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    CHOICE OF LAW

    THE GOVT OF THE PHILIPPINE ISLANDS vs. FRANK

    G. R. No. 2935

    March 23, 1909

    FACTS: In 1903, in the city of Chicago, Illinois, Frank entered into a contract for a period of 2years with the Plaintiff, by which Frank was to receive a salary as a stenographer in the serviceof the said Plaintiff, and in addition thereto was to be paid in advance the expenses incurred intraveling from the said city of Chicago to Manila, and one-half salary during said period oftravel.

    Said contract contained a provision that in case of a violation of its terms on the part of Frank, heshould become liable to the Plaintiff for the amount expended by the Government by way ofexpenses incurred in traveling from Chicago to Manila and the one-half salary paid during such

    period.

    Frank entered upon the performance of his contract and was paid half-salary from the date untilthe date of his arrival in the Philippine Islands.

    Thereafter, Frank left the service of the Plaintiff and refused to make a further compliance withthe terms of the contract.

    The Plaintiff commenced an action in the CFI-Manila to recover from Frank the sum of money,which amount the Plaintiff claimed had been paid to Frank as expenses incurred in travelingfrom Chicago to Manila, and as half-salary for the period consumed in travel.

    It was expressly agreed between the parties to said contract that Laws No. 80 and No. 224 shouldconstitute a part of said contract.

    The Defendant filed a general denial and a special defense, alleging in his special defense that

    (1) the Government of the Philippine Islands had amended Laws No. 80 and No. 224 and hadthereby materially altered the said contract, and also that

    (2) he was a minor at the time the contract was entered into and was therefore not responsibleunder the law.

    The lower court rendered a judgment against Frank and in favor of the Plaintiff for the sum of$265. 90.

    ISSUE:1. Did the amendment of the laws altered the tenor of the contract entered into between

    Plaintiff and Defendant?2. Can the defendant allege minority/infancy?

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    HELD: the judgment of the lower court is affirmed1. NO; It may be said that the mere fact that the legislative department of the Government of thePhilippine Islands had amended said Acts No. 80 and No. 224 by Acts No. 643 and No. 1040 didnot have the effect of changing the terms of the contract made between the Plaintiff and theDefendant. The legislative department of the Government is expressly prohibited by section 5 of

    the Act of Congress of 1902 from altering or changing the terms of a contract. The right whichthe Defendant had acquired by virtue of Acts No. 80 and No. 224 had not been changed in anyrespect by the fact that said laws had been amended. These acts, constituting the terms of thecontract, still constituted a part of said contract and were enforceable in favor of the Defendant.

    2. NO; The Defendant alleged in his special defense that he was a minor and therefore thecontract could not be enforced against him. The record discloses that, at the time the contract wasentered into in the State of Illinois, he was an adult under the laws of that State and had fullauthority to contract. Frank claims that, by reason of the fact that, under that laws of thePhilippine Islands at the time the contract was made, made persons in said Islands did not reachtheir majority until they had attained the age of 23 years, he was not liable under said contract,contending that the laws of the Philippine Islands governed.

    It is not disputedupon the contrary the fact is admittedthat at the time and place of themaking of the contract in question the Defendant had full capacity to make the same. No rule isbetter settled in law than that matters bearing upon the execution, interpretation and validity of acontract are determined b the law of the place where the contract is made. Matters connectedwith its performance are regulated by the law prevailing at the place of performance. Mattersrespecting a remedy, such as the bringing of suit, admissibility of evidence, and statutes oflimitations, depend upon the law of the place where the suit is brought.

    EN BANC

    [G. R. No. 2935. March 23, 1909.]

    THE GOVERNMENT OF THE PHILIPPINE ISLANDS, Plaintiff -Appellee, vs. GEORGE

    I. FRANK,Defendant-Appellant.

    D E C I S I O N

    JOHNSON, J.:

    Judgment was rendered in the lower court on the 5th day of September, 1905.the Defendantappealed. On the 12th day of October, 1905, the Appellantfiled his printed bill ofexceptions with the clerk of the Supreme Court. On the 5th day of December, 1905,the Appellantfiled his brief with the clerk of the Supreme Court. On the 19th day of January,1906, the Attorney-General filed his brief in said cause. Nothing further was done in said causeuntil on about the 30th day of January, 1909, when the respective parties were requested by thiscourt to prosecute the appeal under penalty of having the same dismissed for failure so to do;

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    whereupon the Appellant, by petition, had the cause placed upon the calendar and the same washeard on the 2d day of February, 1909.

    The facts from the record appear to be as follows:

    First. That on or about the 17th day of April, 1903, in the city of Chicago, in the State of Illinois,in the United States, the Defendant, through a representative of the Insular Government of thePhilippine Islands, entered into a contract for a period of two years with the Plaintiff, by whichthe Defendantwas to receive a salary of 1,200 dollars per year as a stenographer in the service ofthe said Plaintiff, and in addition thereto was to be paid in advance the expenses incurred intraveling from the said city of Chicago to Manila, and one-half salary during said period oftravel.

    Second. Said contract contained a provision that in case of a violation of its terms on the part ofthe Defendant, he should become liable to the Plaintifffor the amount expended by theGovernment by way of expenses incurred in traveling from Chicago to Manila and the one-halfsalary paid during such period.

    Third. The Defendantentered upon the performance of his contract upon the 30th day of April,

    1903, and was paid half-salary from the date until June 4, 1903, the date of his arrival in thePhilippine Islands.

    Fourth. That on the 11th day of February, 1904, the Defendantleft the service of the Plaintiffandrefused to make a further compliance with the terms of the contract.

    Fifth. On the 3d day of December, 1904, the Plaintiffcommenced an action in the Court of FirstInstance of the city of Manila to recover from the Defendantthe sum of 269. 23 dollars, whichamount the Plaintiffclaimed had been paid to the Defendantas expenses incurred in travelingfrom Chicago to Manila, and as half-salary for the period consumed in travel.

    Sixth. It was expressly agreed between the parties to said contract that Laws No. 80 and No. 224

    should constitute a part of said contract.To the complaint of the Plaintiffthe Defendantfiled a general denial and a special defense,alleging in his special defense that the Government of the Philippine Islands had amended LawsNo. 80 and No. 224 and had thereby materially altered the said contract, and also that he was aminor at the time the contract was entered into and was therefore not responsible under the law.

    To the special defense of the Defendantthe Plaintifffiled a demurrer, which demurrer the courtsustained.

    Upon the issue thus presented, and after hearing the evidence adduced during the trial of thecause, the lower court rendered a judgment against the Defendantand in favor of the Plaintiffforthe sum of 265. 90 dollars. The lower court found that at the time the Defendantquit the service

    of the Plaintiffthere was due him from the said Plaintiffthe sum of 3. 33 dollars, leaving abalance due the Plaintiffin the sum of 265. 90 dollars. From this judgmenttheDefendantappealed and made the following assignments of error:

    1. The court erred in sustainingPlaintiffs demurrer toDefendants special defenses.

    2. The court erred in rendering judgment against the Defendanton the facts.

    With reference to the above assignments of error, it may be said that the mere fact that thelegislative department of the Government of the Philippine Islands had amended said Acts No.

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    80 and No. 224 by Acts No. 643 and No. 1040 did not have the effect of changing the terms ofthe contract made between the Plaintiffand the Defendant. The legislative department of theGovernment is expressly prohibited by section 5 of the Act of Congress of 1902 from altering orchanging the terms of a contract. The right which the Defendanthad acquired by virtue of ActsNo. 80 and No. 224 had not been changed in any respect by the fact that said laws had been

    amended. These acts, constituting the terms of the contract, still constituted a part of saidcontract and were enforceable in favor of the Defendant.

    The Defendantalleged in his special defense that he was a minor and therefore the contract couldnot be enforced against him. The record discloses that, at the time the contract was entered intoin the State of Illinois, he was an adult under the laws of that State and had full authority tocontract. The Plaintiff[theDefendant] claims that, by reason of the fact that, under that laws ofthe Philippine Islands at the time the contract was made, made persons in said Islands did notreach their majority until they had attained the age of 23 years, he was not liable under saidcontract, contending that the laws of the Philippine Islands governed. It is not disputeduponthe contrary the fact is admittedthat at the time and place of the making of the contract inquestion the Defendanthad full capacity to make the same. No rule is better settled in law than

    that matters bearing upon the execution, interpretation and validity of a contract are determined bthe law of the place where the contract is made. (Scudder vs. Union National Bank, 91 U. S.,406.) cralaw Matters connected with its performance are regulated by the law prevailing at theplace of performance. Matters respecting a remedy, such as the bringing of suit, admissibility ofevidence, and statutes of limitations, depend upon the law of the place where the suit is brought.(Idem.) cralaw

    The Defendants claim that he was an adult when he left Chicago but was a minor when hearrived at Manila; that he was an adult a the time he made the contract but was a minor at thetime the Plaintiffattempted to enforce the contract, more than a year later, is not tenable.

    Our conclusions with reference to the first above assignment of error are, therefore.

    First. That the amendments to Acts No. 80 and No. 224 in no way affected the terms of thecontract in question; and

    Second. The Plaintiff[Defendant] being fully qualified to enter into the contract at the place andtime the contract was made, he cannot plead infancy as a defense at the place where the contractis being enforced.

    We believe that the above conclusions also dispose of the second assignment of error.

    For the reasons above stated, the judgment of the lower court is affirmed, with costs.

    Arellano, C.J., Torres, Mapa, Carson and Willard, JJ., concur.

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    Cadalin vs. POEA

    G.R. No. L-104776, Dec. 5, 1994

    GENERAL RULE: A foreign procedural law will not be applied in the forum.

    EXCEPTION: When the country of the forum has a "borrowing statute," the country ofthe forum will apply the foreign statute of limitations.

    EXCEPTION TO THE EXCEPTION: The court of the forum will not enforce anyforeign claim obnoxious to the forum's public policy.

    FACTS:

    Cadalin et al. are overseas contract workers recruited by respondent-appellant AIBC for its

    accredited foreign principal, Brown & Root, on various dates from 1975 to 1983. As such, they

    were all deployed at various projects in several countries in the Middle East as well as in

    Southeast Asia, in Indonesia and Malaysia. The case arose when their overseasemployment

    contracts were terminated even before their expiration. Under Bahrain law, where some of the

    complainants were deployed, the prescriptive period for claims arising out of a contract of

    employment is one year.

    ISSUE:

    Whether it is the Bahrain law on prescription of action based on the Amiri Decree No. 23of 1976 or a Philippine law on prescription that shall be the governing law

    HELD:

    As a general rule, a foreign procedural law will not be applied in the forum. Procedural matters,

    such as service of process, joinder of actions, period and requisites for appeal, and so forth, are

    governed by teh laws of the forum. This is true even if the action is based upon a foreign

    substantive law.

    A law on prescription of actions is sui generis in Conflict of Laws in the sense that it may be

    viewed either as procedural or substantive, depending on the characterization given such a law.

    However, the characterization of a statute into a procedural or substantive law becomes

    irrelevant when the country of the forum has a borrowing statute. Said statute has the practical

    http://scire-licet.blogspot.com/2009/02/cadalin-vs-poea.htmlhttp://scire-licet.blogspot.com/2009/02/cadalin-vs-poea.html
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    effect of treating the foreign statute of limitation as one of substance. A borrowing statute

    directs the state of the forum to apply the foreign statute of limitations to the pending claims

    based on a foreign law. While there are several kinds of borrowing statutes, one form provides

    that an action barred by the laws of the place where it accrued, will not be enforced in the forum

    even though the local statute has not run against it. Section 48 of our Code of Civil Procedure is

    of this kind. Said Section provides:

    If by the laws of the state or country where the cause of action aro se, the action is barred, it is

    also barred in the Philippine Islands.

    In the light of the 1987 Constitution, however, Section 48 cannot be enforced ex propio vigore

    insofar as it ordains the application in this jurisdiction of Section 156 of the Amiri Decree No. 23

    of 1976.

    The courts of the forum will not enforce any foreign claims obnoxious to the forums publicpolicy. To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976 as

    regards the claims in question would contravene the publicpolicy on the protection to labor.

    HSBC vs. Sherman

    G.R. No. 72494, Aug. 11, 1989

    Choice-of-forum clause Jurisdiction and Venue Parties can stipulate as to their choice of venue. But if the stipulation is not restrictive, it

    shall be treated as merely permissive and will not bar the other party from airing the casein a different forum which has jurisdiction over the subject matter.

    FACTS:

    Sometime in 1981, Eastern Book Supply PTE, Ltd. (Company), a company incorporatedin Singapore, applied with and was granted by the Singapore Branch of HSBC an overdraft

    facility. To secure the overdraft facility, private respondents who were directors of the Companyexecuted a Joint and Several Guarantee in favour of HSBC, which provides that:

    This 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 Republicof Singapore. We hereby agree that the Courts ofSingapore shall have jurisdiction over alldisputes arising under this guarantee.

    http://scire-licet.blogspot.com/2009/03/hsbc-vs-sherman.htmlhttp://scire-licet.blogspot.com/2009/03/hsbc-vs-sherman.htmlhttp://scire-licet.blogspot.com/2009/03/hsbc-vs-sherman.html
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    However, when the Company failed to pay its obligation, HSBC filed this action withthe Philippine courts. In a Motion to Dismiss, the private respondents raised the abovementionedprovision of the Joint and Several Guarantee. The trial courtaffirmed the plaintiffs but CAreversed, citing said provision as basis.

    ISSUE:

    Whether or not Philippine courts have jurisdiction over the suit

    HELD:

    The Supreme Court held that the clause in question did not operate to divest the Philippine courtsof jurisdiction.

    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 dictatesthat 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 thelaws of the Republic of Singapore. We hereby agree that the Courts in Singapore shall havejurisdiction over all disputes arising under this guarantee be liberally construed. One basicprinciple underlies all rules of jurisdiction in International Law: a State does not have jurisdictionin 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 minimumcontacts that will not offend traditional notions of fair play and substantial justice. Indeed, aspointed-out by petitioner BANK at the outset, the instant case presents a very odd situation. Inthe ordinary habits of life, anyone would be disinclined to litigate before a foreign tribunal, withmore reason as a defendant. However, in this case, private respondents are Philippine residents (afact which was not disputed by them) who would rather face a complaint against them before aforeign court and in the process incur considerable expenses, not to mention inconvenience, thanto have a Philippine court try and resolve the case. Private respondents' stance is hardlycomprehensible, unless their ultimate intent is to evade, or at least delay, the payment of a justobligation.

    The defense of private respondents that the complaint should have been filed in Singapore isbased merely on technicality. They did not even claim, much less prove, that the filing of theaction 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.

    The parties did not thereby stipulate that only the courts of Singapore, to the exclusion of all therest, has jurisdiction. Neither did the clause in question operate to divest Philippine courts ofjurisdiction. In International Law, jurisdiction is often defined as the light of a State to exerciseauthority over persons and things within its boundaries subject to certain exceptions. Thus, aState does not assume jurisdiction over travelling sovereigns, ambassadors and diplomatic

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    representatives of other States, and foreign military units stationed in or marching through Stateterritory with the permission of the latter's authorities. This authority, which finds its source inthe concept of sovereignty, is exclusive within and throughout the domain of the State. A State iscompetent to take hold of any judicial matter it sees fit by making its courts and agencies assumejurisdiction over all kinds of cases brought before them.

    Carnival Cruise Lines, Inc. v. Shute

    Citation.499 U.S. 585, 111 S. Ct. 1522, 113 L. Ed. 2d 622 (1991)

    Brief Fact Summary. Plaintiff Carnival Cruise Lines, Inc. opposes a suit by a passenger injured

    on one of their cruise ships, because the cruise tickets contained an agreement that all matters

    relating to the cruise would be litigated before a Florida court.

    Synopsis of Rule of Law. Forum-selection clauses forcing individuals to agree to submit to

    jurisdiction in a particular place are enforceable so long as they pass the test for judicial fairness.

    Facts. Defendant Shute purchased passage for a seven day cruise on the Tropicale, a ship owned

    by Plaintiff, through a Washington travel agent. The face of each ticket contained terms and

    conditions of passage, which included an agreement that all matters disputed or litigated subject

    to the travel agreement, would be before a Florida court. Defendant boarded the ship in

    California, which then sailed to Puerto Vallarta, Mexico before returning to Los Angeles. While

    the ship was in international waters, Defendant Eulala Shute was injured from slipping on a deck

    mat. Defendants filed suit in Federal District Court in Washington. Defendant filed a motion forsummary judgment, alleging that the clause in the tickets required Defendants to bring their suit

    in Florida.

    Issue. Whether the court should enforce a forum-selection clause forcing individuals to submit to

    jurisdiction in a particular state.

    Held. Yes. The Supreme Court of the United States held that the Court of Appeals erred in

    refusing to enforce the forum-selection clause.

    Forum-selection clauses contained in form passage contracts are subject to judicial scrutiny for

    fundamental fairness, but where they are not lacking in fairness, they will be enforced.

    Dissent. Justice Stevens dissented, in which he was joined by Justice Marshall. Essentially

    Justice Stevens feels that adhesion contracts, particularly forum-selection clauses, are void as

    contrary to public policy if they were not freely bargained for, create additional expense for one

    party, or deny one party a remedy.

    http://www.bloomberglaw.com/document/X2NVCT?jcsearch=499%2520U.S.%2520585#jcite&ORIGINATION_CODE=00344http://www.bloomberglaw.com/document/X2NVCT?jcsearch=499%2520U.S.%2520585#jcite&ORIGINATION_CODE=00344http://www.bloomberglaw.com/document/X2NVCT?jcsearch=499%2520U.S.%2520585#jcite&ORIGINATION_CODE=00344http://www.bloomberglaw.com/document/X2NVCT?jcsearch=499%2520U.S.%2520585#jcite&ORIGINATION_CODE=00344
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    Discussion. In reaching its decision, the court noted that there is no evidence that Plaintiff set

    Florida as the forum as a means of discouraging cruise passengers from pursuing their claims.

    Such a suggestion is negated by the fact that Plaintiff has its headquarters in Florida, and many

    of its cruises depart from Florida.

    Bellis vs Bellis

    FACTS:

    Amos Bellis was a citizen of the State of Texas, and of the United States. By his first wife whom

    he divorced he had five legitimate children, by his second wife, who survived him, he had three

    legitimate children, and three illegitimate children. Before he died, he made two wills, one

    disposing of his Texas properties and the other disposing his Philippine properties. In both wills,

    his illegitimate children were not given anything. The illegitimate children opposed the will onthe ground that they have been deprived of their legitimes to which they should be entitled, if

    Philippine law were to be applied.

    ISSUE:

    Whether or not the national law of the deceased should determine the successional rights of the

    illegitimate children.

    HELD:

    The Supreme Court held that the said children are not entitled to their legitimes under the Texas

    Law, being the national law of the deceased, there are no legitimes.The parties admit that the decedent, Amos G. Bellis, was a citizen of the State of Texas, U.S.A.,

    and that under the laws of Texas, there are no forced heirs or legitimes. Accordingly, since the

    intrinsic validity of the provision of the will and the amount of successional rights are to be

    determined under Texas law, the Philippine law on legitimes cannot be applied to the testacy of

    Amos G. Bellis.

    Article 16, par. 2, and Art. 1039 of the Civil Code, render applicable the national law of the

    decedent, in intestate or testamentary successions, with regard to four items: (a) the order of

    succession; (b) the amount of successional rights; (e) the intrinsic validity of the provisions of

    the will; and (d) the capacity to succeed.

    Intestate and testamentary successions, both with respect to the order of succession and to the

    amount of successional rights and to the intrinsic validity of testamentary provisions, shall be

    regulated by the national law of the person whose succession is under consideration, whatever

    may be the nature of the property and regardless of the country wherein said property may be

    found.

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    Aznar vs. Garcia [7 SCRA 95]

    Facts: Edward Christensens (citizen of the State of California) will was executed

    in Manila where it provides that Helen Christensen Garcia receive a payment of P3,600 and

    proposed that the residue of the estate be transferred to his daughter Maria Lucy Christensen.

    Helen Christensen Garcia opposed the project of partition of Edwards estate claiming that she

    was deprived of her legitime as acknowledged natural child under the Philippine law.

    Issue: Whether or not the California law or the Philippine law should apply in the case at bar.

    Held: Philippine law should be applied. The State of California prescribes two sets of laws for

    its citizens residing therein and a conflict of law rules for its citizens domiciled in other

    jurisdictions. Art. 946 of the California Civil Code states that If there is no law to the contrary

    in the place where personal property is situated, it is deemed to follow the person of its owner

    and is governed by the law of his domicile. Edward, a citizen of the State of California, is

    considered to have his domicile in the Philippines. The court of domicile cannot and should not

    refer the case back to the California, as such action would leave the issue incapable of

    determination, because the case would then be tossed back and forth between the states(doctrine

    of renvoi). The validity of the provisions of Edwards will depriving his acknowledged natural

    child of latters legacy, should be governed by the Philippine law.

    The decision appealed from is reversed and the case returned to the lower court

    with instruction that the partition be made as the Philippine law on succession provides.

    http://coffeeafficionado.blogspot.com/2012/02/aznar-vs-garcia-7-scra-95.htmlhttp://coffeeafficionado.blogspot.com/2012/02/aznar-vs-garcia-7-scra-95.htmlhttp://coffeeafficionado.blogspot.com/2012/02/aznar-vs-garcia-7-scra-95.html
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