of
documents
with
which
the
defendant
had
no
and credit.
one
of
its
citizens
against
one
of
ours,
is prima
in the
adjustment
of accounts
between them.
Paris,
Third
record
judgments
Section,
of
the
an
appellate
Tribunal
of
court
of
Commerce
of
the
on all the claims allowed, and 12,559 francs for costs and
expenses.
and that there are still justly due and owing from the
defendants to the plaintiffs upon those said judgments
by
the
Tribunal
of
Commerce
of
the
Fourtin & Co., that the arbitrator and the tribunal declined
defendants.
to
the
defendants,
and
letters
and
other
United States, and that, if there had been a full and fair
that
the
judgment
hereinbefore
rendered,
contracts
or
obligations
justice
controversies
natural
before
them,
and
wrongfully
capable of execution
Code]:"
prejudice,
however,
to
provisions
to
the
contrary,
said
courts
of
France,
and
the
merits
of
the
against
them
upon
the
counterclaims,
amounting to $102,942.91.
The plaintiffs filed a replication to so much of the answer
as made counterclaims, denying its allegations and
setting up in bar thereof the judgment sued on.
composed
their
of
Stewart
and
Libbey,
conducted
which
were
false
and
fraudulent,
and
and
letter
books
to
be
inspected
by
the
The writ of error in the action at law and the appeal in the
v.
Guyot, and
man,
duly
submitted
to
their
These two cases -- the one at law and the other in equity
of Hilton
and
determination.
--
man
the
case
of Ritchie
v.
with great learning and ability and which require for their
satisfactory determination a full consideration of the
authorities. To avoid confusion in indicating the parties, it
No law has any effect, of its own force, beyond the limits
of the sovereignty from which its authority is derived. The
suggested.
absolute
Afterwards, speaking of the difficulty of applying the
Page 159 U. S. 164
has
been
thought
by
jurists
that
the
and
to
produce
friendly
intercourse
"All the effect which foreign laws can have in the territory
of a state depends absolutely on the express or tacit
In order to appreciate
manifested
and
publicists.
by
the
There
is
decisions
no
of
obligation
its
judicial
recognized
by
the
weight of the
various
of
sentence.
coordinate
The
jurisdiction
question,
can
therefore,
examine
the
respecting
its
inquiry."
law. Croudson
v.
Leonard, 4
Cranch
Nottingham said:
examinable here."
cited
v.
at
the
bar
of Burroughs or Burrows
1,
Strange
733,
"the last endorsees had the sole property of the bills, and
were therefore made the only parties to the suit at
450.
proper
jurisdiction
of
the
cases
makes
former
times,
foreign
decrees
in
admiralty in
a new libel. See The City of Mecca, 5 P.D. 28, 6 P.D. 106.
magistratus
infra
regnum
Angliae
may be
held
v.
Garcias, 12
Cl.
&
Fin.
368; The
the other, and the law of England takes notice of this law,
and the judge of the admiralty is the proper magistrate
for this purpose, for he only hath the execution of the civil
law
within
the
realm.
Pasch.
Jac.B.R., Weir's
opinion.
English
court
of
admiralty,
and
not
of
the
specialty,
lawful
consideration
for
which
was
decision
mentioned
of
Lord
Hardwicke
as
Chancellor
was
but
an indebitatus
computassent, so
that
the
assumpsit or
statute
of
an insimul
limitations
is
in England.
Wales,
whose
decisions
were
clearly
liable
to
be
examined."
In Otway v. Ramsay (1736), in the King's Bench, Lord
Hardwicke treated it as worthy of consideration "what
"I have often heard Lord Mansfield repeat what was said
by Lord Hardwicke in the case alluded to from Wales, and
the ground of his lordship's opinion was this: when you
call for my assistance to carry into effect the decision of
that you are in the wrong, and it was on that account that
decree."
judgment
obtained
for
money
in
foreign
argument, he said:
410.
attorney
between proper
in
Jamaica
made
large
advances
for
his
Doug. 5, note.
not that privilege, nor the courts in Wales, etc. But the
doctrine
in
the
case
of Sinclair
v.
Fraser was
than
is impeached."
is
given
to
every
species
of
written
said:
"The
doctrine
which
was
laid
down
in Sinclair
v.
of
his
debt
by
foreign
attachment
in
or
criminal
proceedings,
man
should
be
256.
pleaded non
it
assumpsit and
prevailed
because
be considered afterwards.
Bayley, who said: "As between the parties to the suit, the
In Harris
v.
Saunders (1825),
Chief
Justice
Abbott
because
such
judgment
could
not
be
they
noted
inconvenience,
that
statutes
in
order
had
to
been
remove
passed
that
in
in
impeached. Bissell
neighboring
v.
Briggs, 9
colony
could
Mass.
462,
not
be
464-465;
shall be taken."
and
that
their
consideration
impeached.Armstrong
v.
might
Carson (1794),
be
Dall.
adjudged,
and
therefore nul
tiel
record, and
of
the
state
courts
ought
to
be
v.
McConnell (1818),
the
point
decided
conclusive
were
before us.
only prima
facie evidence,
and
subject
to
be
v.
Cohen (1839),
Mr.
Justice
Wayne,
purport to decide."
in England
facie character."
the cause, yet the courts here will not execute the
judgment, without first
Page 159 U. S. 186
country
in
no
other
respect
than
in
not
being
presumptive
evidence
of
debt,
or
as prima
But neither in those cases nor in any other has this Court
hitherto been called upon to determine how far foreign
judgments may be reexamined upon their merits, or be
impeached for fraud in obtaining them.
municipal
until 1879, the reasons for this view were forcibly stated
judgments in
But the case was decided upon the ground that the
178.
broadly, saying:
Great
Britain,
and
referring
to
Mr.
Justice
Story's
he added:
the rei judicatae, and in all such cases, the justice of the
607.
regard to Dutch
He then observed:
itself
jurisprudence."
firmly
into
the
structure
of
international
618.
In Bradstreet v. Neptune Ins. Co. (1839), in the Circuit
Court
of
the
United
States
for
the
District
of
demurrer, said:
rendered,
judgments,
import
absolute
verity
and
remain
but
not
elsewhere.
When
offered
and
P. 175.
through
foreign
jurisdiction
and
being
government,
and
acting
on
no
P. 180.
P. 179.
prove that they had not been acted on," "some accident
or mistake," or "that the court did not decide at all on the
above
quoted
from
their
Commentaries,
concurred in
to
be
governed
by
principle
would,
we
or
of
France
or
of
any
other
nation
had
into
tribunal
which
should
correct
such
statute."
160.
dominions
Bank
v.
Harding (1832),
Ohio
545,
facie evidence
Platner (1844),
13
Ohio,
of
indebtedness. Pelton
209,
217.
In Jones
v.
v.
decision
as
establishing
that
judgment
of
any
subject
to
direct
appellate
review
in
upon
the
facts. De
Cosse
Brissac
v.
Per.
&
Dav.
143,
146; Henderson
v.
C.P.D. 358.
international law,"
holding such
In Scott
Page 159 U. S. 198
v.
Pilkington (1862),
Chief
Justice
Cockburn
the ground that the record showed that the foreign court
of England.
maintained."
Russell
v.
Smyth (1842),
M.
&
W.
810,
818-
saying
of
Baron
Parke,
above
quoted,
and
consequently
"that anything which negatives the existence of that legal
obligation
or
excuses
the
defendant
from
the
Godard
foreign
714-715; Cotton
judgment
was
only
evidence
of
liability
v.
Gray (1870),
and
L.R.
Lindley, L.
Q.B.
JJ.,
139,
148-
in Nouvion
v.
Cranch
481, 11
U.
S.
485; D'Arcy
v.
determining
how
far
such
judgment
might
be
for
the
Supreme
Judicial
Court
of
praesumptione
legis
judicium
redditur
in
Co.Litt. 248b.
were:
of
local
procedure
into
canon
of
private
or obligation."
grounds
which
require
separate
consideration.
It is objected that the appearance and litigation of the
defendants in the French tribunals were not voluntary,
before
several
abroad
court
of
competent
jurisdiction,
never
acquired
such
jurisdiction
over
the
collision
with
the
defendant's
ship
through
the
155, 162; Voinet v. Barrett (1885), Cab. & El. 554, 54 Law
Journal (N.S.) Q.B. 521, and 55 Law Journal (N.S.) Q.B. 39.
these reasons:
court, and they did not select the tribunal and sue as
country,
whose
laws
they
were
under
no
obligation to obey."
the defendants.
176.
It is next objected that in those courts, one of the
But it is now settled in England that while an appearance
purpose
the
of
protecting
his
property
already
in
that
any
foreign
judgment,
whether in
rem or in
which
vitiates
the
most
solemn
735; Reimers
v.
Druce (1856),
23
Beav.
145,
150; Castrique v. Imrie (1870), L.R. 4 H.L. 414, 445446; Godard v. Gray (1870), L.R. 6 Q.B. 139, 149; Messina
v. Petrococchino (1872), L.R. 4 P.C. 144, 157;Ochsenbein
v. Papelier (1873), 8 Ch. 695.
Under what circumstances this may be done does not
collateral
those goods, as the fact was and as she well knew, were
and during the whole time the suit was pending, and by
30, 34-35.
statements
and
accounts.
This
offer,
if
claim.
and treaties."
rendered,
contracts
or
obligations
and,
provided as follows:
"Judgments
By article 2128,
notwithstanding
the
judgments,
our
before
foreign
officers,
shall
not
be
as
he
remarked,
"a
tribunal
foreign
to
and
the presumption."
work
itself
firmly
into
the
structure
of
international jurisprudence."
elements
or
the
corner
stones
of
the
due
note.
are
not
conclusive
evidence
of
debt,
but prima
competent
jurisdiction
are
reciprocally
carried
into
execution."
Bradstreet v. Neptune Ins. Co., 3 Sumner 600, 608.
Wheaton's International Law (8th ed.) 79, 147.
Page 159 U. S. 214
Since
Mr.
Justice
Woodbury
said
that
judgments in
Story,
Kent,
and
Wheaton
wrote
their
respect
to
those
of
other
countries." Burnham
v.
declaring
the
judgment
executory.
Upon
Parker's
was
made
between
Holker,
French
judgments
rendered
in
foreign
kingdoms
and
been
authorized
to
declare
them
executory;
that
a pareatis from
one
department
to
another
for
on
the
part
of
the
French
tribunals,
that
there
may
result
from
this
an
the
sovereignty
of
governments,
and
which,
the
of the French tribunals which have the right and the duty
merits."
right
of
sovereignty;
that
it
proceeds
from
jurisprudence
does
not
clearly
appear. Odwin
v.
rights
been
duly
respected,
and
prevails
as
to
the
judgments
of
other
Switzerland,
by
the
federal
Constitution,
civil
each canton having its own law upon the subject. But civil
Constant,
79-81;
Piggott,
466.
The
at
all,
are
"bound
to
the
unqualified
respectively," he says:
interested
the
by
to
avoid
the
delays,
the
conflicts,
reciprocity.
and
reciprocity between
It
is
necessary
to
commit
the
does
not
contain
dispositions
which
are
point
of departure
of all
legal
the
modern
theories
of
international
law
which,
and
execution
to
judgments
rendered
by
the
Spanish
Portugal,
foreign
judgments,
whether
against
Constant, 124, and note; Moreau, No. 192; Piggott, 543546; Westlake, ubi sup. In the Argentine Republic, the
into
the
structure
foreign
judgment
was
considered
as prima
itself
of
international
jurisprudence.
Ela (1815),
Smith
Blackbourne (1818),
396,
N.H.
404; Thurber
v.
242; Robinson
v.
78,
95; King
v.
Van
Gilder (1791),
D.Chip.
Conn.
380,
382; Hitchcock
v.
157,
159; Taylor
v.
Bryden (1811),
Johns.
165; Starbuck
v.
Murray (1830),
Wend.
148,
H.
Coleman (1808),
&
Hardin
G.
492,
503; Rogers
413-414; Williams
v.
v.
that
domestic
the
doctrine
judgments
of res
should
judicata applicable
be
applied
to
to
foreign
held, inter
partes, though
recovered
abroad,
jurisdiction,
where,
according
to
its
of
that
country,
knowing
that
all
their
present lord
of
debt
to
enforce
the
judgment
may
be
or
excuses
the
defendant
from
the
erroneous in law
and the cause, and to pay the sum decreed, the question
would be whether it was open to the unsuccessful party
to try the cause over again in a court not sitting as a
court of appeal from that which gave the judgment. It is
quite clear that this could not be done where the action is
brought on the judgment of an English tribunal, and, on
principle, it seems the same rule should apply where it is
brought on that of a foreign tribunal."
In any aspect, it is difficult to see why rights acquired
under foreign judgments do not belong to the category of
private rights acquired under foreign laws. Now the rule is
universal in this country that private rights acquired
under the laws of foreign states will be respected and
enforced in our courts unless contrary to the policy or
prejudicial to the interests of the state where this is
sought to be done, and, although the source of this rule
in
fact
and
the
special
grounds
relied
on
recovered
in
countries
where
our
own
EN BANC
G.R. No. L-11390
EL
BANCO
ESPAOL-FILIPINO, plaintiff-appellant,
vs.
VICENTE PALANCA, administrator of the estate of
Engracio Palanca Tanquinyeng, defendant-appellant.
Aitken
and
DeSelms
Hartigan and Welch for appellee.
for
appellant.
STREET, J.:
of
Republic
SUPREME
Manila
of
the
Philippines
COURT
EN BANC
G.R. No. L-1403
requires
unemployment
employers
to
compensation
pay
fund
into
a
the
state
specified
Court.
compensation
Washington
fund
exacted
Unemployment
by
state
statutes,
Compensation
Act,
The
tax
imposed
by
the
state
unemployment
the
due
process
clause
of
the
Fourteenth
The contributions are a specified percentage of the wages
payable annually by each employer for his employees'
authorizes
the
Commissioner
to
collect
the
the
ground
that
the
service
the
unpaid
contributions.
That
action
was
prohibited
burden
on
interstate
assessment
upon
question,
thirteen
appellant
employed
eleven
to
rejection,
and,
acceptance
when
accepted,
the
in
permanent
display
rooms,
and
the
salesmen's
such commerce.
imposes
interstate
an
unconstitutional
burden
on
an
unemployment
fund
shall
be
relieved
from
530, 205
U.
S.
533; International
Harvester
Co.
v.
intrastate commerce."
Central
R.
Co., 299
U.
S.
334; Perkins
v.
Historically,
the
jurisdiction
judgment in
personam is
of
courts
grounded
on
to
render
their de
U. S. 253. ,
350, 106
those who are authorized to act for it. To say that the
U.
S.
355; Connecticut
Mutual
Co.
v.
merely
to
those
activities
of
the
U.
S.
360; Old
Wayne
Life
Assn.
v.
authorized
agents. Lafayette
Insurance
Co.
v.
95.
S.
Kentucky,
140.
228; International
Harvester
Co.
v.
Washington
procedure.
connected
with
the
activities
within
the
state,
involves
an
unreasonable
or
undue
American
Connecticut
Tobacco
Co.,
supra. Compare
Elevator
Co., 198
U.
S.
424, 198
U.
S.
437-
constitutional
254-255. Cf.
Riverside
Mills
v.
Menefee, 237
U.
S.
power
of
the
states. Carmichael
v.
951; Maubourquet
v.
Wyse, 1
Ir.Rep.C.L.
471. See
Affirmed.
MR. JUSTICE JACKSON took no part in the consideration or
decision of this case.
MR. JUSTICE BLACK delivered the following opinion.
violates
v.
Pa.
an
sufficient.
defeat
dismiss
[Footnote
power to tax and sue those dealing with its citizens within
question
its
the
Commerce
Pennsylvania, 314
issue
so
the
"in
U.S.
palpably
appeal
advance
Clause. Perkins
586,affirming 342
without
as
of
merit are
unsubstantial,
the
necessity
for
the
function
of
our
federative
system
of
applied for the first time to the issue before us. It has
thus introduced uncertain elements confusing the simple
while
giving
additional
reasons
why
notice
under
It is true that this Court did use the terms "fair play" and
"substantial
justice"
in
explaining
the
philosophy
U.
S.
90, 243
U.
S.
91,
cited
in
warned
opportunity
to
against
be
judicial
heard,
and
curtailment
of
referred
such
to
this
a
agree.
the
natural
justice
concept
on
the
abridgment
of
democratic
safeguards
they
already
happened. Betts
v.
Brady, 316
U.
S.
Pennoyer v. Nef
95 U.S. 714
ERROR TO THE CIRCUIT COURT OF THE UNITED STATES
Syllabus
only,
and
may
not
reflect
current
legal
summons
warranties
accuracy,
or
guarantees
about
the
upon
parties
or
their
representatives,
Page 95 U. S. 715
property is once brought under the control of the court by
Held, that defects in the affidavit for the order can only
where
actions
are
brought
against
nonresidents
is
proceeding in rem.
19,
Page 95 U. S. 716
nonresident of Oregon.
proceedings
duly
certified
copies
of
the
complaint,
been
given
without
the
appearance
of
the
Page 95 U. S. 717
follows: --
judgment
in
said
action
contained
the
following
averments:
roll and the records and files of the said court, the said
"Advocate."
That
the
affidavit
showing
the
publication
of
the
Page 95 U. S. 718
Page 95 U. S. 719
one of the circuit courts of the State. The case turns upon
against
his
whom
publication
is
ordered,
or
Page 95 U. S. 720
of the sale, but held that the judgment was invalid from
"unless he appear in the court, or be found within the
defects
in
the
affidavit
upon
which
the
order
of
law.
The
authority
of
every
tribunal
is
publishers
were
"within
the
spirit
of
the
Page 95 U. S. 722
of a resident creditor except by a proceeding in rem, that
is, by a direct proceeding against the property for that
purpose. If these positions are sound, the ruling of the
Circuit Court as to the invalidity of that judgment must be
sustained notwithstanding our dissent from the reasons
upon which it was made. And that they are sound would
seem to follow from two well established principles of
public law respecting the jurisdiction of an independent
State over persons and property. The several States of
the
Union
are
not,
it
is
true,
in
every
respect
ex-territorial
jurisdiction
by
its
tribunals,
would
be
Page 95 U. S. 723
So the State, through its tribunals, may subject property
such persons or property in any other tribunals." Story,
situated within its limits that its tribunals can inquire into
that nonresident's obligations to its own citizens, and the
to
control
the
disposition
of
the
property.
If
the
nonresident
Page 95 U. S. 724
McLean said:--
Page 95 U. S. 725
appears,
the
cause
becomes
mainly
suit in
Page 95 U. S. 726
the nature of this proceeding in this latter class of cases
is clearly evinced by two well established propositions:
Page 95 U. S. 727
which they were founded, if they ever had any existence,
The fact that the defendants in that case had fled from
the State, or had concealed themselves, so as not to be
reached by the ordinary process of the court, and were
not nonresidents, was not made a point in the decision.
The opinion treated them as being without the territorial
jurisdiction of the court, and the grounds and extent of its
authority over persons and property thus situated were
considered when they were not brought within its
jurisdiction by personal service or voluntary appearance.
had perished.
Substituted service by publication, or in any other
authorized form, may be sufficient to inform parties of the
object of proceedings taken where property is once
brought under the control of the court by seizure or some
equivalent act. The law assumes that property is always
in the possession of its owner, in person or by agent, and
it proceeds upon the theory that its seizure will inform
him not only that it is taken into the custody of the court,
judgments in
parte against
personam, obtained ex
liability.
action, and
Page 95 U. S. 728
the property of the nonresident be afterwards seized and
sold on execution. But the answer to this position has
already been given in the statement that the jurisdiction
of the court to inquire into and determine his obligations
at all is only incidental to its jurisdiction over the property.
Its jurisdiction in that respect cannot be made to depend
court rendering
the
judgment had
nonresidents,
binding force."
without
service
upon
them,
or
upon
within the State, to reach and affect which was the object
and the
voluntarily
Page 95 U. S. 731
in
the
recent
case
of Thompson
v.
as
effectual
and
binding
merely
as
appear, served on his wife after she had left her place in
Page 95 U. S. 732
the attachment bound only the property attached as a
proceeding in rem, and
that
it could not
bind the
of
authority
his
to
nonresidence,
pass
upon
his
and
consequently
personal
rights
no
and
judgment was not served with process, and the suit was
less
be
will
absolute
any
frequency
than
nullity,
formerly,
because
it
beginning
rendered
to
without
embrace
every
permissible
exertion
of
power
Page 95 U. S. 733
nonresidents,
connection
with
is
process
effectual
against
only
the
where,
person
in
for
words,
continuation
against
Page 95 U. S. 734
where
the
action
is
in
the
nature
of
of
the
original
litigation
than
the
property in controversy.
taken directly against property, and has for its object the
mentioned.
Page 95 U. S. 735
It is hardly necessary to observe that, in all we have said,
we have had reference to proceedings in courts of first
them."
association
within
its
limits,
or
making
contracts
proceedings
instituted
with
respect
to
such
provide,
upon
their
failure,
to
make
such
Page 95 U. S. 736
interest subject to the conditions prescribed by law. Copin
v. Adamson, Law Rep. 9 Ex. 345.
In the present case, there is no feature of this kind, and
consequently no consideration of what would be the
effect of such legislation in enforcing the contract of a
nonresident can arise. The question here respects only
the validity of a money judgment rendered in one State in
an action upon a simple contract against the resident of
another without service of process upon him or his
appearance therein.
Judgment affirmed.
Page 95 U. S. 737
every State.
that
are these:--
the
residence
is
not
known
and
cannot
be
obtained
in
such
proceeding.
Judgment
in
regulation only.
personally.
To say that a sovereign State has the power to ordain that
Personal notice of a proceeding by which title to property
to
give
him
such
information,
and
an
statute
of
Oregon
summons, supra, p. 95 U.
relating
S.
to
publication
of
thirty
the
years
since.
The
latter
authorizes
Page 95 U. S. 739
have been upon the statute book of New York for more
1813, p. 157.
nonresident
debtor.
And
the
provisions
of
the
statute.
the action.
these
statutes
are
now
adjudged
to
be
Page 95 U. S. 741
rendered."
Page 95 U. S. 742
some of the persons who are made liable will not have
adjudged
against
person
upon
purely ex
but
it
may
possibly
these
Page 95 U. S. 743
happen,
same
language
is
and
used
in Westervelt
in Campbell
v.
v.
take any action on the subject. The title was held void,
also, for the reason that the decree under which it was
have been a previous specific lien upon it; that is, I have
will justify
Page 95 U. S. 744
observed that the lands were not only within the limits of
the territory of Iowa, but that all the Indians who were
Page 95 U. S. 745
judgment
obtained
under
the
State
statute
by
publication.
Webster v. Reid, 11 How. 437, is also cited. There, the
action involved the title to certain lands in the State of
Iowa, being lands formerly belonging to the half-breeds of
the Sac and Fox tribes; and title was claimed against the
matter.
attached,
nor
garnishee
charged,
nor
appearance
Page 95 U. S. 746
Eaton v. Bridger, 33 N. H. 228, was decided upon the
on a publication of the pendency of the suit will be void,
in the suit. The court say the judgment was "not only
express provisions."
verified. All that the court decided was that this judgment
did not arise upon a contest for property sold under the
judgment. Carleton
upon
an
although
erroneous
the
judgment
judgment
are
itself
generally
be
good,
afterwards
v.
Washington
Insurance
supra.
Page 95 U. S. 747
So, in Eastman v. Wadleigh, 65 Me. 251, the question
arose in debt on the judgment, not upon a holding of land
purchased under the judgment. It was decided upon the
power."
in the post office are likely to give the notice, there seems
to be
Page 95 U. S. 748
nothing in the nature of things to prevent their adoption
in lieu of the attachment. The point of power cannot be
thus controlled.
That a State can subject land within its limits belonging to
nonresident owners to debts due to its own citizens as it
can legislate upon all other local matters -- that it can
prescribe the mode and process by which it is to be
reached -- seems to me very plain.
only,
and
may
not
reflect
current
legal
or
guarantees
about
the
accuracy,
SECOND DIVISION
PHILSEC
INVESTMENT
CORPORATION,
BPIINTERNATIONAL FINANCE LIMITED, and ATHONA
HOLDINGS, N.V., petitioners, vs. THE HONORABLE
COURT OF APPEALS, 1488, INC., DRAGO DAIC,
VENTURA O. DUCAT, PRECIOSO R. PERLAS, and
WILLIAM H. CRAIG, respondents.
DECISION
MENDOZA, J.:
This case presents for determination the conclusiveness
of a foreign judgment upon the rights of the parties under
the same cause of action asserted in a case in our local
court. Petitioners brought this case in the Regional Trial
Court of Makati, Branch 56, which, in view of the
pendency at the time of the foreign action, dismissed
Civil Case No. 16563 on the ground of litis pendentia, in
addition to forum non conveniens. On appeal, the Court
Personal
Injury
SUPREME
Manila
LRepublic
of
the
Philippines
COURT
FIRST DIVISION
G.R. No. 72494 August 11, 1989
HONGKONG
AND
SHANGHAI
BANKING
CORPORATION, petitioner,
vs.
JACK ROBERT SHERMAN, DEODATO RELOJ and THE
INTERMEDIATE APPELLATE COURT, respondents.
Quiason, Makalintal, Barot & Torres for petitioner.
Alejandro,
Aranzaso
respondents.
&
Associates
for
private
MEDIALDEA, J.:
This is a petition for review on certiorari of the decision of
the Intermediate Appellate Court (now Court of Appeals)
dated August 2, 1985, which reversed the order of the
Regional Trial Court dated February 28,1985 denying the
Motion to Dismiss filed by private respondents Jack
Robert Sherman and Deodato Reloj.
A complaint for collection of a sum of money (pp. 4952, Rollo) was filed by petitioner Hongkong and Shanghai
Banking Corporation (hereinafter referred to as petitioner
BANK) against private respondents Jack Robert Sherman
and Deodato Reloj, docketed as Civil Case No. Q-42850
before the Regional Trial Court of Quezon City, Branch 84.
It appears that sometime in 1981, Eastern Book Supply
Service PTE, Ltd. (hereinafter referred to as COMPANY), a
company incorporated in Singapore applied with, and was
granted by, the Singapore branch of petitioner BANK an
overdraft facility in the maximum amount of Singapore
dollars 200,000.00 (which amount was subsequently
increased to Singapore dollars 375,000.00) with interest
at 3% over petitioner BANK prime rate, payable monthly,
obligations,
and
liabilities
arising
hereunder shall be
construed
and
determined under and may be enforced in
accordance with the laws of the Republic of
Singapore.'
While it is true that "the transaction took place in
Singaporean setting" and that the Joint and Several
Guarantee contains a choice-of-forum clause, the very
essence of due process dictates that the stipulation that
"[t]his guarantee and all rights, obligations and liabilities
arising hereunder shall be construed and determined
under and may be enforced in accordance with the laws
of the Republic of Singapore. We hereby agree that the
Courts in Singapore shall have jurisdiction over all
disputes arising under this guarantee" be liberally
construed. One basic principle underlies all rules of
jurisdiction in International Law: a State does not have
jurisdiction in the absence of some reasonable basis for
exercising it, whether the proceedings are in rem quasi in
rem or in personam. To be reasonable, the jurisdiction
must be based on some minimum contacts that will not
offend traditional notions of fair play and substantial
justice (J. Salonga, Private International Law, 1981, p. 46).
Indeed, as pointed-out by petitioner BANK at the outset,
the instant case presents a very odd situation. In the
ordinary habits of life, anyone would be disinclined to
litigate before a foreign tribunal, with more reason as a
defendant. However, in this case, private respondents are
Philippine residents (a fact which was not disputed by
them) who would rather face a complaint against them
before a foreign court and in the process incur
considerable expenses, not to mention inconvenience,
than to have a Philippine court try and resolve the case.
Private respondents' stance is hardly comprehensible,
unless their ultimate intent is to evade, or at least delay,
the payment of a just obligation.
The defense of private respondents that the complaint
should have been filed in Singapore is based merely on
technicality. They did not even claim, much less prove,
that the filing of the action here will cause them any
unnecessary trouble, damage, or expense. On the other
hand, there is no showing that petitioner BANK filed the
action here just to harass private respondents.
5. Costs of [s]uit."
Subsequently, upon the motion of Omega, Singkong
Trading Co., and private respondent, the trial court
approved a Compromise Agreement36 [Records, Vol. 2,
pp. 535-538.] among the movants, reducing by 20
percent the amounts adjudged. For their part,
respondents-movants agreed not to appeal the
Decision.37 [Order dated March 6, 1991, ibid., pp. 539541. Private respondent entered into two separate
compromise agreements with Singkong Trading Co. (id.,
pp. 535-536) and another with Omega (id., pp. 537-538).
Both agreements were dated March 4, 1991.] On March 8,
1991, private respondent moved for the execution of
judgment, claiming that the trial court Decision had
already become final and executory. The Motion was
granted and a Writ of Execution was issued. To satisfy the
Decision, Sheriffs Jorge Victorino, Amado Sevilla and
Dionisio Camagon were deputized on March 13, 1991 to
levy and to sell on execution the defendants vessel and
personal property.
xxx
On March 18, 1991, the Bureau of Customs also filed an
ex parte Motion to recall the execution, and to quash the
notice of levy and the sale on execution. Despite this
Motion, the auction sale was conducted on March 21,
1991 by Sheriff Camagon, with private respondent
submitting the winning bid. The trial court ordered the
deputy sheriffs to cease and desist from implementing
the Writ of Execution and from levying on the personal
property of the defendants. Nevertheless, Sheriff
Camagon issued the corresponding Certificate of Sale on
March 27, 1991.
On April 10, 1991, petitioner Banco do Brasil filed, by
special appearance, an Urgent Motion to Vacate
Judgement and to Dismiss Case38 [Rollo, pp. 67-73.] on
the ground that the February 18, 1991 Decision of the
trial court is void with respect to it for having been
rendered without validly acquiring jurisdiction over the
person of Banco do Brasil. Petitioner subsequently
amended its petition39 [Rollo, pp. 74-80.] to specifically
aver that its special appearance is solely for the purpose
of questioning the Courts exercise of personal jurisdiction.
LEPANTO
COMPANY,
CONSOLIDATED
MINING
Respondent.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
SO ORDERED.
Republic of the Philippines
Supreme Court
DECISION
Manila
12,
2006,
denying
the
Motion
for
Reconsideration.
of
Makati
City
Complaint[3] against
petitioner
NM
whom
petitioner (defendant).
summons
and
other
legal
processes
maybe
October
20,
2005,
petitioner
filed
[5]
Special
to
take
deposition
and
serve
written
interrogatories.[8]
On
December
9,
2005,
the
trial
court
issued
an
Decision
dismissing
the
Petition
motion to dismiss.
2006,
Resolution
denying
the
petitioners
Motion
for
Our discussion of the issues raised by the parties follows:
Reconsideration.
Whether
petitioner is
a real party
in interest
September 7, 2006.
12,
2006
Resolution
of
the
Court
of
may
be
the
proper
subject
of
petition
process
foregoing discussion.
in
the
Australian
Securities
&
Investment
under
the
name
of
the
real
party
in
Propriety of
the Resort to
a
Petition
for Certiorari
with
the
Court
of
Appeals
grave
abuse
of
discretion,
the
grant
of
the
Issues more
properly
ventilated
during
the
trial of the
case
that
respondent
is
in pari
delicto in
the
Code
of
the
Philippines;
(2)
defendant
has
the
[18]
Its elements
However,
admits
Appeals,
of
[23]
this
principle
of
exceptions. Thus,
hypothetical
in Tan
v.
admission
Court
we held:
The trial court held that the Complaint in the case at bar
contains all the three elements of a cause of action, i.e., it
alleges that: (1) plaintiff has the right to ask for the
declaration of nullity of the Hedging Contracts for being
null and void and contrary to Article 2018 of the Civil
of
thereto. Such
defense
requires
the
ground.
the
Hedging
Contracts,
despite
the
express
conclusion
hypothetically
of
law,
which
admitted. Quite
therefore
properly,
cannot
the
be
relevant
Jurisdiction
over
the
person
of
petitioner
Petitioner
alleges
that
the
RTC
has
not
acquired
Secondly, the
service
of
summons
to
petitioner
defendant
Respondent
argues[31] that
extraterritorial
service
claims
lien
or
an
interest,
actual
or
Singapore
Pte
Ltd.
v.
Dakila
Trading
Corporation[33] that:
[37]
loan
and
Hedging
Contracts
between
the
personam and
ofaffirmative
since
the
defendant,
petitioner
defenses in
an
Answer
(which
court)
court.
In
the
prayer
for affirmative
[38]
this
regard,
respondent
vigorously
argues
that
and
specific
reliefs
from
the
trial
court.
clearly
refers
to
affirmative
defenses,
rather
than
affirmative reliefs.
voluntary
appearance
therein.
[45]
Thus,
in Philippine
[46]
wherein
for
Review
of Jurisdiction), we held:
awyers
Republic
of
SUPREME COURT
the
Philippines
FIRST DIVISION
G.R. No. 120077
PARDO, J.:
The case before the Court is a petition for certiorari 1 to
annul the following orders of the National Labor Relations
Commission (hereinafter referred to as "NLRC") for having
been issued without or with excess jurisdiction and with
grave abuse of discretion:2
(1) Order of May 31, 1993.3 Reversing and setting aside
its earlier resolution of August 28, 1992. 4 The questioned
order declared that the NLRC, not the Philippine Overseas
Employment Administration (hereinafter referred to as
"POEA"), had jurisdiction over private respondent's
complaint;
(2) Decision of December 15, 1994.5 Directing petitioners
to jointly and severally pay private respondent twelve
thousand and six hundred dollars (US$ 12,600.00)
representing salaries for the unexpired portion of his
contract;
three
thousand
six
hundred
dollars
(US$3,600.00) as extra four months salary for the two (2)
year period of his contract, three thousand six hundred
dollars (US$3,600.00) as "14th month pay" or a total of
nineteen
thousand
and
eight
hundred
dollars
(US$19,800.00) or its peso equivalent and attorney's fees
amounting to ten percent (10%) of the total award; and
(3) Order of March 30, 1995.6 Denying the motion for
reconsideration of the petitioners.
In May, 1988, private respondent Marcelo Santos
(hereinafter referred to as "Santos") was an overseas
worker employed as a printer at the Mazoon Printing
Press, Sultanate of Oman. Subsequently, in June 1988, he
was directly hired by the Palace Hotel, Beijing, People's
Republic of China and later terminated due to
retrenchment.
Petitioners are the Manila Hotel Corporation (hereinafter
referred to as "MHC") and the Manila Hotel International
Company, Limited (hereinafter referred to as "MHICL").
When the case was filed in 1990, MHC was still a
government-owned and controlled corporation duly
organized and existing under the laws of the Philippines.
His service with the Palace Hotel, Beijing was not abruptly
terminated but we followed the one-month notice clause
and Mr. Santos received all benefits due him.
Even assuming that the NLRC was the proper forum, even
on the merits, the NLRC's decision cannot be sustained.
Republic
SUPREME
Manila
of
the
Philippines
COURT
THIRD DIVISION
G.R. Nos. 90306-07 July 30, 1990
K.K. SHELL SEKIYU OSAKA HATSUBAISHO and FU HING
OIL
CO.,
LTD., petitioners,
vs.
THE HONORABLE COURT OF APPEALS, ATLANTIC
VENUS
CO.,
S.A.,
and
THE
VESSEL
M/V
"ESTELLA",respondents.
CORTES, J:
Ordinarily, the Court will not disturb the factual findings of
the Court of Appeals, these being considered final and
conclusive. However, when its factual conclusions are
manifestly mistaken, the Court will step in to correct the
misapprehension [De la Cruz v. Sosing, 94 Phil. 26 (1953);
Castillo v. Court of Appeals, G.R. No. L-48290, September 29,
1983, 124 SCRA 808.] This case is one such instance calling
for the Court's review of the facts.
On January 7,1987, Kumagai Kaiun Kaisha, Ltd. (hereinafter
referred to as Kumagai), a corporation formed and existing
under the laws of Japan, filed a complaint for the collection of
a sum of money with preliminary attachment against Atlantic
Venus Co., S.A. (hereinafter referred to as "Atlantic"), a
corporation registered in Panama, the vessel MV Estella and
Crestamonte Shipping Corporation (hereinafter referred to as
"Crestamonte"), a Philippine corporation. Atlantic is the
owner of the MV Estella. The complaint, docketed as Civil
Case No. 8738930 of the Regional Trial Court, Branch XIV,
Manila alleged that Crestamonte, as bareboat charterer and
operator of the MV Estella, appointed N.S. Shipping
Corporation (hereinafter referred to as "NSS"), a Japanese
corporation, as its general agent in Japan. The appointment
was formalized in an Agency Agreement. NSS in turn
appointed Kumagai as its local agent in Osaka, Japan.
Kumagai supplied the MV Estella with supplies and services
but despite repeated demands Crestamonte failed to pay the
amounts due.
NSS and Keihin Narasaki Corporation (hereinafter referred to
a Keihin filed complaints-in-intervention.
On May 19,1987, petitioner Fu Hing Oil Co., Ltd. (hereinafter
referred to as Fu Hing"), a corporation organized in Hong
Kong and not doing business in the Philippines, filed a motion
for leave to intervene with an attached complaint-inintervention, alleging that Fu Hing supplied marine diesel
oil/fuel to the MV Estella and incurred barge expenses for the
WITNESSETH
That the OWNER has appointed and by these presents
hereby appoints the AGENT as its General Agents for all
Japan in connection with the Owner's vessels and/or
providing suitable vessels for Japan Ports under the following
terms and conditions:
1.0 - In general, the Agent will abide by the
Owner's decisions regarding the mode of
operations of the vessels in Japan and that all
cargo bookings, vessel's fixtures/charters, etc.
by the Agent, shall always be subject to the
prior approval and consent of the Owners.
2.0 - That the Agent shall provide for the
necessary
services
required
for
the
husbanding of the Owner's vessels in all Japan
Ports and issue Bill(s) of Lading to Shippers in
the form prescribed by the Owners.
3.0 - That the Agent shall be responsible for
fixing south-bound cargoes with revenues
sufficient to cover ordinary liner operation
expenses
such
as
bunkers,
additives,
lubricating
oil,
water,
running
repairs,
drydocking expenses, usual port disbursement
accounts, cargo handling charges including
stevedorage, provisions and ship's stores and
cash advance to crew (excluding crew
provisions).
HEINE
v.
plaintiff.
Ct. 132, 133, 56 L. Ed. 274, 38 L. R. A. (N. S.) 40: "It should
in
and
business.
this
district
would
impose
upon
them
great
jurisdiction.
Coal & Iron Co., 235 N.Y. 152, 139 N.E. 223, 32 A. L. R. 1, and
note; Pietraroia v. New Jersey & Hudson River Ry. & Ferry Co.,
197 N.Y. 434, 91 N.E. 120; Gregonis v. P. & R. Coal & Iron Co.,
& Eng. Ency. of Law (2d Ed.) 1350. The courts of this country
Wis. 651, 106 N.W. 821, 15 L. R. A. (N. S.) 1045, 115 Am. St.
Rep. 1063.
Life Ins. Co.[1] But that affords no reason why this court
not on the ground that it has not jurisdiction, but that, from
southern
side
which
were
occupied
by
impoverished
at the Bhopal plant at the request of, and with the approval
Union
Carbide
Corporation,
New
York
corporation.
Livestock
were
killed
and
crops
damaged.
FACTUAL BACKGROUND
2479).
Since
then
144
additional
actions
have
been
"scheme."
been
District Court for the Southern District of New York under the
1985.
The
individual
Indian
federal
Government
court
on
complaints
March
29,
have
1985
enacted
DISCUSSION
Executive Committee.
[1]
Aircraft Co. v. Reyno, 454 U.S. 235, 102 S. Ct. 252, 70 L. Ed.
2d 419 (1981). The plaintiffs cite numerous other lower
below.
"sound
various
Then,
as
concerns
in
matter
the
within
same
direct
its
manner
in
864, infra.
At this juncture, it would be appropriate to discuss the
presumptions
on
a forum
non
conveniens motion.
1. Preliminary Considerations.
"At the outset of any forum non conveniens inquiry, the court
must
was based on the fact that the choice of the home forum
elements of that inquiry are set forth in Piper. First, the Court
defendant
determine
is
whether
`amenable
there
to
exists
process'
an
in
alternative
the
other
convenient,
deference.
foreign
plaintiff's
choice
deserves
that
the
doctrine
of forum
non
less
Extending
the
limited
inquiry
was
transferred
on
the
of forum
non
that
was
doctrine
the
non
change
non
inconsistent
plaintiff
in
its
conveniens doctrine
grounds
determined
with
the
decision
would
underlying
on
it
a forum
become
virtually
[2]
of
law
for
foreign
plaintiffs
suing
American
[T]he
American
courts,
which
are
already
extremely
that
no
adequate
alternative
exists.
As
[T]he
possibility
of
an
unfavorable
change
in
law
(Memorandum
thwart
in
the
victims'
Opposition
by
quest
for"
Plaintiffs'
justice.
Executive
on
three
occasions
before
international
tribunals.
Although the outcome of this analysis, given the rule
preliminary
concern,
regarding
defendant's
[which]
acknowledged
that
it is
subject
to
the
[5]
grows
through
the
judicial
process
and
statutory
emerged
from
its
colonial
heritage
to
display
the
from a gas leak in New Delhi. The Chief Justice and another
Indian
not customarily join into large law firms, and as Mr. Palkhivala
attorneys
use
experts,
when
necessary.
As
to
begun there.
in
Victorian
England. See,
e.g.,
Rylands
v.
affidavit:
Reports for the span from 1914 to 1965 revealed only 613
law to the events which took place in Bhopal. Well settled law
their
elements,
the
[theories]
of
liability,
complex litigation.
conflicts
of
decisions.
Thus,
Mr.
Dadachanji
argues,
judge.
alternative forum.
arrangements
that
to
the
"representative"
suit
is
expressly
limited
in
India.
Plaintiffs
do
not
press
these
that
the
Indian
legal
system
provides
an
adequate
non
conveniens grounds
on
Union
Carbide's
facts.
which
non
should
be
weighed
in
making
a forum
Limited
discovery
on
the
issue
of forum
non
in Piper,
plant
had
"limited
contact"
with
UCIL's
Bombay
A. Sources of Proof.
first
example
of
private
interest
consideration
accident.[13] The
liability at trial.
records
and
reports
of
the
various
While
departments
Mechanical
Chemical
employed
11-12).
repairs
support,
including
Maintenance,
on
both
46
part
people.
equipment,
Instrumentation,
of
the
Agricultural
(Woomer
provided
Aff.
at
engineering
examination
of
members
of
the
Works
Office
itself,
receiving
and
a
that
copy
Union
of
the
Carbide
report
did
not
which
make
called
for
any
its
reports.
(Woomer Aff.
[14]
India or UCIL chose the site and product of the Bhopal plant,
that Union Carbide was the creator of the design used in the
the Court will evaluate the facts which bear on the issue of
program. They urge that for the most *856 part relevant
proof
only,
and
bear
solely
upon
the forum
non
"Design
Service
Transfer
Agreement"
and
"Technical
alia, that:
Mr. Dutta asserts that the Bhopal facility was built by UCIL
over the eight years from 1972 to 1980. (Dutta Aff. at 8). He
UCIL
which
stating:
engineers
performed
oversaw
the
detail
the
55
design
to
work.
60
This
Indian
firm,
[17]
[T]he
process
design
packages
which
Union
Carbide
Mr. Dutta expressly states that the MIC storage tank and
starting
general
points....
They
set
forth
only
the
Mr. Munoz and Mr. Dutta both may be called to testify at trial
forum.
[18]
16).
be trained, and that UCIL paid Union Carbide for the training.
case.[20] The
plant. The Court need not resolve the question of who was
consolidated
is
at 48).
B. Access to Witnesses.
witnesses
Circuit
conveniens motion:
do
has
not
stated
speak
in
English,
the
and
context
of
would
require
a forum
non
measure
such
over them.
upon
the
knowledge
and
activities
of
events which gave rise to it. The United States District Court
in New York, however, has no power to subpoena any of
favoring
Fitzgerald
v.
Texaco, 521
F.2d
448,
451-52
(2d
dismissal
of
this
action
on forum
non
C. Possibility of View.
In summary, then, the private interest factors weigh greatly
The third private interest factor articulated in Gilbert is the
in
that
liability
cases,
since
videotapes,
pictures,
favor
of
dismissal
dismissal
is
on
favored
grounds
at
this
of forum
point
in
non
the
diagrams,
instant case, the site of the accident was sealed after the
Robins
Co.,
Inc., 528
F.
Supp.
809,
there is reason for holding the trial in their view and reach
grounds
a forum that is at home with the state law that must govern
of forum
non
conveniens, the
Second
Circuit
foreign to itself.
Gilbert at 508-09, 67 S. Ct. at 843. The Court will consider
these various factors in turn, as well as others discussed by
the parties andamicus curiae.
A. Administrative Difficulties.
This Court has already determined that because of the
As is evident from the discussion thus far, the mere size of
There can be no doubt that the Bhopal litigation will take its
clear.
toll on any court which sits in judgment on it. This Court sits
in one of the busiest districts in the country, and finds, as a
Lines, 340
F.
Supp.
811 (S.D.N.Y.1972)
evaluated
the
******
I see no reason why this Court, with its heavy burdens and
Clearly, the
478
N.Y.S.2d
597,
467
N.E.2d
245
(1984), cert.
denied, ___ U.S. ___, 105 S. Ct. 783, 83 L. Ed. 2d 778 (1985),
with reference to a decision discussing actions brought in
New York by the Iranian Government against the Shah and
his wife, the Court of Appeals stated that:
ephemeral.
environmental
standards
as
the
price
of
continuing
case
can
in Piper, where
"American
B. The Interests of India and the United States.
American
be
the
citizens
distinguished
Court
rejected
have
an
manufacturers
are
from
the
the
interest
deterred
in
situation
argument
that
ensuring
that
from
producing
on
foreign
soil.
"To
"would
abandon
both
injure
that
our
creating
precedent
which
will
"bind
all
American
20);
Union of India chose this forum, plaintiffs state that there can
multinationals
henceforward,"
(Amicus Brief
at
regarding
all
aspects
of
the
Bhopal
facility
during
to
approve
foreign
collaboration
and
import
of
1982), modified
sub.
nom.Dowling
v.
When
pharmaceuticals
in
a
this
regulated
case
industry,
and
such
passenger
as
aircraft
must be considered.
and amicus
and
unfair
curiae. However,
to
when
defendant.
an
The
industry
district
is
as
court
product's use with the risk of harm associated with that use
its own view of the safety, warning, and duty of care required
than our own. Most significantly, our two societies must deal
Harrison
v.
Wyeth
Laboratories, 510
F.
Supp.
1,
think not.
country." Harrison at
is
imposing
concerns.
(emphasis
omitted).
This
characteristically
American
values
on
Indian
[24]
States.
This
litigation
offers
developing
nation
the
interest
[25]
in
the
outcome
of
the
litigation
exceeds
The public interest factors set forth in Piper and Gilbert also
this United States Court, or a jury working with it. This public
CONCLUSION
Bhopal litigation. They assert that the Indian judiciary has yet
meet their own ends. Plaintiffs allege that the Indian justice
system has not yet cast off the burden of colonialism to meet
judgment
world power in 1986, and its courts have the proven capacity
and
affirmance
comport
with
the
minimal
India has emerged. India and its people can and must
vindicate their claims before the independent and legitimate
SO ORDERED.
waived any possible fee. The Court has been informed that
choose the forum with the most favorable choice of law rules
Ct. 267, n. 25. While the Court feels that it would be fair to
authority to do so.
conveniens inquiry,
dismissal
would
rarely
be
[8] The Court observes that the alleged problem would
Union Carbide.
remedies
in
situations
relating
to
abridgements
of
Woomer, the Indian CBI, which had stepped into the plant
Control,
18-19).
Stores,
Purchasing,
Safety/Medical,
Industrial
affiliates.
specific
responsibility
request
of
"rested
UCIL.
In
exclusively
addition,
with
follow-up
UCIL
plant
64).
"international
employee"
whose
mobility
drawings
for
the
buildings
and
foundation;
and
certification
of
fabricated
vendor's
equipment;
drawings
and
review
and
documents,
[19] Mr. Dutta asserts that Mr. Munoz was a paid consultant
the
drawings,
plant,
material
preparation
take
off
and
of
isometric
inquiry
piping
specification
packages,
[20]
bids
certain
and, for the most part, their medical records, are found in or
witnesses
commissioning.
and
selection
of
vendors,
inspection
of
Union
Carbide
is
not
asserts
throughout
dispositive
of
its
briefs
a forum
and
non
Court would not countenance the impractical and timeconsuming process of calling each of the approximately
foreign locations.
national
are
plaintiffs,
India.
United
States
citizens.
Of
the
200,000
controversy
which
should
be
"decided
at
American
of
minimum.
plaintiffs
where
an
examination
237
available in another state
documents
referred
to
accompanied,
Philippines,
in
if
the
record
is
not
kept
in
the
STOCKTON W. ROUZIE,
JR., respondent.
DECISION
SECOND DIVISION
TINGA, J.:
G.R. No. 162894
February 26, 2008
RAYTHEON
INTERNATIONAL,
INC., petitioner,
vs.
Decision1 and
Resolution2 of the Court of
Appeals in CA-G.R. SP No.
67001 and the dismissal
of the civil case filed by
respondent
against
petitioner with the trial
court.
As culled from the records
of the case, the following
antecedents appear:
Sometime in 1990, Brand
Marine
Services,
Inc.
(BMSI), a corporation duly
organized and existing
under the laws of the
State
of
Connecticut,
United States of America,
and respondent Stockton
W. Rouzie, Jr., an American
citizen, entered into a
contract whereby BMSI
hired respondent as its
representative
to
negotiate the sale of
services
in
several
government projects in
the Philippines for an
agreed remuneration of
10% of the gross receipts.
On
11
March
1992,
respondent
secured
a
service contract with the
Republic of the Philippines
on behalf of BMSI for the
dredging of rivers affected
by
the
Mt.
Pinatubo
eruption and mudflows.3
On
16
respondent
July
filed
1994,
before
Raytheon
International,
Inc. as well as BMSI and
RUST,
the
two
corporations impleaded in
the earlier labor case. The
complaint
essentially
reiterated the allegations
in the labor case that
BMSI verbally employed
respondent to negotiate
the sale of services in
government projects and
that respondent was not
paid the commissions due
him from the Pinatubo
dredging project which he
secured on behalf of BMSI.
The
complaint
also
averred that BMSI and
RUST as well as petitioner
itself had combined and
functioned
as
one
company.
In its Answer,8 petitioner
alleged that contrary to
respondents claim, it was
a foreign corporation duly
licensed to do business in
the Philippines and denied
entering
into
any
arrangement
with
respondent or paying the
latter any sum of money.
Petitioner
also
denied
combining with BMSI and
RUST for the purpose of
assuming
the
alleged
obligation of the said
companies.9 Petitioner
also referred to the NLRC
decision which disclosed
that
per
the
written
agreement
between
Hence,
raising
issues:
this
the
petition
following
WHETHER OR NOT
THE COURT OF
APPEALS ERRED IN
REFUSING
TO
DISMISS
THE
COMPLAINT
FOR
FAILURE TO STATE
A
CAUSE
OF
ACTION
AGAINST
RAYTHEON
INTERNATIONAL,
INC.
WHETHER OR NOT
THE COURT OF
APPEALS ERRED IN
REFUSING
TO
DISMISS
THE
COMPLAINT
ON
THE
GROUND
OF FORUM
NON
CONVENIENS.24
Incidentally,
respondent
failed to file a comment
despite repeated notices.
The Ceferino Padua Law
Office, counsel on record
for
respondent,
manifested
that
the
lawyer handling the case,
Atty. Rogelio Karagdag,
had severed relations with
the law firm even before
the filing of the instant
petition and that it could
no
longer
find
the
whereabouts
of
Atty.
Karagdag
or
of
respondent
despite
diligent
efforts.
In
a
Resolution25 dated
20
November
2006,
the
Court
resolved
to
dispense with the filing of
a comment.
The instant petition lacks
merit.
Petitioner mainly asserts
that the written contract
between respondent and
BMSI included a valid
choice of law clause, that
is, that the contract shall
be governed by the laws
of
the
State
of
Connecticut.
It
also
mentions the presence of
foreign elements in the
dispute namely, the
parties
and
witnesses
involved are American
corporations and citizens
and the evidence to be
presented
is
located
outside the Philippines
that renders our local
courts
inconvenient
forums.
Petitioner
theorizes that the foreign
elements of the dispute
necessitate the immediate
application of the doctrine
of forum non conveniens.
Recently in Hasegawa v.
Kitamura,26 the
Court
outlined three consecutive
phases involved in judicial
resolution of conflicts-of-
Jurisdiction
over
the
nature and subject matter
of an action is conferred
by the Constitution and
the law30 and by the
material allegations in the
complaint, irrespective of
whether
or
not
the
plaintiff is entitled to
recover all or some of the
claims or reliefs sought
therein.31 Civil Case No.
1192-BG is an action for
damages arising from an
alleged
breach
of
contract.
Undoubtedly,
the nature of the action
and
the
amount
of
damages
prayed
are
within the jurisdiction of
the RTC.
As regards jurisdiction
over the parties, the trial
court acquired jurisdiction
over herein respondent
(as party plaintiff) upon
the filing of the complaint.
On
the
other
hand,
jurisdiction
over
the
person of petitioner (as
party
defendant)
was
acquired by its voluntary
appearance in court.32
That the subject contract
included a stipulation that
the
same
shall
be
governed by the laws of
the State of Connecticut
does not suggest that the
Philippine courts, or any
other foreign tribunal for
that matter, are precluded
warranty
obligations
of
defendant
Rust
International in the
Makar Port Project
in General Santos
City, after Rust
International
ceased to exist
after
being
absorbed by REC.
Other documents
already submitted
in evidence are
likewise meager to
preponderantly
conclude
that
Raytheon
International, Inc.,
Rust
International[,] Inc.
and Brand Marine
Service, Inc. have
combined into one
company, so much
so that Raytheon
International, Inc.,
the
surviving
company (if at all)
may be held liable
for the obligation
of
BMSI
to
respondent Rouzie
for
unpaid
commissions.
Neither
these
documents clearly
speak otherwise.38
As correctly pointed out
by the Court of Appeals,
the question of whether
petitioner, BMSI and RUST
merged together requires
On
16
July
1994,
respondent filed before
the Arbitration Branch of
the
National
Labor
Relations
Commission
(NLRC) a suit against BMSI
and Rust International,
Inc. (RUST), Rodney C.
Gilbert and Walter G.
Browning
for
alleged
nonpayment
of
commissions,
illegal
termination and breach of
employment contract.4 On
28
September
1995,
Labor Arbiter Pablo C.
Espiritu,
Jr.
rendered
judgment ordering BMSI
and
RUST
to
pay
respondents
money
claims.5 Upon appeal by
BMSI, the NLRC reversed
the decision of the Labor
Arbiter
and
dismissed
respondents complaint on
the ground of lack of
jurisdiction.6 Respondent
elevated the case to this
Court but was dismissed
in a Resolution dated 26
November
1997.
The
Resolution became final
and executory on 09
November 1998.
On
8
January
1999,
respondent,
then
a
resident of La Union,
instituted an action for
damages
before
the
Regional Trial Court (RTC)
of Bauang, La Union. The
Complaint,7 docketed
as
Civil Case No. 1192-BG,
named
as
defendants
herein
petitioner
Raytheon
International,
Inc. as well as BMSI and
RUST,
the
two
corporations impleaded in
the earlier labor case. The
complaint
essentially
reiterated the allegations
in the labor case that
BMSI verbally employed
respondent to negotiate
the sale of services in
government projects and
that respondent was not
paid the commissions due
him from the Pinatubo
dredging project which he
secured on behalf of BMSI.
The
complaint
also
averred that BMSI and
RUST as well as petitioner
itself had combined and
functioned
as
one
company.
In its Answer,8 petitioner
alleged that contrary to
respondents claim, it was
a foreign corporation duly
licensed to do business in
the Philippines and denied
entering
into
any
arrangement
with
respondent or paying the
latter any sum of money.
Petitioner
also
denied
combining with BMSI and
RUST for the purpose of
assuming
the
alleged
obligation of the said
companies.9 Petitioner
also referred to the NLRC
decision which disclosed
that
per
the
written
agreement
between
respondent and BMSI and
RUST, denominated as
"Special
Sales
Representative
Agreement," the rights
and obligations of the
parties shall be governed
by the laws of the State of
Connecticut.10 Petitioner
sought the dismissal of
the complaint on grounds
of failure to state a cause
of action and forum non
conveniens and prayed for
damages
by
way
of
compulsory
counterclaim.11
On
18
May
1999,
petitioner
filed
an
Omnibus
Motion
for
Preliminary Hearing Based
on Affirmative Defenses
and
for
Summary
Judgment12 seeking
the
dismissal of the complaint
on grounds of forum non
conveniens and failure to
state a cause of action.
Respondent opposed the
same.
Pending
the
resolution of the omnibus
motion, the deposition of
Walter
Browning
was
taken
before
the
Philippine
Consulate
General in Chicago.13
In an Order14 dated 13
September 2000, the RTC
denied
petitioners
omnibus motion. The trial
this
the
petition
following
WHETHER OR NOT
THE COURT OF
APPEALS ERRED IN
REFUSING
TO
DISMISS
THE
COMPLAINT
FOR
FAILURE TO STATE
A
CAUSE
OF
ACTION
AGAINST
RAYTHEON
INTERNATIONAL,
INC.
WHETHER OR NOT
THE COURT OF
APPEALS ERRED IN
REFUSING
TO
DISMISS
THE
COMPLAINT
ON
THE
GROUND
OF FORUM
NON
CONVENIENS.24
Incidentally,
respondent
failed to file a comment
despite repeated notices.
The Ceferino Padua Law
Office, counsel on record
for
respondent,
manifested
that
the
lawyer handling the case,
Atty. Rogelio Karagdag,
had severed relations with
the law firm even before
the filing of the instant
petition and that it could
no
longer
find
the
whereabouts
of
Atty.
Karagdag
or
of
respondent
despite
diligent
efforts.
In
a
25
Resolution dated
20
November
2006,
the
Court
resolved
to
dispense with the filing of
a comment.
The instant petition lacks
merit.
Petitioner mainly asserts
that the written contract
between respondent and
BMSI included a valid
choice of law clause, that
is, that the contract shall
be governed by the laws
of
the
State
of
Connecticut.
It
also
mentions the presence of
foreign elements in the
dispute namely, the
parties
and
witnesses
involved are American
corporations and citizens
and the evidence to be
presented
is
located
outside the Philippines
that renders our local
courts
inconvenient
forums.
Petitioner
theorizes that the foreign
elements of the dispute
necessitate the immediate
application of the doctrine
of forum non conveniens.
Recently in Hasegawa v.
Kitamura,26 the
Court
On
the
matter
of
jurisdiction
over
a
conflicts-of-laws problem
where the case is filed in a
Philippine court and where
the court has jurisdiction
over the subject matter,
the parties and the res, it
may or can proceed to try
the case even if the rules
of conflict-of-laws or the
convenience of the parties
point to a foreign forum.
This is an exercise of
sovereign prerogative of
the country where the
case is filed.29
Jurisdiction
over
the
nature and subject matter
of an action is conferred
by the Constitution and
the law30 and by the
material allegations in the
complaint, irrespective of
whether
or
not
the
plaintiff is entitled to
recover all or some of the
claims or reliefs sought
therein.31 Civil Case No.
1192-BG is an action for
damages arising from an
alleged
breach
of
contract.
Undoubtedly,
the nature of the action
and
the
amount
of
damages
prayed
are
within the jurisdiction of
the RTC.
As regards jurisdiction
over the parties, the trial
court acquired jurisdiction
over herein respondent
defers
to
the
sound
discretion of the lower
courts
because
their
findings are binding on
this Court.
Petitioner also contends
that the complaint in Civil
Case No. 1192-BG failed
to state a cause of action
against petitioner. Failure
to state a cause of action
refers to the insufficiency
of
allegation
in
the
pleading.36 As a general
rule, the elementary test
for failure to state a cause
of action is whether the
complaint alleges facts
which if true would justify
the relief demanded.37
The complaint alleged
that
petitioner
had
combined with BMSI and
RUST to function as one
company.
Petitioner
contends
that
the
deposition
of
Walter
Browning rebutted this
allegation. On this score,
the resolution of the Court
of Appeals is instructive,
thus:
x
x
x
Our
examination of the
deposition of Mr.
Walter Browning as
well
as
other
documents
produced in the
hearing shows that
these
evidence aliunde a
re
not
quite
sufficient for us to
mete a ruling that
the complaint fails
to state a cause of
action.
Annexes "A" to "E"
by themselves are
not
substantial,
convincing
and
conclusive proofs
that
Raytheon
Engineers
and
Constructors, Inc.
(REC) assumed the
warranty
obligations
of
defendant
Rust
International in the
Makar Port Project
in General Santos
City, after Rust
International
ceased to exist
after
being
absorbed by REC.
Other documents
already submitted
in evidence are
likewise meager to
preponderantly
conclude
that
Raytheon
International, Inc.,
Rust
International[,] Inc.
and Brand Marine
Service, Inc. have
combined into one
company, so much
so that Raytheon
International, Inc.,
the
surviving
company (if at all)
may be held liable
for the obligation
of
BMSI
to
respondent Rouzie
for
unpaid
commissions.
Neither
these
documents clearly
speak otherwise.38
As correctly pointed out
by the Court of Appeals,
the question of whether
petitioner, BMSI and RUST
merged together requires
the presentation of further
evidence, which only a
full-blown trial on the
merits can afford.
WHEREFORE, the instant
petition for review on
certiorari is DENIED. The
Decision and Resolution of
the Court of Appeals in
CA-G.R. SP No. 67001 are
hereby AFFIRMED. Costs
against petitioner.
SO ORDERED.
[G.R.
141536. February
2001]
GIL
No.
26,
MIGUEL
T.
PUYAT, petitioner
,
vs. RON
ZABARTE, respo
ndent.
DECISION
PANGANIBAN, J.:
Summary judgment in
a litigation is resorted to if
there is no genuine issue
as to any material fact,
other than the amount of
damages. If this verity is
evident
from
the
pleadings
and
the
supporting
affidavits,
depositions
and
admissions on file with the
court, the moving party is
entitled to such remedy
as a matter of course.
The Case
Before us is a Petition
for
Review
on Certiorari under
Rule
45 of the Rules of Court,
challenging the August
31, 1999 Decision[1] of the
Court of Appeals (CA),
which
affirmed
the
Regional Trial Court (RTC)
of Pasig City, Branch 67 in
Civil Case No. 64107; and
the January 20, 2000 CA
Resolution[2] which denied
reconsideration.
The
Decision
follows:
assailed
disposed
CA
as
WHEREFORE, finding no
error in the judgment
and
without
sufficient
notice
to
him
and
therefore, was rendered in
clear
violation
of
[petitioners] constitutional
rights to substantial and
procedural due process.
10) The
Judgment
on
Stipulation for Entry in
Judgment in Case #C2100265 dated December
12, 1991 was procured by
means
of
fraud
or
collusion
or
undue
influence and/or based on
a clear mistake of fact and
law.
11) The
Judgment
on
Stipulation for Entry in
Judgment in Case #C2100265 dated December
12, 1991 is contrary to the
laws, public policy and
canons
of
morality
obtaining
in
the
Philippines
and
the
enforcement
of
such
judgment
in
the
Philippines would result in
the unjust enrichment of
[respondent]
at
the
expense of [petitioner] in
this case.
9) The
Judgment
on
Stipulations for Entry in
Judgment in Case #C2100265 dated December
12, 1991 was obtained
without the assistance of
counsel for [petitioner]
12) The
Judgment
on
Stipulation for Entry in
Judgment in Case #C2100265 dated December
12, 1991 is null and void
and unenforceable in the
Philippines.
xxxxxxxxx
has
been
laid in this
[respondents] motion,
[petitioner] demurred
as follows:
2) [Petitioner]
begs
to
disagree[;]
in
support
hereof, [he] wishes to
mention
that
in
his
Answer with Special and
Affirmative
Defenses
dated March 16, 1994
[petitioner] has interposed
that the Judgment on
Stipulations for Entry in
Judgment is null and void,
fraudulent,
illegal
and
unenforceable, the same
having been obtained by
means of fraud, collusion,
undue influence and/or
clear mistake of fact and
law. In addition, [he] has
maintained
that
said
Judgment on Stipulations
for Entry in Judgment was
obtained
without
the
assistance of counsel for
[petitioner] and without
sufficient notice to him
and
therefore,
was
rendered in violation of his
constitutional rights to
substantial and procedural
due process.
The
[M]otion
for
[S]ummary
[J]udgment was set
for hearing on 12
August 1994 during
which
[respondent]
marked
and
submitted
in
evidence
following:
Exhibit A - x x x
J
u
d
g
m
e
n
t
o
n
S
ti
p
u
la
ti
o
n
F
o
r
E
n
tr
y
I
n
J
u
d
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On 6 April 1995, the court
a quo issued an [O]rder
granting
[respondents]
[M]otion for [S]ummary
[J]udgment [and] likewise
granting [petitioner] ten
(10)
days
to
submit
opposing affidavits, after
which the case would be
deemed submitted for
resolution (Record, pp.
152-153). [Petitioner] filed
a
[M]otion
for
[R]econsideration of the
aforesaid
[O]rder
and
[respondent]
filed
[C]omment. On 30 June
1995, [petitioner] filed a
[M]otion to [D]ismiss on
the ground of lack of
jurisdiction
over
the
subject matter of the case
and forum-nonconveniens (Record,
pp.
166-170). In
his
[O]pposition
to
the
[M]otion (Record, pp. 181182)
[respondent]
contended that [petitioner
could] no longer question
the jurisdiction of the
lower court on the ground
that [the latters] Answer
had failed to raise the
issue
of
jurisdiction. [Petitioner]
countered by asserting in
his Reply that jurisdiction
Affirming
the
trial
court,
the
Court
of
Appeals
held
that
petitioner was estopped
from
assailing
the
judgment
that
had
become final and had, in
fact,
been
partially
executed. The CA also
ruled
that
summary
judgment
was
proper,
because petitioner had
failed to tender any
genuine issue of fact and
was merely maneuvering
to delay the full effects of
the judgment.
Citing Ingenohl
v.
Olsen,[8] the
CA
also
rejected
petitioners
argument that the RTC
should have dismissed the
action
for
the
enforcement of a foreign
judgment, on the ground
of forum
non
conveniens. It
reasoned
out that the recognition of
the foreign judgment was
based
on
comity,
reciprocity
and res
judicata.
In his Memorandum,
petitioner submits this
lone but all-embracing
issue:
2. That
of forum
the
principle
non
conveniens was
inapplicable to the instant
case.
This Courts Ruling
Petitioner vehemently
insists
that
summary
judgment is inappropriate
to resolve the case at bar,
arguing that his Answer
allegedly raised genuine
and
material
factual
matters which he should
have been allowed to
prove during trial.
On the other hand,
respondent argues that
the alleged genuine issues
of fact raised by petitioner
are mere conclusions of
law,
or
propositions
arrived at not by any
process
of
natural
reasoning from a fact or a
combination
of
facts
stated
but
by
the
application of the artificial
rules of law to the facts
pleaded.[11]
The
RTC
granted
respondents Motion for
Summary
Judgment
because petitioner, in his
Answer,
admitted
the
existence of the Judgment
Again,
in
its
Order[16] dated November
29, 1995, the trial court
clarified that the opposing
affidavits
were
for
[petitioner] to spell out
the facts or circumstances
[that] would constitute
lack of jurisdiction over
the subject matter of and
over the persons involved
in Case No. C21-00265,
and that would render the
judgment therein null and
void. In
this
light,
petitioners
contention
that he was not allowed to
present
evidence
to
substantiate his claims is
clearly untenable.
For
summary
judgment to be valid, Rule
34, Section 3 of the Rules
of Court, requires (a) that
there must be no genuine
issue as to any material
fact,
except
for
the
amount of damages; and
(b)
that
the
party
presenting the motion for
summary judgment must
be entitled to a judgment
as a matter of law.[17] As
mentioned
earlier,
petitioner admitted that a
foreign
judgment
had
been rendered against
him and in favor of
respondent, and that he
had paid $5,000 to the
latter
in
partial
compliance
therewith. Hence,
Petitioner
contends
that the foreign judgment,
which was in the form of a
Compromise Agreement,
cannot
be
executed
without the parties being
assisted by their chosen
lawyers. The reason for
this, he points out, is to
eliminate collusion, undue
influence and/or improper
exertion of ascendancy by
one
party
over
the
other. He alleges that he
discharged his counsel
during the proceedings,
because he felt that the
latter was not properly
attending to the case. The
judge, however, did not
allow him to secure the
services
of
another
counsel. Insisting
that
petitioner settle the case
with
respondent,
the
judge practically imposed
the settlement agreement
on him.In his Opposing
Affidavit, petitioner states:
It is true that I was initially
represented by a counsel
in the proceedings in
#C21-00625. I discharged
him because I then felt
that he was not properly
attending to my case or
was
not
competent
enough to represent my
interest. I asked the Judge
for time to secure another
counsel
but
I
was
practically
discouraged
from engaging one as the
assumed
the
representation for myself
and these firms and this
was
allowed
by
the
Superior Court of the
State of California without
any authorization from
G.G.P. & Sons, Inc. and the
Genesis Group.[24] Clearly,
it was petitioner who
chose to represent the
other defendants; hence,
he cannot now be allowed
to impugn a decision
based on this ground.
In any event, contrary
to petitioners contention,
unjust
enrichment
or solutio indebiti does not
apply to this case. This
doctrine
contemplates
payment when there is no
duty to pay, and the
person who receives the
payment has no right to
receive it.[25] In this case,
petitioner merely argues
that
the
other
two
defendants
whom
he
represented were liable
together with him. This is
not a case of unjust
enrichment.
We do not see, either,
how the foreign judgment
could be contrary to law,
morals, public policy or
the canons of morality
obtaining
in
the
country. Petitioner
owed
money, and the judgment
required him to pay
Question:
Forum
Non
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
The
difficulty
of
ascertaining foreign law.
[27]
None
of
the
aforementioned
reasons
barred the RTC from
exercising
its
jurisdiction. In the present
action, there was no more
need
for
material
witnesses,
no
forum
shopping or harassment
of
petitioner,
no
inadequacy in the local
machinery to enforce the
foreign judgment, and no
question raised as to the
application of any foreign
law.
however, be assailed if
there is evidence of want
of jurisdiction, want of
notice
to
the
party,
collusion, fraud or clear
mistake of law or fact. But
precisely, this possibility
signals the need for a
local trial court to exercise
jurisdiction. Clearly,
the
application of forum non
coveniens is not called for.
The grounds relied
upon by petitioner are
contradictory. On the one
hand, he insists that the
RTC take jurisdiction over
the enforcement case in
order to invalidate the
foreign judgment; yet, he
avers that the trial court
should
not
exercise
jurisdiction over the same
case on the basis of forum
non conveniens. Not only
do these defenses weaken
each other, but they
bolster the finding of the
lower courts that he was
merely maneuvering to
avoid or delay payment of
his obligation.
WHEREFORE,
the
Petition
is
hereby DENIED and
the
assailed
Decision
and
Resolution AFFIRMED. Dou
ble
costs
against
petitioner.
SO ORDERED.
EXISTENCE OF AN
EMPLOYMENT
CONTRACT
BETWEEN PRIVATE
RESPONDENT AND
PETITIONERS.
B.
THE COURT OF
APPEALS DECIDED
A QUESTION OF
SUBSTANCE IN A
WAY
NOT
IN
ACCORD WITH LAW
AND
WITH
APPLICABLE
DECISIONS OF THE
SUPREME
COURT
WHEN IT UPHELD
THE JURISDICTION
OF
THE
TRIAL
COURT
DESPITE
THE FACT THAT
THE
COMPLAINT
INDUBITABLY
SHOWS THAT IT IS
AN ACTION FOR AN
ALLEGED BREACH
OF
EMPLOYMENT
CONTRACT,
AND
HENCE,
FALLS
WITHIN
THE
EXLCUSIVE
JURISDICTION
OF
THE
NATIONAL
LABOR RELATIONS
COMMISSION.
C
THE COURT
APPEALS
OF
DISREGARDED
AND FAILED TO
CONSIDER
THE
PRINCIPLE
OF
"FORUM
NON
CONVENIENS" AS A
VALID
GROUND
FOR DISMISSING A
COMPLAINT.10
In their first assigned
error, petitioners contend
that
there
was
no
perfected
employment
contract between PIL and
herein
respondent.
Petitioners assert that the
annexes to respondent's
complaint show that PIL's
offer was for respondent
to be employed as the
manager only of its premixed concrete operations
and not as the company's
managing director or CEO.
Petitioners
argue
that
when
respondent
reiterated his intention to
become the manager of
PIL's
overall
business
venture in the Philippines,
he, in effect did not
accept
PIL's offer of
employment and instead
made
a
counter-offer,
which, however, was not
accepted
by
PIL.
Petitioners also contend
that under Article 1318 of
the Civil Code, one of the
requisites for a contract to
be
perfected
is
the
consent of the contracting
parties; that under Article
respondent's
complaint
show
that
the
negotiations
on
the
alleged
employment
contract
took
place
between respondent and
PIL through its office in
Hongkong. In other words,
PCPI and PPHI were not
privy to the negotiations
between
PIL
and
respondent
for
the
possible employment of
the latter; and under
Article 1311 of the Civil
Code, a contract is not
binding upon and cannot
be enforced against one
who was not a party to it
even if he be aware of
such contract and has
acted
with
knowledge
thereof.
Petitioners further assert
that petitioner Klepzig
may not be held liable
because he is simply
acting in his capacity as
president of PCPI and PPHI
and settled is the rule that
an officer of a corporation
is not personally liable for
acts
done
in
the
performance of his duties
and within the bounds of
the authority conferred on
him.
Furthermore,
petitioners
argue
that
even if PCPI and PPHI are
held liable, respondent
still has no cause of action
against Klepzig because
PCPI
and
PPHI
have
whether
or
not
the
complaint states a cause
of action.
As to the question of
jurisdiction,
respondent
contends
that
the
complaint he filed was not
based on a contract of
employment. Rather, it
was based on petitioners'
unwarranted breach of
their
contractual
obligation
to
employ
respondent. This breach,
respondent argues, gave
rise to an action for
damages
which
is
cognizable by the regular
courts.
Even assuming that there
was
an
employment
contract,
respondent
asserts that for the NLRC
to acquire jurisdiction, the
claim for damages must
have a reasonable causal
connection
with
the
employer-employee
relationship of petitioners
and respondent.
Respondent
further
argues that there is a
perfected
contract
between
him
and
petitioners as they both
agreed that the latter
shall employ him to
manage and operate their
ready-mix
concrete
operations
in
the
Philippines.
Even
assuming that there was
no perfected contract,
respondent contends that
his complaint alleges an
alternative cause of action
which is based on the
provisions of Articles 19
and 21 of the Civil Code.
As to the applicability of
the doctrine of forum non
conveniens,
respondent
avers that the question of
whether a suit should be
entertained or dismissed
on the basis of the
principle of forum non
conveniens depends
largely upon the facts of
the particular case and is
addressed to the sound
discretion of the trial
judge, who is in the best
position
to
determine
whether
special
circumstances
require
that the court desist from
assuming jurisdiction over
the suit.
The petition lacks merit.
Section 2, Rule 2 of the
Rules
of
Court,
as
amended, defines a cause
of action as the act or
omission by which a party
violates a right of another.
A cause of action exists if
the following elements are
present: (1) a right in
favor of the plaintiff by
whatever
means
and
under whatever law it
arises or is created; (2) an
obligation on the part of
the named defendant to
respect or not to violate
such right; and, (3) an act
or omission on the part of
such defendant violative
of the right of the plaintiff
or constituting a breach of
the obligation of the
defendant to the plaintiff
for which the latter may
maintain an action for
recovery of damages.11
In Hongkong
and
Shanghai
Banking
Corporation Limited v.
Catalan,12 this Court held:
The
elementary
test for failure to
state a cause of
action is whether
the
complaint
alleges facts which
if true would justify
the
relief
demanded. Stated
otherwise, may the
court
render
a
valid
judgment
upon
the
facts
alleged
therein?
The inquiry is into
the sufficiency, not
the veracity of the
material
allegations. If the
allegations in the
complaint furnish
sufficient basis on
which it can be
maintained,
it
should
not
be
dismissed
regardless of the
defense that may
be presented by
the defendants.13
Moreover, the complaint
does not have to establish
or allege facts proving the
existence of a cause of
action at the outset; this
will have to be done at
the trial on the merits of
the case.14 To sustain a
motion to dismiss for lack
of cause of action, the
complaint must show that
the claim for relief does
not exist, rather than that
a
claim
has
been
defectively stated, or is
ambiguous, indefinite or
uncertain.15
Hence,
in
resolving
whether
or
not
the
Complaint in the present
case states a cause of
action, the trial court
correctly limited itself to
examining the sufficiency
of the allegations in the
Complaint as well as the
annexes thereto. It is
proscribed from inquiring
into the truth of the
allegations
in
the
Complaint
or
the
authenticity of any of the
documents referred or
attached
to
the
employment. It is evident
from paragraphs 24 to 28
of the Complaint16 that, on
various occasions, Klepzig
conducted
negotiations
with respondent regarding
the
latter's
possible
employment.
In
fact,
Annex
"H"17 of
the
complaint shows that it
was Klepzig who informed
respondent
that
his
company was no longer
interested in employing
respondent. Hence, based
on the allegations in the
Complaint
and
the
annexes attached thereto,
respondent has a cause of
action
against
herein
petitioners.
As to the question of
jurisdiction, this Court has
consistently
held
that
where
no
employeremployee
relationship
exists between the parties
and no issue is involved
which may be resolved by
reference to the Labor
Code, other labor statutes
or
any
collective
bargaining agreement, it
is the Regional Trial Court
that has jurisdiction.18 In
the present case, no
employer-employee
relationship
exists
between petitioners and
respondent. In fact, in his
complaint,
private
respondent is not seeking
any relief under the Labor
forum
or
place
wherein to bring
their
suit
for
malicious reasons,
such as to secure
procedural
advantages,
to
annoy and harass
the defendant, to
avoid overcrowded
dockets,
or
to
select
a
more
friendly
venue.
Under
this
doctrine, 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 remedies
elsewhere.
Whether
a
suit
should
be
entertained
or
dismissed on the
basis
of
said
doctrine depends
largely upon the
facts
of
the
particular case and
is addressed to the
sound discretion of
the trial court. In
the
case
ofCommunication
Materials
and
Design, Inc. vs.
Court of Appeals,
Moreover,
this
Court enunciated
in Philsec.
Investment
Corporation
vs.
Court of Appeals,
that the doctrine
of forum
non
conveniens shoul
d not be used as
a ground for a
motion
to
dismiss because
Sec. 1, Rule 16
of the Rules of
Court does not
include
said
doctrine
as
a
ground.
This
Court
further
ruled that while
it is within the
discretion of the
trial
court
to
abstain
from
assuming
jurisdiction
on
this ground, it
should
do
so
only after vital
facts
are
established,
to
determine
whether special
circumstances
require
the
courts
desistance; and
that
the
propriety
of
dismissing
a
case based on
this
principle
of forum
non
conveniens requi
res
a
factual
determination,
hence it is more
properly
considered
a
matter
of
defense.22 (empha
sis supplied)
In the present case, the
factual
circumstances
cited by petitioners which
would allegedly justify the
application of the doctrine
of forum
non
conveniens are matters of
defense, the merits of
which should properly be
threshed out during trial.
WHEREFORE, the instant
petition
is DENIED and
the assailed Decision and
Resolution of the Court of
Appeals areAFFIRMED.