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-93-18394.[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 Al-Gazzawi,
the latter as an accomplice.
When plaintiff returned to Jeddah a few days later, several SAUDIA
officials interrogated her about the Jakarta incident. They then
requested her to go back to Jakarta to help arrange the release of
Thamer and Allah. In Jakarta, SAUDIA Legal Officer Sirah Akkad and
base manager Baharini negotiated with the police for the immediate
release of the detained crew members but did not succeed because
plaintiff refused to cooperate. She was afraid that she might be tricked
into something she did not want because of her inability to understand
the local dialect. She also declined to sign a blank paper and a
document written in the 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).
 SO ORDERED.
On October 20, 1995, SAUDIA filed with this Honorable Court the instant
Petition[29] for Review with Prayer for Temporary Restraining Order dated October 13,
1995.
However, during the pendency of the instant Petition, respondent Court of Appeals
rendered the Decision[30] dated April 10, 1996, now also assailed. It ruled that the
Philippines is an appropriate forum considering that the Amended 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:
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.
III.

Petitioner received on April 22, 1996 the April 10, 1996 decision in CA-G.R.
SP NO. 36533 entitled Saudi Arabian Airlines v. Hon. Rodolfo A. Ortiz, et al.
and filed its April 30, 1996 Supplemental Petition For Review With Prayer For
A Temporary Restraining Order on May 7, 1996 at 10:29 a.m. or within the 15-
day reglementary period as provided for under Section 1, Rule 45 of the
Revised Rules of Court. Therefore, the decision in CA-G.R. SP NO. 36533
has not yet become final and executory and this Honorable Court can take
cognizance of this case. [33]

From the foregoing factual and procedural antecedents, the following issues
emerge for our resolution:
I.

WHETHER RESPONDENT APPELLATE COURT ERRED IN

HOLDING THAT THE REGIONAL TRIAL COURT OF QUEZON CITY
HAS JURISDICTION TO HEAR AND TRY CIVIL CASE NO. Q-93-
18394 ENTITLED MILAGROS P. MORADA V. SAUDI ARABIAN
AIRLINES.
II.

WHETHER RESPONDENT APPELLATE COURT ERRED IN RULING

THAT IN 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 commissi rule.[34]
On the other hand, private respondent contends that since her Amended Complaint
is based on Articles 19[35] and 21[36] of the Civil Code, then the instant case is properly a
matter of domestic law.[37]
Under the factual antecedents obtaining in this case, there is no dispute that the
interplay of events occurred in two states, the Philippines and Saudi Arabia.
As stated by private respondent in her Amended Complaint[38] dated June 23, 1994:
2. Defendant SAUDI ARABIAN AIRLINES or SAUDIA is a foreign
airlines corporation doing business in the Philippines. It may be served
with summons and other court processes at Travel Wide Associated
Sales (Phils.), Inc., 3rd Floor, Cougar Building, 114 Valero St., Salcedo
Village, Makati, Metro Manila.
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 choice-of-law theories should intrinsically
advance both notions of justice and predictability, they do not always do so. The forum
is then faced with the problem of deciding which of these two important values should
be stressed.[54]
Before a choice can be made, it is necessary for us to determine under what
category a certain set of facts or rules fall. This process is known as characterization, or
the doctrine of qualification. It is the process of deciding whether or not the facts relate
to the kind of question specified in a conflicts rule.[55] The purpose of characterization is
to enable the forum to select the proper law.[56]
Our starting point of analysis here is not a legal relation, but a factual situation,
event, or operative fact.[57] An essential element of conflict rules is the indication of a test
or connecting factor or point of contact. Choice-of-law rules invariably consist of a
factual relationship (such as property right, contract claim) and a connecting factor or
point of contact, such as the situsof 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.
WHEREFORE, the instant petition for certiorari is hereby DISMISSED. Civil Case
No. Q-93-18394 entitled Milagros P. Morada vs. Saudi Arabia Airlines is hereby
REMANDED to Regional Trial Court of Quezon City, Branch 89 for further proceedings.
SO ORDERED.
Davide, Jr., (Chairman), Bellosillo, Vitug, and Panganiban, JJ., concur.
AZUHIRO HASEGAWA and NIPPON G.R. No. 149177
ENGINEERING CONSULTANTS CO.,
LTD., Present:
Petitioners,
YNARES-SANTIAGO, J.,
Chairperson,
AUSTRIA-MARTINEZ,
- versus - CHICO-NAZARIO,
NACHURA, and
REYES, JJ.

Promulgated:
MINORU KITAMURA,
Respondent. November 23, 2007

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

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] Nippon then assigned respondent to work as the project
manager of the Southern Tagalog Access Road (STAR) Project in the Philippines,
following the company's consultancy contract with the Philippine Government.[6]
When the STAR Project was near completion, the Department of Public Works
and Highways (DPWH) engaged the consultancy services of Nippon, on January
28, 2000, this time for the detailed engineering and construction supervision of the
Bongabon-Baler Road Improvement (BBRI) Project.[7] Respondent was named as
the project manager in the contract's Appendix 3.1.[8]

On February 28, 2000, petitioner Kazuhiro Hasegawa, Nippon's general manager

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

Threatened with impending unemployment, respondent, through his lawyer,

requested a negotiation conference and demanded that he be assigned to the BBRI
project. Nipponinsisted that respondents contract was for a fixed term that had
already expired, and refused to negotiate for the renewal of the ICA.[10]

As he was not able to generate a positive response from the petitioners, respondent
consequently initiated on June 1, 2000 Civil Case No. 00-0264 for specific
performance and damages with the Regional Trial Court of Lipa City.[11]

For their part, petitioners, contending that the ICA had been perfected in Japan and
executed by and between Japanese nationals, moved to dismiss the complaint for
lack of jurisdiction. They asserted that the claim for improper pre-termination of
respondent's ICA could only be heard and ventilated in the proper courts
of Japan following the principles of lex loci celebrationis and lex contractus.[12]

In the meantime, on June 20, 2000, the DPWH approved Nippon's request for the
replacement of Kitamura by a certain Y. Kotake as project manager of the BBRI
Project.[13]

On June 29, 2000, the RTC, invoking our ruling in Insular Government v.
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 first Petition for Certiorari under Rule 65 [docketed as CA-G.R. SP
No. 60205].[18] On August 23, 2000, the CA resolved to dismiss the petition on
procedural groundsfor lack of statement of material dates and for insufficient
verification and certification against forum shopping.[19] An Entry of Judgment was
later issued by the appellate court on September 20, 2000.[20]

Aggrieved by this development, petitioners filed with the CA, on September 19,
2000, still within the reglementary period, a second Petition for Certiorari under
Rule 65 already stating therein the material dates and attaching thereto the proper
verification and certification. This second petition, which substantially raised the
same issues as those in the first, was docketed as CA-G.R. SP No. 60827.[21]

Ruling on the merits of the second petition, the appellate court rendered the
assailed April 18, 2001 Decision[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]

Petitioners' motion for reconsideration was subsequently denied by the CA in the

assailed July 25, 2001 Resolution.[24]

Remaining steadfast in their stance despite the series of denials, petitioners

instituted the instant Petition for Review on 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 SOLUTIONISIN THE LIGHT OF
RECENT DEVELOPMENT[S] IN PRIVATE INTERNATIONAL
LAWS.[26]
The pivotal question that this Court is called upon to resolve is whether the subject
matter jurisdiction of Philippine courts in civil cases for specific performance and
damages involving contracts executed outside the country by foreign nationals may
be assailed on the principles of lex loci celebrationis, lex contractus, the state of
the most significant relationship rule, or forum non conveniens.

However, before ruling on this issue, we must first dispose of the procedural
matters raised by the respondent.

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

We do not agree. When the CA dismissed CA-G.R. SP No. 60205 on account of

the petition's defective certification of non-forum shopping, it was a dismissal
without prejudice.[27] The same holds true in the CA's dismissal of the said case
due to defects in the formal requirement of 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 non-forum shopping in the instant petition for
review of the second certiorari petition, the status of the aforesaid first petition
before the CA. In any case, an omission in the certificate of non-forum shopping
about any event that will not constitute res judicata and litis pendentia, as in the
present case, is not a fatal defect. It will not warrant the dismissal and nullification
of the entire proceedings, considering that the evils sought to be prevented by the
said certificate are no longer present.[34]

The Court also finds no merit in respondent's contention that petitioner Hasegawa
is only authorized to verify and certify, on behalf of Nippon, the certiorari petition
filed with the CA and not the instant petition. True, the Authorization [35] dated
September 4, 2000, which is attached to the second certiorari petition and which is
also attached to the instant petition for review, is limited in scopeits wordings
indicate that Hasegawa is given the authority to sign for and act on behalf of the
company only in the petition filed with the appellate court, and that authority
cannot extend to the instant petition for review.[36] In a plethora of cases, however,
this Court has liberally applied the Rules or even suspended its application
whenever a satisfactory explanation and a subsequent fulfillment of the
requirements have been made.[37] Given that petitioners herein sufficiently
explained their misgivings on this point and appended to their 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 to dismiss is interlocutory,
and cannot be the subject of the extraordinary petition for certiorari or mandamus.
The appropriate recourse is to file an answer and to interpose as defenses the
objections raised in the motion, to proceed to trial, and, in case of an adverse
decision, to elevate the entire case by appeal in due course.[44] While there are
recognized exceptions to this rule,[45] petitioners' case does not fall among them.

This brings us to the discussion of the substantive issue of the case.

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

The Court notes that petitioners adopted an additional but different theory when
they elevated the case to the appellate court. In the Motion to 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.
 G.R. No. 198587, January 14, 2015

SAUDI ARABIAN AIRLINES (SAUDIA) AND BRENDA J. BETIA, Petitioners, v. MA. JOPETTE M. REBESENCIO, MONTASSAH
B. SACAR-ADIONG, ROUEN RUTH A. CRISTOBAL AND LORAINE S. SCHNEIDER-CRUZ, Respondents.

DECISION

LEONEN, J.:

All Filipinos are entitled to the protection of the rights guaranteed in the Constitution.

This is a Petition for Review on Certiorari with application for the issuance of a temporary restraining order and/or writ of
preliminary injunction under Rule 45 of the 1997 Rules of Civil Procedure praying that judgment be rendered reversing and setting
aside the June 16, 2011 Decision1 and September 13, 2011 Resolution2 of the Court of Appeals in CA-G.R. SP. No. 113006.

Petitioner Saudi Arabian Airlines (Saudia) is a foreign corporation established and existing under the laws of Jeddah, Kingdom of
Saudi Arabia. It has a Philippine office located at 4/F, Metro House Building, Sen. Gil J. Puyat Avenue, Makati City. 3 In its Petition
filed with this court, Saudia identified itself as follows: cha nrob lesvi rtua llawlib ra ry

1. Petitioner SAUDIA is a foreign corporation established and existing under the Royal Decree No. M/24 of 18.07.1385H
(10.02.1962G) in Jeddah, Kingdom of Saudi Arabia ("KSA"). Its Philippine Office is located at 4/F Metro House Building, Sen, Gil J.
Puyat Avenue, Makati City (Philippine Office). It may be served with orders of this Honorable Court through undersigned counsel at
4th and 6th Floors, Citibank Center Bldg., 8741 Paseo de Roxas, Makati City. 4 (Emphasis supplied)
Respondents (complainants before the Labor Arbiter) were recruited and hired by Saudia as Temporary Flight Attendants with the
accreditation and approval of the Philippine Overseas Employment Administration. 5 After undergoing seminars required by the
Philippine Overseas Employment Administration for deployment overseas, as well as training modules offered by Saudia (e.g., initial
flight attendant/training course and transition training), and after working as Temporary Flight Attendants, respondents became
Permanent Flight Attendants. They then entered into Cabin Attendant contracts with Saudia: Ma. Jopette M. Rebesencio (Ma.
Jopette) on May 16, 1990;6 Montassah B. Sacar-Adiong (Montassah) and Rouen Ruth A. Cristobal (Rouen Ruth) on May 22,
1993;7 and Loraine Schneider-Cruz (Loraine) on August 27, 1995.8

Respondents continued their employment with Saudia until they were separated from service on various dates in 2006. 9

Respondents contended that the termination of their employment was illegal. They alleged that the termination was made solely
because they were pregnant.10

As respondents alleged, they had informed Saudia of their respective pregnancies and had gone through the necessary procedures
to process their maternity leaves. Initially, Saudia had given its approval but later on informed respondents that its management in
Jeddah, Saudi Arabia had disapproved their maternity leaves. In addition, it required respondents to file their resignation letters.11

Respondents were told that if they did not resign, Saudia would terminate them all the same. The threat of termination entailed the
loss of benefits, such as separation pay and ticket discount entitlements. 12

Specifically, Ma. Jopette received a call on October 16, 2006 from Saudia's Base Manager, Abdulmalik Saddik
(Abdulmalik).13 Montassah was informed personally by Abdulmalik and a certain Faisal Hussein on October 20, 2006 after being
required to report to the office one (1) month into her maternity leave. 14Rouen Ruth was also personally informed by Abdulmalik on
October 17, 2006 after being required to report to the office by her Group Supervisor.15 Loraine received a call on October 12, 2006
from her Group Supervisor, Dakila Salvador.16

Saudia anchored its disapproval of respondents' maternity leaves and demand for their resignation on its "Unified Employment
Contract for Female Cabin Attendants" (Unified Contract).17 Under the Unified Contract, the employment of a Flight Attendant who
becomes pregnant is rendered void. It provides: chan roble svirtual lawlib rary

(H) Due to the essential nature of the Air Hostess functions to be physically fit on board to provide various services required in
normal or emergency cases on both domestic/international flights beside her role in maintaining continuous safety and security of
passengers, and since she will not be able to maintain the required medical fitness while at work in case of pregnancy,
accordingly, if the Air Hostess becomes pregnant at any time during the term of this contract, this shall render her
employment contract as void and she will be terminated due to lack of medical fitness.18 (Emphasis supplied)
In their Comment on the present Petition,19 respondents emphasized that the Unified Contract took effect on September 23, 2006
(the first day of Ramadan),20 well after they had filed and had their maternity leaves approved. Ma. Jopette filed her maternity
leave application on September 5, 2006.21 Montassah filed her maternity leave application on August 29, 2006, and its approval
was already indicated in Saudia's computer system by August 30, 2006. 22 Rouen Ruth filed her maternity leave application on
September 13, 2006,23 and Loraine filed her maternity leave application on August 22, 2006. 24

Rather than comply and tender resignation letters, respondents filed separate appeal letters that were all rejected. 25

Despite these initial rejections, respondents each received calls on the morning of November 6, 2006 from Saudia's office secretary
informing them that their maternity leaves had been approved. Saudia, however, was quick to renege on its approval. On the
evening of November 6, 2006, respondents again received calls informing them that it had received notification from Jeddah, Saudi
Arabia that their maternity leaves had been disapproved. 26

Faced with the dilemma of resigning or totally losing their benefits, respondents executed handwritten resignation letters. In
Montassah's and Rouen Ruth's cases, their resignations were executed on Saudia's blank letterheads that Saudia had provided.
These letterheads already had the word "RESIGNATION" typed on the subject portions of their headings when these were handed to
respondents.27

On November 8, 2007, respondents filed a Complaint against Saudia and its officers for illegal dismissal and for underpayment of
salary, overtime pay, premium pay for holiday, rest day, premium, service incentive leave pay, 13th month pay, separation pay,
night shift differentials, medical expense reimbursements, retirement benefits, illegal deduction, lay-over expense and allowances,
moral and exemplary damages, and attorney's fees.28 The case was initially assigned to Labor Arbiter Hermino V. Suelo and
docketed as NLRC NCR Case No. 00-11-12342-07.

Saudia assailed the jurisdiction of the Labor Arbiter.29 It claimed that all the determining points of contact referred to foreign law
and insisted that the Complaint ought to be dismissed on the ground of forum non conveniens.30 It added that respondents had no
cause of action as they resigned voluntarily.31

On December 12, 2008, Executive Labor Arbiter Fatima Jambaro-Franco rendered the Decision32dismissing respondents' Complaint.
The dispositive portion of this Decision reads: c han roblesv irtuallawl ib rary

WHEREFORE, premises' considered, judgment is hereby rendered DISMISSING the instant complaint for lack of
jurisdiction/merit.33 c ralawlaw lib rary

On respondents' appeal, the National Labor Relations Commission's Sixth Division reversed the ruling of Executive Labor Arbiter
Jambaro-Franco. It explained that "[considering that complainants-appellants are OFWs, the Labor Arbiters and the NLRC has [sic]
jurisdiction to hear and decide their complaint for illegal termination." 34 On the matter of forum non conveniens, it noted that there
were no special circumstances that warranted its abstention from exercising jurisdiction. 35 On the issue of whether respondents
were validly dismissed, it held that there was nothing on record to support Saudia's claim that respondents resigned voluntarily.

The dispositive portion of the November 19, 2009 National Labor Relations Commission Decision 36reads: c hanro blesvi rt uallawli bra ry

WHEREFORE, premises considered, judgment is hereby rendered finding the appeal impressed with merit. The respondents-
appellees are hereby directed to pay complainants-appellants the aggregate amount of SR614,001.24 corresponding to their
backwages and separation pay plus ten (10%) percent thereof as attorney's fees. The decision of the Labor Arbiter dated December
12, 2008 is hereby VACATED and SET ASIDE. Attached is the computation prepared by this Commission and made an integral part
of this Decision.37
c ralawlawl ibra ry

In the Resolution dated February 11, 2010,38 the National Labor Relations Commission denied petitioners' Motion for
Reconsideration.

In the June 16, 2011 Decision,39 the Court of Appeals denied petitioners' Rule 65 Petition and modified the Decision of the National
Labor Relations Commission with respect to the award of separation pay and backwages.

The dispositive portion of the Court of Appeals Decision reads: chan roble svi rtual lawlib rary

WHEREFORE, the instant petition is hereby DENIED. The Decision dated November 19, 2009 issued by public respondent, Sixth
Division of the National Labor Relations Commission - National Capital Region is MODIFIED only insofar as the computation of the
award of separation pay and backwages. For greater clarity, petitioners are ordered to pay private respondents separation pay
which shall be computed from private respondents' first day of employment up to the finality of this decision, at the rate of one
month per year of service and backwages which shall be computed from the date the private respondents were illegally terminated
until finality of this decision. Consequently, the ten percent (10%) attorney's fees shall be based on the total amount of the award.
The assailed Decision is affirmed in all other respects.

The labor arbiter is hereby DIRECTED to make a recomputation based on the foregoing.40 c ralawlaw lib rary

In the Resolution dated September 13, 2011,41 the Court of Appeals denied petitioners' Motion for Reconsideration.

Hence, this Appeal was filed.

The issues for resolution are the following:

First, whether the Labor Arbiter and the National Labor Relations Commission may exercise jurisdiction over Saudi Arabian Airlines
and apply Philippine law in adjudicating the present dispute;

Second, whether respondents' voluntarily resigned or were illegally terminated; and

Lastly, whether Brenda J. Betia may be held personally liable along with Saudi Arabian Airlines. chanRo blesvi rtua lLawl ib rary

Summons were validly served on Saudia and jurisdiction over it validly acquired.

There is no doubt that the pleadings and summons were served on Saudia through its counsel. 42 Saudia, however, claims that the
Labor Arbiter and the National Labor Relations Commission had no jurisdiction over it because summons were never served on it
but on "Saudia Manila."43 Referring to itself as "Saudia Jeddah," it claims that "Saudia Jeddah" and not "Saudia Manila" was the
employer of respondents because:

First, "Saudia Manila" was never a party to the Cabin Attendant contracts entered into by respondents;

Second, it was "Saudia Jeddah" that provided the funds to pay for respondents' salaries and benefits; and

Lastly, it was with "Saudia Jeddah" that respondents filed their resignations. 44

Saudia posits that respondents' Complaint was brought against the wrong party because "Saudia Manila," upon which summons
was served, was never the employer of respondents. 45
Saudia is vainly splitting hairs in its effort to absolve itself of liability. Other than its bare allegation, there is no basis for concluding
that "Saudia Jeddah" is distinct from "Saudia Manila."

What is clear is Saudia's statement in its own Petition that what it has is a "Philippine Office . . . located at 4/F Metro House
Building, Sen. Gil J. Puyat Avenue, Makati City."46 Even in the position paper that Saudia submitted to the Labor Arbiter, 47 what
Saudia now refers to as "Saudia Jeddah" was then only referred to as "Saudia Head Office at Jeddah, KSA," 48 while what Saudia
now refers to as "Saudia Manila" was then only referred to as "Saudia's office in Manila." 49

By its own admission, Saudia, while a foreign corporation, has a Philippine office.

Section 3(d) of Republic Act No.. 7042, otherwise known as the Foreign Investments Act of 1991, provides the following: c hanroblesv irt uallawl ibra ry

The phrase "doing business" shall include . . . opening offices, whether called "liaison" offices or branches; . . . and any
other act or acts that imply a continuity of commercial dealings or arrangements and contemplate to that extent the performance of
acts or works, or the exercise of some of the functions normally incident to, and in progressive prosecution of commercial gain or of
the purpose and object of the business organization. (Emphasis supplied)
A plain application of Section 3(d) of the Foreign Investments Act leads to no other conclusion than that Saudia is a foreign
corporation doing business in the Philippines. As such, Saudia may be sued in the Philippines and is subject to the jurisdiction of
Philippine tribunals.

Moreover, since there is no real distinction between "Saudia Jeddah" and "Saudia Manila" — the latter being nothing more than
Saudia's local office — service of summons to Saudia's office in Manila sufficed to vest jurisdiction over Saudia's person in Philippine
tribunals.cha nRoblesvi rt ual Lawlib rary

II

Saudia asserts that Philippine courts and/or tribunals are not in a position to make an intelligent decision as to the law and the
facts. This is because respondents' Cabin Attendant contracts require the application of the laws of Saudi Arabia, rather than those
of the Philippines.50 It claims that the difficulty of ascertaining foreign law calls into operation the principle of forum non conveniens,
thereby rendering improper the exercise of jurisdiction by Philippine tribunals.51

A choice of law governing the validity of contracts or the interpretation of its provisions dees not necessarily imply forum non
conveniens. Choice of law and forum non conveniens are entirely different matters.

Choice of law provisions are an offshoot of the fundamental principle of autonomy of contracts. Article 1306 of the Civil Code firmly
ensconces this: cha nrob lesvi rtua llawlib ra ry

Article 1306. The contracting parties may establish such stipulations, clauses, terms and conditions as they may deem convenient,
provided they are not contrary to law, morals, good customs, public order, or public policy.
In contrast, forum non conveniens is a device akin to the rule against forum shopping. It is designed to frustrate illicit means for
securing advantages and vexing litigants that would otherwise be possible if the venue of litigation (or dispute resolution) were left
entirely to the whim of either party.

Contractual choice of law provisions factor into transnational litigation and dispute resolution in one of or in a combination of four
ways: (1) procedures for settling disputes, e.g., arbitration; (2) forum, i.e., venue; (3) governing law; and (4) basis for
interpretation. Forum non conveniens relates to, but is not subsumed by, the second of these.

Likewise, contractual choice of law is not determinative of jurisdiction. Stipulating on the laws of a given jurisdiction as the
governing law of a contract does not preclude the exercise of jurisdiction by tribunals elsewhere. The reverse is equally true: The
assumption of jurisdiction by tribunals does not ipso factomean that it cannot apply and rule on the basis of the parties' stipulation.
In Hasegawa v. Kitamura:52 ChanRob les Vi rtualaw lib rary

Analytically, 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 V'hich 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. 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. 53 cra lawlawlib ra ry

As various dealings, commercial or otherwise, are facilitated by the progressive ease of communication and travel, persons from
various jurisdictions find themselves transacting with each other. Contracts involving foreign elements are, however, nothing new.
Conflict of laws situations precipitated by disputes and litigation anchored on these contracts are not totally novel.

Transnational transactions entail differing laws on the requirements Q for the validity of the formalities and substantive provisions
of contracts and their interpretation. These transactions inevitably lend themselves to the possibility of various fora for litigation
and dispute resolution. As observed by an eminent expert on transnational law: chan roblesv irtuallaw lib rary

The more jurisdictions having an interest in, or merely even a point of contact with, a transaction or relationship, the greater the
number of potential fora for the resolution of disputes arising out of or related to that transaction or relationship. In a world of
increased mobility, where business and personal transactions transcend national boundaries, the jurisdiction of a number of
different fora may easily be invoked in a single or a set of related disputes. 54 cralaw lawlib rary

Philippine law is definite as to what governs the formal or extrinsic validity of contracts. The first paragraph of Article 17 of the Civil
Code provides that "[t]he forms and solemnities of contracts . . . shall be governed by the laws of the country in which they are
executed"55 (i.e., lex loci celebrationis).

In contrast, there is no statutorily established mode of settling conflict of laws situations on matters pertaining to substantive
content of contracts. It has been noted that three (3) modes have emerged: (1) lex loci contractus or the law of the place of the
making; (2) lex loci solutionis or the law of the place of performance; and (3) lex loci intentionis or the law intended by the
parties.56
Given Saudia's assertions, of particular relevance to resolving the present dispute is lex loci intentionis.

An author observed that Spanish jurists and commentators "favor lex loci intentionis."57 These jurists and commentators proceed
from the Civil Code of Spain, which, like our Civil Code, is silent on what governs the intrinsic validity of contracts, and the same
civil law traditions from which we draw ours.

In this jurisdiction, this court, in Philippine Export and Foreign Loan Guarantee v. V.P. Eusebio Construction, Inc.,58 manifested
preference for allowing the parties to select the law applicable to their contract": cha nrob lesvi rtua llawli bra ry

No conflicts rule on essential validity of contracts is expressly provided for in our laws. The rule followed by most legal systems,
however, is that the intrinsic validity of a contract must be governed by the lex contractus or "proper law of the contract." This is
the law voluntarily agreed upon by the parties (the lex loci voluntatis) or the law intended by them either expressly or implicitly
(the lex loci intentionis). The law selected may be implied from such factors as substantial connection with the transaction, or the
nationality or domicile of the parties. Philippine courts would do well to adopt the first and most basic rule in most legal systems,
namely, to allow the parties to select the law applicable to their contract, subject to the limitation that it is not against the law,
morals, or public policy of the forum and that the chosen law must bear a substantive relationship to the transaction.59(Emphasis in
the original)
Saudia asserts that stipulations set in the Cabin Attendant contracts require the application of the laws of Saudi Arabia. It insists
that the need to comply with these stipulations calls into operation the doctrine of forum non conveniens and, in turn, makes it
necessary for Philippine tribunals to refrain from exercising jurisdiction.

As mentioned, contractual choice of laws factors into transnational litigation in any or a combination of four (4) ways.
Moreover, forum non conveniens relates to one of these: choosing between multiple possible fora.

Nevertheless, the possibility of parallel litigation in multiple fora — along with the host of difficulties it poses — is not unique to
transnational litigation. It is a difficulty that similarly arises in disputes well within the bounds of a singe jurisdiction.

When parallel litigation arises strictly within the context of a single jurisdiction, such rules as those on forum shopping, litis
pendentia, and res judicata come into operation. Thus, in the Philippines, the 1997 Rules on Civil Procedure provide for willful and
deliberate forum shopping as a ground not only for summary dismissal with prejudice but also for citing parties and counsels in
direct contempt, as well as for the imposition of administrative sanctions.60 Likewise, the same rules expressly provide that a party
may seek the dismissal of a Complaint or another pleading asserting a claim on the ground "[t]hat there is another action pending
between the same parties for the same cause," i.e., litis pendentia, or "[t]hat the cause of action is barred by a prior
judgment,"61 i.e., res judicata.

Forum non conveniens, like the rules of forum shopping, litis pendentia, and res judicata, is a means of addressing the problem of
parallel litigation. While the rules of forum shopping, litis pendentia, and res judicata are designed to address the problem of
parallel litigation within a single jurisdiction, forum non conveniens is a means devised to address parallel litigation arising in
multiple jurisdictions.

Forum non conveniens literally translates to "the forum is inconvenient." 62 It is a concept in private international law and was
devised to combat the "less than honorable" reasons and excuses that litigants use to secure procedural advantages, annoy and
harass defendants, avoid overcrowded dockets, and select a "friendlier" venue. 63 Thus, the doctrine of forum non
conveniens addresses the same rationale that the rule against forum shopping does, albeit on a multijurisdictional scale.

Forum non conveniens, like res judicata,64 is a concept originating in common law.65 However, unlike the rule on res judicata, as
well as those on litis pendentia and forum shopping, forum non conveniens finds no textual anchor, whether in statute or in
procedural rules, in our civil law system. Nevertheless, jurisprudence has applied forum non conveniens as basis for a court to
decline its exercise of jurisdiction.66

Forum non conveniens is soundly applied not only to address parallel litigation and undermine a litigant's capacity to vex and secure
undue advantages by engaging in forum shopping on an international scale. It is also grounded on principles of comity and judicial
efficiency.

Consistent with the principle of comity, a tribunal's desistance in exercising jurisdiction on account of forum non conveniens is a
deferential gesture to the tribunals of another sovereign. It is a measure that prevents the former's having to interfere in affairs
which are better and more competently addressed by the latter. Further, forum non conveniens entails a recognition not only that
tribunals elsewhere are better suited to rule on and resolve a controversy, but also, that these tribunals are better positioned to
enforce judgments and, ultimately, to dispense justice. Forum non conveniens prevents the embarrassment of an awkward
situation where a tribunal is rendered incompetent in the face of the greater capability — both analytical and practical — of a
tribunal in another jurisdiction.

The wisdom of avoiding conflicting and unenforceable judgments is as much a matter of efficiency and economy as it is a matter of
international courtesy. A court would effectively be neutering itself if it insists on adjudicating a controversy when it knows full well
that it is in no position to enforce its judgment. Doing so is not only an exercise in futility; it is an act of frivolity. It clogs the
dockets of a.tribunal and leaves it to waste its efforts on affairs, which, given transnational exigencies, will be reduced to mere
academic, if not trivial, exercises.

Accordingly, under the doctrine of forum non conveniens, "a court, in conflicts of law 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 remedie s
elsewhere."67 In Puyat v. Zabarte,68 this court recognized the following situations as among those that may warrant a court's
desistance from exercising jurisdiction: cha nro blesvi rtua llawli bra ry

1) The belief that the matter can be better tried and decided elsewhere,
either because the main aspects of the case transpired in a foreign
 jurisdiction or the material witnesses have their residence there;
2) The belief that the non-resident plaintiff sought the forum[,] a practice
known as forum shopping[,] merely to secure procedural advantages or
to convey or harass the defendant;
3) The unwillingness to extend local judicial facilities to non residents or
aliens when the docket may already be overcrowded;
4) The inadequacy of the local judicial machinery for effectuating the right
sought to be maintained; and
5) The difficulty of ascertaining foreign law.69
In Bank of America, NT&SA, Bank of America International, Ltd. v. Court of Appeals,70 this court underscored that a Philippine court
may properly assume jurisdiction over a case if it chooses to do so to the extent: "(1) that the Philippine Court is one to which the
parties may conveniently resort to; (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 power to enforce its decision." 71

The use of the word "may" (i.e., "may refuse impositions on its jurisdiction"72) in the decisions shows that the matter of jurisdiction
rests on the sound discretion of a court. Neither the mere invocation of forum non conveniens nor the averment of foreign elements
operates to automatically divest a court of jurisdiction. Rather, a court should renounce jurisdiction only "after 'vital facts are
established, to determine whether special circumstances' require the court's desistance." 73 As the propriety of applying forum non
conveniens is contingent on a factual determination, it is, therefore, a matter of defense.74

The second sentence of Rule 9, Section 1 of the 1997 Rules of Civil Procedure is exclusive in its recital of the grounds for dismissal
that are exempt from the omnibus motion rule: (1) lack of jurisdiction over the subject matter; (2) litis pendentia; (3) res judicata;
and (4) prescription. Moreover, dismissal on account offorum non conveniens is a fundamentally discretionary matter. It is,
therefore, not a matter for a defendant to foist upon the court at his or her own convenience; rather, it must be pleaded at the
earliest possible opportunity.

On the matter of pleading forum non conveniens, we state the rule, thus: Forum non conveniens must not only be clearly pleaded
as a ground for dismissal; it must be pleaded as such at the earliest possible opportunity. Otherwise, it shall be deemed waived.

This court notes that in Hasegawa,76 this court stated that forum non conveniens is not a ground for a motion to dismiss. The
factual ambience of this case however does not squarely raise the viability of this doctrine. Until the opportunity comes to review
the use of motions to dismiss for parallel litigation, Hasegawa remains existing doctrine.

Consistent with forum non conveniens as fundamentally a factual matter, it is imperative that it proceed from & factually
established basis. It would be improper to dismiss an action pursuant to forum non conveniens based merely on a perceived, likely,
or hypothetical multiplicity of fora. Thus, a defendant must also plead and show that a prior suit has, in fact, been brought in
another jurisdiction.

The existence of a prior suit makes real the vexation engendered by duplicitous litigation, the embarrassment of intruding into the
affairs of another sovereign, and the squandering of judicial efforts in resolving a dispute already lodged and better resolved
elsewhere. As has been noted: chan rob lesvi rtual lawlib rary

A case will not be stayed o dismissed on [forum] non conveniens grounds unless the plaintiff is shown to have an available
alternative forum elsewhere. On this, the moving party bears the burden of proof.

A number of factors affect the assessment of an alternative forum's adequacy. The statute of limitations abroad may have run, of
the foreign court may lack either subject matter or personal jurisdiction over the defendant. . . . Occasionally, doubts will be raised
as to the integrity or impartiality of the foreign court (based, for example, on suspicions of corruption or bias in favor of local
nationals), as to the fairness of its judicial procedures, or as to is operational efficiency (due, for example, to lack of resources,
congestion and delay, or interfering circumstances such as a civil unrest). In one noted case, [it was found] that delays of 'up to a
quarter of a century' rendered the foreign forum... inadequate for these purposes. 77 c ralawlawli bra ry

We deem it more appropriate and in the greater interest of prudence that a defendant not only allege supposed dangerous
tendencies in litigating in this jurisdiction; the defendant must also show that such danger is real and present in that litigation or
dispute resolution has commenced in another jurisdiction and that a foreign tribunal has chosen to exercise jurisdiction.

III

Forum non conveniens finds no application and does not operate to divest Philippine tribunals of jurisdiction and to require the
application of foreign law.

Saudia invokes forum non conveniens to supposedly effectuate the stipulations of the Cabin Attendant contracts that require the
application of the laws of Saudi Arabia.

Forum non conveniens relates to forum, not to the choice of governing law. Thai forum non conveniensmay ultimately result in the
application of foreign law is merely an incident of its application. In this strict sense, forum non conveniens is not applicable. It is
not the primarily pivotal consideration in this case.

In any case, even a further consideration of the applicability of forum non conveniens on the incidental matter of the law governing
respondents' relation with Saudia leads to the conclusion that it is improper for Philippine tribunals to divest themselves of
jurisdiction.
Any evaluation of the propriety of contracting parties' choice of a forum and'its incidents must grapple with two (2) considerations:
first, the availability and adequacy of recourse to a foreign tribunal; and second, the question of where, as between the forum court
and a foreign court, the balance of interests inhering in a dispute weighs more heavily.

The first is a pragmatic matter. It relates to the viability of ceding jurisdiction to a foreign tribunal and can be resolved by
juxtaposing the competencies and practical circumstances of the tribunals in alternative fora. Exigencies, like the statute of
limitations, capacity to enforce orders and judgments, access to records, requirements for the acquisition of jurisdiction, and even
questions relating to the integrity of foreign courts, may render undesirable or even totally unfeasible recourse to a foreign court.
As mentioned, we consider it in the greater interest of prudence that a defendant show, in pleading forum non conveniens, that
litigation has commenced in another jurisdiction and that a foieign tribunal has, in fact, chosen to exercise jurisdiction.

Two (2) factors weigh into a court's appraisal of the balance of interests inhering in a dispute: first, the vinculum which the parties
and their relation have to a given jurisdiction; and second, the public interest that must animate a tribunal, in its capacity as an
agent of the sovereign, in choosing to assume or decline jurisdiction. The first is more concerned with the parties, their personal
circumstances, and private interests; the second concerns itself with the state and the greater social order.

In considering the vinculum, a court must look into the preponderance of linkages which the parties and their transaction may have
to either jurisdiction. In this respect, factors, such as the parties' respective nationalities and places of negotiation, execution,
performance, engagement or deployment, come into play.

In considering public interest, a court proceeds with a consciousness that it is an organ of the state. It must, thus, determine if the
interests of the sovereign (which acts through it) are outweighed by those of the alternative jurisdiction. In this respect, the court
delves into a consideration of public policy. Should it find that public interest weighs more heavily in favor of its assumption of
jurisdiction, it should proceed in adjudicating the dispute, any doubt or .contrary view arising from the preponderance of linkages
notwithstanding.

Our law on contracts recognizes the validity of contractual choice of law provisions. Where such provisions exist, Philippine
tribunals, acting as the forum court, generally defer to the parties' articulated choice.

This is consistent with the fundamental principle of autonomy of contracts. Article 1306 of the Civ:l Code expressly provides that
"[t]he contracting parties may establish 'such stipulations, clauses, terms and conditions as they may deem
convenient."78 Nevertheless, while a Philippine tribunal (acting as the forum court) is called upon to respect the parties' choice of
governing law, such respect must not be so permissive as to lose sight of considerations of law, morals, good customs, public order,
or public policy that underlie the contract central to the controversy.

Specifically with respect to public policy, in Pakistan International Airlines Corporation v. Ople,79 this court explained that: chan roble svirtual lawlib rary

counter-balancing the principle of autonomy of contracting parties is the equally general rule that provisions of applicable law,
especially provisions relating to matters affected with public policy, are deemed written inta the contract. Put a little differently, the
governing principle is that parties may not contract away applicable provisions of law especially peremptory provisions dealing with
matters heavily impressed with public interest.80(Emphasis supplied)
Article II, Section 14 of the 1987 Constitution provides that "[t]he State ... shall ensure the fundamental equality before the law of
women and men." Contrasted with Article II, Section 1 of the 1987 Constitution's statement that "[n]o person shall ... be denied
the equal protection of the laws," Article II, Section 14 exhorts the State to "ensure." This does not only mean that the Philippines
shall not countenance nor lend legal recognition and approbation to measures that discriminate on the basis of one's being male or
female. It imposes an obligation to actively engage in securing the fundamental equality of men and women.

The Convention on the Elimination of all Forms of Discrimination against Women (CEDAW), signed and ratified by the Philippines on
July 15, 1980, and on August 5, 1981, respectively,81 is part of the law of the land. In view of the widespread signing and
ratification of, as well as adherence (in practice) to it by states, it may even be said that many provisions of the CEDAW may have
become customary international law. The CEDAW gives effect to the Constitution's policy statement in Article II, Section 14. Article
I of the CEDAW defines "discrimination against women" as: cha nro blesvi rt uallawli bra ry

any distinction, exclusion or restriction made on the basis of sex which has the effect or purpose of impairing or nullifying the
recognition, enjoyment or exercise by women, irrespective of their marital status, on a basis of equality of men and women, of
human rights and fundamental freedoms in the political, economic, social, cultural, civil or any other field.82 cralaw lawlib rary

The constitutional exhortation to ensure fundamental equality, as illumined by its enabling law, the CEDAW, must inform and
animate all the actions of all personalities acting on behalf of the State. It is, therefore, the bounden duty of this court, in rendering
judgment on the disputes brought before it, to ensure that no discrimination is heaped upon women on the mere basis of their
being women. This is a point so basic and central that all our discussions and pronouncements — regardless of whatever averments
there may be of foreign law — must proceed from this premise.

So informed and animated, we emphasize the glaringly discriminatory nature of Saudia's policy. As argued by respondents,
Saudia's policy entails the termination of employment of flight attendants who become pregnant. At the risk of stating the
obvious, pregnancy is an occurrence that pertains specifically to women. Saudia's policy excludes from and restricts employment on
the basis of no other consideration but sex.

We do not lose sight of the reality that pregnancy does present physical limitations that may render difficult the performance of
functions associated with being a flight attendant. Nevertheless, it would be the height of iniquity to view pregnancy as a disability
so permanent and immutable that, it must entail the termination of one's employment. It is clear to us that any individual,
regardless of gender, may be subject to exigencies that limit the performance of functions. However, we fail to appreciate how
pregnancy could be such an impairing occurrence that it leaves no other recourse but the complete termination of the means
through which a woman earns a living.

Apart from the constitutional policy on the fundamental equality before the law of men and women, it is settled that contracts
relating to labor and employment are impressed with public interest. Article 1700 of the Civil Code provides that "[t]he relation
between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to
the common good."

Consistent with this, this court's pronouncements in Pakistan International Airlines Corporation83 are clear and unmistakable: chan roblesv irtuallawl ib rary

Petitioner PIA cannot take refuge in paragraph 10 of its employment agreement which specifies, firstly, the law of Pakistan as the
applicable law of the agreement, and, secondly, lays the venue for settlement of any dispute arising out of or in connection with the
agreement "only [in] courts of Karachi, Pakistan". The first clause of paragraph 10 cannot be invoked to prevent the application of
Philippine labor laws and'regulations to the subject matter of this case, i.e., the employer-employee relationship between petitioner
PIA and private respondents. We have already pointed out that the relationship is much affected with public interest and that the
otherwise applicable Philippine laws and regulations cannot be rendered illusory by the parties agreeing upon some other law to
govern their relationship. . . . Under these circumstances, paragraph 10 of the employment agreement cannot be given effect so as
to oust Philippine agencies and courts of the jurisdiction vested upon them by Philippine law. 84 (Emphasis supplied)
As the present dispute relates to (what the respondents allege to be) the illegal termination of respondents' employment, this case
is immutably a matter of public interest and public policy. Consistent with clear pronouncements in law and jurisprudence,
Philippine laws properly find application in and govern this case. 'Moreover, as this premise for Saudia's insistence on the
application forum non conveniens has been shattered, it follows that Philippine tribunals may properly assume jurisdiction over the
present controversy. Philippine jurisprudence provides ample illustrations of when a court's renunciation of jurisdiction on account
of forum non conveniens is proper or improper.'

In Philsec Investment Corporation v. Court of Appeals,85 this court noted that the trial court failed to consider that one of the
plaintiffs was a domestic corporation, that one of the defendants was a Filipino, and that it was the extinguishment of the latter's
debt that was the object of the transaction subject of the litigation. Thus, this court held, among others, that the trial court's refusal
to assume jurisdiction was not justified by forum non conveniens and remanded the case to the trial court.

In Raytheon International, Inc. v. Rouzie, Jr.,86 this court sustained the trial court's assumption of jurisdiction considering that the
trial court could properly enforce judgment on the petitioner which was a foreign corporation licensed to do business in the
Philippines.

In Pioneer International, Ltd. v. Guadiz, Jr.,87 this court found no reason to disturb the trial court's assumption of jurisdiction over a
case in which, as noted by the trial court, "it is more convenient to hear and decide the case in the Philippines because Todaro [the
plaintiff] resides in the Philippines and the contract allegedly breached involve[d] employment in the Philippines." 88

In Pacific Consultants International Asia, Inc. v. Schonfeld,89 this court held that the fact that the complainant in an illegal dismissal
case was a Canadian citizen and a repatriate did not warrant the application of forum non conveniens considering that: (1) the
Labor Code does not include forum non conveniens as a ground for the dismissal of a complaint for illegal dismissal; (2) the
propriety of dismissing a case based on forum non conveniens requires a factual determination; and (3) the requisites for
assumption of jurisdiction as laid out in Bank of America, NT&SA90 were all satisfied.

In contrast, this court ruled in The Manila Hotel Corp. v. National Labor Relations Commission 91 that the National Labor Relations Q
Commission was a seriously inconvenient forum. In that case, private respondent Marcelo G. Santos was working in the Sultanate
of Oman when he received a letter from Palace Hotel recruiting him for employment in Beijing, China. Santos accepted the offer.
Subsequently, however, he was released from employment supposedly due to business reverses arising from political upheavals in
China (i.e., the Tiananmen Square incidents of 1989). Santos later filed a Complaint for illegal dismissal impleading Palace Hotel's
General Manager, Mr. Gerhard Schmidt, the Manila Hotel International Company Ltd. (which was, responsible for training Palace
Hotel's personnel and staff), and the Manila Hotel Corporation (which owned 50% of Manila Hotel International Company Ltd.'s
capital stock).

In ruling against the National Labor Relations Commission's exercise of jurisdiction, this court noted that the main aspects of the
case transpired in two (2) foreign jurisdictions, Oman and China, and that the case involved purely foreign elements. Specifically,
Santos was directly hired by a foreign employer through correspondence sent to Oman. Also, the proper defendants were neither
Philippine nationals nor engaged in business in the Philippines, while the main witnesses were not residents of the Philippines.
Likewise, this court noted that the National Labor Relations Commission was in no position to conduct the following: first, determine
the law governing the employment contract, as it was entered into in foreign soil; second, determine the facts, as Santos'
employment was terminated in Beijing; and third, enforce its judgment, since Santos' employer, Palace Hotel, was incorporated
under the laws of China and was not even served with summons.

Contrary to Manila Hotel, the case now before us does not entail a preponderance of linkages that favor a foreign jurisdiction.

Here, the circumstances of the parties and their relation do not approximate the circumstances enumerated in Puyat,92 which this
court recognized as possibly justifying the desistance of Philippine tribunals from exercising jurisdiction.

First, there is no basis for concluding that the case can be more conveniently tried elsewhere. As established earlier, Saudia is doing
business in the Philippines. For their part, all four (4) respondents are Filipino citizens maintaining residence in the Philippines and,
apart from their previous employment with Saudia, have no other connection to the Kingdom of Saudi Arabia. It would even be to
respondents' inconvenience if this case were to be tried elsewhere.

Second, the records are bereft of any indication that respondents filed their Complaint in an effort to engage in forum shopping or
to vex and inconvenience Saudia.

Third, there is no indication of "unwillingness to extend local judicial facilities to non-residents or aliens."93 That Saudia has
managed to bring the present controversy all the way to this court proves this.

Fourth, it cannot be said that the local judicial machinery is inadequate for effectuating the right sought to be maintained.
Summons was properly served on Saudia and jurisdiction over its person was validly acquired.

Lastly, there is not even room for considering foreign law. Philippine law properly governs the present dispute.
As the question of applicable law has been settled, the supposed difficulty of ascertaining foreign law (which requires the application
of forum non conveniens) provides no insurmountable inconvenience or special circumstance that will justify depriving Philippine
tribunals of jurisdiction.

Even if we were to assume, for the sake of discussion, that it is the laws of Saudi Arabia which should apply, it does not follow that
Philippine tribunals should refrain from exercising jurisdiction. To. recall our pronouncements in Puyat, 94 as well as in Bank of
America, NT&SA,95 it is not so much the mere applicability of foreign law which calls into operation forum non conveniens. Rather,
what justifies a court's desistance from exercising jurisdiction is "[t]he difficulty of ascertaining foreign law"96 or the inability of a
"Philippine Court to make an intelligent decision as to the law[.]" 97

Consistent with lex loci intentionis, to the extent that it is proper and practicable (i.e., "to make an intelligent decision"98),
Philippine tribunals may apply the foreign law selected by the parties. In fact, (albeit without meaning to make a pronouncement on
the accuracy and reliability of respondents' citation) in this case, respondents themselves have made averments as to the laws of
Saudi Arabia. In their Comment, respondents write: chan rob lesvi rtua llawlib ra ry

Under the Labor Laws of Saudi Arabia and the Philippines[,] it is illegal and unlawful to terminate the employment of any woman by
virtue of pregnancy. The law in Saudi Arabia is even more harsh and strict [sic] in that no employer can terminate the employment
of a female worker or give her a warning of the same while on Maternity Leave, the specific provision of Saudi Labor Laws on the
matter is hereto quoted as follows: chan roble svi rtual lawlib rary

"An employer may not terminate the employment of a female worker or give her a warning of the same while on maternity leave."
(Article 155, Labor Law of the Kingdom of Saudi Arabia, Royal Decree No. M/51.) 99 c ralawlawl ibra ry

All told, the considerations for assumption of jurisdiction by Philippine tribunals as outlined in Bank of America, NT&SA100 have been
satisfied. First, all the parties are based in the Philippines and all the material incidents transpired in this jurisdiction. Thus, the
parties may conveniently seek relief from Philippine tribunals. Second, Philippine tribunals are in a position to make an intelligent
decision as to the law and the facts. Third, Philippine tribunals are in a position to enforce their decisions. There is no compelling
basis for ceding jurisdiction to a foreign tribunal. Quite the contrary, the immense public policy considerations attendant to this case
behoove Philippine tribunals to not shy away from their duty to rule on the case. cha nRoblesv irt ual Lawlib rary

IV

Respondents were illegally terminated.

In Bilbao v. Saudi Arabian Airlines,101 this court defined voluntary resignation as "the voluntary act of an employee who is in a
situation where one believes that personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no
other choice but to dissociate oneself from employment. It is a formal pronouncement or relinquishment of an office, with the
intention of relinquishing the office accompanied by the act of relinquishment."102 Thus, essential to the act of resignation is
voluntariness. It must be the result of an employee's exercise of his or her own will.

In the same case of Bilbao, this court advanced a means for determining whether an employee resigned voluntarily: chan rob lesvi rtua llawlib ra ry

As the intent to relinquish must concur with the overt act of relinquishment, the acts of the employee before and after the alleged
resignation must be considered in determining whether he or she, in fact, intended, to sever his or her employment.103 (Emphasis
supplied)
On the other hand, constructive dismissal has been defined as "cessation of work because 'continued employment is rendered
impossible, unreasonable or unlikely, as an offer involving a demotion in rank or a diminution in pay' and other benefits." 104

In Penaflor v. Outdoor Clothing Manufacturing Corporation,105 constructive dismissal has been described as tantamount to
"involuntarily [sic] resignation due to the harsh, hostile, and unfavorable conditions set by the employer."106 In the same case, it
was noted that "[t]he gauge for constructive dismissal is whether a reasonable person in the employee's position would feel
compelled to give up his employment under the prevailing circumstances." 107

Applying the cited standards on resignation and constructive dismissal, it is clear that respondents were constructively dismissed.
Hence, their termination was illegal.

The termination of respondents' employment happened when they were pregnant and expecting to incur costs on account of child
delivery and infant rearing. As noted by the Court of Appeals, pregnancy is a time when they need employment to sustain their
families.108 Indeed, it goes against normal and reasonable human behavior to abandon one's livelihood in a time of great financial
need.

It is clear that respondents intended to remain employed with Saudia. All they did was avail of their maternity leaves. Evidently, the
very nature of a maternity leave means that a pregnant employee will not report for work only temporarily and that she will resume
the performance of her duties as soon as the leave allowance expires.

It is also clear that respondents exerted all efforts to' remain employed with Saudia. Each of them repeatedly filed appeal letters
(as much as five [5] letters in the case of Rebesencio 109) asking Saudia to reconsider the ultimatum that they resign or be
terminated along with the forfeiture of their benefits. Some of them even went to Saudia's office to personally seek
reconsideration.110

Respondents also adduced a copy of the "Unified Employment Contract for Female Cabin Attendants." 111This contract deemed void
the employment of a flight attendant who becomes pregnant and threatened termination due to lack of medical fitness. 112 The
threat of termination (and the forfeiture of benefits that it entailed) is enough to compel a reasonable person in respondents'
position to give up his or her employment.

Saudia draws attention to how respondents' resignation letters were supposedly made in their own handwriting. This minutia fails to
surmount all the other indications negating any voluntariness on respondents' part. If at all, these same resignation letters are
proof of how any supposed resignation did not arise from respondents' own initiative. As earlier pointed out, respondents'
resignations were executed on Saudia's blank letterheads that Saudia had provided. These letterheads already had the word
"RESIGNATION" typed on the subject portion of their respective headings when these were handed to respondents.113 ChanRoblesVirtualawlib rary

"In termination cases, the burden of proving just or valid cause for dismissing an employee rests on the employer." 114 In this case,
Saudia makes much of how respondents supposedly completed their exit interviews, executed quitclaims, received their separation
pay, and took more than a year to file their Complaint.115 If at all, however, these circumstances prove only the fact of their
occurrence, nothing more. The voluntariness of respondents' departure from Saudia is non sequitur.

Mere compliance with standard procedures or processes, such as the completion of their exit interviews, neither negates
compulsion nor indicates voluntariness.

As with respondent's resignation letters, their exit interview forms even support their claim of illegal dismissal and militates against
Saudia's arguments. These exit interview forms, as reproduced by Saudia in its own Petition, confirms the unfavorable conditions as
regards respondents' maternity leaves. Ma. Jopette's and Loraine's exit interview forms are particularly telling: chan rob lesvi rtual lawlib rary

a. From Ma. Jopette's exit interview form:

3. In what respects has the job met or failed to meet your expectations?

THE SUDDEN TWIST OF DECISION REGARDING THE MATERNITY LEAVE.116

b. From Loraine's exit interview form:

1. What are your main reasons for leaving Saudia? What company are you joining?

xxx xxx xxx

Others

CHANGING POLICIES REGARDING MATERNITY LEAVE (PREGNANCY) 117

As to respondents' quitclaims, in Phil. Employ Services and Resources, Inc. v. Paramio,118 this court noted that "[i]f (a) there is
clear proof that the waiver was wangled from an unsuspecting or gullible person; or (b) the terms of the settlement are
unconscionable, and on their face invalid, such quitclaims must be struck down as invalid or illegal." 119 Respondents executed their
quitclaims after having been unfairly given an ultimatum to resign or be terminated (and forfeit their benefits). c hanRoble svirtual Lawlib ra ry

Having been illegally and unjustly dismissed, respondents are entitled to full backwages and benefits from the time of their
termination until the finality of this Decision. They are likewise entitled to separation pay in the amount of one (1) month's salary
for every year of service until the fmality of this Decision, with a fraction of a year of at least six (6) months being counted as one
(1) whole year.

Moreover, "[m]oral damages are awarded in termination cases where the employee's dismissal was attended by bad faith, malice or
fraud, or where it constitutes an act oppressive to labor, or where it was done in a manner contrary to morals, good customs or
public policy."120 In this case, Saudia terminated respondents' employment in a manner that is patently discriminatory and running
afoul of the public interest that underlies employer-employee relationships. As such, respondents are entitled to moral damages.

To provide an "example or correction for the public good" 121 as against such discriminatory and callous schemes, respondents are
likewise entitled to exemplary damages.

In a long line of cases, this court awarded exemplary damages to illegally dismissed employees whose "dismissal[s were] effected
in a wanton, oppressive or malevolent manner." 122 This court has awarded exemplary damages to employees who were terminated
on such frivolous, arbitrary, and unjust grounds as membership in or involvement with labor unions, 123 injuries sustained in the
course of employment,124development of a medical condition due to the employer's own violation of the employment
contract,125and lodging of a Complaint against the employer.126 Exemplary damages were also awarded to employees who were
deemed illegally dismissed by an employer in an attempt to evade compliance with statutorily established employee
benefits.127 Likewise, employees dismissed for supposedly just causes, but in violation of due process requirements, were awarded
exemplary damages.128

These examples pale in comparison to the present controversy. Stripped of all unnecessary complexities, respondents were
dismissed for no other reason than simply that they were pregnant. This is as wanton, oppressive, and tainted with bad faith as any
reason for termination of employment can be. This is no ordinary case of illegal dismissal. This is a case of manifest gender
discrimination. It is an affront not only to our statutes and policies on employees' security of tenure, but more so, to the
Constitution's dictum of fundamental equality between men and women. 129

The award of exemplary damages is, therefore, warranted, not only to remind employers of the need to adhere to the requirements
of procedural and substantive due process in termination of employment, but more importantly, to demonstrate that gender
discrimination should in no case be countenanced.

Having been compelled to litigate to seek reliefs for their illegal and unjust dismissal, respondents are likewise entitled to attorney's
fees in the amount of 10% of the total monetary award.130

VI

Petitioner Brenda J. Betia may not be held liable.

A corporation has a personality separate and distinct from those of the persons composing it. Thus, as a rule, corporate directors
and officers are not liable for the illegal termination of a corporation's employees. It is only when they acted in bad faith or with
malice that they become solidarity liable with the corporation. 131

In Ever Electrical Manufacturing, Inc. (EEMI) v. Samahang Manggagawa ng Ever Electrical,132 this court clarified that "[b]ad faith
does not connote bad judgment or negligence; it imports a dishonest purpose or some moral obliquity and conscious doing of
wrong; it means breach of a known duty through some motive or interest or ill will; it partakes of the nature of fraud." 133

Respondents have not produced proof to show that Brenda J. Betia acted in bad faith or with malice as regards their termination.
Thus, she may not be held solidarity liable with Saudia. cral awred

WHEREFORE, with the MODIFICATIONS that first, petitioner Brenda J. Betia is not solidarity liable with petitioner Saudi Arabian
Airlines, and second, that petitioner Saudi Arabian Airlines is liable for moral and exemplary damages. The June 16, 2011 Decision
and the September 13, 2011 Resolution of the Court of Appeals in CA-G.R. SP. No. 113006 are hereby AFFIRMED in all other
respects. Accordingly, petitioner Saudi Arabian Airlines is ordered to pay respondents:

(1) Full backwages and all other benefits computed from the respective
dates in which each of the respondents were illegally terminated until
the finality of this Decision;
(2) Separation pay computed from the respective dates in which each of the
respondents commenced employment until the finality of this Decision at
the rate of one (1) month's salary for every year of service, with a
fraction of a year of at least six (6) months being counted as one (1)
whole year;
(3) Moral damages in the amount of P100,000.00 per respondent;
(4) Exemplary damages in the amount of P200,000.00 per respondent; and
(5) Attorney's fees equivalent to 10% of the total award.
Interest of 6% per annum shall likewise be imposed on the total judgment award from the finality of this Decision until full
satisfaction thereof.

This case is REMANDED to the Labor Arbiter to make a detailed computation of the amounts due to respondents which petitioner
Saudi Arabian Airlines should pay without delay.

SO ORDERED. chan roble svi rtual lawlib rary