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GOVERNING LAW; THE CHOICE OF

FOREIGN LAW IS MERELY AN
INCIDENT OF ITS APPLICATION
Published by  Atty Elvin B. Villanueva at  May 26, 2017
The Author

Atty. Elvin B.
Saudi Arabian Airlines (Saudia) and Brenda J. Betia Vs. Ma. Jopette M. Villanueva is a
Rebesencio Montassah B. Sacar-Adiong, et al. litigation lawyer
G.R. No. 198587, January 14, 2015 specializing in labor
laws. He graduated
Facts: from Arellano
University School of
Respondents (complainants before the Labor Arbiter) were recruited and hired by
Law with honors. He
Saudia as Temporary Flight Attendants with the accreditation and approval of the
was a recipient of
Philippine Overseas Employment Administration.
the Supreme Court
Get an updated copy of the Labor Code (2017), by Atty. Villanueva, as re-numbered award for his essay
pursuant to R.A. 10151 and per DOLE Department Advisory o1, Series of 2015 on the Role of the
Rule of Law in
After undergoing seminars required by the Philippine National
Overseas Employment Administration for deployment Development.
overseas, as well as training modules o ered by Saudia
(e.g., initial ight attendant/training course and transition Learn More
training), and after working as Temporary Flight
Attendants, respondents became Permanent Flight
Attendants.
Categories
They then entered into Cabin Attendant contracts with
Saudia. Respondents continued their employment with Atty. Elvin's
Saudia until they were separated from service on various Books
dates in 2006. Respondents contended that the
termination of their employment was illegal. They alleged Corporation
that the termination was made solely because they were Law
pregnant.
Criminal Law
As respondents alleged, they had informed Saudia of their respective pregnancies
Events
and had gone through the necessary procedures to process their maternity leaves.
Initially, Saudia had given its approval but later on informed respondents that its Forms and
management in Jeddah, Saudi Arabia had disapproved their maternity leaves. Templates
In addition, it required respondents to le their resignation letters. Respondents Labor Law
were told that if they did not resign, Saudia would terminate them all the same.
The threat of termination entailed the loss of bene ts, such as separation pay and Rules of
Procedure
ticket discount entitlements. Our mission Opening hours Contact us
Saudia anchored its disapproval of respondents’ maternity leaves and demand for Tax Law
To deliver legal services Monday - Friday:  Unit G03 Makati
their resignation on its “Uni ed Employment Contract for Female Cabin Attendants”
that will provide the best  8:30am - 5:30pm Executive Tower
TRAIN Law2, Dela
(Uni ed Contract). Under the Uni ed Contract, the employment of a Flight
solution for clients and Rosa St., Makati City
Attendant who becomes pregnant is rendered void stating that if the Air Hostess Uncategorized
better results for society. Saturday - Sunday:
becomes pregnant at any time during the term of this contract, this shall render  (02) 579-9170
 Closed
her employment contract as void and she will be terminated due to lack of medical  (02) 831-5881
tness.  attyelvin@gmail.com
 Tags
Faced with the dilemma of resigning or totally losing their bene ts, respondents
learomano77@gmail.com
executed handwritten resignation letters. In Montassah’s and Rouen Ruth’s cases, 120-day rule 240
their resignations were executed on Saudia’s blank letterheads that Saudia had
days 240-day rule
provided. These letterheads already had the word “RESIGNATION” typed on the
abandonment
subject portions of their headings when these were handed to respondents.
abandonment
Respondents led a Complaint against Saudia and its o cers for illegal dismissal
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Saudia assailed the jurisdiction of the Labor Arbiter. It claimed that all the backwages
determining points of contact referred to foreign law and insisted that the compensability
Complaint ought to be dismissed on the ground of forum non conveniens. It added constructive
that respondents had no cause of action as they resigned voluntarily. dismissal Death
bene t disability
LA Ruling:
Disability claim
The Executive Labor Arbiter Fatima Jambaro-Franco rendered the Decision dismissal
dismissing respondents’ Complaint. employer-
employee
NLRC Ruling:
relationship
On respondents’ appeal, the National Labor Relations Commission’s Sixth Division immutability of
reversed the ruling of Executive Labor Arbiter Jambaro-Franco. It explained that judgment job contracting

“[c]onsidering that complainants-appellants are OFWs, the Labor Arbiters and the labor-
jurisdiction
NLRC has [sic] jurisdiction to hear and decide their complaint for illegal only contracting
termination.” loss of trust and
On the matter of forum non conveniens, it noted that there were no special con dence PEME
circumstances that warranted its abstention from exercising jurisdiction. On the Permanent
issue of whether respondents were validly dismissed, it held that there was nothing and Total
on record to support Saudia’s claim that respondents resigned voluntarily.
Disability
The National Labor Relations Commission denied petitioners’ Motion for petition for certiorari

Reconsideration. piercing the veil Post

employment medical
CA Ruling: examination project
employment
The Court of Appeals denied petitioners’ Rule 65 Petition and modi ed the Decision
quitclaim
of the National Labor Relations Commission with respect to the award of
reinstatement
separation pay and backwages.
release resignation
The Court of Appeals denied petitioners’ Motion for Reconsideration. Hence, the retirement
Appeal before the SC. retrenchment
second motion for
Issue/s:
reconsideration
Whether or not the laws of Saudi Arabia apply and the Philippines is a forum non separation pay
conveniens serious
SC Ruling:
misconduct
strained relations
A choice of law governing the validity of contracts or the interpretation of its termination theft
provisions does not necessarily imply forum non conveniens. Choice of law and third doctor TRAIN law
forum non conveniens are entirely di erent matters. valid dismissal
waiver willful breach
Choice of law provisions are an o shoot of the fundamental principle of autonomy willful disobedience
of contracts. work-relatedness

In contrast, forum non conveniens is a device akin to the rule against forum
shopping. It is designed to frustrate illicit means for securing advantages and
vexing litigants that would otherwise be possible if the venue of litigation (or
dispute resolution) were left entirely to the whim of either party.

Likewise, contractual choice of law is not determinative of jurisdiction. Stipulating

on the laws of a given jurisdiction as the governing law of a contract does not
preclude the exercise of jurisdiction by tribunals elsewhere. The reverse is equally
true: The assumption of jurisdiction by tribunals does not ipso facto mean that it
cannot apply and rule on the basis of the parties’ stipulation.

Philippine law is de nite as to what governs the formal or extrinsic validity of

contracts. The rst paragraph of Article 17 of the Civil Code provides that “[t]he
forms and solemnities of contracts . . . shall be governed by the laws of the country
Our mission
in which they are executed” (i.e., lex loci celebrationis). Opening hours Contact us
In contrast, there is no statutorily established
To deliver mode of settling
legal services Monday con ict of laws
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situations on matters pertaining to substantive
that will provide thecontent
best ofcontracts.
8:30am - It has been
5:30pm Executive Tower 2, Dela
noted that three (3) modes have emerged: (1) lex
solution for clients and loci contractusor the law of the Rosa St., Makati City
place of the making; (2) lex loci solutionis or the law
better results for society. of the place of performance;
Saturday - Sunday:
and (3) lex loci intentionis or the law intended by the parties. Closed  (02) 579-9170
 (02) 831-5881
Saudia asserts that stipulations set in the Cabin Attendant contracts require the  attyelvin@gmail.com
application of the laws of Saudi Arabia. It insists that the need to comply with these 
stipulations calls into operation the doctrine of forum non conveniens and, in turn, learomano77@gmail.com
makes it necessary for Philippine tribunals to refrain from exercising jurisdiction.
As mentioned, contractual choice of laws factors into transnational litigation in any
or a combination of four (4) ways. Moreover, forum non conveniens relates to one
of these: choosing between multiple possible fora.

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

Forum non conveniens literally translates to “the forum is inconvenient.” It is a

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

Unlike the rule on res judicata, as well as those on litis pendentia and forum
shopping, forum non conveniens nds no textual anchor, whether in statute or in
procedural rules, in our civil law system. Nevertheless, jurisprudence has applied
forum non conveniens as basis for a court to decline its exercise of jurisdiction.

Accordingly, under the doctrine of forum non conveniens, “a court, in con icts 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.”

In Bank of America, NT&SA, Bank of America International, Ltd. v. Court of Appeals, this
court underscored that a Philippine court may properly assume jurisdiction over a
case if it chooses to do so to the extent: “(1) that the Philippine Court is one to
which the parties may conveniently resort to; (2) that the Philippine Court is in a
position to make an intelligent decision as to the law and the facts; and (3) that the
Philippine Court has or is likely to have power to enforce its decision.

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

Forum non conveniens must not only be clearly pleaded as a ground for dismissal;
it must be pleaded as such at the earliest possible opportunity. Otherwise, it shall
be deemed waived. The SC notes that it is stated in Hasegawa, forum non
conveniens is not a ground for a motion to dismiss. Consistent with forum non
conveniens as fundamentally a factual matter, it is imperative that it proceeds from
a factually established basis. It would be improper to dismiss an action pursuant to
forum non conveniens based merely on a perceived, likely, or hypothetical
multiplicity of fora. Thus, a defendant must also plead and show that a prior suit
has, in fact, been brought in another jurisdiction.

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

Forum non conveniens relates to forum, not to the choice of governing law. That
forum non conveniens may ultimately result in the application of foreign law is
merely an incident of its application. In this strict sense, forum non conveniens is
not applicable. It is not the primarily pivotal consideration in this case.
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Any evaluation of the propriety of contracting parties’ choice of a forum and its
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incidents must grapple with To
twodeliver
(2) considerations:
legal services rst, Monday
the availability and
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adequacy of recourse to a foreign tribunal; and second,
that will provide the best the
 8:30am - 5:30pm as
question of where, Executive Tower 2, Dela
between the forum court and a foreign
solution forcourt,
clientsthe
andbalance of interests inhering in a Rosa St., Makati City
dispute weighs more heavily.better results for society. Saturday - Sunday:
 Closed  (02) 579-9170
The rst is a pragmatic matter. It relates to the viability of ceding jurisdiction to a  (02) 831-5881
foreign tribunal and can be resolved by juxtaposing the competencies and practical  attyelvin@gmail.com
circumstances of the tribunals in alternative fora. Exigencies, like the statute of 
limitations, capacity to enforce orders and judgments, access to records, learomano77@gmail.com
requirements for the acquisition of jurisdiction, and even questions relating to the
integrity of foreign courts, may render undesirable or even totally unfeasible
recourse to a foreign court. As mentioned, we consider it in the greater interest of
prudence that a defendant show, in pleading forum non conveniens, that litigation
has commenced in another jurisdiction and that a foreign tribunal has, in fact,
chosen to exercise jurisdiction. © 2017 EBV Law. All Rights Reserved. CkDesign
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Two (2) factors weigh into a court’s appraisal of the balance of interests inhering in
a dispute: rst, the vinculum which the parties and their relation have to a given
jurisdiction; and second, the public interest that must animate a tribunal, in its
capacity as an agent of the sovereign, in choosing to assume or decline jurisdiction.
The rst is more concerned with the parties, their personal circumstances, and
private interests; the second concerns itself with the state and the greater social
order.

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

In considering public interest, a court proceeds with a consciousness that it is an

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

Our law on contracts recognizes the validity of contractual choice of law provisions.
Where such provisions exist, Philippine tribunals, acting as the forum court,
generally defer to the parties’ articulated choice. This is consistent with the
fundamental principle of autonomy of contracts. Article 1306 of the Civil Code
expressly provides that “[t]he contracting parties may establish such stipulations,
clauses, terms and conditions as they may deem convenient.” Nevertheless, while a
Philippine tribunal (acting as the forum court) is called upon to respect the parties’
choice of governing law, such respect must not be so permissive as to lose sight of
considerations of law, morals, good customs, public order, or public policy that
underlie the contract central to the controversy.

Article II, Section 14 of the 1987 Constitution provides that “[t]he State . . . shall
ensure the fundamental equality before the law of women and men.” Contrasted
with Article II, Section 1 of the 1987 Constitution’s statement that “[n]o person shall
. . . be denied the equal protection of the laws,” Article II, Section 14 exhorts the
State to “ensure.” This does not only mean that the Philippines shall not
countenance nor lend legal recognition and approbation to measures that
discriminate on the basis of one’s being male or female. It imposes an obligation to
actively engage in securing the fundamental equality of men and women. The
Convention on the Elimination of all Forms of Discrimination against Women
(CEDAW), signed and rati ed by the Philippines on July 15, 1980, and on August 5,
1981, respectively, is part of the law of the land. In view of the widespread signing
and rati cation of, as well as adherence (in practice) to it by states, it may even be
said that many provisions of the CEDAW may have become customary international
law. The CEDAW gives e ect to the Constitution’s policy statement in Article II,
Section 14.

Saudia’s policy entails the termination of employment of ight attendants who

become pregnant. At the risk of stating the obvious, pregnancy is an occurrence
that pertains speci cally to women. Saudia’s policy excludes from and restricts
employment on the basis of no other consideration but sex.

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

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As the present dispute relates to (what the respondents allege to be) the illegal Contact us
termination of respondents’ employment, this case is immutably a matter of public
To deliverwith
interest and public policy. Consistent legalclear
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that will provide the best
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this case. Executive Tower 2, Dela
solution for clients and
Moreover, as this premise for Saudia’s insistence on the application forum non Rosa St., Makati City
better
conveniens has been shattered, results that
it follows for society.
Philippine Saturday
tribunals -may
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assume jurisdiction over the present controversy.  (02) 831-5881
There is no basis for concluding that the case can be more conveniently tried  attyelvin@gmail.com
elsewhere. As established earlier, Saudia is doing business in the Philippines. For 
their part, all four (4) respondents are Filipino citizens maintaining residence in the learomano77@gmail.com
Philippines and, apart from their previous employment with Saudia, have no other
connection to the Kingdom of Saudi Arabia. It would even be to respondents’
inconvenience if this case were to be tried elsewhere.

Second, the records are bereft of any indication that respondents led their
Complaint in an e ort to engage©in2017
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facilities to non-residents or aliens.” That Saudia has managed to bring the present
controversy all the way to this court proves this. Fourth, it cannot be said that the
local judicial machinery is inadequate for e ectuating the right sought to be
maintained. Summons was properly served on Saudia and jurisdiction over its
person was validly acquired. Lastly, there is not even room for considering foreign
law. Philippine law properly governs the present dispute.

It does not follow that Philippine tribunals should refrain from exercising
jurisdiction. To recall the Court pronouncements in Puyat, as well as in Bank of
America, NT&SA, it is not so much the mere applicability of foreign law which calls
into operation forum non conveniens. Rather, what justi es a court’s desistance
from exercising jurisdiction is “[t]he di culty of ascertaining foreign law” or the
inability of a “Philippine Court . . . to make an intelligent decision as to the law[.]

All told, the considerations for assumption of jurisdiction by Philippine tribunals as

outlined in Bank of America, NT&SA99 have been satis ed. First, all the parties are
based in the Philippines and all the material incidents transpired in this
jurisdiction. Thus, the parties may conveniently seek relief from Philippine
tribunals. Second, Philippine tribunals are in a position to make an intelligent
decision as to the law and the facts. Third, Philippine tribunals are in a position to
enforce their decisions. There is no compelling basis for ceding jurisdiction to a
foreign tribunal. Quite the contrary, the immense public policy considerations
attendant to this case behoove Philippine tribunals to not shy away from their duty
to rule on the case.

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