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    FUNDAMENTALSOF PUBLICAND PRIVATE INTERNATIONAL LAW

    By: Edzyl Josef G. Magante

    I. Public International Law

    A. Sources of Public International Law

    Article 38 of the Statute of the International Court of Justice (ICJ) provides:(WFDA IL SDAA STI)

    The Court, whose function is to decide in accordance withinternational law such disputes as are submitted to it, shall apply:

    a. international conventions, whether general or particular,establishing rules expressly recognized by the contesting states;

    b. international custom, as evidenced by a general practiceaccepted as law;

    c. the general principles of law recognized by civilized nations;

    d. subject to the provisions of Article 59,judicial decisions andthe teachings of the most highly qualified publicists of the variousnations, as subsidiary means for determination of the rules of law.

    This provision shall not prejudice the power of the Court to decide acase ex aequo et bono, if the parties agree thereon.1

    The significance of the enumeration lies in its exclusiveness.2 Article 38(1)subparagraphs (a)-(c) of the ICJ Statute deal with the formal sources of international law(that from which a rule of law derives its force and validity) and are otherwise known aslaw-creating processes, while Article 38(1) subparagraph (d) refers to subsidiary sources ofinternational law or other means resorted to in order to determine whether a norm hascrystallized into a custom or a general principle of law.3

    1. Treaty

    1 Statute of the International Court of Justice, art. 38, 1945, 3 Bevans 1179; 59 Stat. 1031; T.S. No. 993(Emphasis supplied).

    2 SCHWARZENBERGER, INTERNATIONAL LAW 26-27 (1957), as reproduced in D.J. HARRIS, CASES AND MATERIAL INPUBLIC INTERNATIONAL LAW 21-22 (1998).

    3 See Statute of the International Court of Justice,supra note 1, art. 38 (1) (d).

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    A treaty is an international agreement conducted between states in written form andgoverned by international law, whether embodied in a single instrument or in two or morerelated instruments and whatever particular designation they may be given.4

    There are no substantive requirements of form.5 In Qatar v. Bahrain,6 the exchange

    of notes between two heads of state was considered an international agreement. Evenunilateral declarations concerning a legal or factual situation may create legal obligations.7

    When it is the intention of the state to become bound according to its terms, that intentionconfers on the declaration the character of a legal undertaking, the state being thenceforthlegally required to follow a course of conduct consistent with the declaration.8

    Negotiation: The person representing a state must possess full powers.9 Thefollowing persons, however, do not need to present evidence of full powers: (1) heads ofstate, heads of government and ministers of foreign affairs; (2) heads of diplomaticmissions (only for adoption); and (3) representatives to an international conference or to an

    international organization or one of its organs (only for adoption).10

    Adoption: All states participating must consent, except in an internationalconference where a vote of 2/3 is required unless the same majority shall decide to apply adifferent rule.11 The relevant provisions of the constitution are: Art. VII, Sec. 20 (foreignloans with Monetary Board concurrence); Art. VII, Sec. 21 (treaty- 2/3 Senate vote); Art.VIII, Sec. 4 (2) (constitutionality of the treaty is heard by the Supreme Court en banc); Art.XVIII, Sec. 25 (treaty on military bases, troops and military facilities).12

    4 Vienna Convention on the Law of Treaties, art. 2(1)(a), May 23, 1969, 1155 U.N.T.S. 331 [hereinafterVCLT]; [1962] 2 Y.B. Intl L. Commn 161.

    5 IAN BROWNLIE, PRINCIPLES OF PUBLIC INTERNATIONAL LAW 581 (2003), citing Maritime Delimitation andTerritorial Questions (Qatar v. Bahrain), 1994 I.C.J. 112, 120-22; VCLT, supra note 4, art. 2(1)(a); JOAQUINBERNAS, AN INTRODUCTIONTO PUBLIC INTERNATIONAL LAW 24 (2002).

    6 1994 I.C.J. 112.7 Nuclear Test (Australia v. France)(New Zealand v. France), 1974 I.C.J. 253. In this case, France was a

    signatory to the nuclear Test Ban Treaty but continued to conduct tests in the South Pacific. Australia and NewZealand filed protests when France conducted several tests in 1972 and 1973. The case was taken off of theCourts list without a decision when France announced by a series of unilateral announcements that it wouldconduct no further test in 1973.

    8 Id.9 VCLT,supra note 4, art. 7 (1).10 Idat art. 7 (2).11 Id. at art. 9.12

    Art. VII, Sec. 20 states:The President may contract or guarantee foreign loans on behalf of the Republic of the Philippines with the prior

    concurrence of the Monetary Board, and subject to such limitations as may be provided by law. The MonetaryBoard shall, within thirty days from the end of every quarter of the calendar year, submit to the Congress acomplete report of its decisions on applications for loans to be contracted or guaranteed by the Government orgovernment-owned and controlled corporations which would have the effect of increasing the foreign debt, andcontaining other matters as may be provided by law.

    Article VI, Sec. 21 states:No treaty or international agreement shall be valid and effective unless concurred in by at least two-thirds of the

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    Consent: Consent may be expressed by signature, exchange of instruments,ratification, acceptance, approval or accession, or by any other means if so agreed.13 It isthis consent which is formally expressed through writing that shows the willingness of astate to be bound by a treaty. Article 34 of the Vienna Convention on the Law of Treaties

    (VCLT) adds that a treaty does not create rights or obligations for a third state without itsconsent. Even if a state is not party to a treaty, however, it may be bound by a treaty whenit contains a stipulationpour autrui,but the consent of such third state may be required.14

    Also, the treaty may serve as evidence of customary international law.15 The conventionmay serve as an authoritative guide for the practice of States faced with the relevant newlegal problems, and its provisions thus become the nucleus around which a new set ofgenerally recognized legal rules may crystallize.16 An example of this is the recognition andcodification of human rights in several human rights treaties such as the InternationalConvention on Civil and Political Rights and the International Convention on Economic,Social and Cultural Rights. Article 38 of the VCLT recognizes this back-door means by

    which a treaty may become binding on non-parties.

    Reservation: A reservation is a unilateral statement, however phrased or named,made by a state when signing, ratifying, accepting, approving, or acceding to a treaty,whereby it purports to exclude or modify the legal effect of certain provisions of the treatyin their application to that state.17 Generally, a state may formulate a reservation unless: (a)the reservation is prohibited by the treaty; (b) the treaty provides only specifiedreservations; and (c) in cases not falling under (a) and (b), the reservation is incompatiblewith the object and purpose of the treaty.18 A reservation must be formulated in writingand communicated to the contracting states and other states entitled to become parties to

    Members of the Senate.

    Art. VIII, Sec. 4 (2) states:All cases involving the constitutionality of a treaty, international or executive agreement, or law, which shall be

    heard by the Supreme Court en banc, and all other cases which under the Rules of Court are required to hearden banc, including those involving the constitutionality, application, or operation of presidential decrees,proclamations, orders, instructions, ordinances, and other regulations, shall be decided with the concurrence of amajority of the members who actually took part in the deliberations on the issues in the case and voted thereon.

    Article XVIII, Sec. 25 states:After the expiration in 1991 of the Agreement between the Republic of the Philippines and the United States of

    America concerning the Military Bases, foreign military bases, troops, or facilities shall not be allowed in thePhilippines except under a treaty duly concurred in by the Senate and, when the Congress so requires, ratified

    by a majority of the votes cast by the people in a national referendum held for that purpose, and recognized as atreaty by the other contracting State.

    13 VCLT,supra note 4, art. 11-16.14 Id. art. 36.15 The ICJ has also recognized this possibility in the North Sea Continental Shelf (Germany v. Denmark),

    1969 I.C.J. 1.16 North Sea Continental Shelf, 1969 I.C.J. at 244.17 VCLT,supra note 4, art. 2. See also VCLT, arts. 19-23.18 Id. art. 19.

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    the treaty.19 It need not, however, be consented to by all the parties to be effective.20 Astate can be regarded as a party if the reservation is not incompatible with the object andpurpose of the treaty and the ICJ has held that compatibility could be decided by statesindividually since, if a party objects, they can consider the state as not a party to thetreaty.21 Thus, it is possible for different legal relationships to arise among the parties to

    one treaty.

    Application: The fundamental principle ofpacta sunt servanda requires that everytreaty in force is binding upon the parties to it and must be performed by them in goodfaith.22 Art. 46 of the Vienna Convention on the Law of Treaties, A state party may notinvoke the provisions of its internal law as justification for failure to perform an obligationunder a treaty.23

    Interpretation: Article 31 of the VCLT contains the rules for the interpretation oftreaties. The general rule is to interpret the treaty in good faith in accordance with the

    ordinary meaning to be given to the terms of the treaty in their context and in the light of itsobject and purpose.24 The exception to this rule is where the parties intended to give aspecial meaning to the terms.25

    Invalidity of Treaties: (ERCDJc) Several grounds can invalidate treaties, to wit:error,26 fraud,27 corruption,28 duress,29 and violation of ius cogens (a peremptory norm ofgeneral international law from which no derogation is permitted and which can be modifiedonly by a subsequent norm having the same character).30

    Termination or Withdrawal: (MB SIP RSS) A treaty may be terminated or a party

    may withdraw in conformity with the provisions of the treaty or at any time byconsent of all the parties after consultation with the other contracting states.31 Materialbreach,32 supervening impossibility of performance,33 and rebus sic stantibus34 willalso terminate the treaty. As a rule, an unforeseen fundamental change of circumstances orthe doctrine of rebus sic stantibus may not be invoked as a ground for terminating or

    19 Id. art. 23.20 Reservations to the Genocide Convention, 1951 I.C.J. 15.21 Id.22 VCLT,supra note 4, art. 26.23 Id. art. 46.24 Id. art. 31 (1).25

    Id. art. 31 (2). See also art. 32 on the supplementary means of interpretation.26 Id. art. 48.27 Id. art. 49.28 Id. art. 50.29 Id. art. 51-52.30 Id. art. 53. See also art. 64.31 Id. art. 54.32 Id. art. 60.33 Id. art. 61.34 Id. art. 62.

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    withdrawing from the treaty, unless it was the essential basis of the consent and theobligation is transformed radically.35 Even if it was so, however, no termination will beallowed if the treaty establishes a boundary or the fundamental change was the result of abreach by the invoking party.36

    Cases on Termination or Withdrawal:

    Fisheries Jurisdiction (U.K. v. Iceland) (Jurisdiction), 1973 I.C.J. 3

    Facts: The United Kingdom applied to the ICJ claiming that Icelands proposed extensionof their exclusive fisheries jurisdiction was a breach their agreement. Iceland contendedthat the agreement was no longer binding due to a fundamental change of circumstancesreferring to the increased exploitation of fishery resources in the seas.

    Held: One of the basic requirements embodied in Article 62 of the VCLT, which reflects

    the doctrine ofrebus sic stantibus, is that the change of circumstances must have been afundamental one. In this respect, Iceland has referred to increased exploitation of fisheryresources in the seas surrounding Iceland and the danger of further exploitation because ofan increase in the catching capacity of fishing fleets. The Icelandic statements recall theexceptional dependence of that country on fishing for its existence and economicdevelopment.

    The invocation by Iceland of its vital interests must be interpreted, in the context ofthe assertion of changed circumstances, as an indication by Iceland of the reason why itregards as fundamental the changes which in its view have taken place in previously

    existing fishing techniques. This interpretation would correspond to the traditional viewthat the changes of circumstances which must be regarded as fundamental or vital are thosewhich imperil the existence or vital development of one of the parties.

    If, as contended by Iceland, there have been any fundamental changes in fishingtechniques in the waters around Iceland, those changes might be relevant for the decisionon the merits of the dispute, and the Court might need to examine the contention at thatstage, together with any other arguments that Iceland might advance in support of thevalidity of the extension of its fisheries jurisdiction beyond what was agreed upon in the1961 Exchange of Notes. But the alleged changes could not affect in the least theobligation to submit to the Court's jurisdiction, which is the only issue at the present stageof the proceedings. It follows that the apprehended dangers to the vital interests of Iceland,resulting from changes in fishing techniques, cannot constitute a fundamental change withrespect to the lapse or subsistence of the compromissory clause establishing the Court'sjurisdiction.

    35 Gabkovo-Nagymaros Project (Hung. v. Slovk.), 1997 I.C.J. 7.36 Id.

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    Moreover, in order that a change of circumstances may give rise to a ground forinvoking the termination of a treaty, it is necessary that it should have resulted in a radicaltransformation of the extent of the obligations still to be performed. The change must haveincreased the burden of the obligations to be executed to the extent of rendering theperformance something essentially different from that originally undertaken. This condition

    is wholly unsatisfied. The change of circumstances alleged by Iceland cannot be said tohave transformed radically the extent of the jurisdictional obligation which is imposed inthe 1961 Exchange of Notes. The compromissory clause enabled either of the parties tosubmit to the Court any dispute between them relating to an extension of Icelandic fisheriesjurisdiction in the waters above its continental shelf beyond the 12-mile limit. The presentdispute is exactly of the character anticipated in the compromissory clause of the Exchangeof Notes. Not only has the jurisdictional obligation not been radically transformed in itsextent; it has remained precisely what it was in 1961.

    Namibia (Advisory Opinion), 1971 I.C.J. 16

    Facts: The General Assembly adopted Resolution 2145 (XXI) whereby it decided thatSouth Africas Mandate over Namibia was terminated and that South Africa had no otherright to administer the territory. Subsequently, the Security Council adopted variousresolutions including resolution 276 (1970) declaring the continued presence of SouthAfrica in Namibia illegal.

    Held: In examining this action of the General Assembly, it is appropriate to have regard tothe general principles of international law regulating termination of a treaty relationship on

    account of breach. For even if the mandate is viewed as having the character of aninstitution, as is maintained, it depends on those international agreements which created thesystem and regulated its application. As the Court indicated in 1962, this Mandate, likepractically all other similar Mandates was a special type of instrument composite in natureand instituting a novel international regime. It incorporates a definite agreement. TheCourt stated conclusively in that Judgment that the Mandate '... in fact and in law, is aninternational agreement having the character of a treaty or convention' The rules laid downby the VCLT concerning the termination of a treaty relationship on account of breach(adopted without a dissenting vote) may, in many respects, be considered as a codificationof existing customary law on the subject. In light of the rules, only a material breach of atreaty justifies termination, such breach being defined as: (a) a repudiation of a treaty notsanctioned by the present Convention; or (b) the violation of a provision essential to theaccomplishment of the object or purpose of the treaty.

    General Assembly (G.A.) Resolution 2145 (XXI) determines that both forms ofmaterial breach had occurred in this case. By stressing that South Africa has in factdisavowed the Mandate, the G.A. declared that it had repudiated it. The resolution inquestion is, therefore, to be viewed as the exercise of a right to terminate a relationship in

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    case of a deliberate and persistent violation of obligations which destroys the very objectand purpose of that relationship.

    The silence of a treaty as to the existence of such right cannot be interpreted asimplying the exclusion of a right which has its source outside the treaty, in general

    international law, and is dependent on the occurrence of circumstances which are notnormally envisaged when a treaty is concluded.

    To say that the power of revocation of the Mandate could not have been exercisedunilaterally, but only in cooperation with South Africa, would postulate an impossibility.For obvious reasons, the consent of the wrongdoers to such a form of termination cannot berequired.

    Gabcikovo-Nagymaros Project(Hungary v. Slovakia), 1997 I.C.J. 7.

    Facts: Hungary and Czechoslovakia entered into a treaty to facilitate the construction ofdams on the Danube. Hungary later suspended the works due to environmental concerns,in response to which Czechoslovakia carried out unilateral measures. Hungary claims theright to terminate the treaty since Czechoslovakia violated the treaty by undertakingunilateral measures. Hungary invoked state of ecological necessity, superveningimpossibility of performance, rebus sic stantibus and material breach.

    Held: The existence of a state of necessity is a ground recognized by customaryinternational law for precluding the wrongfulness of an act not in conformity with an

    international obligation. This can only be invoked under certain strictly defined conditionswhich must be cumulatively satisfied; and the state concerned is not the sole judge ofwhether those conditions have been met. For a state of necessity to exist, the followingbasic conditions set forth in Draft Article 33 (now Article 25 of Articles on StateResponsibility) are relevant: it must have been occasioned by an essential interest of thestate which is the author of the act conflicting with one of its international obligations; thatinterest must have been threatened by a grave and imminent peril; the act beingchallenged must have been the only means of safeguarding that interest; that act must nothave seriously impaired an essential interest of the state towards which the obligationexisted; and the state which is the author of that act must not have contributed to theoccurrence of the state of necessity. The Hungarian argument on the state of necessitycould not convince the Court unless it was at least proven that a real, grave andimminent peril existed in 1989 and that the measures taken by Hungary were the onlypossible response to it.

    Even if a state of necessity is found to exist, it is not a ground for the termination ofa treaty. It may only be invoked to exonerate a state which has failed to implement a treaty.Even if found justified, it does not terminate a treaty; the treaty may be ineffective as long

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    as the condition of necessity continues to exist; it may in fact be dormant, but - unless theparties by mutual agreement terminate the treaty - it continues to exist. As soon as the stateof necessity ceases to exist, the duty to comply with treaty obligations revives.

    Impossibility of performance may not be invoked for the termination of a treaty by a

    party to that treaty when it results from that partys own breach of an obligation under thetreaty. Hungary cannot invoke this because it did not carry out most of the works for whichit was responsible.

    Hungary further argued that it was entitled to invoke a number of events which,cumulatively, would have constituted a fundamental change of circumstances (i.e., changesof political nature, reduced economic viability of the Project, and the progress ofenvironmental knowledge and international environmental law). The changedcircumstances advanced by Hungary, however, are not of such a nature that their effectwould radically transform the extent of the obligations still to be performed in order to

    accomplish the project.

    It is only a material breach of the treaty itself which entitles the other party to relyon it as a ground for terminating the treaty. The violation of other treaty rules or of rules ofgeneral international law may justify the taking of certain measures, but it does notconstitute a ground for termination under the law of treaties. Czechoslovakia violated thetreaty only when it diverted the waters of the Danube into the bypass canal in October1992. In constructing the works which would lead to the putting into operation of theunilateral measure, Czechoslovakia did not act unlawfully. The notification of terminationby Hungary was premature. No breach of the treaty by Czechoslovakia had yet taken place

    and consequently Hungary was not entitled to invoke any such breach of the treaty as aground for terminating it when it did.

    Rules on conflict between a treaty and a local law:

    Article 46 of the VCLT states that when a constitutional violation is manifest

    and concerns a rule of internal law of fundamental importance, a state may deviate

    from a treaty obligation.37 But it must also be considered that, under the dualist theory,unconstitutionality of a treaty is a purely domestic matter. Thus, a state faces the risk ofinternational sanction.

    As to general domestic legislation, it depends on which court is deciding. If it is aninternational court, it will uphold the treaty obligation in general. But if it is a domesticcourt, it should always try to give effect to both. If there is an inconsistency, the later indate will control, provided that the treaty stipulation is self-executing. 38 But the rule only

    37 See also VCLT,supra note 4, art.27 (A party may not invoke the provisions of internal law as justificationfor its failure to perform a treaty.).

    38 See Sei Fuji v. California, 242 P.2d 617 (1952).

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    applies in the domestic sphere. A treaty, even if contrary to a later statute, is binding ininternational law.39

    2. Custom

    Article 38 of the ICJ Statute refers to custom as an evidence of a general practiceaccepted as law. In contrast to treaty law, a rule of customary international law is bindingupon a state whether or not it has affirmatively assented to that rule. The Restatement(Third) of Foreign Relations Law of the United States also defines custom as a general andconsistent practice of states followed by them from a sense of legal obligation. From thisdefinition, two elements are constituted: (1) widespread state practice and (2) opinio juris(or a sense of legal obligation).

    State practice is the material element, and simply means that a sufficient numberof states behave in a regular and repeated manner consistent with the customary norm.40

    State practice requires duration, uniformity and generality.41

    Evidence of state practicemay include a codificatory treaty, if a sufficient number of states sign, ratify, and accede toa convention.42 The following are also material sources of custom: diplomaticcorrespondence, policy statements, press releases, opinions of legal advisers, officialmanuals on legal questions, executive decisions and practices, orders to naval forces,comments by governments on drafts produced by the International Law Commission,international and national judicial decisions, recitals in treaties and other internationalinstruments, a pattern of treaties in the same form, practice of international organs, andresolutions relating to legal questions by the United Nations General Assembly.43

    Opinio juris is the psychological or subjective element of customary internationallaw. It requires that the state action in question be taken out of a sense of legal obligation,as opposed to mere expediency.44 Put another way, opinio juris is the conviction of a statethat it is following a certain practice as a matter of law and that, were it to depart from thepractice, some form of sanction would, or ought to, fall on it.45

    Cases:

    North Sea Continental Shelf(Germany. v. Denmark & Netherlands), 1969 I.C.J. 1

    Facts: Bilateral agreements between (1) the Netherlands and Germany and (2) Denmarkand Germany were made drawing lateral or median lines delimiting the North Sea

    39 VCLT,supra note 4, art. 46.40 See BROWNLIE,supra note 5, at 6-12.41 Id. at 7.42 See HARRIS,supra note 2, at 39.43 BROWNLIE,supra note 5, at 6; See also [1950] 2 Y.B. Intl L. Commn 368-72.44 Id. at 8.45 MARKE. VILLIGER, CUSTOMARY INTERNATIONAL LAWAND TREATIES 4 (1985).

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    continental shelves of adjacent and opposite sides. These agreements, however, did nomore than draw a dividing line for a short distance from the coast beginning at the point atwhich the land boundary of the two states concerned was located.

    Held: Although the passage of only a short period of time is not necessarily, or itself, a bar

    to the formation of a new rule of customary international law on the basis of what waspurely a conventional rule, an indispensable requirement would be that within the period inquestion, short though it might be, state practice, including that of states whose interests arespecially affected, should have been both extensive and virtually uniform in the sense ofthe provision invokedand should moreover have occurred in such a way as to show ageneral recognition that a rule of law or legal obligation is involved. The use of theequidistance method is not to be regarded as a rule of law as it would not be consistent withopinio juris in the matter of delimitation. Delimitation is to be effected by agreement inaccordance with equitable principles.

    Asylum (Colombia v. Peru), 1950 I.C.J. 266

    Facts: After an unsuccessful rebellion in Peru, a warrant was issued for the arrest on acriminal charge arising out of the rebellion of Haya de la Torre. De la Torre was grantedasylum by Colombia. Colombia sought for safe conduct to allow De la Torre out of thecountry. Peru refused. Colombia asserted that it was competent to qualify the offense forthe purposes of asylum (unilateral qualification).

    Held: The party which relies on a custom must prove that such custom is established insuch a manner that it has become binding on the other party. The Colombian Government

    must prove that the rule invoked by it is in accordance with a constant and uniform usagepracticed by the states in question, and that this usage is the expression of a rightappertaining to the state granting asylum and a duty incumbent on the territorial state andnot merely for reasons of political expediency. The facts brought to the knowledge of thecourt disclose so much uncertainty and contradiction, so much fluctuation and discrepancyin the exercise of diplomatic asylum and in the official views expressed on variousoccasions. There has been so much inconsistency in the rapid succession of conventions onasylum, ratified by some States and rejected by others, and the practice has been so muchinfluenced by considerations of political expediency in the various cases, that it is notpossible to discern in all this any constant and uniform usage, accepted as law, with regardto the alleged rule.

    But even if it could be supposed that such a custom existed between certain Latin-American states only, it could not be invoked against Peru which, far from having by itsattitude adhered to it, has, on the contrary, repudiated it by refraining from ratifying theMontevideo Conventions, which were the first to include a rule concerning thequalification of the offense in matters of diplomatic asylum. Peru was considered by theCourt as a persistent objector.

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    A persistent objector is a state that has persistently objected to a rule of customaryinternational law and may thus contract out of a custom in the process of formation. 46

    Evidence of objection must be clear and there is probably a presumption of acceptancewhich is to be rebutted.47

    3. General Principles of Law

    These are principles of municipal law common to the legal systems of the world.48

    Such principles are gap-filler provisions: on occasion, the ICJ must have recourse to rulestypically found in domestic courts and domestic legal systems in order to addressprocedural and other issues.

    The bulk of recognized general principles are procedural in nature, for example, thelaws regarding burden of proof and admissibility of circumstantial evidence, estoppel,

    waiver, unclean hands, necessity, andforce majeure.49

    The principle of general equity inthe interpretation of legal documents and relationships is one of the most widely citedgeneral principles of international law.50 General principles may also include commercialprinciples. Even the Iran-U.S. Claims Tribunal has used general principles to findgeneral principles of commercial and contract law, including doctrines concerning contractformation, unjust enrichment, and conflicts of laws. 51

    As pointed out by Lord McNair, former President of the ICJ, in South West Africa,52

    it is never a question of importing into international law private law institutions lock,stock and barrel, ready made and fully equipped with a set of rules. It is rather a

    question of finding in the private law institutions indications of legal policy and principlesappropriate to the solution of the international problem at hand. It is not the concretemanifestations of a principle in different national systems which are anyhow likely tovary but the general concept of law underlying them that the international judge isentitled to apply under Article 38 (c) of the ICJ Statute.53

    It is important to note, however, that equity in this sense is a source ofinternational law, brought before the court under Article 38(1)(c) of the ICJ Statute.54 It isan inter legem (within the case) application of equitable principles, and not a power of the

    46 BROWNLIE,supra note 5, at 11.47

    Id.48 Statute of the International Court of Justice,supra note 1, art. 38 (1) (c).49 See generally BIN CHENG, GENERAL PRINCIPLES OF LAW AS APPLIED BY INTERNATIONAL COURTS AND TRIBUNALS

    (1953).50 Restatement (Third) of Foreign Relations Law of the United States (1987), section 102, cmt. 1.51 John R. Crook, Applicable Law in International Arbitration: The Iran-U.S. Claims Tribunal Experience, 83

    AM.J. INT'L L. 278, 292-297.52 1950 I.C.J. 148.53 HARRIS,supra note 2, at 48-49.54 BROWNLIE,supra note 5, at 25.

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    Court to decide the merits of the case ex aequo et bono (that is, to simply decide the casebased upon a balancing of the equities), a separate matter treated under Article 38(2) of theStatute.55 The power to decide ex aequo et bono involves elements of compromise andconciliation whereas equity is applied as a part of normal judicial function.56

    Case on ex aequo et bono:

    Diversion of Water from the Meuse, 1973 P.C.I.J. (ser.A/B) No. 70, at 77 (separate opinionof Judge Hudson)

    The Court has not been expressly authorized by its Statute to apply equity asdistinguished from law. The Courts recognition of equity as a part of international law isin no way restricted by the special power conferred upon it to decide a case ex aequo etbono, if the parties agree thereto. It must be concluded, therefore, that under Article 38 ofthe Statute, if not independently of that Article, the Court has some freedom to consider

    principles of equity as part of the international law which it must apply. It would seem tobe an important principle of equity that where two parties have assumed an identical or areciprocal obligation, one party which is engaged in a continuing non-performance of thatobligation should not be permitted to take advantage of a similar non-performance of thatobligation by the other party.

    4. Judicial Decisions and Teachings of the Most Highly Qualified Publicists

    Judicial decisions and teachings of the most highly qualified publicists are asubsidiary means of finding the law.57 Judicial decisions and scholarly writings are, in

    essence, research aids for the ICJ, used for example to support or refute the existence of acustomary norm, to clarify the bounds of a general principle or customary rule, or todemonstrate state practice under a treaty.

    Judicial decisions, whether from international tribunals or from domestic courts, aswell as arbitral tribunals, are useful to the extent that they address international law directlyor demonstrate a general principle.58 Teachings refers simply to the writings of learnedscholars. These teachings are expressly limited to teachings of the most highly qualifiedpublicists. For international law generally, this is a very short list, and includes nameslike Grotius, Lauterpacht, and Brownlie. Within the context of a specific field forexample, environmental law there are additional scholars who would be regarded ashighly qualified publicists.

    55 Id. at 25-26.56 Id. at 26.57 Statute of the International Court of Justice,supra note 1, art. 38 (1) (d).58 BROWNLIE,supra note 5, at 19.

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    B. Subjects and Objects of International Law

    A subject of international law is an entity capable of possessing international rightsand duties and having the capacity to maintain its rights by bringing international claims.59

    States remain the predominant subjects although international organizations may also have

    personality. 60 Objects of international law, on the other hand, are those who indirectly haverights under, or are beneficiaries of, international law through subjects of international law.Individuals and corporations are regarded as objects of international law. However, withthe progression of human rights, individuals in some instances are regarded as subjects ofinternational law. Also, internationalized contracts between a state and a foreigncorporation give the latter a limited capacity by invoking in international law the rightsderived from the contract.61

    C. Jurisdiction and Enforcement

    Jurisdiction refers to particular aspects of the general legal competence of statesoften referred to as sovereignty such as judicial, legislative and executive.62 One of thefundamental principles is that jurisdiction is territorial.63 In this aspect, the power to makedecisions or rules (prescriptive or legislative jurisdiction) is distinct from the power to takeexecutive action in pursuit of or consequent to the making of decisions or rules(enforcement or prerogative jurisdiction).64

    In terms of civil jurisdiction, a State must in normal circumstances maintain asystem of courts empowered to decide civil cases and, in doing so, be prepared to applyprivate international law where appropriate in cases concerning a foreign element.65

    Excessive and abusive assertion of civil jurisdiction could lead to internationalresponsibility and protests as ultra vires acts.66

    As to criminal jurisdiction, several principles have received varying degrees ofpractice and support, to wit: territorial principle, nationality principle, passive nationalityprinciple, protective principle, and universal jurisdiction.67 The principle that the courts ofthe place where the crime is committed may exercise jurisdiction has received universalrecognition, and is but a single application of the essential territoriality of the sovereignty,the sum of legal competences, which a state has.68 Also, generally accepted and oftenapplied is the objective territorial principle, according to which jurisdiction is founded

    59

    Id. at 57 citingReparation for Injuries, 1949 I.C.J. 179.60 Reparation for Injuries, 1949 I.C.J. 179.61 Texaco Overseas Petroleum Co. v. Government of the Libyan Arab Republic, 77 I.L.M. 1978 (1977).62 BROWNLIE,supra note 5, at 297.63 Id.64 Id.65 Id. at 298.66 Id.67 See id. at 299-305.68 Id. at 299.

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    when any essential constituent element of a crime is consummated on the states territory.69

    As to the nationality principle, nationality, as a mark of allegiance and an aspect ofsovereignty, is also generally recognized as a basis for jurisdiction over extra-territorialacts.70 According to the passive nationality principle, aliens may be punished for actsharmful to the nationals of the forum. The protective principle provides that all states

    assume jurisdiction over aliens for acts done abroad which affect the security of the state.The universal principle allows for jurisdiction over acts of non-nationals where thecircumstances, including the nature of the crime, justify the repression of some types ofcrimes as a matter of international public policy like crimes against humanity or genocide. 71

    Under international law, the governing principle is that a state cannot take measureson the territory of another state by way of enforcement of national laws without the consentof the latter.72 Persons may not be arrested, summons may not be served, police or taxinvestigations may not be mounted, orders for production of documents may not beexecuted on the territory of another state, except under the terms of a treaty or other

    consent given.73

    B. Immunity

    Immunity from jurisdiction is enjoyed by both the head of state and by the stateitself. Acts of state carried out within its own territory cannot be challenged in the courtsof other states. This is based on the sovereign equality of states. However, this immunityis reserved only for acts jure imperii (governmental acts), but not for acts jure gestionis(trading and commercial acts).74

    Ambassadors and other diplomatic agents are also given immunities and privilegeswhen they are within the territory of another state. Diplomatic agents have immunity fromcriminal and, in most cases, civil jurisdiction of the host state.75 In particular, diplomaticagents may not be arrested or otherwise detained by the host state.76 Moreover, thepremises of the mission are inviolable.77 Unless waived, these immunities must beobserved.

    C. State Responsibility v. Individual Responsibility

    69

    Id.70 Id. at 301;see also Lotus, 1927 P.C.I.J. (ser. A) No. 10, at 92 (separate opinion of Judge Moore).71 BROWNLIE,supra note 5, at 303.72 Id. at 306.73 Id.citingLotus, 1927 P.C.I.J. (ser. A) No. 10, at 18.74 See Syquia v. Lopez, 84 Phil. 312 (1949); United States v. Ruiz, 136 SCRA 487 (1987); Sanders v.

    Veridiano, 162 SCRA 88 (1988); United States v. Guinto, 182 SCRA 644 (1990).75 Vienna Convention on Diplomatic Relations, art. 31, 1961, 500 U.N.T.S. 95.76 Id. art. 29.77 Id. art. 22.

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    Breach of international law by a state entails its international responsibility.78

    International responsibility covers the relations which arise under international law fromthe internationally wrongful act of a state, whether such relations are limited to thewrongdoing state and one injured state or whether they extend also to other states or indeedto other subjects of international law, and whether they are centered on obligations of

    restitution or compensation or also give the injured state the possibility of responding byway of countermeasures.79 Two elements are required to establish the existence of aninternationally wrongful act of the state.80 First, the conduct in question must be attributableto the state under international law.81 The acts which may be attributed to the state may beacts of state organs, the acts of other persons (empowered by the government to exercisegovernmental authority,82 or is acting on the instructions of, or under the direction orcontrol of, the state83), or the acts of revolutionaries.84 Secondly, for responsibility to attachto the act of the state, the conduct must constitute a breach of an international legalobligation in force for that state at that time.85

    Generally speaking, the actions of private parties are not attributable to states.86

    Theprinciple that individuals, including state officials, may be responsible under internationallaw has primarily operated in the field of criminal responsibility, but it is not excluded thatdevelopments may occur in the field of individual civil responsibility.87 Where crimesagainst international law are committed by state officials, it will often be the case that thestate itself is responsible for the acts in question or for failure to prevent or punish them.88

    The state is not exempted from its own responsibility for internationally wrongful conductby the prosecution and punishment of the state officials who carried it out.89 Neither maythose officials hide behind the state in respect of their own responsibility for conduct whichis contrary to rules of international law applicable to them.90

    D. Damages and Reparations

    78 Responsibility of States for Internationally Wrongful Acts, G.A. Res. 56/83, art. 1, U.N. GAOR, 56th Sess.,Annex, Agenda Item 162 at 3, U.N. Doc. A/RES/56/83 (2001) [hereinafter Articles on State Responsibility];

    Report of the International Law Commission, U.N. GAOR, 55th Sess., Supp. No. 10, at 63, U.N. Doc. A/56/10(2001) [hereinafter Commentary].

    79 Commentary,supra note 70, at 67.80 Articles on State Responsibility,supra note 78, art. 2; Commentary,supra note 78, at 68.81 Articles on State Responsibility,supra note 78, art. 2; Commentary,supra note 78, at 68.82 Articles on State Responsibility,supra note 78, art. 5.83 Id. art. 8.84 See id. arts. 4-10.85

    Articles on State Responsibility,supra note 78, art. 2; Commentary,supra note 78, at 68.86 JAMES CRAWFORD, THE INTERNATIONAL LAW COMMISSION 'S ARTICLESON STATE RESPONSIBILITY: INTRODUCTION, TEXT& COMMENTARIES 110 (2002).

    87 Commentary, supra note 78, at 364, citing Convention against Torture and Other Cruel, Inhuman or

    Degrading Treatment or Punishment, 1465 U.N.T.S. 112, art. 14, dealing with compensation for victims oftorture.

    88 Commentary,supra note 78, at 364.89 Id.90 Id. See also Rome Statute of the International Criminal Court, July 17, 1998, A/CONF.183/9, arts. 25 (2),

    27.

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    The principle is that there are legal consequences for a states internationallywrongful act.91 Aside from the obligation of cessation and assurances or guarantees of non-repetition,92 the consequence of a commission of an internationally wrongful act involvesan obligation to make reparation in an adequate form. 93 Reparation must, so far as

    possible, wipe out all the consequences of the illegal act and re-establish the situationwhich would, in all probability, have existed if the wrongful act had not been committed.94

    Restitution is in kind, or, if this is not possible, payment of a sum corresponding to thevalue which a restitution in kind would bear; there is an award of damages for losssustained which would not be covered by restitution in kind or payment in place of it. 95

    There is no general requirement that a state should have suffered material harm or damagebefore it can seek reparation for a breach.96 The existence of actual damage will be highlyrelevant to the form and quantum of reparation.97

    II. Private International Law

    A. Jurisdiction

    The court has to determine first whether it has jurisdiction over the case.98 If it hasno jurisdiction, the case should be dismissed on that ground.99 If it has jurisdiction, thecourt will determine whether it should assume jurisdiction over the case or dismiss it on theground offorum non conveniens.100It is the law of the forum that determines whether thecourt has jurisdiction over the case.101

    91 Articles on State Responsibility,supra note 78, art. 28.92 Id .art. 30.93

    Id .art. 31. See also Chorzow Factory, 1927 P.C.I.J. (ser. A) No. 9, at 21.94 Chorzow Factory, 1927 P.C.I.J. (ser. A) No. 9, at 47; Commentary,supra note 78, at 223-24.95 Chorzow Factory, 1927 P.C.I.J. (ser. A) No. 9, at 47; Commentary,supra note 78, at 224.96 Commentary,supra note 78, at 226.97 Id.98 ALICIA SEMPIO-DIY, HANDBOOKON CONFLICTOF LAWS 4 (2004).99 Id.100 Id.; JORGE COQUIA & ELIZABETH AGUILING-PANGALANGAN, CONFLICTOF LAWS: CASES, MATERIALSAND COMMENTS 39

    (2000).101 SEMPIO-DIY,supra note 98, at 4.

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    Once the court has determined whether it has jurisdiction over the case, it will nextdetermine whether to apply the internal law of the forum or the proper foreign law,considering the attendant circumstances.102

    Doctrine ofForum Non Conveniens

    Even if the court assumes jurisdiction over the parties and the subject matter, it maydecline to try the case on the ground that there is another available and more appropriateforum in which the ends of justice would be better served in view of the interests of allparties, by eliminating the vexatious or oppressive character of the pending proceedingsand by removing any unfairness to either party which would result from trial in the forumseized of the case.103

    American courts have also applied the doctrine in order to prevent abuse of the

    courts process, i.e., when plaintiff made the choice of the forum primarily to harassdefendant by pursuing the remedy, or where a non-resident plaintiff chose the forumbecause he felt that jury verdicts were larger there than in another forum.104 Another reasonfor the rule is to avoid global forum shopping, which is the filing of repetitious suits incourts of different jurisdiction.105

    Assume Jurisdiction

    The presence of any one of the following factors would justify the application ofinternal law:

    1. a specific law of the forum decrees that internal law should apply;2. the proper foreign law was not properly pleaded and proved; or3. the case falls under any of the exceptions to the application of foreign law.106

    Notably, forum law is also applied when there is failure to plead and prove thepertinent law because it leads to the presumption that it is the same as forum law.107

    102 Id.; COQUIA & AGUILING-PANGALANGAN, supra note 100, at 51.103 COQUIA & AGUILING-PANGALANGAN, supra note 100, at 40-41, quoting Joseph Dainov, The Inappropriate

    Forum, 29 ILL.L.REV. 867 (1934).104 Id. at 40.105 Id. at 41.106 Id. at 51-52.107 Id. at 52.

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    Forum law should also be applied if the case falls under the exceptions to theapplication of the foreign law. They are:

    1. when the foreign law is contrary to an important public policy of the forum;2. when the foreign law is penal in nature;

    3. when the foreign law is procedural in nature;4. when the foreign law is purely fiscal or administrative;5. when the application of foreign law will work undeniable injustice to the citizens of

    the forum;6. when the case involves real or personal property situated in the forum;7. when the application of the foreign law might endanger the vital interest of the state;

    and8. when the foreign law is contrary to good morals.108

    Doctrine ofLex Loci Contractus

    As a general rule, the law of the place where a contract is made or entered intogoverns with respect to its nature and validity, as well as obligation and interpretation. Thishas been said to be the rule even though the place where the contract was made is differentfrom the place where it is to be performed, and particularly so if the place of the makingand the place of performance are the same. Hence, the court should apply the law of theplace where the airline ticket was issued, when the passengers are residents and nationals ofthe forum and the ticket is issued in such state by the defendant airline.

    Jurisdiction over the person

    Jurisdiction over the person is acquired by the voluntary appearance of a party andhis submission to authority.109 The court also acquires jurisdiction over the person of theplaintiff the moment he invokes the aid of the court by filing a suit.110

    Jurisdiction over the defendant may be had by personal service or substitutedservice of summons.111

    Jurisdiction over subject matter

    108 Id. at 57.109 Id. at 21.110 Id.111 See RULESOF COURT, Rule 14, secs. 6-7.

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    Jurisdiction over the subject matter is more than the general power conferred by lawto take cognizance of cases of a general class to which the case belongs. It is not enoughthat a court has power in abstract to try and decide that class of litigation to which a casebelongs; it is necessary that said power be properly invoked by filing a petition.112 It cannotbe conferred by the consent of the parties and a decision may be set aside where the court

    exceeds its jurisdiction. 113

    Jurisdiction over the res or property

    Jurisdiction over the property which is the subject matter of litigation results eitherfrom the seizure of the property under legal process or from the institution of legalproceedings wherein the courts power over the property is recognized and madeeffective.114

    Cases:

    Carnival Cruise Lines v. Schute, 499 U.S. 585 (1991)

    Facts: After the spouses Schute (Washington) purchased passage for a 7-day cruise on theship Tropicale owned by Carnival Cruise (Florida-based line) thru an agent, CarnivalCruise sent them tickets containing a forum selection clause designating courts in Floridaas the agreed-upon fora. Mrs. Shute suffered injuries when she slipped on a deck matduring a guided tour of the ships gallery. The Shutes filed suit in Washington.

    Is the stipulation limiting the fora to Florida courts valid? Was the case improperly

    filed in Washington as it was within the jurisdiction of Florida courts?Held: YES, the appellate court erred in refusing to enforce the forum selection clause.Since the facts in the case of Bremen are different from the facts of this case, Bremen isinapplicable to negate the application of the forum selection clause in the case at bar. Thestatement the serious inconvenience of the contractual forum to one or both of the partiesmight carry great weight in determining the reasonableness of the forum clause was madein the context of a hypothetical agreement between two Americans to resolve theiressentially local disputes in a remote alien forum. Here, in contrast, Florida is not such aforum, nor given the location of Mrs. Shutes accident is this dispute an essentiallylocal one inherently more suited to resolution in Washington than in Florida. In the lightof these distinctions, and because the Shutes do not claim lack of notice of the forumclause, nor was there any finding by the Washington court that the Shutes were financiallyincapable of pursuing litigation in Florida. They have not satisfied the heavy burden ofproof required to set aside the clause on grounds of inconvenience. Although forumselection clauses contained in form passage contracts are subject to judicial scrutiny for

    112 Caluag v. Pecson, 82 Phil. 8 (1948).113 COQUIA & AGUILING-PANGALANGAN, supra note100, at 37, citingCaluag v. Pecson, 82 Phil. at 8.114 Id. at 23, citingBanco Espanol-Filipino v. Palanca, 37 Phil. 921 (1918).

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    fundamental fairness, there is no indication that Carnival Cruise Lines selected Florida todiscourage cruise passengers from pursuing legitimate claims or obtained the Shutesaccession to the forum clause by fraud or overreaching.

    Burger King v. Rudzewicz, 471 U.S. 462 (1985)

    Facts: Rudzevicz (Michigan) entered into a twenty-year franchise contract with BurgerKing [BK] (Florida) to operate a restaurant in Michigan. The contract provides that thefranchise relationship is established in Miami and governed by Florida law. It calls forpayment of a $40,000 franchise fee and all required monthly royalties and fees; forwardingof all relevant notices to the Miami headquarters. The Miami headquarters set policies andwork directly with the franchisees in attempting to resolve major problems. Day-to-daymonitoring of franchises, however, is conducted through district offices that in turn reportto Miami headquarters. Subsequently, when the restaurants patronage declined, thefranchisees fell behind their monthly payments. Headquarters terminated the franchise and

    ordered the franchisees to vacate the premises. They refused and continued to operate therestaurant. BK then brought a diversity action in Florida. Franchisees claimed that becausethey were Michigan residents and because BKs claim did not arise within Florida, thedistrict court lacked personal jurisdiction over them.

    Held: Florida court has jurisdiction. A forum may assert specific jurisdiction over a non-resident defendant where an alleged injury arises out of or relates to actions by thedefendant himself that are purposefully directed toward forum residents and wherejurisdiction would not otherwise offend fair play and substantial justice. Jurisdiction inthese circumstances may not be avoided merely because the defendant did not physically

    enter the forum. So long as a commercial actors efforts are purposefully directedtoward residents of another state, we have consistently rejected the notion that an absenceof physical contacts can defeat personal jurisdiction there.

    The Bremen v. Zapata Offshore Co., 407 U.S. 1 (1972)

    Facts: Unterweser (German) entered into an agreement to tow Zapatas (US) drilling rigfrom Louisiana to Italy. The contract contained a forum-selection clause providing for thelitigation of any dispute in the High Court of Justice in London. The contract was executedby Zapata at Houston and was sent and accepted by Unterweser in Germany. When the rigunder tow was damaged in a storm, Zapata instructed Unterweser to tow the rig to Tampa,the nearest port of refuge. There, Zapata brought suit in admiralty against Bremen.Unterweser invoked the forum clause in moving for dismissal for want of jurisdiction andbrought suit in an English court, which ruled it had jurisdiction under the contractual forumprovision.

    Held: London court has jurisdiction. Forum selection clauses are prima facie VALID andshould be enforced, unless enforcement is shown by the resisting party to be

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    unreasonable under the circumstances. The threshold question is whether that courtshould have exercised its jurisdiction to do more than give effect to the legitimateexpectations of the parties, manifested in their freely negotiated agreement, by specificallyenforcing the forum clause.

    Forum selection is valid UNLESS it (1) contravenes a strong public policy of theforum and (2) is seriously inconvenient for the trial of the action. The forum selectionclause, which was a vital part of the towing contract, is BINDING on the parties, unlessZapata off-shore can meet the heavy burden of showing that its enforcement would beunreasonable, unfair, or unjust.

    Piper Aircraft Co. v. Reyno, 454 U.S. 235 (1981)

    Facts: A small commercial aircraft crashed in Scotland. 5 passengers died, they were allScottish. The aircraft was manufactured by Piper (US). Reyno, representative of the heirs,

    instituted an action in the US. Reyno sought to recover from Piper Aircraft on the basis ofnegligence or strict liability (NOT recognized by Scottish law), and admitted that the actionwas filed in the US because its laws regarding liability, capacity to sue, and damages aremore favorable to Reynos/heirs position than those of Scotland.

    Held: The Scottish court has jurisdiction. Reyno may not defeat a motion to dismiss onthe ground offorum non conveniens merely by showing that the substantive law that wouldbe applied in the alternative forum is less favorable to them than that of the chosen forum.The possibility of a change in substantive law should ordinarily not be given conclusive oreven substantial weight in theforum non conveniens inquiry. But if the remedy provided

    by the alternative forum is so clearly inadequate or unsatisfactory, that is no remedy at all,the unfavorable change in law may be given substantial weight; the district court mayconclude that dismissal would not be in the interests of justice. Scottish laws do notdeprive the heirs of any remedy.

    The District Court properly decided that the presumption in favor of the plaintiffsforum choice applied with less than maximum force when the plaintiffs are foreign. Whenthe plaintiff has chosen the home forum, it is reasonable to assume that the choice isconvenient; but when the plaintiffs are foreign this assumption is much less reasonable andthe plaintiffs choice deserves less deference.

    National Rental v. Szukhent, 375 U.S. 311 (1964)

    Facts: National Rental (New York) sued Szukhent, et al. (Michigan) in a federal court inNew York, claiming that Szukhent had defaulted in payments due under a farm equipmentlease. The last paragraph of the lease provided that the lessee hereby designates FlorenceWeinberg as agent for the purpose of accepting service of any process within the state ofNew York. Szukhent, et al. were NOT acquainted with Florence and she had not

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    expressly undertaken to transmit notice to them. The Marshall delivered two copies of thesummons and complaint to Florence. That same day, she mailed the summons andcomplaint to Szukhent, together with a letter stating that the documents had been servedupon her as Szukhents agent for the purpose of accepting service of process in New York,in accordance with the agreement contained in the lease.

    Held: The service of processes was validly made, thereby vesting jurisdiction in the NewYork court. Parties to a contract may agree in advance to submit to the jurisdiction of agiven court, to permit notice to be served by the opposing party, or even to waive noticealtogether. The purpose underlying the contractual provision is to assure that any litigationunder the lease should be conducted in the state of New York. Weinbergs promptacceptance and transmittal to Szukhent of the summons and complaint pursuant to theauthorization was itself sufficient to validate the agency, even though there was no explicitprevious promise on her part to do so. The fact that the designated agent was not personallyknown to Szukhent at the time of her appointment, and that she may be related to an officer

    of National Rental, did not invalidate the agency.

    United Airlines v. Court of Appeals, 357 SCRA 99 (2001)

    Facts: The Fontanillas bought tickets from United Airlines through its agent in Manila.When in Washington, they rewrote their tickets. They were bumped off their flight andthree caucasians were allowed to board instead of them. They were also rudely insulted byan employee of United Airlines so they sued for damages.

    Which law applies: US Code of Federal Regulation or Philippine law?

    Held: The Court of Appeals erred in applying the US Code of Federal Regulation.Philippine law applies. Although the contract of carriage was to be performed in theUnited States, the tickets were purchased thru United Airlines agent in Manila.

    Pakistan International Airlines v. Ople, 190 SCRA 90 (1990)

    Facts: Pakistan International Airways [PIA] (Pakistan and is licensed to do businessunder Philippine laws) hired 2 Filipino flight attendants. The contract of employment wasentered into in the Philippines and their base station was in the Philippines. The contractstipulated that laws of Pakistan would apply and Pakistani courts have jurisdiction. WhenPIA terminated their contracts, the flight attendants filed an action for illegal dismissal inthe Philippines.

    Which laws apply, Pakistani or Philippine?

    Held: Philippine laws apply. Parties may not contract away applicable provisions of lawespecially peremptory provisions dealing with matters heavily impressed with public

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    interest. PIA CANNOT take refuge in paragraph 10 of its employment agreement whichspecifies, firstly, the law of Pakistan as the applicable law of the agreement and, secondly,lays the venue for settlement of any dispute arising out of or in connection with theagreement "only [in] courts of Karachi, Pakistan". PIA did NOT undertake to plead andprove the contents of Pakistan law on the matter; it must therefore be presumed that the

    applicable provisions of the law of Pakistan are the same as the applicable provisions ofPhilippine law.

    Cadalin v. POEA, 238 SCRA 721 (1994)

    Facts: Brown and Root International Inc. (BRII) (Texas) employed Filipino OCWs throughits recruiting agent in the Philippines to work in the Middle East. The Contract stipulatedthat the employees were entitled to benefits under Bahrain law which provides for aprescriptive period of merely 1 year. They filed an action in the Philippines.

    Which law will apply, Labor Code or Bahrain Law?

    Held: As a general rule, a foreign procedural law will not be applied in the forum. A lawon prescription of actions is sui generis in Conflict of Laws in the sense that it may beviewed either as procedural or substantive, depending on the characterization given such alaw. However, the characterization of a statute into a procedural or substantive lawbecomes irrelevant when the country of the forum has a borrowing statute. Said statutehas the practical effect of treating the foreign statute of limitation as one of substance. Aborrowing statute directs the state of the forum to apply the foreign statute of limitationsto the pending claims based on a foreign law.

    Sec 48 of the Rules of Civil Procedure provide: If by the laws of the state or countrywhere the cause of action arose, the action is barred, it is also barred in the PhilippinesIslands. However, since their prescriptive period was unconstitutional and against thepublic policy of protecting labor, the Labor Code will be applied.

    Sweet Lines v. Teves, 83 SCRA 361 (1978)

    Facts: Attys. Tandog and Tiro bought two tickets from the main office of Sweet Lines.They were to board M/S Sweet Hope bound for Tagbilaran. Upon learning that the vesselwas not proceeding to Bohol, Attys. Tandog and Tiro went to the branch office for properrelocation to M/S Sweet Town. Because the said vessel was already filled to capacity, theywere forced to hide at the cargo section to avoid inspection of the officers of the PhilippineCoastguard. They sued Sweet Lines in the Court of First Instance of Misamis Oriental forbreach of contract of carriage. Sweet Lines moved to dismiss the complaint on the groundof improper venue. The motion was premised on the condition printed at the back of thetickets that actions arising from the provisions of this ticket shall be filed in the competentcourts in the City of Cebu.

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    Is the condition valid and enforceable?

    Held: NO, venue was proper. The condition is VOID. Reasons: (1) under circumstancesobtaining in the inter-island shipping industry, it is not just and fair to bind passengers to

    the terms of the conditions printed at the back of the passage tickets printed in fine letters,and (2) the condition subverts the public policy on transfer of venue since the same willprejudice rights and interests of innumerable passengers in different parts of the country.

    The Court may declare the agreement as to venue to be in effect contrary to publicpolicy despite that, in general, changes and transfers of venue by written agreement of theparties are allowable whenever it is shown that a stipulation as to venue works injusticeby practically denying to the party concerned the remedy provided by the rules.

    Hongkong and Shanghai Banking Corp. (HSBC) v. Sherman, 176 SCRA 331 (1989)

    Facts: Eastern Book & Supply Service (Singapore) was granted by HSBC Singapore anoverdraft facility. Sherman, et. al. and directors of Eastern Book executed a Joint andSeveral Guarantee in favor of HSBC. Eastern Book defaulted. Hence, HSBC filed a suit forcollection against them before the Regional Trial Court of Quezon City. Sherman filed aMotion to Dismiss on the ground of lack of jurisdiction over the complaint and persons ofthe defendants. The guarantee provides: This guarantee and all rights, obligations andliabilities arising hereunder shall be construed and determined under and may be enforcedin accordance with the laws of the Republic of Singapore.

    Held: Philippine courts have jurisdiction over the suit. The stipulation shall be liberallyconstrued. A stipulation as to venue does not preclude the filing of suits in the residence ofplaintiff or defendant under Sec 2 (b), Rule 4 of the Rules of Court, in the absence ofqualifying or restrictive words in the agreement which indicate that the place named is theonly venue agreed upon by the parties. The parties did not thereby stipulate that only thecourts of Singapore, to the exclusion of all the rest, have jurisdiction. Neither did the clausein question operate to divest Philippine courts of jurisdiction. In International Law,jurisdiction is often defined as the right of a state to exercise authority over persons andthings within its boundaries subject to certain exceptions. This authority, which finds itssource in the concept of sovereignty, is exclusive within and throughout the domain of thestate. A state is competent to take hold of any judicial matter it sees fit by making its courtsand agencies assume jurisdiction over all kinds of cases brought before them.

    International Shoe Co. v. Washington, 326 U.S. 310 (1945)

    Facts: International Shoe is a Delaware Corporation with principal office in Missouri.International Shoe has no sales outlets or offices in Washington but its salesmen reside andsolicit orders in Washington. Only display rooms are in Washington and sales are made in

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    places other than Washington. A suit for tax liability is filed in Washington againstInternational Shoe.

    Held: The Washington court has jurisdiction over International Shoe. Regular andsystematic solicitation of orders in Washington was sufficient to constitute doing business

    in Washington so as to make International Shoe amenable to suits in its courts. There weresufficient additional activities which constitute doing business such as display of samplesin permanent display rooms and continuous maintenance of salesmen residence inWashington.

    Due process requires only that in order to subject a defendant to a judgment inpersonam, if he be not present within the territory of the forum, he should have certainminimum contacts with it such that the maintenance of the suit does not offend thetraditional notions of fair play and substantial justice. The corporations presence can bemanifested only by activities carried on in its behalf by those who are authorized to act for

    it. Thus, service of summons on the salesmen and service by registered mail at its homeoffice are sufficient to bind International Shoe.

    Perkins v. Benguet Consolidated Mining, 93 Phil. 1034 (1954)

    Facts: Perkins filed an action for recovery of dividends due her as a stockholder ofBenguet Consolidated Mining (BCM). BCM has been carrying on in Ohio a continuousand systematic but limited part of its general business. Its president, while engaged in doingsuch business in Ohio, has been served with summons in this proceeding. The cause ofaction did not arise in Ohio and does not relate to the corporations activities there. Thus,

    the trial court sustained a motion to quash service of summons on BCM.

    Held: Ohio court has jurisdiction. The service of summons is valid. If an authorizedrepresentative of a foreign corporation is physically present in the state of forum and bethere engaged in activities appropriate to accepting service or receiving notice on its behalf,there is no unfairness in subjecting the corporation to the jurisdiction of courts of that statethrough such service of process upon the representative. This has been squarely held to beso in a proceeding in personam against such a corporation, at least in relation to a cause ofaction arising out of the corporations activities within the state of the forum. The amountand kind of activities, however, which must be carried on by the foreign corporation in thestate of the forum so as to make it reasonable and just to subject the corporation to thejurisdiction of that state are to be determined in each case.

    Philsec Investment Corp. v. Court of Appeals, 274 SCRA 102 (1997)

    Facts: Ducat obtained loans from Ayala International Finance and Philsec secured byshares of stock. 1488 Inc. assumed Ducats obligation. 1488 sold to Athona Holdings aparcel of land in Harris County, Texas while Philsec and Ayala extended a loan to Athona

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    to finance payment of the purchase price. Thus, Ducat was released from the obligation. AsAthona failed to pay the balance of the purchase price, the entire debt became due anddemandable. 1488 sued Philsec, Ayala and Athona in the US for payment of the balanceplus damages. While the case was pending, Philsec filed a complaint against Ducat, et al. inthe Regional Trial Court of Makati. Ducat filed a motion to dismiss on the ground of litis

    pendentia and forum non conveniens. The trial court granted Ducats motion even as itnoted that Ducat was not a party in the US case.

    Held: The dismissal of the case was improper. The case was arbitrarily dismissed. Whilethis court has given the effect ofres judicata to foreign judgments in several cases, it wasafter the parties opposed to the judgment had been given ample opportunity to repel themon grounds allowed under the law.Neither the trial court nor the appellate court was evenfurnished copies of the pleadings in the US Court or apprised of the evidence presentedthereat, to assure a proper determination of whether the issues then being litigated in theUS court were exactly the issues raised in this case such that the judgment that might be

    rendered would constitute res judicata. The trial court arbitrarily dismissed the case evenafter finding that Ducat was not a party in the US case.

    World Wide Volkswagen v. Woodson, 444 U.S. 286 (1980)

    Facts: The Robinsons (New York [NY]) purchased a new Audi automobile from SeawayVolkswagen (NY). The following year the Robinson family, who resided in NY, left thatState for a new home in Arizona. As they passed through the State of Oklahoma, anothercar struck their Audi in the rear, causing a fire which severely burned Kay and her 2 kids.Thus, the Robinsons brought a products liability action against the retailer Seaway

    Volkswagen and its wholesale distributor Worldwide Volkswagen (NY), among others, inan Oklahoma court.

    Held: Oklahoma court does not have jurisdiction. The only connection to Oklahoma is thatthe accident occurred there. Consistently with the Due Process Clause, the Oklahoma trialcourt may NOT exercise in personam jurisdiction over Seaway and WW Volkswagen.Oklahoma courts exercise of in personamjurisdiction, under the Long-Arm Statute, overthe NY auto retailer and wholesale distributor for products liability action arising from anautomobile accident in Oklahoma, is violative of due process.

    A state court may exercise personal jurisdiction over a non-resident defendant onlyso long as there exist minimum contacts between the defendant and the forum state. Thereare no such contacts here. The defendants contacts with the forum State must be such thatmaintenance of the suit does not offend traditional notions of fair play and substantialjustice and the relationship between the defendant and the forum must be such that it isreasonable to require the corporation to defend the particular suit which is brought there.The due process clause does not contemplate that a state may make binding a judgment inpersonam against an individual or corporate defendant with which the state has no contacts,

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    ties, or relations.

    Calder v. Jones, 465 U.S. 783 (1984)

    Facts: Jones (California) brought suit in California, claiming that she had been libeled in

    an article written and edited by Calder and South in Florida, and published in the NationalEnquirer, a national magazine having its largest circulation in California. Calder and South,both residents of Florida, were served with process by mail in Florida and, on specialappearances, moved to quash the service of process for lack of personal jurisdiction.

    Held: California court has jurisdiction. Jurisdiction over Calder and South in California isproper because of their intentional conduct in Florida allegedly calculated to cause injury toJones in California. The Due Process Clause permits personal jurisdiction over a defendantin any state with which the defendant has certain minimum contacts such that themaintenance of the suit does not offend traditional notions of fair play and substantial

    justice. In judging minimum contracts, a court properly focuses on the relationshipamong the defendant, the forum, and the litigation. The plaintiffs lack of contacts will notdefeat otherwise proper jurisdiction, but the plaintiffs contacts may be so manifold as topermit jurisdiction when it would not exist in their absence.

    Here, California is the focal point of both the allegedly libelous article and of theharm suffered. Jurisdiction over Calder and South is therefore proper in California based onthe effects of their Florida conduct in California. Calder and South are not charged withmere untargeted negligence, but rather their intentional, and allegedly tortuous, actionsexpressly aimed at California. They wrote and edited an article that they knew would have

    a potentially devastating impact upon Jones, and they knew that the brunt of that injurywould be felt by Jones in the state in which she lives and works, and in which the magazinehas its largest circulation. Under these circumstances, Calder and South must reasonablyanticipate being haled into court there to answer for the truth of the statements made in thearticle.

    Compuserve v. Patterson, 89 F.3d 1257 (6th Cir. 1996)

    Facts: Patterson (Texas) entered into contracts with Compuserve (Ohio) wherein he woulduse its services to sell his software programs to others. These contracts provide that theyare entered into in Ohio and would be governed by Ohio laws. Compuserve started comingout with its own programs which were like those of Patterson. Patterson demanded at least$100,000 to settle. Compuserve filed a declaratory judgment action in Ohio.

    Held: Ohio has jurisdiction. To determine whether personal jurisdiction exists over adefendant, federal courts apply the law of the forum state, subject to the limits of the DueProcess Clause. The Ohio long-arm statute allows an Ohio court to exercise personaljurisdiction over non-residents of Ohio on claims arising from the non-residents transacting

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    any business in Ohio.

    Also, the following requisites were present:

    1.) Purposeful availment (physical presence not necessary. He entered into a contract

    with Compuserve and injected his software product into the stream of commerce these together are enough);

    2.) Claim arises out of forum-related activities; and3.) Reasonableness: whether exercise of personal jurisdiction would comport with the

    traditional notions of fair play and substantial justice.

    A court must consider several factors including:

    1.) the burden of the defendant;2.) the interest of the forum state;

    3.) the plaintiffs interest in obtaining relief; and4.) the interest of other states in securing the most efficient resolution of controversies.

    Although burdensome for Patterson to defend a suit in Ohio, he knowingly made aneffort and in fact, purposefully contracted to market a product in other states, withOhio-based Compuserve operating, in effect, as his distribution center. Thus, it isreasonable to subject Patterson to suit in Ohio, the State which is home to the computernetwork service he chose to employ.

    Rush v. Savchuk, 444 U.S. 320 (1980)

    Facts: While a resident of Indiana, Savchuk was injured in an accident in Indiana whileriding as a passenger in a car driven by Rush, also an Indiana resident. After moving toMinnesota, Savchuk commenced this action against Rush in a Minnesota state court,alleging negligence and seeking damages. As Rush had no contacts with Minnesota thatwould support in personam jurisdiction, Savchuk attempted to obtain quasi in remjurisdiction by garnishing the contractual obligation of State Farm Mutual AutomobileInsurance to defend and indemnify Rush in connection with such a suit.

    Held: Indiana has jurisdiction. A state may not constitutionally exercise quasi in remjurisdiction over a defendant who has no forum contacts by attaching the contractualobligation of an insurer licensed to do business in the state to defend and indemnify him inconnection with the suit. A state may exercise jurisdiction over an absent defendant only ifthe defendant has certain minimum contacts with the forum such that the maintenance ofthe suit does not offend traditional notions of fair play and substantial justice.

    The mere presence of property in a state does not establish a sufficient relationshipbetween the owner of the property and the state to support the exercise of jurisdiction over

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    an unrelated cause of action, and it cannot be said that the defendant engaged in anypurposeful activity related to the forum that would make the exercise of jurisdiction fair,just, or reasonable merely because his insurer does business there. Neither does the policyprovide significant contacts between the litigation and the forum, for the policy obligationspertain only to the conduct, not the substance, of the litigation.

    Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947)

    Facts: Gilbert (Virginia) sued Gulf Oil (Virginia and New York) for damages for allegedlybeing careless in handling a delivery of gasoline to his warehouse (in Virginia) therebycausing an explosion and fire destroying his warehouse. Gulf Oil, invoking the doctrine offorum non conveniens, claimed that the appropriate place for trial is Virginia where Gilbertlives and Gulf Oil does business, where all events in litigation took place, where most ofthe witnesses reside, and where both state and federal courts are available to Gilbert and areable to obtain jurisdiction over Gulf Oil.

    Held: Virginia court has jurisdiction but not on the ground offorum non conveniens. Thedoctrine offorum non conveniens can never apply if there is absence of jurisdiction ormistake of venue. Everything happened in Virginia and all witnesses are there. It isGilberts residence and Gulf Oil does business there. Apparently, Gilbert only wanted tofile the case in NY because NY juries are accustomed to large awards of damages. NYcourt lacks jurisdiction. Virginia court is competent to take cognizance of the case.

    Manila Hotel v. NLRC, G. R. No. 120077, 13 October 2000

    Facts: Santos worked at Palace Hotel but was terminated due to political upheaval. Hefiled a complaint for illegal dismissal in the Philippines. Forum non conveniens is invokedby defendants.

    Held: NLRC lacks jurisdiction. NLRC was a seriously inconvenient forum. The mainaspects of the case transpired in two foreign jurisdictions and the case involves purelyforeign elements. The only link that the Philippines has with the case is that Santos is aFilipino citizen. The Palace Hotel and Manila Hotel International are foreign corporations.Not all cases involving our citizens can be tried here. Santos was hired by Palace Hotel(foreign employer) thru correspondence sent to the Sultanate of Oman. Santos was hiredwithout the intervention of POEA or any authorized recruitment agency of the government.

    Under the rule offorum non conveniens, a Philippine court may assume jurisdiction overthe case if it chooses to do soprovided:

    1.) That the Philippine court is one to which the parties may conveniently resort;2.) That the Philippine court is in a position to make an intelligent decision as to the law

    and the facts;

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    3.) That the Philippine court has or is likely to have power to enforce its decision.

    The conditions are unavailing in this case. IF Santos were an OCW, a Philippine forum,especifically the POEA, not the NLRC would protect him. He is NOT, however, an OCW,a fact which he admits with conviction.

    K. K. Shell v. Court of Appeals, 188 SCRA 145 (1990)

    Facts: Kumagai (Japan) filed a complaint for collection of sum of money against AtlanticVenus (Panama / M/V Estella owner ), the vessel M/V Estella & Crestamonte ShippingCorporation (Philippines) with the Manila Regional Trial Court (RTC). The complaintalleged that Crestamonte, as bareboat charterer of M/V Estella, appointed NS ShippingCorp. (Japan) as its general agent in Japan. NS Shipping appointed Kumagai as its localagent in Osaka, Japan. Kumagai supplied the M/V Estella with supplies and services, but,despite repeated demands, Crestamonte failed to pay the amounts due. Fu Hing Oil

    (Hongkong) filed a motion for leave to intervene alleging that it supplied marine diesel oilto M/V Estella & incurred barge expenses but has remained unpaid. KK Shell (Japan) alsofiled a Motion to Intervene alleging that it also provided M/V Estella with marine diesel.The RTC allowed the intervention. The Court of Appeals (CA) REVERSED. The CAheld that Fu Hing and KK Shell were not suppliers but subagents of NS Shipping, hence,they were bound by the Agency Agreement between Crestamonte and NS Shipping,particularly, the choice of forum clause which provides that Japanese courts would havejurisdiction.

    Held: Manila RTC has jurisdiction. A reading of the Agency Agreement fails to support

    the conclusion that KK Shell is a sub-agent of NS Shipping and is therefore bound by theagreement. As the choice of forum clause has not been conclusively shown to be bindingupon KK Shell, additional evidence would have to be presented to establish this defense.KK Shell cannot therefore, as of yet, be barred from instituting an action in the Philippines.The Supreme Court is not ready to rule on Crestamontes invocation of forum nonconveniens, as the exact nature of the relationship of the parties is still to be established.The Supreme Court leaves the matter to the sound discretion of the trial court judge who isin the best position, after some vital facts are established, to determine whether specialcircumstances require that his court desist from assuming jurisdiction over the suit.

    Communication Materials v. Court of Appeals, 260 SCRA 673 (1996)

    Facts: International Inc. (ITEC) (Alabama) entered into a Representative Agreement withASPAC Multi-trade, Inc. (ASPAC) (Philippines). Pursuant to the contract, ITEC engagedASPAC as its exclusive representative in the Philippines for the sale of its products, inconsideration of which ASPAC was paid a stipulated commission. ITEC decided toterminate the contract because ASPAC allegedly violated its contractual commitment.ITEC charges ASPAC and Digital Base Communications (Philippines), whose presidents

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    are the same, of using knowledge and information on ITECs product specs to develop theirown line of equipment and product support which are similar to ITECs own & offeringthem to ITECs former customer. ITEC filed its complaint with the Regional Trial Court ofMakati. Defendants filed a Motion to Dismiss on the grounds of (1) lack of ITECs legalcapacity to sue and (2)forum non conveniens.

    Held: Makati RTC has jurisdiction. Forum non conveniens is not applicable. Throughforum non conveniens, the Philippine court may refuse to assume jurisdiction in spite of itshaving acquired jurisdiction. Conversely, the court may assume jurisdiction over the case ifit chooses to do so, provided, that the following requisites are met:

    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; and3.) That the Philippine court has or is likely to have power to enforce its decision.

    The aforesaid requirements having been met, and in view of the courts disposition to givedue course to the questioned action, the matter of the present forum not being the mostconvenient as ground for the suits dismissal deserves scant consideration.

    Aznar v. Garcia, 117 Phil. 96 (1963)

    Facts: Edward (US) died leaving a will. Helen, natural acknowledged child, opposed the

    project of partition saying she was deprived of her legitime. She says that the distributionshould be governed by the laws of the Philppines, and that the distribution would depriveher of her legitime. It was alleged that the law that should govern the estate should not bethe internal law of California alone, but the entire law thereof because several foreignelements are involved, that the forum is the Philippines and even if the case were decidedin California, Section 946 of the California Code of Commerce, which requires that thedomicile of the decedent apply, should be applicable.

    Held: Philippine courts have jurisdiction. Being a non-resident Californian citizen,Philippine laws apply as provided by the California Civil Code. The conflict of law rule inCalifornia, Article 946, Civil Code, refers back the case, when a decedent is not domiciledin California, to the law of his domicile, the Philippines in the case at bar. The court ofdomicile should refer the case back to California, as the action would leave the issueincapable of determination, because the case will then be tossed back and forth between thetwo states (renvoi), that is, between the country of which the decedent was a citizen and thecountry of his domicile. The Philippine court must apply its own law as directed in theconflict of laws rule of the state of the decedent, if the question has to be decided,especially as the application of the internal law of California provides no legitime for

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    children while Philippine law, Articles 887(4) and 894 of the Civil Code of the Philippines,makes natural children legally acknowledged forced heirs of the parent recognizing them.

    As the domicile of the deceased, who was a citizen of California, was thePhilippines, the validity of the provisions of his will depriving his acknowledged natural

    child of the latter's legacy, should be governed by Philippine law, pursuant to Article 946of the Civil Code of California, not by the law of California.

    Lueck v. Sunstrand, 99-15961 (9th Cir. Jan. 8, 2001)

    Facts: Ansett New Zealand flight crashed allegedly due to faulty altimeter. Plane crashvictims sued Sunstrand for damages. The sole A