Topic Content

COL Basic Concepts

Significance, definition, elements, and functions (Saudi Arabian Airlines v. CA,

122191, 10/8/98)

Significance – (Purpose)

Benito:

Harmonizes the laws of several states whenever a conflicts of law situation exits.

Paras:

The subject is important in order:

(a) To adjust conflicting rights in international, mercantile and corporate transactions; and

(b) To solve personal, family, property, and successional, contractual problems, possessed of
facts or elements operating in two or more states.

Definition

Paras:

Conflict of laws (or private international law)" is that part of the municipal law of a state which
directs its courts and administrative agencies, when confronted with a legal problem involving a
foreign element, whether or not they should apply a foreign law or foreign laws.

Benito:

It comprehends laws regulating private interactions across national frontiers. It deals with conflict
of laws among the laws of 2 or more states and necessitates a determination of which municipal
law applies to case.

Elements

4 elements:

1. Conflict of laws is part of the municipal law of a state

And precisely because the subject is “part of the municipal law,” it is NOT international in
character. It is however given the appellation of INTERNATIONAL LAW because of the
presence of a FOREIGN element in a given problem.

2. There is a directive to courts and administrative agencies

It is the judicial tribunals of a country that ultimately are called upon to decide or resolve
“conflicts” problems.

3. There is a legal problem involving a foreign element

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 Foreign element is the most important component of a conflicts of law problem. It is
anything which is not domestic and has a foreign component to it.

It is a factual situation that cuts across territorial lines and is affected by the diverse laws
of 2 or more states. (Saudi Arabian Airlines v. CA)

4. There is either an application or non-application of a foreign law or foreign laws

The solution will have to be found in the application of either the LOCAL law or FOREIGN
law.

When effect is given to a foreign law in any territory, it is only because the municipal law
of that state temporarily abdicates its supreme authority in favor of the foreign law, which
for the time being, with reference to that particular matter, becomes itself, by will of that
state, its municipal law.

Functions:

The three-fold functions of Conflict of Laws are:

(1) To prescribe the conditions under which the court is competent to entertain such a suit
(JURISDICTION)

(2) To determine for each class of cases the particular territorial system of law by reference to
which the rights of the parties must be ascertained; (CHOICE OF LAW)

(3) To specify the circumstances in which a foreign judgment can be recognized as decisive of
the question in dispute (APPLICABILITY OF A FOREIGN JUDGMENT)

Note: A conflict of laws problem is presented whenever a legal controversy arises in which there
is a foreign element. It comes into being because of the variance in the municipal laws of the
different states.

II. Sources (Paras)

Direct Sources Indirect Sources

Natural and moral law (rule of human
Constitution
conduct)
Codifications Works of writers (legal scholars)
Special laws
Treaties and conventions
Judicial decisions
International customs

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III. COL v. PIL (Paras and Benito)

Public International Law Private International Law

Basis
(Law of Nations) (Conflict of Law)
Nature International in character Municipal in character
Sovereign states and international
Persons involved Private individuals
organizations
Transactions Transactions are private ones Transactions which generally affect
involved between private individuals public interest
Remedies may be peaceful or
forcible.
Peaceful – diplomatic negotiation,
Remedies or
Resort to municipal tribunals mediation, inquiry, and conciliation,
sanctions
arbitration
Forcible – severance of diplomatic
relations, reprisals, embargo, etc
International conventions,
international customs, general
Source Domestic and municipal laws
principles of law recognized by
civilized nations, etc

IV. Phases in Conflicts Resolution (Benito)

1. Jurisdiction – concerns the authority of a court of law to take cognizance of a case

Where can or should litigation be initiated?

2. Choice of law – refers to the applicable law to the problem

Which law will the court apply?

3. Recognition and Enforcement – concerns the enforcement of foreign laws and

judgments in another jurisdiction

Where can the resulting judgment be enforced?

Note: These phases are important in determining the applicable theories of law as well as the
defenses available thereto. The three phases are separate from each other and a defense in one
phase is not a defense in another phase.

Example: Lex loci celebrationis & lex loci contractus – defense under phase 2 (choice of law) but
not in phase 1 (jurisdiction) and Forum non conveniens in a defense under phase 1 but not in
phase 2.

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V. Jurisdiction (Paras)

Definition: Authority of a tribunal to hear and decide a case

Complete jurisdiction: includes not only the power to hear and determine a case, but also the
power to enforce any judgment it may render thereon.

Kind of jurisdiction:

1) Jurisdiction over the subject matter – conferred by law

Authority of a court to hear and decide cases of the general class to which the proceedings
in question belong.

2) Jurisdiction over the person (over the plaintiff and the defendant) – acquired either by
voluntary appearance or personal or substituted service of summons

Power of the court to render a judgment that will be binding on the parties involved.

Note: Continuing Jurisdiction. Even if the defendant leaves the state of the forum prior
to the final determination of the suits, the jurisdiction over him that had been previously
acquired continues.

3) Jurisdiction over the res (if involves property) – acquired by coercive seizure by
attachment proceedings

Three options for the disposition of a conflicts case: (Hasegawa v Kitamura)

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 (lex fori)

3) Assume jurisdiction over the case and apply the law of some other State or States (lex
causae)

Forum non conveniens (Benito)

- Literally means forum is not convenient

- It is a means devised in addressing parallel litigation in multiple jurisdiction

- Usually interposed by way of a motion to dismiss

- Must be clearly pleaded as a ground for dismissal at the earliest possible opportunity

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Instances where a court may desist from exercising jurisdiction:

1. Belief that the matter can be better tried and decided elsewhere, whether because the main
aspects of the case transpired in a foreign jurisdiction or the material witnesses have their
residence there

2. 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. Unwillingness to extend local judicial facilities to nonresidents or aliens when the docket may
already be overcrowded

4. Inadequacy of the local judicial machinery for effectuating the right sought to be maintained

5. Difficulty of ascertaining foreign law

Three factors to take into account, Principle of Effectiveness (not sure)

Three-step analysis in Iragorri v. United Techs. Corp:

1) Determine the degree of deference to give the plaintiff’s choice of forum

2) Determine whether an adequate forum exists

3) Balance the private interests of the parties against any public interests at stake

Litis pendencia – another ground for dismissal

-another action is pending between the same parties for the same cause

Another ground – res judicata – the cause of action is barred by a prior judgment

Cases: The Manila Hotel Corp. v. NLRC (120077, 10/13/00), Philsec Investment v. CA (1997),
Puyat v. Zabarte, 141536, 2/26/01), Bank of America v. CA (120135, 3/31/03), Saudi Arabian
Airlines v. Rebesencio (198587, 1/14/15), In re Union Carbide 634F. Supp. 842 (SDNY 1886), 1st
Phil Intl Bank v. CA (1996), Wing On Co. v. Syyap (1967), Heine v. NY Insurance Co. (45 F2d
426 (1940)

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Three instances when courts are constrained to apply lex fori (internal or domestic law) –
Paras

(1) when the law of the forum expressly provides for the application of the internal law

Ex. ARTICLE 16, NCC. Real property as well as personal property is subject to the law of the
country where it is situated.

However, intestate and testamentary successions, both with respect to the order of
succession and to the amount of successional rights and to the intrinsic validity of
testamentary provisions, shall be regulated by the national law of the person whose
succession is under consideration, whatever may be the nature of the property and
regardless of the country wherein said property may be found.

(2) when the proper foreign law has not been properly pleaded and proved;

There is NO judicial notice of any foreign law. A foreign law must be properly pleaded and
proved as a fact.

Proof of Foreign Law

(1) If the foreign law is WRITTEN LAW (such as a statute or a constitution), it may be
proved by:

(a) an official publication thereof; or

(b) by a copy attested by the officer having the legal custody of the record, or by his deputy,
and accompanied with a certificate that such officer has custody.

(3) when the case involves any of the exceptions to the application of the proper foreign law
(exceptions to the application of comity):

(a) when the foreign law, judgment, or contract is contrary to a sound and established
public policy of the forum;

(b) when the foreign law, judgment, or contract, is contrary to almost universally conceded
principles of morality (contra bonos mores);

(c) when the foreign law, judgment, or contract involves procedural matters;

(d) when the case involves penal laws, contracts, judgments;

(e) when the case involves purely fiscal (that is, revenueproducing) or administrative
matters

(f) when the application of the foreign law, judgment, or contract, may work undeniable
injustice to the citizens or residents of the forum;

(g) when the application of the foreign law, judgment, or contract, may work against the
vital interests and national security of the state of the forum;

(h) when the case involves real or personal property situated in the forum. (See Art. 17,

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 par. 3, and Art. 16, par. 1, Civil Code. See also Minor, Conflict of Laws, pp. 9-26; Goodrich,
Conflict of Laws, pp. 21- 24, 30).

When conflicts rule provides:

When we already have a conflicts rule on the matter (a rule governing a situation where a
foreign element is involved) this rule is the expression of our public policy on the matter.
Therefore, any foreign law, judgment, or contract that contravenes our conflicts rule on the matter
is clearly VIOLATIVE of our public policy.

Conflicts Rules v. Internal Rules

Conflicts rules (or rules of Private International Law) are the provisions found in a country’s own
law which govern factual situations possessed of a foreign element. According to Dean
Falconbridge, “a conflict rule of the forum, as distinguished from domestic or local rule of the law
of the forum, is usually expressed in the form of an abstract proposition that a given legal question
is ‘governed’ by the “law’ of a particular country, which is to be ascertained in the manner indicated
in the rule.’

Compared With Purely Internal Rules

A purely internal rule governs a purely domestic problem, one without any foreign element; a
conficts rule applies when the factual situation involves a foreign element. The former directly
answers a given problem; the latter merely indirectly responds by indicating whether internal or
foreign law is to be applied.

Kinds

(1) the one-sided rule (which indicates when Philippine internal law will apply); and

(2) the all-sided rule (which indicates when foreign law is to be applied).

Examples:

(1) the one-sided rule (unilateral rule)

Art. 15, Civil Code: “Laws relating to family rights and duties, or to the status, condition, and legal
capacity of persons are binding upon citizens of the Philippines, even though living abroad.”

NOTE: Under this Article, the capacity, etc. of a Filipino shall be governed generally by Philippine
law; what law governs the capacity, etc. of a German? This is NOT expressly answered by the
Article. The matter will be discussed in the succeeding pages.

(2) the all-sided rule (multilateral rule)

Art. 16, par, Civil Code:“However, intestate and testamentary successions, both with respect to
the order of succession and to the amount of successional rights and to the intrinsic validity of
testamentary provisions, shall be regulated by the national law of the person whose succession
is under consideration, whatever may be the nature of the property and regardless of the country

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wherein said property maybe found.”

NOTE: It is obvious under this Article that if the deceased is a German, German law governs; if a
Cuban law applies Cuban law governs, and so forth. Clearly, therefore, the Article is all sided.

2 parts of a Conflicts Rule

Every conflicts rule consists of two parts:

(1) the factual situation (the set of facts presenting a conflicts problem);

(2) the point of contact or the connecting factor (the law of the country with which the factual
situation is most intimately connected).

Prof. Rabel, in his Conflict of Laws (Vol. 1, p. 42), says that “the first part of the rule defines its
object, that is, certain operative facts, the legal consequences of which are determined in the
second part. From another point of view, the first part raises, and the second part answers, a legal
question.”

Arts. 14 to 17, Civil Code

ARTICLE 14. Penal laws and those of public security and safety shall be obligatory upon all who
live or sojourn in Philippine territory, subject to the principles of public international law and to
treaty stipulations. (8a)

ARTICLE 15. Laws relating to family rights and duties, or to the status, condition and legal
capacity of persons are binding upon citizens of the Philippines, even though living abroad. (9a)

ARTICLE 16. Real property as well as personal property is subject to the law of the country where
it is situated.

However, intestate and testamentary successions, both with respect to the order of succession
and to the amount of successional rights and to the intrinsic validity of testamentary provisions,
shall be regulated by the national law of the person whose succession is under consideration,
whatever may be the nature of the property and regardless of the country wherein said property
may be found. (10a)

ARTICLE 17. The forms and solemnities of contracts, wills, and other public instruments shall be
governed by the laws of the country in which they are executed.

When the acts referred to are executed before the diplomatic or consular officials of the Republic
of the Philippines in a foreign country, the solemnities established by Philippine laws shall be
observed in their execution.

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

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Arts. 819, 829, supra

ARTICLE 819. Wills, prohibited by the preceding article, executed by Filipinos in a foreign country
shall not be valid in the Philippines, even though authorized by the laws of the country where they
may have been executed.

ARTICLE 829. A revocation done outside the Philippines, by a person who does not have his
domicile in this country, is valid when it is done according to the law of the place where the will
was made, or according to the law of the place in which the testator had his domicile at the time;
and if the revocation takes place in this country, when it is in accordance with the provisions of
this Code.

When proper foreign law is not properly pleaded and proved

Processual presumption

Doctrine of Processual Presumption – The foreign law, whenever applicable, should be proved
by the proponent thereof, otherwise, such law shall be presumed to be exactly the same as the
law of the forum.

Proof of foreign law and processual presumption

- Foreign laws have to be properly proved before they are admitted into evidence

- Failure to prove will result to the exclusion of the foreign law and presumption will arise that
foreign law is the same as local law (doctrine of processual presumption)

- Foreign documents also need to be proved before they can be admitted into evidence

Rule 132, Secs. 19, 24 & 25 and Rule 130, Secs. 45 and 46 of the Revised Rules of Court

Rule 3, Sec. 1 on Rule on Electronic Evidence (AM 01-7-01-SC)

Exceptions to proof of foreign laws

1. Presentation of a foreign-licensed attorney who will testify in open court concerning her
knowledge of the law in question

2. Case of administrative agencies recognizing foreign laws without proof thereof.

Administrative agencies are not bound by technical rules of procedure and may properly
recognize the existence of a foreign law by judicial notice.

3. Lack of objection to the improper presentation by one party of proof of foreign law.

4. Tribunal may properly recognize the existence of universally known law or law whose existence
is known to most men due to its universal application

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5. Laws appearing in official websites like those of the Office of the President or the Library of
Congress

Cases: Bank of America v, American Realty Corp (133876, 12/29/99), Dumez Co v. NLRC,
74495, 7/11/96, Benedicto v. CA, 1253359, 9/4/01, Asiavest v, CA, 1228803, 9/25/98, Pardo v.
Republic,, 2248, 1/23/50, Manufacturers Hanovers Trust, Co. v. Guerrero, 136804, 2/19/03,
Northwest Orient Airlines v. CA, 112573/ 2/9/1995, Fluemer v. Hix, 1930, Bryan v. Eastern and
Australian SS Co., PCIB v. Escolin (1974), Reyes v. Wells (1929), Ang Giok Chip v. Springfiled
(1931), Phil. Trust Co. v. Bohanan (1960)

Wildvalley Shipping v. CA, 119602, 10/6/00, Edi-Staff Builders Intl v. NLRC, 145587, 10/26/07,
Norse Management Co. v. National Seamen Board, 54204, 9/30/82, HSBC v. Sherman, 72494,
8/11/1989, Carnival Cruise Lines, Inc v. Shute, 1990 Willamette Iron & Steel works v. Muzzal, L-
42538, 5/21/35

When the case falls under any of the exceptions to application of foreign law or lex causae

Cases: Bank of America v. American Realty Corp, 133876, 12/29/1999, Pakistan Intl Airlines
Corp. v. Ople, 1990, Eagle Star Insurance Co,ltd v. Chia Yu, 1955 , Banco de Brazil SA v. AC
Israel Community Co, 190 NE, 2d, 215 (1965), Cadalin v. POEA, L-104776, 104911-14, and
105029-32, 12/5/94, Dacasin v. Dacasin, 168785, 2/5/10,

Theories justifying application of foreign laws

(1) The Theory of Comity

Under this theory, we apply the foreign law because of its convenience, and finally, because we
want to give protection to our citizens, residents, and transients in our land.

There are two kinds of comity: comity that is based on reciprocity, and comity based on the
persuasiveness of a foreign judgment.

Comity based on reciprocity is simple: if the laws and judgments of the forum are recognized in a
foreign state, the forum in turn will recognize the laws and judgments emanating from said foreign
state. Upon the other hand, comity based on the persuasiveness of the foreign judgment is
precisely what it says: if the forum is persuaded that a foreign judgment is meritorious and has
been rendered by a court of competent jurisdiction, it will not hesitate to enforce that foreign
judgment in the forum even if the foreign forum does not reciprocate.

(2) The Theory of Vested Rights

Here we seek to enforce not the foreign law itself but the rights that have been vested under such
foreign law.

(3) The Theory of Local Law

The adherents of this school of thought believe that we apply foreign law not because it is foreign,

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but because our own laws, by applying similar rules, require us to do so; hence, it is as if the
foreign law has become part and parcel of our own local law.

(4) The Theory of Harmony of Laws

The theorists here insist that in many cases we have to apply the foreign laws so that wherever a
case is decided, that is, irrespective of the forum, the solution should be approximately the same:
thus, identical or similar solutions anywhere and everywhere. When the goal is realized there will
be a “harmony of laws.”

(5) The Theory of Justice

The purpose of all laws, including Conflict of Laws, is the dispensing of justice; if this can be
attained in many cases by applying the proper foreign law, we must do so.

Choice of Law (BENITO)

-Theories (Haag v. Barnes. 9 NY 2d 554, 1961; Babcock v. Jackson 12 NY 2d 473, 1963)

-Characterization, problems and steps (Gibbs v. Gov't of Pi, Grant v. Mcauliffe (41 Cal. 2D 859
(1953)

-Borrowing Statute (Cadalin v. POEA Administrator)

-Points of Contact (Saudi Arabian Airlines v. CA, 122191, 10/8/98, Phil. Export and Foreign Loan
Guarantee Corp v. VP Eusebio Construction , 140047, July 13, 2004)

-Depecage

Cases: Erie Insurance Exchange v. Edmund D. Heffernan II, Haumschild v. Continental Casualty
(1959), In re KMH, Francisco v. Stolt Achievement MT, 293 F.3d 270 (2002)

-The problem of Renvoi

Cases: Aznar v. Garcia ,L-16749, 1/31/63

Bellis v. Bellis (L-23678, 6/6/67,

PCIB v. Escolin, (1974)

VII. Recognition and Enforcement of Foreign Judgments

-Recognition v. Enforcement

Recognition of a foreign judgment — means that our courts will allow said foreign judgment to
be presented as a defense to a local litigation (the defense of res adjudicata); enforcement, upon

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the other hand, exists when a plaintiff wants the courts to positively carry out and make effective
in the Philippines a foreign judgment.

Recognition involves merely the sense of justice; enforcement virtually implies a direct act of
sovereignty. (Perkins v. Benguet Consolidated Mining Co., supra).

(3) Recognition does not require either action or a special proceeding; enforcement
necessitates a separate action or proceeding brought precisely to make the foreign judgment
effective.

-Requirements:

(1) There must be proof of the foreign judgment; for recognition, there is no necessity for a
separate action or proceeding; enforcement requires such separate action or proceeding.

(2) The judgment must be on a civil or commercial matter (because if on a criminal or revenue or
administrative or remedial matter, the same would fall under the exceptions to the application of
the foreign law).

(3) There must be no lack of jurisdiction, no want of notice, no collusion, no fraud, no clear mistake
of law or fact.

(4) The judgment must not contravene a sound and established public policy of the forum.

(5) The judgment must be RES JUDICATA in the state that rendered it.

NOTE:

The requisites for RES JUDICATA are the following:

(a) The judgment must be FINAL;

(b) The court rendering the judgment must have JURISDICTION over the subject matter and the
parties;

(c) The judgment must be on the MERITS;

(d) There must be IDENTITY of parties, of subject matter, and of cause of action — except that
with reference to the last, the real cause of action is now the recognition or enforcement of the
foreign judgment on the original cause of action.

VIII. Three phases are distinct from each other.

Case: Hasegawa v. Kitamura, 149177, 11/23/07

Additional references: all cases referred to in the book chapters assigned.

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