsideration was timely filed.36 In the
proceedings before the CA, if a motion for
reconsideration (including a partial motion for
reconsideration37) is timely filed by the proper
party, execution of the CAs judgment or final
resolution shall be stayed.38 This rule is
applicable even to proceedings before the
Supreme Court, as provided in Section 4, Rule
56 of the Rules of Court.39

In the present case, Tung Ho timely filed its

motion for reconsideration with the CA and
seasonably appealed the CAs rulings with the
Court through the present petition (G.R. No.
182153).
To now recognize the finality of the Resolution of
Ting Guan petition (G.R. No. 176110) based on
its entry of judgment and to allow it to foreclose
the present meritorious petition of Tung Ho,
would of course cause unfair and unjustified
injury to Tung Ho. First, as previously
mentioned, the Ting Guan petition did not
question or assail the full merits of the CA
decision. It was Tung Ho, the party aggrieved by
the CA decision, who substantially questioned
the merits of the CA decision in its petition; this
petition showed that the CA indeed committed
error and Tung Hos complaint before the RTC
should properly proceed. Second, the present
case is for the enforcement of an arbitral award
involving millions of pesos. Tung Ho already won
in the foreign arbitration and the present case is
simply for the enforcement of this arbitral
award in our jurisdiction. Third, and most
importantly, Tung Ho properly and timely
availed of the remedies available to it under the
Rules of Court, which provide that filing and
pendency of a motion for reconsideration stays
the execution of the CA judgment. Therefore, at
the time of the entry of judgment in G.R. No.
176110 in the Supreme Court on January 8,
2008, the CA decision which the Court affirmed
was effectively not yet be final.
Significantly, the rule that a timely motion for
reconsideration stays the execution of the
assailed judgment is in accordance with Rule
51, Section 10 (Rules governing the CA
proceedings) which provides that "entry of
judgments may only be had if there is no appeal
or motion for reconsideration timely filed. The
date when the judgment or final resolution
becomes executory shall be deemed as the
date of its entry." Incidentally, this procedure
also governs before Supreme Court
proceedings.40 Following these rules, therefore,
the pendency of Tung Hos MR with the CA
made the entry of the judgment of the Court in
the Ting Guan petition premature and
inefficacious for not being final and executory.
Based on the above considerations, the Court
would not be in error if it applies its ruling in the
case of Realty Sales Enterprises, Inc. and
Macondray Farms, Inc. v. Intermediate Appellate
Court, et al.41 where the Court, in a per curiam
resolution, ruled that an entry of judgment may
be recalled or lifted motu proprio when it is
clear that the decision assailed of has not yet
become final under the rules:

The March 6, 1985 resolution denying

reconsideration of the January 30, 1985
resolution was, to repeat, not served on the
petitioners until March 20, 1985 - and therefore
the Jan. 30, 1985 resolution could not be
deemed final and executory until one (1) full
day (March 21) had elapsed, or on March 22,
1985 (assuming inaction on petitioners' part.)
The entry of judgment relative to the January
30, 1985 resolution, made on March 18, 1985,
was therefore premature and inefficacious. An
entry of judgment does not make the judgment
so entered final and execution when it is not so
in truth. An entry of judgment merely records
the fact that a judgment, order or resolution has
become final and executory; but it is not the
operative act that make the judgment, order or
resolution final and executory. In the case at
bar, the entry of judgment on March 18, 1985
did not make the January 30, 1985 resolution
subject of the entry, final and executory, As of
the date of entry, March 18, 1985, notice of the
resolution denying reconsideration of the
January 30, 1985 resolution had not yet been
served on the petitioners or any of the parties,
since March 18, 1985 was also the date of the
notice (and release) of the March 6, 1985
resolution denying reconsideration.1wphi1
According to this ruling, the motu proprio recall
or setting aside of the entry of final judgment
was proper and "entirely consistent with the
inherent power of every court inter alia to
amend and control its process and orders so as
to make them conformable to law and justice
[Sec. 5(g), Rule 135, Rules of Court,]. That the
recall has in fact served to achieve a verdict
consistent with law and justice is clear from the
judgment subsequently rendered on the
merits." This course of action is effectively what
the Court undertook today, adapted of course to
the circumstances of the present case.
In light of these premises, we hereby REVERSE
and SET ASIDE the July 5, 2006 decision and the
March 12, 2008 resolution of the Court of
Appeals in CA-G.R. SP No. 92828. SP. Proc. No.
11.-5954 is hereby ordered reinstated. Let the
records of this case be remanded to the court of
origin for further proceedings. No costs.
SO ORDERED.
Republic of the Philippines
Manila
FIRST DIVISION

G.R. No. 112573

February 9, 1995

petitioner,
vs.
respondents

J.:
This petition for review on certiorari seeks to set
aside the decision of the Court of Appeals
affirming the dismissal of the petitioner's
complaint to enforce the judgment of a
Japanese court. The principal issue here is
whether a Japanese court can acquire
jurisdiction over a Philippine corporation doing
business in Japan by serving summons through
diplomatic channels on the Philippine
corporation at its principal office in Manila after
prior attempts to serve summons in Japan had
failed.
Petitioner Northwest Orient Airlines, Inc.
(hereinafter NORTHWEST), a corporation
organized under the laws of the State of
Minnesota, U.S.A., sought to enforce in Civil
Case No. 83-17637 of the Regional Trial Court
(RTC), Branch 54, Manila, a judgment rendered
in its favor by a Japanese court against private
respondent C.F. Sharp & Company, Inc.,
(hereinafter SHARP), a corporation incorporated
under Philippine laws.
As found by the Court of Appeals in the
challenged decision of 10 November
1993, 1 the following are the factual and
procedural antecedents of this controversy:
On May 9, 1974, plaintiff Northwest Airlines and
defendant C.F. Sharp & Company, through its
Japan branch, entered into an International
Passenger Sales Agency Agreement, whereby
the former authorized the latter to sell its air
transportation tickets. Unable to remit the
proceeds of the ticket sales made by defendant
on behalf of the plaintiff under the said
agreement, plaintiff on March 25, 1980 sued
defendant in Tokyo, Japan, for collection of the
unremitted proceeds of the ticket sales, with
claim for damages.

On April 11, 1980, a writ of summons was

issued by the 36th Civil Department, Tokyo
District Court of Japan against defendant at its
office at the Taiheiyo Building, 3rd floor, 132,
Yamashita-cho, Naka-ku, Yokohoma, Kanagawa
Prefecture. The attempt to serve the summons
was unsuccessful because the bailiff was
advised by a person in the office that Mr.
Dinozo, the person believed to be authorized to
receive court processes was in Manila and
would be back on April 24, 1980.
On April 24, 1980, bailiff returned to the
defendant's office to serve the summons. Mr.
Dinozo refused to accept the same claiming
that he was no longer an employee of the
defendant.
After the two attempts of service were
unsuccessful, the judge of the Tokyo District
Court decided to have the complaint and the
writs of summons served at the head office of
the defendant in Manila. On July 11, 1980, the
Director of the Tokyo District Court requested
the Supreme Court of Japan to serve the
summons through diplomatic channels upon the
defendant's head office in Manila.
On August 28, 1980, defendant received from
Deputy Sheriff Rolando Balingit the writ of
summons (p. 276, Records). Despite receipt of
the same, defendant failed to appear at the
scheduled hearing. Thus, the Tokyo Court
proceeded to hear the plaintiff's complaint and
on [January 29, 1981], rendered judgment
ordering the defendant to pay the plaintiff the
sum of 83,158,195 Yen and damages for delay
at the rate of 6% per annum from August 28,
1980 up to and until payment is completed (pp.
12-14, Records).
On March 24, 1981, defendant received from
Deputy Sheriff Balingit copy of the judgment.
Defendant not having appealed the judgment,
the same became final and executory.
Plaintiff was unable to execute the decision in
Japan, hence, on May 20, 1983, a suit for
enforcement of the judgment was filed by
plaintiff before the Regional Trial Court of Manila
Branch 54. 2On July 16, 1983, defendant filed
its answer averring that the judgment of the
Japanese Court sought to be enforced is null
and void and unenforceable in this jurisdiction
having been rendered without due and proper
notice to the defendant and/or with collusion or
fraud and/or upon a clear mistake of law and
fact (pp. 41-45, Rec.).

Unable to settle the case amicably, the case

was tried on the merits. After the plaintiff rested
its case, defendant on April 21, 1989, filed a
Motion for Judgment on a Demurrer to Evidence
based on two grounds:
(1) the foreign judgment sought to be enforced
is null and void for want of jurisdiction and (2)
the said judgment is contrary to Philippine law
and public policy and rendered without due
process of law. Plaintiff filed its opposition after
which the court a quo rendered the now
assailed decision dated June 21, 1989 granting
the demurrer motion and dismissing the
complaint (Decision, pp. 376-378, Records). In
granting the demurrer motion, the trial court
held that:
The foreign judgment in the Japanese Court
sought in this action is null and void for want of
jurisdiction over the person of the defendant
considering that this is an action in personam;
the Japanese Court did not acquire jurisdiction
over the person of the defendant because
jurisprudence requires that the defendant be
served with summons in Japan in order for the
Japanese Court to acquire jurisdiction over it,
the process of the Court in Japan sent to the
Philippines which is outside Japanese
jurisdiction cannot confer jurisdiction over the
defendant in the case before the Japanese Court
of the case at bar. Boudard versus Tait 67 Phil.
170. The plaintiff contends that the Japanese
Court acquired jurisdiction because the
defendant is a resident of Japan, having four (4)
branches doing business therein and in fact had
a permit from the Japanese government to
conduct business in Japan (citing the exhibits
presented by the plaintiff); if this is so then
service of summons should have been made
upon the defendant in Japan in any of these
alleged four branches; as admitted by the
plaintiff the service of the summons issued by
the Japanese Court was made in the Philippines
thru a Philippine Sheriff. This Court agrees that
if the defendant in a foreign court is a resident
in the court of that foreign court such court
could acquire jurisdiction over the person of the
defendant but it must be served upon the
defendant in the territorial jurisdiction of the
foreign court. Such is not the case here because
the defendant was served with summons in the
Philippines and not in Japan.
Unable to accept the said decision, plaintiff on
July 11, 1989 moved for reconsideration of the
decision, filing at the same time a conditional
Notice of Appeal, asking the court to treat the
said notice of appeal "as in effect after and
upon issuance of the court's denial of the
motion for reconsideration."

Defendant opposed the motion for

reconsideration to which a Reply dated August
28, 1989 was filed by the plaintiff.
On October 16, 1989, the lower court
disregarded the Motion for Reconsideration and
gave due course to the plaintiff's Notice of
Appeal. 3
In its decision, the Court of Appeals sustained
the trial court. It agreed with the latter in its
reliance upon Boudard vs Tait 4 wherein it was
held that "the process of the court has no
extraterritorial effect and no jurisdiction is
acquired over the person of the defendant by
serving him beyond the boundaries of the
state." To support its position, the Court of
Appeals further stated:
In an action strictly in personam, such as the
instant case, personal service of summons
within the forum is required for the court to
acquire jurisdiction over the defendant
(Magdalena Estate Inc. vs. Nieto, 125 SCRA
230). To confer jurisdiction on the court,
personal or substituted service of summons on
the defendant not extraterritorial service is
necessary (Dial Corp vs. Soriano, 161 SCRA
739).
But while plaintiff-appellant concedes that the
collection suit filed is an action in personam, it
is its theory that a distinction must be made
between an action in personam against a
resident defendant and an action in
personam against a non-resident defendant.
Jurisdiction is acquired over a non-resident
defendant only if he is served personally within
the jurisdiction of the court and over a resident
defendant if by personal, substituted or
constructive service conformably to statutory
authorization. Plaintiff-appellant argues that
since the defendant-appellee maintains
branches in Japan it is considered a resident
defendant. Corollarily, personal, substituted or
constructive service of summons when made in
compliance with the procedural rules is
sufficient to give the court jurisdiction to render
judgment in personam.
Such an argument does not persuade.
It is a general rule that processes of the court
cannot lawfully be served outside the territorial
limits of the jurisdiction of the court from which
it issues (Carter vs. Carter; 41 S.E. 2d 532, 201)
and this isregardless of the residence or
citizenship of the party thus served (Iowa-Rahr
vs. Rahr, 129 NW 494, 150 Iowa 511, 35 LRC,

NS, 292, Am. Case 1912 D680). There must be

actual service within the proper territorial limits
on defendant or someone authorized to accept
service for him. Thus, a defendant, whether a
resident or not in the forum where the action is
filed, must be served with summons within that
forum.
But even assuming a distinction between a
resident defendant and non-resident defendant
were to be adopted, such distinction applies
only to natural persons and not in the
corporations. This finds support in the concept
that "a corporation has no home or residence in
the sense in which those terms are applied to
natural persons" (Claude Neon Lights vs. Phil.
Advertising Corp., 57 Phil. 607). Thus, as cited
by the defendant-appellee in its brief:
Residence is said to be an attribute of a natural
person, and can be predicated on an artificial
being only by more or less imperfect analogy.
Strictly speaking, therefore, a corporation can
have no local residence or habitation. It has
been said that a corporation is a mere ideal
existence, subsisting only in contemplation of
law an invisible being which can have, in fact,
no locality and can occupy no space, and
therefore cannot have a dwelling place. (18 Am.
Jur. 2d, p. 693 citing Kimmerle v. Topeka, 88
370, 128 p. 367; Wood v. Hartfold F. Ins. Co., 13
Conn 202)
Jurisprudence so holds that the foreign or
domestic character of a corporation is to be
determined by the place of its origin where its
charter was granted and not by the location of
its business activities (Jennings v. Idaho Rail
Light & P. Co., 26 Idaho 703, 146 p. 101), A
corporation is a "resident" and an inhabitant of
the state in which it is incorporated and no
other (36 Am. Jur. 2d, p. 49).
Defendant-appellee is a Philippine Corporation
duly organized under the Philippine laws.
Clearly, its residence is the Philippines, the
place of its incorporation, and not Japan. While
defendant-appellee maintains branches in
Japan, this will not make it a resident of Japan. A
corporation does not become a resident of
another by engaging in business there even
though licensed by that state and in terms
given all the rights and privileges of a domestic
corporation (Galveston H. & S.A.R. Co. vs.
Gonzales, 151 US 496, 38 L ed. 248, 4 S Ct.
401).
On this premise, defendant appellee is a nonresident corporation. As such, court processes
must be served upon it at a place within the

state in which the action is brought and not

elsewhere (St. Clair vs. Cox, 106 US 350, 27 L
ed. 222, 1 S. Ct. 354). 5
It then concluded that the service of summons
effected in Manila or beyond the territorial
boundaries of Japan was null and did not confer
jurisdiction upon the Tokyo District Court over
the person of SHARP; hence, its decision was
void.
Unable to obtain a reconsideration of the
decision, NORTHWEST elevated the case to this
Court contending that the respondent court
erred in holding that SHARP was not a resident
of Japan and that summons on SHARP could
only be validly served within that country.
A foreign judgment is presumed to be valid and
binding in the country from which it comes, until
the contrary is shown. It is also proper to
presume the regularity of the proceedings and
the giving of due notice therein. 6
Under Section 50, Rule 39 of the Rules of Court,
a judgment in an action in personam of a
tribunal of a foreign country having jurisdiction
to pronounce the same is presumptive evidence
of a right as between the parties and their
successors-in-interest by a subsequent title. The
judgment may, however, be assailed by
evidence of want of jurisdiction, want of notice
to the party, collusion, fraud, or clear mistake of
law or fact. Also, under Section 3 of Rule 131, a
court, whether of the Philippines or elsewhere,
enjoys the presumption that it was acting in the
lawful exercise of jurisdiction and has regularly
performed its official duty.
Consequently, the party attacking a foreign
judgment has the burden of overcoming the
presumption of its validity.7 Being the party
challenging the judgment rendered by the
Japanese court, SHARP had the duty to
demonstrate the invalidity of such judgment. In
an attempt to discharge that burden, it
contends that the extraterritorial service of
summons effected at its home office in the
Philippines was not only ineffectual but also
void, and the Japanese Court did not, therefore
acquire jurisdiction over it.
It is settled that matters of remedy and
procedure such as those relating to the service
of process upon a defendant are governed by
the lex fori or the internal law of the forum. 8 In
this case, it is the procedural law of Japan where
the judgment was rendered that determines the
validity of the extraterritorial service of process

on SHARP. As to what this law is is a question of

fact, not of law. It may not be taken judicial
notice of and must be pleaded and proved like
any other fact. 9 Sections 24 and 25, Rule 132
of the Rules of Court provide that it may be
evidenced by an official publication or by a duly
attested or authenticated copy thereof. It was
then incumbent upon SHARP to present
evidence as to what that Japanese procedural
law is and to show that under it, the assailed
extraterritorial service is invalid. It did not.
Accordingly, the presumption of validity and
regularity of the service of summons and the
decision thereafter rendered by the Japanese
court must stand.
Alternatively in the light of the absence of proof
regarding Japanese
law, the presumption of identity or similarity or
the so-called processual presumption 10 may
be invoked. Applying it, the Japanese law on the
matter is presumed to be similar with the
Philippine law on service of summons on a
private foreign corporation doing business in
the Philippines. Section 14, Rule 14 of the Rules
of Court provides that if the defendant is a
foreign corporation doing business in the
Philippines, service may be made: (1) on its
resident agent designated in accordance with
law for that purpose, or, (2) if there is no such
resident agent, on the government official
designated by law to that effect; or (3) on any
of its officers or agents within the Philippines.
If the foreign corporation has designated an
agent to receive summons, the designation is
exclusive, and service of summons is without
force and gives the court no jurisdiction unless
made upon him. 11
Where the corporation has no such agent,
service shall be made on the government
official designated by law, to wit: (a) the
Insurance Commissioner in the case of a foreign
insurance company; (b) the Superintendent of
Banks, in the case of a foreign banking
corporation; and (c) the Securities and
Exchange Commission, in the case of other
foreign corporations duly licensed to do
business in the Philippines. Whenever service of
process is so made, the government office or
official served shall transmit by mail a copy of
the summons or other legal proccess to the
corporation at its home or principal office. The
sending of such copy is a necessary part of the
service. 12
SHARP contends that the laws authorizing
service of process upon the Securities and
Exchange Commission, the Superintendent of
Banks, and the Insurance Commissioner, as the

case may be, presuppose a situation wherein

the foreign corporation doing business in the
country no longer has any branches or offices
within the Philippines. Such contention is belied
by the pertinent provisions of the said laws.
Thus, Section 128 of the Corporation
Code 13and Section 190 of the Insurance
Code 14 clearly contemplate two situations: (1)
if the corporation had left the Philippines or had
ceased to transact business therein, and (2) if
the corporation has no designated agent.
Section 17 of the General Banking Act 15 does
not even speak a corporation which had ceased
to transact business in the Philippines.
Nowhere in its pleadings did SHARP profess to
having had a resident agent authorized to
receive court processes in Japan. This silence
could only mean, or least create an impression,
that it had none. Hence, service on the
designated government official or on any of
SHARP's officers or agents in Japan could be
availed of. The respondent, however, insists
that only service of any of its officers or
employees in its branches in Japan could be
resorted to. We do not agree. As found by the
respondent court, two attempts at service were
made at SHARP's Yokohama branch. Both were
unsuccessful. On the first attempt, Mr. Dinozo,
who was believed to be the person authorized
to accept court process, was in Manila. On the
second, Mr. Dinozo was present, but to accept
the summons because, according to him, he
was no longer an employee of SHARP. While it
may be true that service could have been made
upon any of the officers or agents of SHARP at
its three other branches in Japan, the
availability of such a recourse would not
preclude service upon the proper government
official, as stated above.
As found by the Court of Appeals, it was the
Tokyo District Court which ordered that
summons for SHARP be served at its head office
in the Philippine's after the two attempts of
service had failed. 16 The Tokyo District Court
requested the Supreme Court of Japan to cause
the delivery of the summons and other legal
documents to the Philippines. Acting on that
request, the Supreme Court of Japan sent the
summons together with the other legal
documents to the Ministry of Foreign Affairs of
Japan which, in turn, forwarded the same to the
Japanese Embassy in Manila . Thereafter, the
court processes were delivered to the Ministry
(now Department) of Foreign Affairs of the
Philippines, then to the Executive Judge of the
Court of First Instance (now Regional Trial Court)
of Manila, who forthwith ordered Deputy Sheriff
Rolando Balingit to serve the same on SHARP at
its principal office in Manila. This service is
equivalent to service on the proper government
official under Section 14, Rule 14 of the Rules of
Court, in relation to Section 128 of the

Corporation Code. Hence, SHARP's contention

that such manner of service is not valid under
Philippine laws holds no water. 17
In deciding against the petitioner, the
respondent court sustained the trial court's
reliance on Boudard vs Tait 18where this Court
held:
The fundamental rule is that jurisdiction in
personam over nonresidents, so as to sustain a
money judgment, must be based upon personal
service within the state which renders the
judgment.
xxx

xxx

xxx

The process of a court, has no extraterritorial

effect, and no jurisdiction is acquired over the
person of the defendant by serving him beyond
the boundaries of the state. Nor has a judgment
of a court of a foreign country against a resident
of this country having no property in such
foreign country based on process served here,
any effect here against either the defendant
personally or his property situated here.
Process issuing from the courts of one state or
country cannot run into another, and although a
nonresident defendant may have been
personally served with such process in the state
or country of his domicile, it will not give such
jurisdiction as to authorize a personal judgment
against him.
It further availed of the ruling in Magdalena
Estate, Inc vs Nieto 19 and Dial
Corp vs Soriano, 20 as well as the principle laid
down by the Iowa Supreme Court in the 1911
case of Raher vs Raher. 21
The first three cases are, however,
inapplicable. Boudard involved the enforcement
of a judgment of the civil division of the Court of
First Instance of Hanoi, French Indo-China. The
trial court dismissed the case because the
Hanoi court never acquired jurisdiction over the
person of the defendant considering that "[t]he,
evidence adduced at the trial conclusively
proves that neither the appellee [the defendant]
nor his agent or employees were ever in Hanoi,
French Indo-China; and that the deceased Marie
Theodore Jerome Boudard had never, at any
time, been his employee." In Magdalena Estate,
what was declared invalid resulting in the failure
of the court to acquire jurisdiction over the
person of the defendants in an action in
personam was the service of summons through

publication against non-appearing resident

defendants. It was claimed that the latter
concealed themselves to avoid personal service
of summons upon them. In Dial, the defendants
were foreign corporations which were not,
domiciled and licensed to engage in business in
the Philippines and which did not have officers
or agents, places of business, or properties
here. On the other hand, in the instant case,
SHARP was doing business in Japan and was
maintaining four branches therein.
Insofar as to the Philippines is
concerned, Raher is a thing of the past. In that
case, a divided Supreme Court of Iowa declared
that the principle that there can be no
jurisdiction in a court of a territory to render a
personal judgment against anyone upon service
made outside its limits was applicable alike to
cases of residents and non-residents. The
principle was put at rest by the United States
Supreme Court when it ruled in the 1940 case
ofMilliken vs Meyer 22 that domicile in the state
is alone sufficient to bring an absent defendant
within the reach of the state's jurisdiction for
purposes of a personal judgment by means of
appropriate substituted service or personal
service without the state. This principle is
embodied in section 18, Rule 14 of the Rules of
Court which allows service of summons on
residents temporarily out of the Philippines to
be made out of the country. The rationale for
this rule was explained inMilliken
[T]he authority of a state over one of its citizens
is not terminated by the mere fact of his
absence from the state. The state which
accords him privileges and affords protection to
him and his property by virtue of his domicile
may also exact reciprocal duties. "Enjoyment of
the privileges of residence within the state, and
the attendant right to invoke the protection of
its laws, are inseparable" from the various
incidences of state citizenship. The
responsibilities of that citizenship arise out of
the relationship to the state which domicile
creates. That relationship is not dissolved by
mere absence from the state. The attendant
duties, like the rights and privileges incident to
domicile, are not dependent on continuous
presence in the state. One such incident of
domicile is amenability to suit within the state
even during sojourns without the state, where
the state has provided and employed a
reasonable method for apprising such an absent
party of the proceedings against him. 23
The domicile of a corporation belongs to the
state where it was incorporated. 24 In a strict
technical sense, such domicile as a corporation
may have is single in its essence and a

corporation can have only one domicile which is

the state of its creation. 25
Nonetheless, a corporation formed in one-state
may, for certain purposes, be regarded a
resident in another state in which it has offices
and transacts business. This is the rule in our
jurisdiction and apropos thereto, it may be
necessery to quote what we stated in State
Investment House, Inc, vs. Citibank, N., 26 to
wit:
The issue is whether these Philippine branches
or units may be considered "residents of the
Philippine Islands" as that term is used in
Section 20 of the Insolvency Law . . . or
residents of the state under the laws of which
they were respectively incorporated. The
answer cannot be found in the Insolvency Law
itself, which contains no definition of the
term, resident, or any clear indication of its
meaning. There are however other statutes,
albeit of subsequent enactment and effectivity,
from which enlightening notions of the term
may be derived.
The National Internal Revenue Code declares
that the term "'resident foreign corporation'
applies to a foreign corporation engaged in
trade or business within the Philippines," as
distinguished from a "'non-resident foreign
corporation' . . . (which is one) not engaged in
trade or bussiness within the Philippines." [Sec.
20, pars. (h) and (i)].
The Offshore Banking Law, Presidential Decree
No. 1034, states "that branches, subsidiaries,
affiliation, extension offices or any other units of
corporation or juridical person organized under
the laws of any foreign country operating in the
Philippines shall be considered residents of the
Philippines. [Sec. 1(e)].
The General Banking Act, Republic Act No. 337,
places "branches and agencies in the
Philippines of foreign banks . . . (which are)
called Philippine branches," in the same
category as "commercial banks, savings
associations, mortgage banks, development
banks, rural banks, stock savings and loan
associations" (which have been formed and
organized under Philippine laws), making no
distinction between the former and the latter in
so far as the terms "banking institutions" and
"bank" are used in the Act [Sec. 2], declaring on
the contrary that in "all matters not specifically
covered by special provisions applicable only to
foreign banks, or their branches and agencies in
the Philippines, said foreign banks or their
branches and agencies lawfully doing business

in the Philippines "shall be bound by all laws,

rules, and regulations applicable to domestic
banking corporations of the same class, except
such laws, rules and regulations as provided for
the creation, formation, organization, or
dissolution of corporations or as fix the relation,
liabilities, responsibilities, or duties of members,
stockholders or officers of corporation. [Sec.
18].
This court itself has already had occasion to
hold [Claude Neon Lights, Fed. Inc. vs.
Philippine Advertising Corp., 57 Phil. 607] that a
foreign corporation licitly doing business in the
Philippines, which is a defendant in a civil suit,
may not be considered a non-resident within
the scope of the legal provision authorizing
attachment against a defendant not residing in
the Philippine Islands; [Sec. 424, in relation to
Sec. 412 of Act No. 190, the Code of Civil
Procedure; Sec. 1(f), Rule 59 of the Rules of
1940, Sec. 1(f), Rule 57, Rules of 1964] in other
words, a preliminary attachment may not be
applied for and granted solely on the asserted
fact that the defendant is a foreign corporation
authorized to do business in the Philippines
and is consequently and necessarily, "a party
who resides out of the Philippines."
Parenthetically, if it may not be considered as a
party not residing in the Philippines, or as a
party who resides out of the country, then,
logically, it must be considered a party who
does reside in the Philippines, who is a resident
of the country. Be this as it may, this Court
pointed out that:
. . . Our laws and jurisprudence indicate a
purpose to assimilate foreign corporations, duly
licensed to do business here, to the status of
domestic corporations. (Cf. Section 73, Act No.
1459, and Marshall Wells Co. vs. Henry W. Elser
& Co., 46 Phil. 70, 76; Yu Cong Eng vs. Trinidad,
47 Phil. 385, 411) We think it would be entirely
out of line with this policy should we make a
discrimination against a foreign corporation, like
the petitioner, and subject its property to the
harsh writ of seizure by attachment when it has
complied not only with every requirement of law
made specially of foreign corporations, but in
addition with every requirement of law made of
domestic corporations. . . .
Obviously, the assimilation of foreign
corporations authorized to do business in the
Philippines "to the status
of domestic corporations, subsumes their being
found and operating as corporations,
hence,residing, in the country.
The same principle is recognized in American
law: that the residence of a corporation, if it can

be said to have a residence, is necessarily

where it exercises corporate functions . . .;" that
it is considered as dwelling "in the place where
its business is done . . .," as being "located
where its franchises are exercised . . .," and as
being "present where it is engaged in the
prosecution of the corporate enterprise;" that a
"foreign corporation licensed to do business in a
state is a resident of any country where it
maintains an office or agent for transaction of
its usual and customary business for venue
purposes;" and that the "necessary element in
its signification is locality of existence." [Words
and Phrases, Permanent Ed., vol. 37, pp. 394,
412, 493].
In as much as SHARP was admittedly doing
business in Japan through its four duly
registered branches at the time the collection
suit against it was filed, then in the light of the
processual presumption, SHARP may be
deemed a resident of Japan, and, as such, was
amenable to the jurisdiction of the courts
therein and may be deemed to have assented
to the said courts' lawful methods of serving
process. 27
Accordingly, the extraterritorial service of
summons on it by the Japanese Court was valid
not only under the processual presumption but
also because of the presumption of regularity of
performance of official duty.
We find NORTHWEST's claim for attorney's fees,
litigation expenses, and exemplary damages to
be without merit. We find no evidence that
would justify an award for attorney's fees and
litigation expenses under Article 2208 of the
Civil Code of the Philippines. Nor is an award for
exemplary damages warranted. Under Article
2234 of the Civil Code, before the court may
consider the question of whether or not
exemplary damages should be awarded, the
plaintiff must show that he is entitled to moral,
temperate, or compensatory damaged. There
being no such proof presented by NORTHWEST,
no exemplary damages may be adjudged in its
favor.
WHEREFORE, the instant petition is partly
GRANTED, and the challenged decision is
AFFIRMED insofar as it denied NORTHWEST's
claims for attorneys fees, litigation expenses,
and exemplary damages but REVERSED insofar
as in sustained the trial court's dismissal of
NORTHWEST's complaint in Civil Case No. 8317637 of Branch 54 of the Regional Trial Court
of Manila, and another in its stead is hereby
rendered ORDERING private respondent C.F.
SHARP L COMPANY, INC. to pay to NORTHWEST
the amounts adjudged in the foreign judgment

subject of said case, with interest thereon at the

legal rate from the filing of the complaint
therein until the said foreign judgment is fully
satisfied.
Costs against the private respondent.
SO ORDERED.

doing business in the Philippines, entered into

two (2) continuing guarantee agreements with
Cordova Chin San in Hongkong whereby the
latter agreed to pay on demand all sums of
money which may be due the bank from
Worlder Enterprises to the extent of the total
amount of two hundred fifty thousand
Hongkong dollars (HK $250,000). 1

Republic of the Philippines

Worlder Enterprises having defaulted in its

payment, petitioner filed in the Supreme Court
of Hongkong a collection suit against Worlder
Enterprises and Chin San. Summonses were
allegedly served upon Worlder Enterprises and
Chin San at their addresses in Hongkong but
they failed to respond thereto. Consequently,
the Supreme Court of Hongkong issued the
following:

Manila

JUDGMENT

THIRD DIVISION

THE 14th DAY OF JUNE, 1984

Today is Tuesday, June 23, 2015

No notice of intention to defend having been

given by the 1st and 2nd Defendants herein, IT
IS THIS DAY ADJUDGED that:
G.R. No. 73765

August 26, 1991

petitioner,
vs.
respondents.
Belo, Abiera & Associates for petitioner.
Castelo Law Office for private respondent.

FERNAN, C.J.:p
Challenged in this petition for certiorari which is
anchored on grave abuse of discretion, are two
orders of the Regional Trial Court, Branch CXLII
of Makati, Metro Manila dismissing the
complaint for collection of a sum of money and
denying the motion for reconsideration of the
dismissal order on the ground that petitioner, a
Hongkong-based bank, is barred by the General
Banking Act from maintaining a suit in this
jurisdiction.
The records show that on July 18, 1979,
petitioner Hang Lung Bank, Ltd., which was not

(1)
the 1st Defendant (Ko Ching Chong
Trading otherwise known as the Worlder
Enterprises) do pay the Plaintiff the sum of
HK$1,117,968.36 together with interest on the
respective principal sums of HK$196,591.38,
HK$200,216.29, HK$526,557.63, HK$49,350.00
and HK$3,965.50 at the rates of 1.7% per
month (or HK$111.40 per day), 18.5% per
annum (or HK$101.48 per day), 1.85% per
month (or HK$324.71 per day), 1.55% per
month (or HK$25.50 per day) and 1.7% per
month (or HK$2.25 per day) respectively from
4th May 1984 up to the date of payment; and
(2)
the 2nd Defendant (Cordova Chin San)
do pay the Plaintiff the sum of
HK$279,325.00 together with interest on the
principal sum of HK$250,000.00 at the rate
of 1.7% per month (or HK$141.67 per
day) from 4th May 1984 up to the date of
payment.
AND IT IS ADJUDGED that the 1st and 2nd
Defendants do pay the Plaintiff the sum of
HK$970.00 fixed costs.
N.J. BARNETT
Registrar

Thereafter, petitioner through counsel sent a

demand letter to Chin San at his Philippine
address but again, no response was made
thereto. Hence, on October 18, 1984, petitioner
instituted in the court below an action seeking
"the enforcement of its just and valid claims
against private respondent, who is a local
resident, for a sum of money based on a
transaction which was perfected, executed and
consummated abroad." 2
In his answer to the complaint, Chin San raised
as affirmative defenses: lack of cause of action,
incapacity to sue and improper venue. 3
Pre-trial of the case was set for June 17, 1985
but it was postponed to July 12, 1985. However,
a day before the latter pre-trial date, Chin San
filed a motion to dismiss the case and to set the
same for hearing the next day. The motion to
dismiss was based on the grounds that
petitioner had no legal capacity to sue and that
venue was improperly laid.
Acting on said motion to dismiss, on December
20, 1985, the lower court 4 issued the following
order:
On defendant Chin San Cordova's motion to
dismiss, dated July 10, 1985; plaintiff's
opposition, dated July 12, 1985; defendant's
reply, dated July 22, 1985; plaintiff's
supplemental opposition, dated September 13,
1985, and defendant's rejoinder filed on
September 23, 1985, said motion to dismiss is
granted.
Section 14, General Banking Act provides:
"No foreign bank or banking corporation
formed, organized or existing under any laws
other than those of the Republic of the
Philippines, shall be permitted to transact
business in the Philippines, or maintain by itself
any suit for the recovery of any debt, claims or
demands whatsoever until after it shall have
obtained, upon order of the Monetary Board, a
license for that purpose."
Plaintiff Hang Lung Bank, Ltd. with business and
postal address at the 3rd Floor, United Centre,
95 Queensway, Hongkong, does not do business
in the Philippines. The continuing guarantee,
Annexes "A" and "B" appeared to have been
transacted in Hongkong. Plaintiff's Annex "C"
shows that it had already obtained judgment
from the Supreme Court of Hongkong against

defendant involving the same claim on June 14,

1984.
The cases of Mentholatum Company, Inc. versus
Mangaliman, 72 Phil. 524 and Eastern Seaboard
Navigation, Ltd. versus Juan Ysmael &
Company, Inc., 102 Phil. 1-8, relied upon by
plaintiff, deal with isolated transaction in the
Philippines of foreign corporation. Such
transaction though isolated is the one that
conferred jurisdiction to Philippine courts, but in
the instant case, the transaction occurred in
Hongkong.
Case dismissed. The instant complaint not the
proper action.
SO ORDERED. 5
Petitioner filed a motion for the reconsideration
of said order but it was denied for lack of
merit. 6 Hence, the instant petition
for certiorari seeking the reversal of said orders
"so as to allow petitioner to enforce through the
court below its claims against private
respondent as recognized by the Supreme Court
of Hongkong." 7
Petitioner asserts that the lower court gravely
abused its discretion in: (a) holding that the
complaint was not the proper action for
purposes of collecting the amount guaranteed
by Chin San "as recognized and adjudged by
the Supreme Court of Hongkong;" (b)
interpreting Section 14 of the General Banking
Act as precluding petitioner from maintaining a
suit before Philippine courts because it is a
foreign corporation not licensed to do business
in the Philippines despite the fact that it does
not do business here; and (c) impliedly
sustaining private respondent's allegation of
improper venue.
We need not detain ourselves on the issue of
improper venue. Suffice it to state that private
respondent waived his right to invoke it when
he forthwith filed his answer to the complaint
thereby necessarily implying submission to the
jurisdiction of the court. 8
The resolution of this petition hinges on a
determination of whether petitioner foreign
banking corporation has the capacity to file the
action below.
Private respondent correctly contends that since
petitioner is a bank, its capacity to file an action

in this jurisdiction is governed by the General

Banking Act (Republic Act No. 337), particularly
Section 14 thereof which provides:
SEC. 14.
No foreign bank or banking
corporation formed, organized or existing under
any laws other than those of the Republic of the
Philippines shall be permitted to transact
business in the Philippines, or maintain by itself
or assignee any suit for the recovery of any
debt, claims, or demand whatsoever, until after
it shall have obtained, upon order of the
Monetary Board, a license for that purpose from
the Securities and Exchange Commissioner. Any
officer, director or agent of any such
corporation who transacts business in the
Philippines without the said license shall be
punished by imprisonment for not less than one
year nor more than ten years and by a fine of
not less than one thousand pesos nor more than
ten thousand pesos. (45 O.G. No. 4, 1647, 16491650)
In construing this provision, we adhere to the
interpretation given by this Court to the almost
identical Section 69 of the old Corporation Law
(Act No. 1459) which reads:
SEC. 69.
No foreign corporation or
corporation formed, organized, or existing
under any laws other than those of the
Philippines shall be permitted to transact
business in the Philippines or maintain by itself
or assignee any suit for the recovery of any
debt, claim, or demand whatever, unless it shall
have the license prescribed in the section
immediately preceding. Any officer, director or
agent of the corporation or any person
transacting business for any foreign corporation
not having the license prescribed shall be
punished by imprisonment for not less than six
months nor more than two years or by a fine of
not less than two hundred pesos nor more than
one thousand pesos, or by both such
imprisonment and fine, in the discretion of the
Court.
In a long line of cases, this Court has
interpreted this last quoted provision as not
altogether prohibiting a foreign corporation not
licensed to do business in the Philippines from
suing or maintaining an action in Philippine
courts.9 What it seeks to prevent is a foreign
corporation doing business in the Philippines
without a license from gaining access to
Philippine courts. As elucidated in MarshallWells Co. vs. Elser & Co., 46 Phil. 70:
The object of the statute was to subject the
foreign corporation doing business in the

Philippines to the jurisdiction of its courts. The

object of the statute was not to prevent it from
performing single acts but to prevent it from
acquiring a domicile for the purpose of business
without taking the steps necessary to render it
amenable to suit in the local courts. The
implication of the law is that it was never the
purpose of the Legislature to exclude a foreign
corporation which happens to obtain an isolated
order for business from the Philippines from
securing redress from Philippine courts, and
thus, in effect, to permit persons to avoid their
contract made with such foreign corporation.
The effect of the statute preventing foreign
corporations from doing business and from
bringing actions in the local courts, except on
compliance with elaborate requirements, must
not be unduly extended or improperly applied. It
should not be construed to extend beyond the
plain meaning of its terms, considered in
connection with its object, and in connection
with the spirit of the entire law.
The fairly recent case of Universal Shipping
Lines vs. Intermediate Appellate
Court, 10 although dealing with the amended
version of Section 69 of the old Corporation
Law, Section 133 of the Corporation Code
(Batas Pambansa Blg. 68), but which is
nonetheless apropos, states the rule succinctly:
"it is not the lack of the prescribed license (to
do business in the Philippines) but doing
business without license, which bars a foreign
corporation from access to our courts."
Thus, we have ruled that a foreign corporation
not licensed to do business in the Philippines
may file a suit in this country due to the
collision of two vessels at the harbor of
Manila 11 and for the loss of goods bound for
Hongkong but erroneously discharged in
Manila. 12
Indeed, the phraseologies of Section 14 of the
General Banking Act and its almost identical
counterpart Section 69 of the old Corporation
Law are misleading in that they seem to require
a foreign corporation, including a foreign bank
or banking corporation, not licensed to do
business and not doing business in the
Philippines to secure a license from the
Securities and Exchange Commission before it
can bring or maintain an action in Philippine
courts. To avert such misimpression, Section
133 of the Corporation Code is now more plainly
worded thus:
No foreign corporation transacting business in
the Philippines without a license, or its
successors or assigns, shall be permitted to
maintain or intervene in any action, suit or

proceeding in any court or administrative

agency of the Philippines.
Under this provision, we have ruled that a
foreign corporation may sue in this jurisdiction
for infringement of trademark and unfair
competition although it is not doing business in
the Philippines 13 because the Philippines was a
party to the Convention of the Union of Paris for
the Protection of IndustrialProperty. 14
We even went further to say that a foreign
corporation not licensed to do business in the
Philippines may not be denied the right to file
an action in our courts for an isolated
transaction in this country. 15
Since petitioner foreign banking corporation
was not doing business in the Philippines, it
may not be denied the privilege of pursuing its
claims against private respondent for a contract
which was entered into and consummated
outside the Philippines. Otherwise we will be
hampering the growth and development of
business relations between Filipino citizens and
foreign nationals. Worse, we will be allowing the
law to serve as a protective shield for
unscrupulous Filipino citizens who have
business relationships abroad.
In its pleadings before the court, petitioner
appears to be in a quandary as to whether the
suit below is one for enforcement or recognition
of the Hongkong judgment. Its complaint states:
COMES NOW Plaintiff, by undersigned counsel,
and to this Honorable Court, most respectfully
alleges that:
1.
Plaintiff is a corporation duly organized
and existing under and by virtue of the laws of
Hongkong with business and postal address at
the 3rd Floor, United Centre, 95 Queensway,
Hongkong, not doing business in the Philippines,
but is suing for this isolated transaction, but for
purposes of this complaint may be served with
summons and legal processes of this Honorable
Court, at the 6th Floor, Cibeles Building, 6780
Ayala Avenue, Makati, Metro Manila, while
defendant Cordova Chin San, may be served
with summons and other legal processes of this
Honorable Court at the Municipality of Moncada,
Province of Tarlac, Philippines;
2.
On July 18, 1979 and July 25, 1980, the
defendant executed Continuing Guarantees, in
consideration of plaintiff's from time to time
making advances, or coming to liability or

discounting bills or otherwise giving credit or

granting banking facilities from time to time to,
or on account of the Wolder Enterprises (sic),
photocopies of the Contract of Continuing
Guarantees are hereto attached as Annexes "A"
and "B", respectively, and made parts hereof;
3.
In June 1984, a complaint was filed by
plaintiff against the Wolder Enterprises (sic) and
defendant Cordova Chin San, in The Supreme
Court of Hongkong, under Case No. 3176, and
pursuant to which complaint, a judgment dated
14th day of July, 1984 was rendered by The
Supreme Court of Hongkong ordering to (sic)
defendant Cordova Chin San to pay the plaintiff
the sum of HK$279,325.00 together with
interest on the principal sum of HK$250,000.00
at the rate of HK$1.7% per month or
(HK$141.67) per day from 4th May, 1984 up to
the date the said amount is paid in full, and to
pay the sum of HK$970.00 as fixed cost, a
photocopy of the Judgment rendered by The
Supreme Court of Hongkong is hereto attached
as Annex "C" and made an integral part hereof.
4.
Plaintiff has made demands upon the
defendant in this case to pay the aforesaid
amount the last of which is by letter dated July
16, 1984 sent by undersigned counsel, a
photocopy of the letter of demand is hereto
attached as Annex "D" and the Registry Return
Card hereto attached as Annex "E",
respectively, and made parts hereof. However,
this notwithstanding, defendant failed and
refused and still continue to fail and refuse to
make any payment to plaintiff on the aforesaid
amount of HK$279,325.00 plus interest on the
principal sum of HK$250,000.00 at the rate of
(HK$141.67) per day from May 4, 1984 up to
the date of payment;
5.
In order to protect and safeguard the
rights and interests of herein plaintiff, it has
engaged the services of undersigned counsel,
to file the suit at bar, and for whose services it
has agreed to pay an amount equivalent to 25%
of the total amount due and owing, as of and by
way of attorney's fees plus costs of suit.
WHEREFORE, premises considered, it is most
respectfully prayed of this Honorable Court that
judgment be rendered ordering the defendant:
a) To pay plaintiff the sum of HK$279,325.00
together with interest on the principal sum of
HK$260,000.00 at the rate of HK$1.7% (sic) per
month (or HK$141.67 per day) from May 4,
1984 until the aforesaid amount is paid in full;

b) To pay an amount equivalent to 25% of the

total amount due and demandable as of and by
way of attorney's fees; and

oppositors-appellants,
vs.
heirs-appellees.

c) To pay costs of suit, and

Plaintiff prays for such other and further reliefs,
to which it may by law and equity, be
entitled. 16
The complaint therefore appears to be one of
the enforcement of the Hongkong judgment
because it prays for the grant of the affirmative
relief given by said foreign
judgment. 17 Although petitioner asserts that it
is merely seeking the recognition of its claims
based on the contract sued upon and not the
enforcement of the Hongkong judgment 18 it
should be noted that in the prayer of the
complaint, petitioner simply copied the
Hongkong judgment with respect to private
respondent's liability.
However, a foreign judgment may not be
enforced if it is not recognized in the jurisdiction
where affirmative relief is being sought. Hence,
in the interest of justice, the complaint should
be considered as a petition for the recognition
of the Hongkong judgment under Section 50 (b),
Rule 39 of the Rules of Court in order that the
defendant, private respondent herein, may
present evidence of lack of jurisdiction, notice,
collusion, fraud or clear mistake of fact and law,
if applicable.
WHEREFORE, the questioned orders of the lower
court are hereby set aside. Civil Case No. 8762
is reinstated and the lower court is directed to
proceed with dispatch in the disposition of said
case. This decision is immediately executory. No
costs.
SO ORDERED.

Republic of the Philippines

Manila
EN BANC

PEOPLE'S BANK and TRUST

COMPANY, executor.

Vicente R. Macasaet and Jose D. Villena for

oppositors appellants.
Paredes, Poblador, Cruz and Nazareno for heirsappellees E. A. Bellis, et al.
Quijano and Arroyo for heirs-appellees W. S.
Bellis, et al.
J. R. Balonkita for appellee People's Bank & Trust
Company.
Ozaeta, Gibbs and Ozaeta for appellee A. B.
Allsman.
J.:This is a direct appeal to Us, upon a question
purely of law, from an order of the Court of First
Instance of Manila dated April 30, 1964,
approving the project of partition filed by the
executor in Civil Case No. 37089
therein.1wph1.t
The facts of the case are as follows:
Amos G. Bellis, born in Texas, was "a citizen of
the State of Texas and of the United States." By
his first wife, Mary E. Mallen, whom he divorced,
he had five legitimate children: Edward A. Bellis,
George Bellis (who pre-deceased him in
infancy), Henry A. Bellis, Alexander Bellis and
Anna Bellis Allsman; by his second wife, Violet
Kennedy, who survived him, he had three
legitimate children: Edwin G. Bellis, Walter S.
Bellis and Dorothy Bellis; and finally, he had
three illegitimate children: Amos Bellis, Jr., Maria
Cristina Bellis and Miriam Palma Bellis.
On August 5, 1952, Amos G. Bellis executed a
will in the Philippines, in which he directed that
after all taxes, obligations, and expenses of
administration are paid for, his distributable
estate should be divided, in trust, in the
following order and manner: (a) $240,000.00 to
his first wife, Mary E. Mallen; (b) P120,000.00 to
his three illegitimate children, Amos Bellis, Jr.,
Maria Cristina Bellis, Miriam Palma Bellis, or
P40,000.00 each and (c) after the foregoing two
items have been satisfied, the remainder shall
go to his seven surviving children by his first
and second wives, namely: Edward A. Bellis,
Henry A. Bellis, Alexander Bellis and Anna Bellis
Allsman, Edwin G. Bellis, Walter S. Bellis, and
Dorothy E. Bellis, in equal shares.1wph1.t
Subsequently, or on July 8, 1958, Amos G. Bellis
died a resident of San Antonio, Texas, U.S.A. His

will was admitted to probate in the Court of First

Instance of Manila on September 15, 1958.
The People's Bank and Trust Company, as
executor of the will, paid all the bequests
therein including the amount of $240,000.00 in
the form of shares of stock to Mary E. Mallen
and to the three (3) illegitimate children, Amos
Bellis, Jr., Maria Cristina Bellis and Miriam Palma
Bellis, various amounts totalling P40,000.00
each in satisfaction of their respective legacies,
or a total of P120,000.00, which it released from
time to time according as the lower court
approved and allowed the various motions or
petitions filed by the latter three requesting
partial advances on account of their respective
legacies.
On January 8, 1964, preparatory to closing its
administration, the executor submitted and filed
its "Executor's Final Account, Report of
Administration and Project of Partition" wherein
it reported, inter alia, the satisfaction of the
legacy of Mary E. Mallen by the delivery to her
of shares of stock amounting to $240,000.00,
and the legacies of Amos Bellis, Jr., Maria
Cristina Bellis and Miriam Palma Bellis in the
amount of P40,000.00 each or a total of
P120,000.00. In the project of partition, the
executor pursuant to the "Twelfth" clause of
the testator's Last Will and Testament divided
the residuary estate into seven equal portions
for the benefit of the testator's seven legitimate
children by his first and second marriages.
On January 17, 1964, Maria Cristina Bellis and
Miriam Palma Bellis filed their respective
oppositions to the project of partition on the
ground that they were deprived of their
legitimes as illegitimate children and, therefore,
compulsory heirs of the deceased.
Amos Bellis, Jr. interposed no opposition despite
notice to him, proof of service of which is
evidenced by the registry receipt submitted on
April 27, 1964 by the executor.1
After the parties filed their respective
memoranda and other pertinent pleadings, the
lower court, on April 30, 1964, issued an order
overruling the oppositions and approving the
executor's final account, report and
administration and project of partition. Relying
upon Art. 16 of the Civil Code, it applied the
national law of the decedent, which in this case
is Texas law, which did not provide for legitimes.
Their respective motions for reconsideration
having been denied by the lower court on June

11, 1964, oppositors-appellants appealed to this

Court to raise the issue of which law must apply
Texas law or Philippine law.
In this regard, the parties do not submit the
case on, nor even discuss, the doctrine of
renvoi, applied by this Court in Aznar v.
Christensen Garcia, L-16749, January 31, 1963.
Said doctrine is usually pertinent where the
decedent is a national of one country, and a
domicile of another. In the present case, it is not
disputed that the decedent was both a national
of Texas and a domicile thereof at the time of
his death.2 So that even assuming Texas has a
conflict of law rule providing that the domiciliary
system (law of the domicile) should govern, the
same would not result in a reference back
(renvoi) to Philippine law, but would still refer to
Texas law. Nonetheless, if Texas has a conflicts
rule adopting the situs theory (lex rei sitae)
calling for the application of the law of the place
where the properties are situated, renvoi would
arise, since the properties here involved are
found in the Philippines. In the absence,
however, of proof as to the conflict of law rule of
Texas, it should not be presumed different from
ours.3Appellants' position is therefore not
rested on the doctrine of renvoi. As stated, they
never invoked nor even mentioned it in their
arguments. Rather, they argue that their case
falls under the circumstances mentioned in the
third paragraph of Article 17 in relation to
Article 16 of the Civil Code.
Article 16, par. 2, and Art. 1039 of the Civil
Code, render applicable the national law of the
decedent, in intestate or testamentary
successions, with regard to four items: (a) the
order of succession; (b) the amount of
successional rights; (e) the intrinsic validity of
the provisions of the will; and (d) the capacity to
succeed. They provide that
ART. 16. Real property as well as personal
property is subject to the law of the country
where it is situated.
However, intestate and testamentary
successions, both with respect to the order of
succession and to the amount of successional
rights and to the intrinsic validity of
testamentary provisions, shall be regulated by
the national law of the person whose succession
is under consideration, whatever may he the
nature of the property and regardless of the
country wherein said property may be found.
ART. 1039. Capacity to succeed is governed by
the law of the nation of the decedent.

Appellants would however counter that Art. 17,

paragraph three, of the Civil Code, stating that

Prohibitive laws concerning persons, their acts

or property, and those which have for their
object public order, public policy and good
customs shall not be rendered ineffective by
laws or judgments promulgated, or by
determinations or conventions agreed upon in a
foreign country.

intrinsic validity of the provision of the will and

the amount of successional rights are to be
determined under Texas law, the Philippine law
on legitimes cannot be applied to the testacy of
Amos G. Bellis.
Wherefore, the order of the probate court is
hereby affirmed in toto, with costs against
appellants. So ordered.
Republic of the Philippines

prevails as the exception to Art. 16, par. 2 of the

Civil Code afore-quoted. This is not correct.
Precisely, Congressdeleted the phrase,
"notwithstanding the provisions of this and the
next preceding article" when they incorporated
Art. 11 of the old Civil Code as Art. 17 of the
new Civil Code, while reproducing without
substantial change the second paragraph of Art.
10 of the old Civil Code as Art. 16 in the new. It
must have been their purpose to make the
second paragraph of Art. 16 a specific provision
in itself which must be applied in testate and
intestate succession. As further indication of
this legislative intent, Congress added a new
provision, under Art. 1039, which decrees that
capacity to succeed is to be governed by the
national law of the decedent.
It is therefore evident that whatever public
policy or good customs may be involved in our
System of legitimes, Congress has not intended
to extend the same to the succession of foreign
nationals. For it has specifically chosen to
leave, inter alia, the amount of successional
rights, to the decedent's national law. Specific
provisions must prevail over general ones.
Appellants would also point out that the
decedent executed two wills one to govern
his Texas estate and the other his Philippine
estate arguing from this that he intended
Philippine law to govern his Philippine estate.
Assuming that such was the decedent's
intention in executing a separate Philippine will,
it would not alter the law, for as this Court ruled
in Miciano v. Brimo, 50 Phil. 867, 870, a
provision in a foreigner's will to the effect that
his properties shall be distributed in accordance
with Philippine law and not with his national
law, is illegal and void, for his national law
cannot be ignored in regard to those matters
that Article 10 now Article 16 of the Civil
Code states said national law should govern.
The parties admit that the decedent, Amos G.
Bellis, was a citizen of the State of Texas, U.S.A.,
and that under the laws of Texas, there are no
forced heirs or legitimes. Accordingly, since the

Manila
EN BANC
petitioner-appellee,
vs.
opponent-appellant.
Ross, Lawrence and Selph for appellant.
Camus and Delgado for appellee.

J.:The partition of the estate left by the

deceased Joseph G. Brimo is in question in this
case.
The judicial administrator of this estate filed a
scheme of partition. Andre Brimo, one of the
brothers of the deceased, opposed it. The court,
however, approved it.
The errors which the oppositor-appellant assigns
are:
(1) The approval of said scheme of partition; (2)
denial of his participation in the inheritance; (3)
the denial of the motion for reconsideration of
the order approving the partition; (4) the
approval of the purchase made by the Pietro
Lana of the deceased's business and the deed
of transfer of said business; and (5) the
declaration that the Turkish laws are
impertinent to this cause, and the failure not to
postpone the approval of the scheme of
partition and the delivery of the deceased's
business to Pietro Lanza until the receipt of the
depositions requested in reference to the
Turkish laws.

The appellant's opposition is based on the fact

that the partition in question puts into effect the
provisions of Joseph G. Brimo's will which are
not in accordance with the laws of his Turkish
nationality, for which reason they are void as
being in violation or article 10 of the Civil Code
which, among other things, provides the
following:
Nevertheless, legal and testamentary
successions, in respect to the order of
succession as well as to the amount of the
successional rights and the intrinsic validity of
their provisions, shall be regulated by the
national law of the person whose succession is
in question, whatever may be the nature of the
property or the country in which it may be
situated.
But the fact is that the oppositor did not prove
that said testimentary dispositions are not in
accordance with the Turkish laws, inasmuch as
he did not present any evidence showing what
the Turkish laws are on the matter, and in the
absence of evidence on such laws, they are
presumed to be the same as those of the
Philippines. (Lim and Lim vs. Collector of
Customs, 36 Phil., 472.)
It has not been proved in these proceedings
what the Turkish laws are. He, himself,
acknowledges it when he desires to be given an
opportunity to present evidence on this point;
so much so that he assigns as an error of the
court in not having deferred the approval of the
scheme of partition until the receipt of certain
testimony requested regarding the Turkish laws
on the matter.
The refusal to give the oppositor another
opportunity to prove such laws does not
constitute an error. It is discretionary with the
trial court, and, taking into consideration that
the oppositor was granted ample opportunity to
introduce competent evidence, we find no
abuse of discretion on the part of the court in
this particular. There is, therefore, no evidence
in the record that the national law of the
testator Joseph G. Brimo was violated in the
testamentary dispositions in question which,
not being contrary to our laws in force, must be
complied with and executed. lawphil.net
Therefore, the approval of the scheme of
partition in this respect was not erroneous.
In regard to the first assignment of error which
deals with the exclusion of the herein appellant
as a legatee, inasmuch as he is one of the

persons designated as such in will, it must be

taken into consideration that such exclusion is
based on the last part of the second clause of
the will, which says:
Second. I like desire to state that although by
law, I am a Turkish citizen, this citizenship
having been conferred upon me by conquest
and not by free choice, nor by nationality and,
on the other hand, having resided for a
considerable length of time in the Philippine
Islands where I succeeded in acquiring all of the
property that I now possess, it is my wish that
the distribution of my property and everything
in connection with this, my will, be made and
disposed of in accordance with the laws in force
in the Philippine islands, requesting all of my
relatives to respect this wish, otherwise, I annul
and cancel beforehand whatever disposition
found in this will favorable to the person or
persons who fail to comply with this request.
The institution of legatees in this will is
conditional, and the condition is that the
instituted legatees must respect the testator's
will to distribute his property, not in accordance
with the laws of his nationality, but in
accordance with the laws of the Philippines.
If this condition as it is expressed were legal
and valid, any legatee who fails to comply with
it, as the herein oppositor who, by his attitude
in these proceedings has not respected the will
of the testator, as expressed, is prevented from
receiving his legacy.
The fact is, however, that the said condition is
void, being contrary to law, for article 792 of the
civil Code provides the following:
Impossible conditions and those contrary to law
or good morals shall be considered as not
imposed and shall not prejudice the heir or
legatee in any manner whatsoever, even should
the testator otherwise provide.
And said condition is contrary to law because it
expressly ignores the testator's national law
when, according to article 10 of the civil Code
above quoted, such national law of the testator
is the one to govern his testamentary
dispositions.
Said condition then, in the light of the legal
provisions above cited, is considered unwritten,
and the institution of legatees in said will is
unconditional and consequently valid and
effective even as to the herein oppositor.

It results from all this that the second clause of

the will regarding the law which shall govern it,
and to the condition imposed upon the
legatees, is null and void, being contrary to law.
All of the remaining clauses of said will with all
their dispositions and requests are perfectly
valid and effective it not appearing that said
clauses are contrary to the testator's national
law.
Therefore, the orders appealed from are
modified and it is directed that the distribution
of this estate be made in such a manner as to
include the herein appellant Andre Brimo as one
of the legatees, and the scheme of partition
submitted by the judicial administrator is
approved in all other respects, without any
pronouncement as to costs.
So ordered.

Republic of the Philippines

Manila
EN BANC

ADOLFO C. AZNAR, Executor and LUCY

CHRISTENSEN, Heir of the deceased, Executor
and Heir-appellees,
vs.

residue to be payable to Mrs. Carrie Louise C.

Borton, etc., in accordance with the provisions
of the will of the testator Edward E. Christensen.
The will was executed in Manila on March 5,
1951 and contains the following provisions:
3. I declare ... that I have but ONE (1) child,
named MARIA LUCY CHRISTENSEN (now Mrs.
Bernard Daney), who was born in the Philippines
about twenty-eight years ago, and who is now
residing at No. 665 Rodger Young Village, Los
Angeles, California, U.S.A.
4. I further declare that I now have no living
ascendants, and no descendants except my
above named daughter, MARIA LUCY
CHRISTENSEN DANEY.
xxx

xxx

xxx

7. I give, devise and bequeath unto MARIA

HELEN CHRISTENSEN, now married to Eduardo
Garcia, about eighteen years of age and who,
notwithstanding the fact that she was baptized
Christensen, is not in any way related to me,
nor has she been at any time adopted by me,
and who, from all information I have now
resides in Egpit, Digos, Davao, Philippines, the
sum of THREE THOUSAND SIX HUNDRED PESOS
(P3,600.00), Philippine Currency the same to be
deposited in trust for the said Maria Helen
Christensen with the Davao Branch of the
Philippine National Bank, and paid to her at the
rate of One Hundred Pesos (P100.00), Philippine
Currency per month until the principal thereof
as well as any interest which may have accrued
thereon, is exhausted..
xxx

xxx

xxx

oppositor-appellant.
M. R. Sotelo for executor and heir-appellees.
Leopoldo M. Abellera and Jovito Salonga for
oppositor-appellant.
J.:This is an appeal from a decision of the Court
of First Instance of Davao, Hon. Vicente N. Cusi,
Jr., presiding, in Special Proceeding No. 622 of
said court, dated September 14, 1949,
approving among things the final accounts of
the executor, directing the executor to
reimburse Maria Lucy Christensen the amount
of P3,600 paid by her to Helen Christensen
Garcia as her legacy, and declaring Maria Lucy
Christensen entitled to the residue of the
property to be enjoyed during her lifetime, and
in case of death without issue, one-half of said

12. I hereby give, devise and bequeath, unto

my well-beloved daughter, the said MARIA LUCY
CHRISTENSEN DANEY (Mrs. Bernard Daney),
now residing as aforesaid at No. 665 Rodger
Young Village, Los Angeles, California, U.S.A., all
the income from the rest, remainder, and
residue of my property and estate, real,
personal and/or mixed, of whatsoever kind or
character, and wheresoever situated, of which I
may be possessed at my death and which may
have come to me from any source whatsoever,
during her lifetime: ....
It is in accordance with the above-quoted
provisions that the executor in his final account
and project of partition ratified the payment of
only P3,600 to Helen Christensen Garcia and
proposed that the residue of the estate be

transferred to his daughter, Maria Lucy

Christensen.
Opposition to the approval of the project of
partition was filed by Helen Christensen Garcia,
insofar as it deprives her (Helen) of her legitime
as an acknowledged natural child, she having
been declared by Us in G.R. Nos. L-11483-84 an
acknowledged natural child of the deceased
Edward E. Christensen. The legal grounds of
opposition are (a) that the distribution should
be governed by the laws of the Philippines, and
(b) that said order of distribution is contrary
thereto insofar as it denies to Helen
Christensen, one of two acknowledged natural
children, one-half of the estate in full ownership.
In amplification of the above grounds it was
alleged that the law that should govern the
estate of the deceased Christensen should not
be the internal law of California alone, but the
entire law thereof because several foreign
elements are involved, that the forum is the
Philippines and even if the case were decided in
California, Section 946 of the California Civil
Code, which requires that the domicile of the
decedent should apply, should be applicable. It
was also alleged that Maria Helen Christensen
having been declared an acknowledged natural
child of the decedent, she is deemed for all
purposes legitimate from the time of her birth.
The court below ruled that as Edward E.
Christensen was a citizen of the United States
and of the State of California at the time of his
death, the successional rights and intrinsic
validity of the provisions in his will are to be
governed by the law of California, in accordance
with which a testator has the right to dispose of
his property in the way he desires, because the
right of absolute dominion over his property is
sacred and inviolable (In re McDaniel's Estate,
77 Cal. Appl. 2d 877, 176 P. 2d 952, and In re
Kaufman, 117 Cal. 286, 49 Pac. 192, cited in
page 179, Record on Appeal). Oppositor Maria
Helen Christensen, through counsel, filed
various motions for reconsideration, but these
were denied. Hence, this appeal.
The most important assignments of error are as
follows:
I
THE LOWER COURT ERRED IN IGNORING THE
DECISION OF THE HONORABLE SUPREME COURT
THAT HELEN IS THE ACKNOWLEDGED NATURAL
CHILD OF EDWARD E. CHRISTENSEN AND,
CONSEQUENTLY, IN DEPRIVING HER OF HER
JUST SHARE IN THE INHERITANCE.

II
THE LOWER COURT ERRED IN ENTIRELY
IGNORING AND/OR FAILING TO RECOGNIZE THE
EXISTENCE OF SEVERAL FACTORS, ELEMENTS
AND CIRCUMSTANCES CALLING FOR THE
APPLICATION OF INTERNAL LAW.
III
THE LOWER COURT ERRED IN FAILING TO
RECOGNIZE THAT UNDER INTERNATIONAL LAW,
PARTICULARLY UNDER THE RENVOI DOCTRINE,
THE INTRINSIC VALIDITY OF THE TESTAMENTARY
DISPOSITION OF THE DISTRIBUTION OF THE
ESTATE OF THE DECEASED EDWARD E.
CHRISTENSEN SHOULD BE GOVERNED BY THE
LAWS OF THE PHILIPPINES.
IV
THE LOWER COURT ERRED IN NOT DECLARING
THAT THE SCHEDULE OF DISTRIBUTION
SUBMITTED BY THE EXECUTOR IS CONTRARY TO
THE PHILIPPINE LAWS.
V
THE LOWER COURT ERRED IN NOT DECLARING
THAT UNDER THE PHILIPPINE LAWS HELEN
CHRISTENSEN GARCIA IS ENTITLED TO ONEHALF (1/2) OF THE ESTATE IN FULL OWNERSHIP.
There is no question that Edward E. Christensen
was a citizen of the United States and of the
State of California at the time of his death. But
there is also no question that at the time of his
death he was domiciled in the Philippines, as
witness the following facts admitted by the
executor himself in appellee's brief:
In the proceedings for admission of the will to
probate, the facts of record show that the
deceased Edward E. Christensen was born on
November 29, 1875 in New York City, N.Y.,
U.S.A.; his first arrival in the Philippines, as an
appointed school teacher, was on July 1, 1901,
on board the U.S. Army Transport "Sheridan"
with Port of Embarkation as the City of San
Francisco, in the State of California, U.S.A. He
stayed in the Philippines until 1904.
In December, 1904, Mr. Christensen returned to
the United States and stayed there for the
following nine years until 1913, during which

time he resided in, and was teaching school in

Sacramento, California.
Mr. Christensen's next arrival in the Philippines
was in July of the year 1913. However, in 1928,
he again departed the Philippines for the United
States and came back here the following year,
1929. Some nine years later, in 1938, he again
returned to his own country, and came back to
the Philippines the following year, 1939.
Wherefore, the parties respectfully pray that the
foregoing stipulation of facts be admitted and
approved by this Honorable Court, without
prejudice to the parties adducing other
evidence to prove their case not covered by this
stipulation of facts. 1wph1.t
Being an American citizen, Mr. Christensen was
interned by the Japanese Military Forces in the
Philippines during World War II. Upon liberation,
in April 1945, he left for the United States but
returned to the Philippines in December, 1945.
Appellees Collective Exhibits "6", CFI Davao, Sp.
Proc. 622, as Exhibits "AA", "BB" and "CCDaney"; Exhs. "MM", "MM-l", "MM-2-Daney" and
p. 473, t.s.n., July 21, 1953.)
In April, 1951, Edward E. Christensen returned
once more to California shortly after the making
of his last will and testament (now in question
herein) which he executed at his lawyers' offices
in Manila on March 5, 1951. He died at the St.
Luke's Hospital in the City of Manila on April 30,
1953. (pp. 2-3)
In arriving at the conclusion that the domicile of
the deceased is the Philippines, we are
persuaded by the fact that he was born in New
York, migrated to California and resided there
for nine years, and since he came to the
Philippines in 1913 he returned to California
very rarely and only for short visits (perhaps to
relatives), and considering that he appears
never to have owned or acquired a home or
properties in that state, which would indicate
that he would ultimately abandon the
Philippines and make home in the State of
California.
Sec. 16. Residence is a term used with many
shades of meaning from mere temporary
presence to the most permanent abode.
Generally, however, it is used to denote
something more than mere physical presence.
(Goodrich on Conflict of Laws, p. 29)

As to his citizenship, however, We find that the

citizenship that he acquired in California when
he resided in Sacramento, California from 1904
to 1913, was never lost by his stay in the
Philippines, for the latter was a territory of the
United States (not a state) until 1946 and the
deceased appears to have considered himself
as a citizen of California by the fact that when
he executed his will in 1951 he declared that he
was a citizen of that State; so that he appears
never to have intended to abandon his
California citizenship by acquiring another. This
conclusion is in accordance with the following
principle expounded by Goodrich in his Conflict
of Laws.
The terms "'residence" and "domicile" might
well be taken to mean the same thing, a place
of permanent abode. But domicile, as has been
shown, has acquired a technical meaning. Thus
one may be domiciled in a place where he has
never been. And he may reside in a place where
he has no domicile. The man with two homes,
between which he divides his time, certainly
resides in each one, while living in it. But if he
went on business which would require his
presence for several weeks or months, he might
properly be said to have sufficient connection
with the place to be called a resident. It is clear,
however, that, if he treated his settlement as
continuing only for the particular business in
hand, not giving up his former "home," he could
not be a domiciled New Yorker. Acquisition of a
domicile of choice requires the exercise of
intention as well as physical presence.
"Residence simply requires bodily presence of
an inhabitant in a given place, while domicile
requires bodily presence in that place and also
an intention to make it one's domicile."
Residence, however, is a term used with many
shades of meaning, from the merest temporary
presence to the most permanent abode, and it
is not safe to insist that any one use et the only
proper one. (Goodrich, p. 29)
The law that governs the validity of his
testamentary dispositions is defined in Article
16 of the Civil Code of the Philippines, which is
as follows:
ART. 16. Real property as well as personal
property is subject to the law of the country
where it is situated.
However, intestate and testamentary
successions, both with respect to the order of
succession and to the amount of successional
rights and to the intrinsic validity of
testamentary provisions, shall be regulated by
the national law of the person whose succession
is under consideration, whatever may be the

nature of the property and regardless of the

country where said property may be found.
The application of this article in the case at bar
requires the determination of the meaning of
the term "national law"is used therein.
There is no single American law governing the
validity of testamentary provisions in the United
States, each state of the Union having its own
private law applicable to its citizens only and in
force only within the state. The "national law"
indicated in Article 16 of the Civil Code above
quoted can not, therefore, possibly mean or
apply to any general American law. So it can
refer to no other than the private law of the
State of California.
The next question is: What is the law in
California governing the disposition of personal
property? The decision of the court below,
sustains the contention of the executor-appellee
that under the California Probate Code, a
testator may dispose of his property by will in
the form and manner he desires, citing the case
of Estate of McDaniel, 77 Cal. Appl. 2d 877, 176
P. 2d 952. But appellant invokes the provisions
of Article 946 of the Civil Code of California,
which is as follows:
If there is no law to the contrary, in the place
where personal property is situated, it is
deemed to follow the person of its owner, and is
governed by the law of his domicile.
The existence of this provision is alleged in
appellant's opposition and is not denied. We
have checked it in the California Civil Code and
it is there. Appellee, on the other hand, relies on
the case cited in the decision and testified to by
a witness. (Only the case of Kaufman is
correctly cited.) It is argued on executor's behalf
that as the deceased Christensen was a citizen
of the State of California, the internal law
thereof, which is that given in the abovecited
case, should govern the determination of the
validity of the testamentary provisions of
Christensen's will, such law being in force in the
State of California of which Christensen was a
citizen. Appellant, on the other hand, insists
that Article 946 should be applicable, and in
accordance therewith and following the doctrine
of the renvoi, the question of the validity of the
testamentary provision in question should be
referred back to the law of the decedent's
domicile, which is the Philippines.
The theory of doctrine of renvoi has been
defined by various authors, thus:

The problem has been stated in this way: "When

the Conflict of Laws rule of the forum refers a
jural matter to a foreign law for decision, is the
reference to the purely internal rules of law of
the foreign system; i.e., to the totality of the
foreign law minus its Conflict of Laws rules?"
On logic, the solution is not an easy one. The
Michigan court chose to accept the renvoi, that
is, applied the Conflict of Laws rule of Illinois
which referred the matter back to Michigan law.
But once having determined the the Conflict of
Laws principle is the rule looked to, it is difficult
to see why the reference back should not have
been to Michigan Conflict of Laws. This would
have resulted in the "endless chain of
references" which has so often been criticized
be legal writers. The opponents of the renvoi
would have looked merely to the internal law of
Illinois, thus rejecting the renvoi or the
reference back. Yet there seems no compelling
logical reason why the original reference should
be the internal law rather than to the Conflict of
Laws rule. It is true that such a solution avoids
going on a merry-go-round, but those who have
accepted the renvoi theory avoid
this inextricabilis circulas by getting off at the
second reference and at that point applying
internal law. Perhaps the opponents of
the renvoi are a bit more consistent for they
look always to internal law as the rule of
reference.
Strangely enough, both the advocates for and
the objectors to the renvoi plead that greater
uniformity will result from adoption of their
respective views. And still more strange is the
fact that the only way to achieve uniformity in
this choice-of-law problem is if in the dispute
the two states whose laws form the legal basis
of the litigation disagree as to whether
the renvoi should be accepted. If both reject, or
both accept the doctrine, the result of the
litigation will vary with the choice of the forum.
In the case stated above, had the Michigan
court rejected the renvoi, judgment would have
been against the woman; if the suit had been
brought in the Illinois courts, and they too
rejected the renvoi, judgment would be for the
woman. The same result would happen, though
the courts would switch with respect to which
would hold liability, if both courts accepted
the renvoi.
The Restatement accepts the renvoi theory in
two instances: where the title to land is in
question, and where the validity of a decree of
divorce is challenged. In these cases the
Conflict of Laws rule of the situs of the land, or
the domicile of the parties in the divorce case,
is applied by the forum, but any further

reference goes only to the internal law. Thus, a

person's title to land, recognized by the situs,
will be recognized by every court; and every
divorce, valid by the domicile of the parties, will
be valid everywhere. (Goodrich, Conflict of
Laws, Sec. 7, pp. 13-14.)

since an affirmative answer to the question

postulated and the operation of the adoption of
the foreign law in toto would in many cases
result in returning the main controversy to be
decided according to the law of the forum. ...
(16 C.J.S. 872.)

X, a citizen of Massachusetts, dies intestate,

domiciled in France, leaving movable property
in Massachusetts, England, and France. The
question arises as to how this property is to be
distributed among X's next of kin.

Another theory, known as the "doctrine

of renvoi", has been advanced. The theory of
the doctrine of renvoi is that the court of the
forum, in determining the question before it,
must take into account the whole law of the
other jurisdiction, but also its rules as to conflict
of laws, and then apply the law to the actual
question which the rules of the other jurisdiction
prescribe. This may be the law of the forum.
The doctrine of the renvoi has generally been
repudiated by the American authorities. (2 Am.
Jur. 296)

Assume (1) that this question arises in a

Massachusetts court. There the rule of the
conflict of laws as to intestate succession to
movables calls for an application of the law of
the deceased's last domicile. Since by
hypothesis X's last domicile was France, the
natural thing for the Massachusetts court to do
would be to turn to French statute of
distributions, or whatever corresponds thereto
in French law, and decree a distribution
accordingly. An examination of French law,
however, would show that if a French court were
called upon to determine how this property
should be distributed, it would refer the
distribution to the national law of the deceased,
thus applying the Massachusetts statute of
distributions. So on the surface of things the
Massachusetts court has open to it alternative
course of action: (a) either to apply the French
law is to intestate succession, or (b) to resolve
itself into a French court and apply the
Massachusetts statute of distributions, on the
assumption that this is what a French court
would do. If it accepts the socalled renvoidoctrine, it will follow the latter
course, thus applying its own law.
This is one type of renvoi. A jural matter is
presented which the conflict-of-laws rule of the
forum refers to a foreign law, the conflict-oflaws rule of which, in turn, refers the matter
back again to the law of the forum. This is
renvoi in the narrower sense. The German term
for this judicial process is 'Ruckverweisung.'"
(Harvard Law Review, Vol. 31, pp. 523-571.)
After a decision has been arrived at that a
foreign law is to be resorted to as governing a
particular case, the further question may arise:
Are the rules as to the conflict of laws contained
in such foreign law also to be resorted to? This
is a question which, while it has been
considered by the courts in but a few instances,
has been the subject of frequent discussion by
textwriters and essayists; and the doctrine
involved has been descriptively designated by
them as the "Renvoyer" to send back, or the
"Ruchversweisung", or the "Weiterverweisung",

The scope of the theory of renvoi has also been

defined and the reasons for its application in a
country explained by Prof. Lorenzen in an article
in the Yale Law Journal, Vol. 27, 1917-1918, pp.
529-531. The pertinent parts of the article are
quoted herein below:
The recognition of the renvoi theory implies that
the rules of the conflict of laws are to be
understood as incorporating not only the
ordinary or internal law of the foreign state or
country, but its rules of the conflict of laws as
well. According to this theory 'the law of a
country' means the whole of its law.
xxx

xxx

xxx

Von Bar presented his views at the meeting of

the Institute of International Law, at Neuchatel,
in 1900, in the form of the following theses:
(1) Every court shall observe the law of its
country as regards the application of foreign
laws.
(2) Provided that no express provision to the
contrary exists, the court shall respect:
(a) The provisions of a foreign law which
disclaims the right to bind its nationals abroad
as regards their personal statute, and desires
that said personal statute shall be determined
by the law of the domicile, or even by the law of
the place where the act in question occurred.

(b) The decision of two or more foreign systems

of law, provided it be certain that one of them is
necessarily competent, which agree in
attributing the determination of a question to
the same system of law.
xxx

xxx

xxx

If, for example, the English law directs its judge

to distribute the personal estate of an
Englishman who has died domiciled in Belgium
in accordance with the law of his domicile, he
must first inquire whether the law of Belgium
would distribute personal property upon death
in accordance with the law of domicile, and if he
finds that the Belgian law would make the
distribution in accordance with the law of
nationality that is the English law he must
accept this reference back to his own law.
We note that Article 946 of the California Civil
Code is its conflict of laws rule, while the rule
applied in In re Kaufman, Supra, its internal law.
If the law on succession and the conflict of laws
rules of California are to be enforced jointly,
each in its own intended and appropriate
sphere, the principle cited In re Kaufman should
apply to citizens living in the State, but Article
946 should apply to such of its citizens as are
not domiciled in California but in other
jurisdictions. The rule laid down of resorting to
the law of the domicile in the determination of
matters with foreign element involved is in
accord with the general principle of American
law that the domiciliary law should govern in
most matters or rights which follow the person
of the owner.
When a man dies leaving personal property in
one or more states, and leaves a will directing
the manner of distribution of the property, the
law of the state where he was domiciled at the
time of his death will be looked to in deciding
legal questions about the will, almost as
completely as the law of situs is consulted in
questions about the devise of land. It is logical
that, since the domiciliary rules control
devolution of the personal estate in case of
intestate succession, the same rules should
determine the validity of an attempted
testamentary dispostion of the property. Here,
also, it is not that the domiciliary has effect
beyond the borders of the domiciliary state. The
rules of the domicile are recognized as
controlling by the Conflict of Laws rules at the
situs property, and the reason for the
recognition as in the case of intestate
succession, is the general convenience of the
doctrine. The New York court has said on the
point: 'The general principle that a dispostiton
of a personal property, valid at the domicile of

the owner, is valid anywhere, is one of the

universal application. It had its origin in that
international comity which was one of the first
fruits of civilization, and it this age, when
business intercourse and the process of
accumulating property take but little notice of
boundary lines, the practical wisdom and justice
of the rule is more apparent than ever.
(Goodrich, Conflict of Laws, Sec. 164, pp. 442443.)
Appellees argue that what Article 16 of the Civil
Code of the Philippines pointed out as
the national law is the internal law of California.
But as above explained the laws of California
have prescribed two sets of laws for its citizens,
one for residents therein and another for those
domiciled in other jurisdictions. Reason
demands that We should enforce the California
internal law prescribed for its citizens residing
therein, and enforce the conflict of laws rules
for the citizens domiciled abroad. If we must
enforce the law of California as in comity we are
bound to go, as so declared in Article 16 of our
Civil Code, then we must enforce the law of
California in accordance with the express
mandate thereof and as above explained, i.e.,
apply the internal law for residents therein, and
its conflict-of-laws rule for those domiciled
abroad.
It is argued on appellees' behalf that the clause
"if there is no law to the contrary in the place
where the property is situated" in Sec. 946 of
the California Civil Code refers to Article 16 of
the Civil Code of the Philippines and that the
law to the contrary in the Philippines is the
provision in said Article 16 that the national
law of the deceased should govern. This
contention can not be sustained. As explained
in the various authorities cited above the
national law mentioned in Article 16 of our Civil
Code is the law on conflict of laws in the
California Civil Code, i.e., Article 946, which
authorizes the reference or return of the
question to the law of the testator's domicile.
The conflict of laws rule in California, Article
946, Civil Code, precisely refers back the case,
when a decedent is not domiciled in California,
to the law of his domicile, the Philippines in the
case at bar. The court of the domicile can not
and should not refer the case back to California;
such action would leave the issue incapable of
determination because the case will then be like
a football, tossed back and forth between the
two states, between the country of which the
decedent was a citizen and the country of his
domicile. The Philippine court must apply its
own law as directed in the conflict of laws rule
of the state of the decedent, if the question has
to be decided, especially as the application of
the internal law of California provides no
legitime for children while the Philippine law,
Arts. 887(4) and 894, Civil Code of the

Philippines, makes natural children legally

acknowledged forced heirs of the parent
recognizing them.
The Philippine cases (In re Estate of Johnson, 39
Phil. 156; Riera vs. Palmaroli, 40 Phil. 105;
Miciano vs. Brimo, 50 Phil. 867; Babcock
Templeton vs. Rider Babcock, 52 Phil. 130; and
Gibbs vs. Government, 59 Phil. 293.) cited by
appellees to support the decision can not
possibly apply in the case at bar, for two
important reasons, i.e., the subject in each case
does not appear to be a citizen of a state in the
United States but with domicile in the
Philippines, and it does not appear in each case
that there exists in the state of which the
subject is a citizen, a law similar to or identical
with Art. 946 of the California Civil Code.
We therefore find that as the domicile of the
deceased Christensen, a citizen of California, is
the Philippines, the validity of the provisions of
his will depriving his acknowledged natural
child, the appellant, should be governed by the
Philippine Law, the domicile, pursuant to Art.
946 of the Civil Code of California, not by the
internal law of California..
WHEREFORE, the decision appealed from is
hereby reversed and the case returned to the
lower court with instructions that the partition
be made as the Philippine law on succession
provides. Judgment reversed, with costs against
appellees.
Republic of the Philippines
Manila
EN BANC
executor-appellee,
vs.
oppositors-appellants.
Jose D. Cortes for appellants.
Ohnick, Velilla and Balonkita for appellee.
J.:Appeal against an order of the Court of First
Instance of Manila, Hon. Ramon San Jose,
presiding, dismissing the objections filed by
Magdalena C. Bohanan, Mary Bohanan and
Edward Bohanan to the project of partition
submitted by the executor and approving the
said project.

On April 24, 195 0, the Court of First Instance of

Manila, Hon. Rafael Amparo, presiding, admitted
to probate a last will and testament of C. O.
Bohanan, executed by him on April 23, 1944 in
Manila. In the said order, the court made the
following findings:
According to the evidence of the opponents the
testator was born in Nebraska and therefore a
citizen of that state, or at least a citizen of
California where some of his properties are
located. This contention in untenable.
Notwithstanding the long residence of the
decedent in the Philippines, his stay here was
merely temporary, and he continued and
remained to be a citizen of the United States
and of the state of his pertinent residence to
spend the rest of his days in that state. His
permanent residence or domicile in the United
States depended upon his personal intent or
desire, and he selected Nevada as his homicide
and therefore at the time of his death, he was a
citizen of that state. Nobody can choose his
domicile or permanent residence for him. That
is his exclusive personal right.
Wherefore, the court finds that the testator C.
O. Bohanan was at the time of his death a
citizen of the United States and of the State of
Nevada and declares that his will and
testament, Exhibit A, is fully in accordance with
the laws of the state of Nevada and admits the
same to probate. Accordingly, the Philippine
Trust Company, named as the executor of the
will, is hereby appointed to such executor and
upon the filing of a bond in the sum of
P10,000.00, let letters testamentary be issued
and after taking the prescribed oath, it may
enter upon the execution and performance of its
trust. (pp. 26-27, R.O.A.).
It does not appear that the order granting
probate was ever questions on appeal. The
executor filed a project of partition dated
January 24, 1956, making, in accordance with
the provisions of the will, the following
adjudications: (1) one-half of the residuary
estate, to the Farmers and Merchants National
Bank of Los Angeles, California, U.S.A. in trust
only for the benefit of testator's grandson
Edward George Bohanan, which consists of
several mining companies; (2) the other half of
the residuary estate to the testator's brother,
F.L. Bohanan, and his sister, Mrs. M. B.
Galbraith, share and share alike. This consist in
the same amount of cash and of shares of
mining stock similar to those given to testator's
grandson; (3) legacies of P6,000 each to his
(testator) son, Edward Gilbert Bohana, and his
daughter, Mary Lydia Bohanan, to be paid in
three yearly installments; (4) legacies to Clara

Daen, in the amount of P10,000.00; Katherine

Woodward, P2,000; Beulah Fox, P4,000; and
Elizabeth Hastings, P2,000;
It will be seen from the above that out of the
total estate (after deducting administration
expenses) of P211,639.33 in cash, the testator
gave his grandson P90,819.67 and one-half of
all shares of stock of several mining companies
and to his brother and sister the same amount.
To his children he gave a legacy of only P6,000
each, or a total of P12,000.
The wife Magadalena C. Bohanan and her two
children question the validity of the
testamentary provisions disposing of the estate
in the manner above indicated, claiming that
they have been deprived of the legitimate that
the laws of the form concede to them.
The first question refers to the share that the
wife of the testator, Magdalena C. Bohanan,
should be entitled to received. The will has not
given her any share in the estate left by the
testator. It is argued that it was error for the
trial court to have recognized the Reno divorce
secured by the testator from his Filipino wife
Magdalena C. Bohanan, and that said divorce
should be declared a nullity in this jurisdiction,
citing the case of Querubin vs.Querubin, 87
Phil., 124, 47 Off. Gaz., (Sup, 12) 315, Cousins
Hiz vs. Fluemer, 55 Phil., 852,
Ramirez vs. Gmur, 42 Phil., 855 and
Gorayeb vs. Hashim, 50 Phil., 22. The court
below refused to recognize the claim of the
widow on the ground that the laws of Nevada,
of which the deceased was a citizen, allow him
to dispose of all of his properties without
requiring him to leave any portion of his estate
to his wife. Section 9905 of Nevada Compiled
Laws of 1925 provides:
Every person over the age of eighteen 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.
Besides, the right of the former wife of the
testator, Magdalena C. Bohanan, to a share in
the testator's estafa had already been passed
upon adversely against her in an order dated
June 19, 1955, (pp. 155-159, Vol II Records,
Court of First Instance), which had become final,
as Magdalena C. Bohanan does not appear to
have appealed therefrom to question its validity.
On December 16, 1953, the said former wife
filed a motion to withdraw the sum of P20,000
from the funds of the estate, chargeable against
her share in the conjugal property, (See pp.

294-297, Vol. I, Record, Court of First Instance),

and the court in its said error found that there
exists no community property owned by the
decedent and his former wife at the time the
decree of divorce was issued. As already and
Magdalena C. Bohanan may no longer question
the fact contained therein, i.e. that there was no
community property acquired by the testator
and Magdalena C. Bohanan during their
converture.
Moreover, the court below had found that the
testator and Magdalena C. Bohanan were
married on January 30, 1909, and that divorce
was granted to him on May 20, 1922; that
sometime in 1925, Magdalena C. Bohanan
married Carl Aaron and this marriage was
subsisting at the time of the death of the
testator. Since no right to share in the
inheritance in favor of a divorced wife exists in
the State of Nevada and since the court below
had already found that there was no conjugal
property between the testator and Magdalena
C. Bohanan, the latter can now have no longer
claim to pay portion of the estate left by the
testator.
The most important issue is the claim of the
testator's children, Edward and Mary Lydia, who
had received legacies in the amount of P6,000
each only, and, therefore, have not been given
their shares in the estate which, in accordance
with the laws of the forum, should be two-thirds
of the estate left by the testator. Is the failure
old the testator to give his children two-thirds of
the estate left by him at the time of his death,
in accordance with the laws of the forum valid?
The old Civil Code, which is applicable to this
case because the testator died in 1944,
expressly provides that successional rights to
personal property are to be earned by the
national law of the person whose succession is
in question. Says the law on this point:
Nevertheless, legal and testamentary
successions, in respect to the order of
succession as well as to the extent of the
successional rights and the intrinsic validity of
their provisions, shall be regulated by the
national law of the person whose succession is
in question, whatever may be the nature of the
property and the country in which it is found.
(par. 2, Art. 10, old Civil Code, which is the
same as par. 2 Art. 16, new Civil Code.)
In the proceedings for the probate of the will, it
was found out and it was decided that the
testator was a citizen of the State of Nevada
because he had selected this as his domicile

and his permanent residence. (See Decision

dated April 24, 1950, supra). So the question at
issue is whether the estementary dispositions,
especially hose for the children which are short
of the legitime given them by the Civil Code of
the Philippines, are valid. It is not disputed that
the laws of Nevada allow a testator to dispose
of all his properties by will (Sec. 9905, Complied
Nevada Laws of 1925, supra). It does not
appear that at time of the hearing of the project
of partition, the above-quoted provision was
introduced in evidence, as it was the executor's
duly to do. The law of Nevada, being a foreign
law can only be proved in our courts in the form
and manner provided for by our Rules, which
are as follows:
SEC. 41. Proof of public or official record. An
official record or an entry therein, when
admissible for any purpose, may be evidenced
by an official publication thereof or by a copy
tested by the officer having the legal custody of
he record, or by his deputy, and accompanied, if
the record is not kept in the Philippines, with a
certificate that such officer has the custody. . . .
(Rule 123).
We have, however, consulted the records of the
case in the court below and we have found that
during the hearing on October 4, 1954 of the
motion of Magdalena C. Bohanan for withdrawal
of P20,000 as her share, the foreign law,
especially Section 9905, Compiled Nevada
Laws. was introduced in evidence by appellant's
(herein) counsel as Exhibits "2" (See pp. 77-79,
VOL. II, and t.s.n. pp. 24-44, Records, Court of
First Instance). Again said laws presented by the
counsel for the executor and admitted by the
Court as Exhibit "B" during the hearing of the
case on January 23, 1950 before Judge Rafael
Amparo (se Records, Court of First Instance, Vol.
1).

In addition, the other appellants, children of the

testator, do not dispute the above-quoted
provision of the laws of the State of Nevada.
Under all the above circumstances, we are
constrained to hold that the pertinent law of
Nevada, especially Section 9905 of the
Compiled Nevada Laws of 1925, can be taken
judicial notice of by us, without proof of such
law having been offered at the hearing of the
project of partition.
As in accordance with Article 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.