CONFLICT OF LAWS7 MARCH 2013

OBLIGATIONS AND CONTRACTS

ContractsArt. 1305, CC. A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service. The fundamental policy is to give effect to the justified expectations of the parties. When ambiguity exists with regard to what law parties intended, their intent normally can be given effect by a reference to the law that will sustain their agreement.Art. 1159, CC: Obligations arising from contracts have the force of law between the contracting parties and must be complied with in good faith.

General PrinciplesWhere a contract involves contacts with different states, the choice of law is subject to stipulation.The choice of the parties will not be respected when the choice is violative of a fundamental policy of the State with a materially greater interest than the chosen state.

General PrinciplesConvention on the Law Applicable to Contractual Obligations, Rome Convention of 1980 provides universally accepted rules and enunciates customary law. It provides, for e.g., that a contract is to be governed by the law chosen by the parties.

Rome ConventionThe choice of the parties is either expressed or must be demonstrated with reasonable certainty either by: the term of the contract or the circumstances of the case. Absent express or implied choice, the law of the country with which it is most clearly connected applies. But the Convention also allows DECEPAGE or SCISSION which is subjecting different parts of the contract to different laws.

Rome ConventionProvides that when the contracting parties are both in the same country, validity is determined by recourse to the applicable law, or the LEX LOCI CELEBRATIONIS. But when the contracting parties are in different countries (through phone, telex, fax or e-mail), the validity as to form is determined by the applicable law or by the law of either of the countries where the parties are. Significantly, capacity to contract is excluded from the convention.

PHIL LAW ON EXTRINSIC VALIDITYThe Philippine follows the LEX LOCI CONTRACTUS rule as embodied in Art 17, CC., which states:the forms and solemnities of contracts (i.e., requirement of writing, formalities of execution) shall be governed by the laws of the country in which they are executed.

PHIL LAW ON EXTRINSIC VALIDITYFormal validity is determined by reference to the laws of the place where the contract was executed. But note that par 2, Art 17 provides that acts before diplomatic or consular officers abroad must conform to the formalities prescribed by Philippine Law.

PHIL LAW ON EXTRINSIC VALIDITYExceptions:A contract entered into by the parties in 2 different countries by cablegram, telex or fax is presumed to have been entered in the place where the offer was made (Art. 1319, par. 2, CC). This is in keeping with the tradition of our contract law on the control the offeror has over the transaction.If the place of execution was merely casual or accidental, the law which has the MOST SIGNIFICANT RELATIONSHIP to the transaction should be applied.

PHIL LAW ON INTRINSIC VALIDITYIntrinsic validity refers to the nature, content and effects of the contract. It also refers to the essence and substance of the obligation.Art. 1318 CC states that the following requisites must concur for there to be a contract: (1) consent; (2) object certain which is the subject matter; and (3) cause of the obligation which is established.

CONFLICT RULES ON INTRINSIC VALIDITYThere are 3 possible laws that may govern:Law of the place where the contract is made or lex loci contractusLaw of the place of performance or lex loci solutionisLaw intended by the parties or lex loci intentionis

PHIL LAW ON INTRINSIC VALIDITYThere is no specific provision in the Civil Code on intrinsic validity (includes consideration or cause, interpretation of instruments, nature of damages for breach or non-performance). Further, there is scarcity of case law on the matter which is attributed to the practice of the courts to treat COL cases as domestic cases thereby applying local laws. Such treatment is premised on expediency and convenience to the courts as well as to the litigants in not being burdened anymore with the duty to prove a foreign law.

PHIL LAW ON INTRINSIC VALIDITYPhilippine domestic law promotes the policy of giving effect to the intention of the parties. This is the doctrine of party autonomy recognized in most countries.Art. 1306 allows parties to bind themselves by stipulations, clauses, terms and conditions as they may deem convenient, provided that these are not contrary to law, morals, good customs, public order or public policy.

PHIL LAW ON INTRINSIC VALIDITYQuestions of construction and interpretation of contracts are within the contractual capacity of parties.Art. 1370 CC: If the terms of the contract are clear and leave no doubt as to the intention of the parties, the literal meaning of its stipulations must control. If the words appear to be contrary to the evident intention of the parties, the latter shall prevail over the former.

PHIL LAW ON INTRINSIC VALIDITYArt. 1371 CC: Intentions of contracting parties judged by contemporaneous and subsequent acts. Further the law looks at the acts of the parties and their surrounding circumstances which may possibly have exerted some influence upon their actions, and then assumes that their intentions are in harmony with such acts and circumstances.This is in line with the most significant relationship test, in the absence of choice of applicable law by the parties.

CAPACITY TO ENTER INTO CONTRACTSFor status, it is the personal laws of the contracting parties (either nationality OR domiciliary). Capacity is either governed by his national law OR by the law of his domicile. The latter, which involves the lex loci contractus rule with reference to capacity to enter into a contract, has now been abandoned. This follows the rule that the law that should govern a contract is the law of the state with which the contract has its more significant relationship.

CAPACITY TO ENTER INTO CONTRACTSExceptions to application of personal law to determine capacity are: contracts involving alienation or encumbrance of real or personal properties wherein lex situs governs the capacity of the contracting parties.Under the CC, the capacity of a Filipino is governed by Philippine law following the nationality theory (Art. 15)

CAPACITY TO ENTER INTO CONTRACTSAs to capacity for corporations to enter into a contract:The law of the place of contracting, rather than the state of incorporation determines whether a foreign corporation though considered as domiciled in the state where chartered, is capacitated.

CAPACITY TO ENTER INTO CONTRACTSPhilippine law on capacity is regulated at Art. 15 CC, which states:Laws relating to family rights and duties or to status, condition and legal capacity of persons are binding upon citizens of the Philippines even though living abroad.

CAPACITY TO ENTER INTO CONTRACTSOne prevailing rule in the Philippines is that the DOCTRINE OF ESTOPPEL will prevent a minor from repudiating a contract by later alleging that he was not of age in contracting with a party that dealt with him in good faith.

Geneva Conflict Rules on Bills of Exchange & Promissory Notes of 1930Capacity of a person to bind himself by a bill of exchange is initially determined by his national law; but a person who lacks capacity under his national law is nevertheless bound, if his signature is given in any territory in which according to the law in force there, he would have the requisite capacity. The Swiss Code provides that an alien who enters into a transaction in Switzerland cannot plead his lack of capacity if he has the capacity under Swiss law.

To reconcile different viewpoints, it has been suggested that Art. 15 CC should be limited by applying it only to agreements involving family rights and domestic relations and not to commercial transactions. Thus, capacity to enter into a contract commercial in nature should NOT be regulated by his personal law but rather by the law which governs the entire contract.

Insular Government vs. Frank 13 Phil 236, G.R.No.2935. March 23, 1909FACTS: In 1903 in the state of Illinois, Mr. Frank, a US citizen and a representative of the Insular Government of the Philippines entered into a contract whereby the former shall serve as stenographer in the Philippines for a period of 2 years. The contract contained a provision that in case of violation of its terms, Mr. Frank shall be liable for the amount incurred by the Philippine Government for his travel from Chicago to Manila and one-half salary paid during such period. After serving for 6 months, defendant left the service and refused to make further compliance with the terms of the contract, therefore the Government sued him to recover the amount of $269.23 plus damages. The lower court ruled in favor of the plaintiff, hence the defendant appealed presenting minority as his special defense. By reason of the fact that under the laws of the Philippines, contracts made by person who did not reach majority age of 23 are unenforceable.Defendant claim that he is an adult when he left Chicago but was a minor when he arrived in Manila and at the time the plaintiff attempted to enforce the contract.

Insular Government vs. Frank 13 Phil 236, G.R.No.2935. March 23, 1909RULING: Mr. Frank being fully qualified to enter into a contract at the place and time the contract was made, he cannot therefore plead infancy as a defense at the place where the contract is being enforced. Although Mr. Frank was still a minor under Philippine laws, he was nevertheless considered an adult under the laws of the state of Illinois, the place where the contract was made.

Insular Government vs. Frank 13 Phil 236, G.R.No.2935. March 23, 1909No rule is better settled in law than that matters bearing upon the execution, interpretation and validity of a contract are determined by the law of the place where the contract is made. Matters connected to its performance are regulated by the law prevailing at the place of its performance. Matters respecting a remedy, such as bringing of a suit, admissibility of evidence, and statutes of limitations, depend upon the law of the place where the suit is brought. Although generally, capacity of the parties to enter into a contract is governed by national law. This is one case not involving real property which was decided by our Supreme Court, where instead of national law, what should determine capacity to enter into a contract is the lex loci celebrationis.

Insular Government vs. Frank 13 Phil 236, G.R.No.2935. March 23, 1909According to Conflict of Laws writer Edgardo Paras, Franks capacity should be judged by his national law and not by the law of the place where the contract was entered into. In the instant case whether it is the place where the contract was made or Franks nationality, the result would be the same. However, as suggested by the mentioned author, for the conflicts rule in capacity in general, national law of the parties is controlling

Particular contracts: Money depositsSpecific sums of money taken and held on account by a bank, as a service to its clients.Such deposits, whether in sum or in specie are naturally bound to the place of the banking or financial institution to which they are entrusted. The law of the place governs the deposit (including all questions such as service charges, the manner of keeping the deposit, the effects of currency fluctuations, the mode of withdrawal or the deposits). See Ruben Martinez v. CA, G.R. No. 131673, 10 September 2004.

Contracts with Arbitration and Choice-of-Forum ClausesArbitration Clause is a commonly used clause in a contract that requires the parties to resolve their disputes thru an arbitration process. See Companie de Commerce vs. Hamburg-Amenka (G.R.No. L-10986, 31 March 1917), Republic Act 876 (1953), Republic Act 9285 (2004), LM Power Engineering Corp. vs. Capitol Industrial Construction, G.R. No. 141833, 26 March 2003

Contracts with Arbitration and Choice-of-Forum ClausesA Choice-of-Forum clause is a provision subjecting any litigation or controversy between the parties to a specified court or forum. It simply designates whether a dispute is to be resolved by a court and/or an alternative adjudication process such as an arbitration panel.As with arbitration clauses, Philippine courts have also looked with disfavor on contracts with choice-of-forum clauses on the ground that such a clause would oust them of their rightful jurisdiction.See Molina vs. Dela Riva, G.R. No. L-2521, 22 March 1906

Contracts with Arbitration and Choice-of-Forum ClausesBut to reduce the burden on courts, the SC has abandoned the old view and adopted a new rule:Where there is no fraud or overreaching, and there is no showing that the enforcement of the choice-of-forum clause would be unreasonable or unjust, the clause must be given effect. Scherk vs. Alberto-Culver Co., 417 U.S. 506, 1974

Other Notable ViewsPakistan International Airlines vs. Ople, G.R. No. 61594, 28 Sept 1990 The SC held that where the relationship between the parties is affected with public interest and the multiple and substantive contacts of the contract are with Philippine law, Philippine courts and agencies may not be ousted of their jurisdiction.KK Shell Sekiyu Osaka Hatsubaisho vs. CA, G.R.Nos. 90304-07, 30 July 1990 the SC held that when the choice-of-forum clause in a contract or agreement has not been conclusively shown to be binding due to ambiguity or lack of evidence, it will not operate to oust the local courts of their jurisdiction.

Cadalin v. POEA, 238 SCRA 721 (1994)A case on contracts in the area of CHOICE OF LAW. The aggrieved overseas Filipino workers brought suit on a contract of employment that made applicable the laws of the host country, Bahrain. The contracts for employment was signed in the Philippines. Issue: What was the applicable law defining the prescriptive period for the action Art. 1144 of CC grants a 10-yr period, Art 291 of Labor Code sets a 3-year period, or Amiri decree no. 23 of Bahrain that limits the period to 1 year? The 3-year prescriptive period of the Labor Code controls.

Cadalin v. POEA, 238 SCRA 721 (1994)The SC reiterated the fundamental rule that foreign procedural law will NOT be applied by the forum. However, it held that the law on prescription of actions was SUI GENERIS, neither substantive nor procedural. The Court the pointed out that in regard to this issue there is a domestic borrowing statute (Sec. 48 of Civil Code of Procedure which has not been repealed by the CC) that has the effect of treating a foreign statute of limitations as one of substantive law.Under this borrowing statute, an action barred by the laws of the place where it accrued will not be enforced in the forum even though the local law has not run against it. Thus, even if Bahrains statute of limitations was the applicable law, the Court nevertheless held that Bahrains law could not be enforced since a 1-yr statute of limitations against claims of workers violated a public policy of the forum-state: the protection of the welfare of laborers and workers.

Cadalin v. POEA, 238 SCRA 721 (1994)The Court upheld the rule that parties to a contract may select the law by which it is to be governed. In such a case, the law selected would regulate the relations of the parties, including questions of their capacity to enter into the contract, the formalities to be observed by them, matters of performance, etc. This right will be upheld provided that the law so chosen bears some relationship to the parties or to their transaction.

United Airlines vs. CA, GR 124110, April 20, 2001 (357 SCRA 99)The law of the place where the contract is made or entered into (place of perfection of contract not place of performance) governs with respect to validity, nature, obligation and interpretation. This case is important for laying down the RULE that this precept applies even if the place where the contract is made may be different from the place where the contract is made may be different from the place where it is performed. Thus, if an airline ticket is issued in the Philippines, of which passengers are either residents or nationals, the laws of the Philippines will govern the contract, even if the flight takes place elsewhere.

QueryIs it the law of the place where the contract is perfected, or the law chosen by the parties to govern their contract that controls?

QueryIs it the law of the place where the contract is perfected, or the law chosen by the parties to govern their contract that controls?The rule directing application of the law of the place where a contract is made or entered into governs only when the parties have not stipulated a different law, or when the law they choose to govern their contract cannot, on some legal grounds, be applied.

Choice of Contracting LawIt is either express or implied. If implied, it is inferred from such factors as substantial connection with the transaction, or the nationality or domicile of the parties. With respect to time, place, manner of performance and valid excuses for non-performance, the Court characterizes as useful the proposal to apply the law of the place of performance (LEX LOCI SOLUTIONIS). This is considered to have a significant relationship to the contract. Phil Export and Foreign Loan Guarantee Corporation v. V.P. Eusebio Construction, Inc. (GR 140047, 13 July 2004, 434 SCRA 202).

Choice of Contracting LawPhilippine law allows the parties to choose the law that controls their contract provided that such a choice is not contrary to law, morals or public policy and that the chosen law must bear a substantive relationship to the transaction.

PHILIPPINE CONFLICT RULE: ScenariosWhat if the parties stipulate that the contract be governed by a specific law, what law will govern? Lex loci intentionis, but subject to the limitation that it is not against the law, morals and public policy of the forum, and it must bear a substantive relationship to the transaction.

PHILIPPINE CONFLICT RULE: ScenariosWhat if there is an absence of an effective choice of law, whether express or implies, what law will govern? With respect to the particular issue involved, by the law which has the closest and most substantial connection with the transaction and the parties.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESGenerally, the parties cannot select a law that has NO connection at all with the transaction.If the selected law changes, the new law should apply except when the change is so revolutionary that it could not have been contemplated by the parties.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESCHOICE OF FORUM CLAUSEThe parties may stipulate on the VENUE of the suit in case of litigation concerning the contract. However, a case arising from a contract will be litigated in the forum chosen by the parties if the choice of forum clause specifically identifies it as the only venue.When there is no fraud or overreaching, and there is no showing that the choice of forum clause would be unreasonable and unjust, the clause must be given effect.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESWHAT IS A COGNOVIT CLAUSE? This is a clause in a contract whereby the debtor may agree to be subject to the jurisdiction of a specific court or courts in case he breaches the contract or defaults in payments. Also called confession-of-judgment clause.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASES2. CONTRACTS WITH ARBITRATION CLAUSEIn the Philippines, the provisions of the CC on arbitration and the arbitration law (RA 876) embody a clear legislative policy in favor of settling controversies by a method considered more expeditious, less expensive and with greater chance in some cases for substantial justice.May courts apply to arbitration agreements the LAW OF WHATEVER PLACE THE PARTIES HAVE DESIGNATED AS GOVERNING, thus sustaining their agreement to arbitrate.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASES3. ADHESION CONTRACTSAdhesion contracts are not entirely prohibited. The one who agrees to the contract is in reality free to reject it entirely; if he adheres, he gives his consent.When there is no proof of arbitrariness, abuse of power, or gross negligence, the contract or stipulation will be enforced. Such contract is valid if it is reasonable and just under the circumstances, and has been fairly and freely agreed upon.When there is an oppressive use of superior bargaining power, a Philippine court may be justified in refusing to apply the contract or a stipulation thereof on the ground that there is no real arms-length transaction between the contracting parties.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESSPECIAL CONTRACTSFor SALES AND BARTER, LEASE OF PROPERTY AND COMMODATUM Its extrinsic and instrinsic validity, and capacity of parties is governed by the LEX SITUSConvention on the Law Applicable to International Sale of Goods (1955): Art. 3 provides that when the contract does not express, nor does it clearly suggest what law governs the contracts, a sale shall be governed by the domestic law of the country in which the vendor has his habitual residence at the time when he receives the order. If the order is received by an establishment of the vendor, the sale shall be governed by the domestic law of the country in which the establishment is situated. When the vendor himself or his agent receives the order in the country of which the purchaser (the vendee) has his habitual residence, the sale shall be governed by the domestic laws of such country.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESSPECIAL CONTRACTSb) For LEASE OF SERVICES AND SIMPLE LOAN (MUTUUM): Its extrinsic validity is governed by LEX LOCI CELEBRATIONIS, capacity of parties by NATIONAL LAW, and intrinsic validity by LEX LOCI CELEBRATIONIS or LEX LOCI INTENTIONIS. For AGENCY CONTRACTS:Extrinsic validity LEX LOCI CELEBRATIONIS (unless the agency deals with the conveyance or encumbering or property in which case the LEX SITUS if the property applies)Capacity of parties NATIONAL LAW of the parties (unless the agency deals with the conveyance of property (LEX SITUS RULE))Intrinsic validity LEX LOCI VOLUNTATIS or LEX LOCI INTENTIONIS (unless the agency deals with the conveyance or encumbrance of property (LEX SITUS RULE))

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESSPECIAL CONTRACTSFor PLEDGE, CHATTEL MORTGAGE, REAL MORTGAGE AND ANTICHRESISIts extrinsic and intrinsic validity, capacity of parties governed by LEX SITUS.Note: These are accessory contracts only, therefore, if the principal contract (generally the contract of loan) is defective, the accessory contract must also be deemed effective.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESSPECIAL CONTRACTSFor GUARANTY AND SURETYSHIP:Extrinsic validity LEX LOCI CELEBRATIONISCapacity of parties NATIONAL LAWIntrinsic validity LEX LOCI VOLUNTATIS or LEX LOCI INTENTIONISNote: These are accessory contracts only, therefore, if the principal contract is defective, the accessory contract must also be deemed effective.

CHOICE OF LAW ISSUES IN CONFLICTS CONTRACT CASESSPECIAL CONTRACTSFor CONTRACT OF COMMON CARRIER OF GOODS:Extrinsic validity fixed situs of the carrier (depot or resting place)Capacity of parties fixed situs of the carrierIntrinsic validity fixed situs of the carrierLiability for loss, destruction, or deterioration of goods in transitu law of the destination

TRANSPORT OF GOODSCarriage of Goods by Sea Hamburg Rules (1978): suit may be brought before the courts of the principal place of business or the habitual residence of the defendant. Courts of the locus contractus also enjoy jurisdiction, provided the defendant has a place of business or at least an agency thereat. Similarly, courts in the state of the port of loading or of discharge may take cognizance of the case. And considering the mobility of ships, jurisdiction is vested on the courts of the state where the vessel is arrested, safeguarding the defendants right to have the action transferred to any of the jurisdictions mentioned above. There is, under international maritime rules, a policy against forum shopping.

TRANSPORT OF GOODSTransport by Sea:Philippine ports to Foreign ports LAW OF THE COUNTRY OF DESTINATIONForeign ports to Philippine ports Civil Code primary lawCode of CommerceCarriage of Goods by Sea Act

TRANSPORT OF GOODSInternational Air Transportation governed by the Warsaw Convention. This Convention applies to all international carriage of persons, baggage or goods performed by aircraft for hire. It does NOT apply to carriage of mail and postal packages. It provides the venue for suits which is the domicile of the carrier, the carriers principal place of business, the place of destination or the place contract was made.

Air Transportation ContractsSince 1934, international air transportation of passengers has been governed by Warsaw Convention. It is an international treaty which regulates liability for international carriage of persons, luggage or goods performed by aircraft for reward. Proc. 201 (1955) declared formal adherence of the Phils to he Convention.

Warsaw ConventionFor the Warsaw Convention to apply, the passenger must be informed of this fact. Art 111 requires airlines to deliver to the passenger a ticket containing a statement that the transportation is subject to the rules relating to liability established by this convention. Further, the ticket must be delivered in time to allow the passenger to take out insurance if he so desires.

Warsaw ConventionThe Convention does not cover all possible questions or definitions. Among those NOT expressly defined are, among others, the definition of injury, embarkation or disembarkation as extending to waiting room areas, willful misconduct, contributory negligence defense, and tolling of statutes of limitations. On these and other questions, the LEX FORI may provide the answer.Where the passengers are residents and nationals of the forum and the ticket is issued in such State by the defendant airline, the court may justifiably apply the law of the forum in a suit covered by the provisions of the Warsaw Convention.

Warsaw ConventionIn cases where the Convention does not apply, the validity of the contract of carriage as well as the rights created thereby are determined, in the absence of an effective choice of law by the parties, by the local law of the State from which the passenger departs or the goods are dispatched, unless with respect to the particular issue, some other State has a more significant relationship to the contract and to the parties.In the absence of an effective choice of law, the courts have usually applied the local law of the State of departure, sometimes on the stated ground that it was the place of making or the CENTER OF GRAVITY of the contract.

Liabilities Under the Warsaw ConventionMaximum compensation for death of a passenger on a journey to or from the US: $75,000 per passenger inclusive of legal fees and cost; $58,000 if exclusive of legal fees and cost. The Convention creates a presumption of liability against the air carrier.

Liabilities Under the Warsaw ConventionAlitalia Airways vs. IAC, G.R. No. 77011, 24 July 1990 the SC held that the Warsaw Convention does not operate as an absolute limit of the extent of an airlines liability; it does not regulate or exclude liability for other breaches of contract by the carrier, or misconduct of its employees, or for some particular or exceptional type of damage. A passenger is entitled to an award of nominal damages due to the carriers failure to deliver her luggage on time. Alitalia vs. IAC and Pablo, GRN 71929, December 4, 1990 The limit of liability for baggage lost is $1,000 and for death of passenger is at $100,000. However, the parties may stipulate a higher limit of liability

The Montreal ConventionIt replaced in 1999 the Warsaw Conventions regulations concerning compensation for the victims of air disasters. Air carriers are liable for up to $135,000 per passenger in case of an accident, with unlimited liability if the carrier itself is at fault. It also allows victims families to sue foreign carriers in their own country of citizenship, and requires all air carriers to carry liability insurance. This Convention will replace the Warsaw Convention system once it is ratified by all States.

TRANSPORT OF GOODSLiability of carrier for loss, destruction and deterioration of goods transported to the Philippines from a foreign country is governed by the Civil Code and NOT by the Warsaw Convention.The period of responsibility includes the time during which the baggage or goods are in the charge of the carrier, whether in an airport or in any place, whatsoever.

TRANSPORTATION BY CARRIERSIt does not operate as an exclusive enumeration of instances when a carrier shall be liable for breach of contract or as an absolute limit of the extent of liability nor does it regulate or exclude liability for other breaches of contract by the carrier, misconduct of its employees, or for some particular or exceptional type of damage.Limits of liability shall NOT apply if it is proved that the damage resulted from an act or omission of the carrier, his servants or agents done with intent to cause damage or recklessly and with knowledge that damage would probably result, provided that it is proved that the servant or agent is acting within the scope of the employment.

TRANSPORTATION BY CARRIERSSuits may be prosecuted in any of the following places at the option of the plaintiff-passenger:Court of the domicile of the carrierCourt of the principal place of business of the carrierCourt where the carrier has a place of business through which the contract was madeCourt of the place of destinationAction will prescribe if not brought within 2 years from the: Date of arrival at the destinationDate on which the aircraft ought to have arrivedDate on which the transportation stoppedNOTE: Method of counting the period of limitation is determined by the law of the forum (lex fori)

TRANSPORTATION BY SUCCESSIVE CARRIERSEach of the carrier who accepts the passengers or baggage shall be subject to the rules set out in the convention and shall be deemed as one of the contracting parties insofar as the contract deals with that of the transportation which is performed under his supervision. The passenger or representative can take action only against the carrier who performed the transportation during which the accident or delay occurred, unless by express agreement the first carrier has assumed the responsibility for the entire journey.

TRANSPORTATION BY SUCCESSIVE CARRIERSAs regards baggage or goods, the passenger or consignor shall have a right of action against the first carrier or the last carrier. Furthermore, each may take an action against the carrier who performed the transportation during which the loss, damage or delay took place. These carriers shall be jointly and severally liable to the passenger, or to the consigner or consignee.In cases where the convention does not apply, the Second Restatement holds that the validity of the contract of carriage as well as the rights created thereby are determined, in the absence of an effective choice of law by the parties, by the local law of the state from which the passenger departs or the goods are dispatched, UNLESS with respect to the particular issue, some other State has a more significant relationship to the contract and to the parties.

CasesAtienza v. Philimare Shipping & Equipment Supply (GRN 71604, 11 August 1989, 176 SCRA 325) Petitioner sought the application of Singaporean law in regard to his compensation claims because he alleged that Singaporean law afforded him higher benefits than did Philippine law. The SC refused to apply Singaporean law because the Crew Agreement did not provided that the law would be applied which afforded the crew member higher benefits.

CasesNorse Management, Co. (PTE) v. National Seamen Board, GRN L-54204, 30 September 1982 (117 SCRA 486) The Court held to apply Singaporean law when it afforded higher compensation benefits because the Employment Agreement provided that compensation will be paid according with and subject to the limitations of the Workmens Compensation Act of the Republic of the Philippines or the Workers Insurance Law of registry of the vessel whichever is greater. Under Philippine laws, it then does not follow that the law with the more beneficient provisions towards the worker will be applied. The center of gravity will still be the express contractual provision or at least a provision that justifies the application of foreign law.

ExercisesA contract power of attorney - entered into in Japan between a Filipino and Japanese, what law will govern the formalities or extrinsic validity? A contract sale of property was entered into in Argentina between a Chinese and a Filipino for a parcel of land located in the Philippines, what law governs its formalities? If such contract is celebrated in the Philippine embassy or consulate, what law governs formalities?

ExercisesA contract power of attorney - entered into in Japan between a Filipino and Japanese, what law will govern the formalities or extrinsic validity? Japanese law (lex loci celebrationis or where executed)A contract sale of property was entered into in Argentina between a Chinese and a Filipino for a parcel of land located in the Philippines, what law governs its formalities? Philippine law (lex situs)If such contract is celebrated in the Philippine embassy or consulate, what law governs formalities? Philippine law under the principle of exterritoriality.

ExercisesX and Y entered into a contract in Madrid, Spain wherein it was agreed that X would construct for Y an apartment in Manila, the consideration being Ys house and lot in SF, California. The laws of what country/ies would govern the validity, performance and consideration of the contract?

ExercisesX and Y entered into a contract in Madrid, Spain wherein it was agreed that X would construct for Y an apartment in Manila, the consideration being Ys house and lot in SF, California. The laws of what country/ies would govern the validity, performance and consideration of the contract? Philippine law (lex situs)

Intellectual Property RightsTrademarks/Trade NamePatentCopyright

Trademarks/Trade NamesDefinition of Trademark: A system providing for protection for mark, collective mark, or trade name.Definition of Trade name: the name or designation identifying or distinguishing an enterprise.

Philips Export v. CA, 206 SCRA 457 (1992)FACTS: A foriegn corpn not engaged in business here, was the registered owner of the trademark Philips. Respondent Standard Philips Corporation (Standard) was a holder of a Certificate of Registration issued by the SEC. Philips Export filed a letter of complaint praying for the cancellation of the word Philips from Standards Philips Corporations corporate name of the ground of prior registration in the Bureau of Patents of such trademark and logo. Standard contended that Philips did not have the capacity to sue, not having been licensed to do business in the Philippines

Philips Export v. CA, 206 SCRA 457 (1992)RULING: A corporations right to use its corporate and trade name is a property right, a right in rem, which it may assert and protect agains the world in the same manner as it may protect is tangible property, real or personal, against trespass or conversion. It is regarded, to a certain extent, as a property right and one which cannot be impaired or defeated by subsequent appropriation by another corporation in the same field.

RA 8293, Intellectual Prop Code (1998)Foreign corporation not engaged in business in the Philippines is allowed to file civil or administrative action for opposition, cancellation, infringement, or unfair competition.

PATENTDefinition of Patent: refers to titles granted to inventions only. It is used in its generic sense in the Philippines, to include titles to inventions, utility models, and industrial designs.Counterfeiting of an industrial property is governed by the law of the country in which the patent is issued

COPYRIGHTDefinition of Copyright: A protection extended to expressions and not to ideas, procedures, methods of operation or mathematical concepts. Such expressions may be in the form of literary, scholarly, scientific and artistic works. Related rights refer to the protection extended to derivative works, to include among others, dramatizations, translations, adaptations, abridgements, arrangements, and other alterations of literary or artistic works. In copyright cases, the courts apply the law of the country where the violation is committed.Reciprocity and International Conventions

Reciprocity and International Conventions A number of multilateral conventions have been concluded in order to harmonize national laws.For instance: The TRIPS Agreement: defines standards of IPRs and enforcement mechanisms for individual countries to follow, and incorporates those into the existing Dispute Settlement mechanism of the WTO. It defines these standards by reference to existing agreements under the WIPO.

Intellectual Property in COLThe Territorial FrameworkSimilar to other choses in action, intellectual property is without a definite situs and must therefore follow the PLACE OF ITS REGISTRAITON OR PROTECTION. Lex loci protectionis, also known as the territorial principle, enables each country to apply its own law to the infringement of an intellectual property right that is in force in its territory.

CORPORATION AND OTHER JURIDICAL ENTITIES

Definition of CorporationC.J. Marshall in a leading case (Darthmouth College v. Woodward, 1918) defines: A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being a mere creature of the law, it possesses only those properties which the charter of its creation confers upon it, either expressly, or as incidental to its very existence. It is a body, which in its corporate capacity is the mere creature of the act to which it owes its existence.

Our Statutory Definition of CorporationSec. 2, Corporation Code: A corporation is an artificial being created by operation of law, having the right of succession and powers, attributes and properties expressly authorized by law or incident to its existence.

Domicile of CorporationArt. 51, CC: When the law creating or recognizing them, or any other provision does NOT fix the domicile of juridical persons, the same shall be understood to be the place where their legal representation is established or where they exercise their principal functions.

Nationality of CorporationsThe nationality of the corporation serves as a legal basis for subjecting the enterprise or its activities to the laws, the economic and fiscal powers, and the various social and financial policies of the State to which it is supposed to belong. Nationality may be used to classify a corporation as national or foreign for, e.g., national treatment under commercial or trade treaties such as GATT.

Several tests to determine a corporations nationalityThe PLACE OF INCORPORATION TEST A corporation is a national of the country under whose laws it has been organized and registered. Embodied in Art. 123, Corpo Code: A foreign corporation is one formed, organized or existing under any laws other than those of the Philippines and whose laws allow Filipino citizens and corporation to do business in its own country or state.

Several tests to determine a corporations nationalityThe PLACE OF BUSINESS TEST The corporation is a national or subject to the jurisdiction of the place where its principal office or center of management (siege social) is located.The GRANDFATHER TEST The method by which the percentage of Filipino equity in a corporation engaged in nationalized and/or partly nationalized areas of activities, provided for under the Constitution and other laws, is computed.

Several tests to determine a corporations nationalityThe WARTIME TEST The nationality of a private corporation during times of war in such country is determined by the character or citizenship of its controlling stockholders.The CONTROL TEST relies on Section 2, Article XII of the Constitution. This may be applicable only to corporations engaged in business as authorized by the foreign investment law, as amended, which specifies the percentage of ownership of Filipino nationals in corporations allowed to engage in such business.

Nationality and Domicile of Corporations**The nationality of a private corporation is determined by the character or citizenship of its controlling stockholders.**The domicile of a domestic corporation is its principal place of business (contained in the AOI). For foreign corporations, their domicile is in the country under whose laws they are incorporated.

2 TESTS TO DETERMINE FILIPINO CORPORATION:Grandfather rule - governs the strict application of the ownership of a corporation (generally 60% Filipino-owned)Control test - a corporation that is at least 60% Filipino-owned is considered a Filipino for purposes of determining the Filipino ownership of a corporation whose nationality is put in issue

Personal Law of a CorporationNormally, the Phil laws applicable to a domestic corporations are also applicable to any foreign corporation lawfully doing business in the Philippines EXCEPT for those which are considered internal matters and affairs of the foreign corporation.What constitutes internal matters covers the creation, formation, organization or dissolution of the foreign corporation and those which fix the relations, liabilities, responsibilities or duties of stockholders, members, or officers of foreign corporations to each other or to the corporation.

What determines the personal law of a corporationPhilippine law follows the incorporation principle. See Art. 129, Corporation Code: Any foreign corporation lawfully doing business in the Philippines shall be bound by all laws, rules and regulations applicable to domestic corporations of the same class, except such only as provide for the creation, formation, organization or dissolution of corporations or those which fix the relations, liabilities, responsibilities, or duties of stockholders, members, or officers of corporations to each other or to the corporation.

Northwest Orient Airlines, Inc. vs. CA, G.R. No. 112573, Feb. 9, 1995CORPORATION DOMICILED IN ONE STATE BUT DOING BUSINESS IN ANOTHER IS A RESIDENT OF THE LATTER

FACTS: Northwest, a US corporation, and Sharp, a Filipino corporation but with a branch in Japan, entered into an agreement whereby the former authorized the latter to sell its air transportation tickets. Sharp, however, was unable to remit the proceeds of the ticket sales, prompting Northwest to sue for collection in Japan. Summons was served on Sharps branch office in Japan but because the manager authorized to receive summons was said to be in Manila, the same was also served on Sharps Manila head office through diplomatic channels. Sharp nevertheless failed to appear during the hearing and judgment was rendered. Northwest now filed a case before the Philippine court to enforce the foreign judgment.

Northwest Orient Airlines, Inc. vs. CA, G.R. No. 112573, Feb. 9, 1995ISSUE: Whether or not the Japanese court acquired jurisdiction over the person of Sharp

HELD: The domicile of a corporation belongs to the state where it was incorporated. In a strict technical sense, such domicile as a corporation may have is single in its essence and a corporation can only have one domicile which is the state of its creation. Nonetheless, a corporation formed in one state may, for certain purposes, be regarded as a resident in another state in which it has offices and transacts business.In as much as Sharp was admittedly doing business in Japan through its duly registered branches at the time the collection suit against it was filed, then in the light of the processual presumption, Sharp may be deemed a resident of Japan, and, as such, was amenable to the jurisdiction of the courts therein and may be deemed to have assented to the said courts lawful methods of serving process.

State Investment House, Inc. vs. Citibank, et al, G.R. No. 79926-27, Oct. 17, 1991FOREIGN CORPORATION DOING BUSINESS IN THE PHILIPPINES IS A RESIDENT

FACTS: Consolidated Mines, Inc. (CMI) obtained loans from Citibank, Bank of America and HSBC, all foreign corporations but with branches in the Philippines. Meanwhile, State Investment House, Inc. (SIHI) and State Financing Center, Inc. (SFCI), also creditors of CMI, filed collection suits against the latter with writs of preliminary attachment. Subsequently, the three banks jointly filed with the court a petition for involuntary insolvency of CMI. SHI and SFCI opposed the petition on the ground that the petitioners are not resident creditors in contemplation of the Insolvency Law.

ISSUE: Whether or not a foreign corporation with a branch in the Philippines and doing business therein can be considered a resident

State Investment House, Inc. vs. Citibank, et al, G.R. No. 79926-27, Oct. 17, 1991HELD: Foreign corporations duly licensed to do business in the Philippines are considered residents of the Philippines, as the word is understood in Sec. 20 of the Insolvency Law, authorizing at least three resident creditors of the Philippines to file a petition to declare a corporation insolvent. The Tax Code declares that the term resident foreign corporation applies to foreign corporation engaged in trade or business within the Philippines as distinguished from a non-resident foreign corporation which is not engaged in trade or business within the Philippines. The Offshore Banking Law sates that: Branches, subsidiaries, affiliates, extension offices or any other units of corporation or juridical person organized under the laws of any foreign country operating in the Philippines shall be considered residents of the Philippines. The General Banking Act places branches and agencies in the Philippines of foreign banks in the category as commercial banks, rural banks, stock savings and loan association making no distinction between the former ad the latter in so far as the terms banking institutions and banks are used in said Act.

CORPORATIONSFormation of the corporation (requisites); kind of stocks, transfer of stocks to bind the corporation, issuance, amount & legality & dividends, powers & duties of members, stockholders and officers - Law of the place of incorporation

CORPORATIONSValidity of corporate acts & contracts (including ultra vires acts) - Law of the place of incorporation & law of the place of performance (the act or contract must be authorized by BOTH laws)

CORPORATIONSRight to sue & amenability to court processes & suits against it LEX FORIManner & effect of dissolution - Law of the place of incorporation provided that the public policy of the forum is not militated againstDomicile - If not fixed by the law creating or recognizing the corporation or by any other provision the domicile is where it is legal representation is established or where it exercises its principal functions (Article. 15)

CORPORATIONSReceivers (appointment & powers) - Principal receiver is appointed by the courts of the state of incorporation; ancillary receivers, by the courts of any state where the corporation has assets (authority is CO-EXTENSIVE) w/ the authority of the appointing court

WHEN DOES THE PERSONAL LAW OF THE CORPORATION GOVERN?1. Requisites for formation of the corporation and its legal character2. The capacity and powers of the corporation: Note however that two questions should be asked in determining the legal effect of an act of a corporation: First, is the corporation authorized by its charter to do the particular act? Second, is this act permitted by the law of the place where the act is done?3. Kinds of stocks allowed and transfer of stocks in a way that would be binding on the corporation4. Issuance, amount, and legality of dividends;5. The internal organization of the corporate enterprise, the rights and liabilities of shareholders, members, directors, officers, their relations inter se, and stockholders participation in the management and in the profits.6. Alteration or modification of the charter and the dissolution of the corporation.

PHILIPPINE JURISDICTION OVER FOREIGN CORPORATIONSConsent doctrine a foreign corporation will be recognized and will be allowed to transact business in any state which gives its consent. (Secs. 125, 126, 127 and 128 Corporation Code)

NOTE: all foreign corporations lawfully doing business here in the Philippines shall be bound by all laws, rules and regulations applicable to domestic corporations EXCEPT provisions for the creation, formation, organization or dissolution of corporations or those which fix the relations and liabilities or duties of the stockholders, members or officers of the corporation to each other.

Phil Law on Foreign CorporationsWhen a foreign corporation (1) establishes a branch or agency, (2) invests in a local subsidiary, (3) engages in a joint venture with domestic corporation, (4) establishes regional or area headquarters, (5) enters into a service contract with a domestic corporation (e.g., mining): Once a case involving internal dispute or intra-corporate controversy of a corporation licensed to do business in the Phils is filed in a Philippine court, the courts may NOT assume jurisdiction even tho the courts may have complete jurisdiction over the parties both the corporation and its officers.A court may decline to act from a lack of power to enforce its decrees, or because the court of other jurisdiction is better entitled to settle the dispute. Internal affairs are governed by the State of Incorporation.

Personality of Foreign Corporation in the PhilippinesA foreign corporation can transact or do business in this jurisdiction even without a license. However, such unlicensed foreign corporation suffers a disability. It cannot sue and seek for redress but permits it to be sued in any judicial or administrative proceeding.However, a foreign corporations use of its corporate and trade name is a property right which it may assert anywhere.

RIGHT TO BRING A SUIT

GENERAL RULE: If a corporation doing business in the country is not duly licensed or authorized to transact business in the Philippines, it cannot be permitted to maintain or intervene in any action, suit or proceeding in any court or administrative agency of the Philippines BUT it can be sued before any court or administrative tribunals on a valid cause (Sec. 133 of CorpCode).

EXCEPTIONS: 1. Isolated transactions; 2. Action to protect trademark, trade name, goodwill, patent or for unfair competition3. Agreements fully transacted outside the Philippines 4. Petition filed is merely a corollary defense in a suit against it 5. In case of Estoppel, a person who enters into a contract with a foreign corporation and receives benefits from the contract is estopped from setting up the failure of said corporation to comply with the requirements for doing business in order to avoid liability

A corporation is doing business when it is continuing the body or substance of the business or enterprise for which it was organized. The term implies a continuity of commercial dealings and arrangements and contemplates, to that extent, the performance of acts and works or the exercise of some of the functions normally incident to, and in progressive prosecution of, the purpose and objective of its organization

MULTI-NATIONAL CORPORATIONS

A single enterprise composed of several corporations, each with a separate entity and different nationalities.A cluster of corporations of diverse nationalities joined together by ties of common ownership and responsive to a common management strategy.Jurisdiction over a local counterpart may amount to jurisdiction on the parent company if the local counterpart is only a branch and is without separate juridical personality from the mother company and when such local counterpart is but a conduit or alter-ego of the parent company.

MULTI-NATIONAL CORPORATIONS

However, if the local counterpart is a subsidiary with an entirely distinct personality, jurisdiction over the local counter-part is not jurisdiction over the parent company.NOTE: A subsidiary is one which is incorporated separately from the mother company, thus obtaining its own juridical personality.

PARTNERSHIPSA business association wherein 2 or more persons bind themselves to contribute money, property, or industry to a common fund, with the intention of dividing the profits among themselves. This association has a personality distinct and separate from its members.The existence or non-existence of legal personality of the firm; the capacity to contract; liability of the firm & the partners to 3rd persons -The personal law of the partnership is the law of the place where it was created (Article 15 of the Code of Commerce) (Subject to the exceptions given above as in the case of corporations.) Note in Civil law countries, the personal law of the partnership is determined by its central office.

PARTNERSHIPSCreation of branches in the Philippines; validity & effect of the branches commercial transaction; & the jurisdiction of the court Philippine law (law of the place where branches were created) (Article 15, Code of Commerce)Dissolution, winding up, & termination of branches in the Philippines Philippine law (Article 15, Code of Commerce)

PARTNERSHIPSDomicile - If not fixed by the law creating or recognizing the partnership or by any other provision the domicile is where it is legal representation is established or where it exercises its principal functions (Article. 15)Receivers Philippine law insofar as the assets in the Philippines are concerned can be exercised as such only in the Philippines

FOUNDATIONSFoundations (combination of capital independent of individuals, usually not for profit) - Personal law of the foundation (place of principal center of administration)

Religious Societies and Corporation SoleReligious societies are religious corporations that are governed by Chapter II of the Corporation Code. A Corporation sole is an incorporated office composed of only one person. Sec 113, Corporation Code explicitly gives the corporation sole the capacity to purchase and hold real estate and personal property for its church. This capacity exists even if the chief archbishop, bishop, priest, minister, or other presiding elder who is the corporation sole is in fact a foreign citizen and personally cannot own and hold real property.

TORTS AND CRIMES

CHOICE OF LAW - TORTSLEX LOCI DELICTI COMISSI or law of the place where the alleged tort was committed.What then is the locus of the tort? There are several LOCUS DELICTI (Place of Wrong) Theories:Place of injury (Common law concept) looks to the place where the last event necessary to make an actor liable for an alleged tort occurs. It adheres to the vested rights theory in that if the harm does not take place then the tort is not completed.Place of conduct (Civil law rule) views the situs of torts as the place where the tortuous act was committed. This is premised on the principle that the legality or illegality of ones act should be determined by the law of the state where he is at the time he does the act.Most substantial connection theory (Theory of Dr. Rabel) the locus delicti is determined by the place where the important and substantial acts leading to the tortuous act were committed.

THEORIES RELATING TO TORTSOBLIGATION THEORY The tortuous act gives rise to an obligation, which is transitory and follows the person committing the tortuous act and may be enforced wherever he may be found.

THEORIES RELATING TO TORTSMODERN THEORIES IN DETERMINING LIABILITY FOR TORTS:Theory of Most Significant Relationship An action for tort may be filed in the country where it has the most significant relationship. In determining the state which has the most significant relationship, the following factors are to be taken into account:Place where the injury occurred;Place of conduct causing the injury;Domicile, residence, nationality, place of incorporation and place of business of the parties; andPlace where the relationship between the parties is centered.Gives controlling effect to the law of the jurisdiction which, because of its relationship or contact with the occurrence or the parties, has the greatest concern with the specific issue of the case.

Saudi Arabian Airlines v. CA, GR 122191, 8 October 1999 (297 SCRA 469)Under the rule of lex loci actus the tortuous conduct can be said to have taken place in the Philippines because it is in the Philippines where petitioner allegedly deceived the private respondent, a Filipina residing and working here. It is in this jurisdiction where the over-all harm or the totality of the alleged injury to the person, reputation, social standing and human rights of the complainant had lodged. The court applied the factors to determine the most significant relationship to the case, i.e., the plaintiff is a Filipina working with the defendant which, though a foreign corporation, is a resident of the Philippines and the relationship was centered here, she was employed in the Philippines. Hence, the Philippines is the state with the most significant relationship to the case.

MODERN THEORIES IN DETERMINING LIABILITY FOR TORTS:

2. The Interest-Analysis ApproachConsiders the relevant concerns that two or more states may have in the case. The State which has the more relevant and weighty interests in the case should be considered the locus delicti.3. Qavers Principle of PreferenceA higher standard of conduct and financial protection given to the injured party by one State is applied by the State where the injury happened, if the latter State adopts a lower standard of conduct and financial protection to the injured.

KILBERG DOCTRINEWhere a wrongful death occurred in one state and the action for damages is brought in another state, the latter is not bound by any limitation of liability arising from the wrongful death in the place by the law of the place where the conduct causing death occurred concerning limitations on damages.Rationale: Laws that set limitations on damages are procedural and, therefore, the law of the forum should be applied. (Kilberg v. Northwest Airlines, Inc. 9 N.Y.2d 34, 211 N.Y.S.2d. 133, 172 N.E.2d 526)

CONFLICTS RULES ON MARITIME TORTSIf the tort is committed aboard a public vessel, whether on the high seas or in foreign territorial waters, the law of the flag is the LEX LOCI DELICTI COMMISSII.If the tort is committed aboard a private or merchant vessel on the high seas, the law of the registry is the LEX LOCI DELICTI COMMISSII.If two vessels collide and are from the same state, the law of the registry is the LEX LOCI DELICTI COMMISSII.If the vessels come from different states with identical laws, apply said identical lawsIf the vessels come from different states with different laws, the LEX LOCI DELICTI COMMISSII is the general maritime law as understood and applied by the forum where the case is filed.

CONDITIONS FOR THE ENFORCEMENT OF TORT CLAIMSThe foreign tort is based on a civil action and not on a crime;The enforcement of the tort would not infringe the public policy of the forum;The judicial machinery of the forum is adequate for its proper enforcement.Note: While all procedural matters are governed by the lex fori, all substantive matters are governed by LEX LOCI COMMISSII.

PHIL CODAL SOURCES OF TORT LAWArt 2176, CC imposes obligations arising out of culpa extra-contractual or culpa aquiliana from either fault, which requires the execution of an act which visits damage on another, or negligence which is culpable omission that causes damage.Art. 2180, CC determines liabilities for acts or omissions of others, e.g., parents and teachers for children, owners and managers for employees, state for special agents, teachers or heads of schools of arts and trades for pupils or apprentices. This assigns parties who bear the coasts for the inconvenience, destruction or damage caused by others.Art 2187, CC holds manufacturers and processors of foodstuff, drinks, toilet articles and similar goods liable for death or for injuries caused by any noxious or harmful substance used. Articles on Human Relations Articles 20, 21, 26, and 32.

PHILIPPINE RULE ON FOREIGN TORTSThere is no governing specific statutory law but courts may give due course on the theory of vested rights or most significant relationship provided that there are minimum contacts and the defendant can be served with summons.In case of injuries which involve physical harm, mental disturbance, false imprisonment, malicious prosecution the law of the State where the injury was inflicted.In case of intentional tort the law of the State where the actor initiated or carried out the tortuous act.

PHILIPPINE RULE ON FOREIGN TORTSWe also follow the rule of generality in criminal law. Penal laws and those of public security shall be obligatory upon all who live or sojourn in Philippine territory subject to the principles of PIL and to treaty stipulations. (Locus regit actum) Art. 14, CC. Thus, for the essential elements of a crime and its penalties it is generally where committed. In the Philippines, we follow the territorial theory in general; by way of exception, Art. 2 of the RPC stressed the protective.The protective theory is followed in the cases mentioned in Art. 2 of the Revised Penal Code, such that even if the crime was committed outside our territorial jurisdiction, it is triable by our courts.

Trajano v. Marcos-Manotoc and Hilao vs. Marcos (1994)The American courts, through its Alien Tort Statute (28 USC 1350) which allows district courts to acquire jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the US. It ruled that Marcos wrongful acts consisted in torture leading to death. The Marcos estate was liable for torture which is proscribed by jus cogens, the peremptory norm of international law. The court rejected the defense of act of state or sovereign immunity.

Guinto v. Marcos (S.D. Cal., 1986)The suit was brought against Marcos claiming violation of petitioners right to freedom of expression and damages resulting from unlawful confiscation of a film. The court ruled it had no jurisdiction. The U.S. Constitution on which the petition was anchored was not applicable to foreign officials within their own territory. Petitioners were also not allowed to invoke the protective provisions of the Alien Tort Claims Act since the violation of freedom of speech is not a violation of the law of nations.

The Locus Delicti of Certain CrimesThe Philippines follows as a general rule the TERRITORIAL THEORY; by way of exception, we also occasionally and in the proper cases make use of the PROTECTIVE THEORY.For frustrated and consummated homicide, murder, infanticide, and parricide Where the victim was injured (not where the aggressor wielded the weapon)For attempted homicide, murder, infanticide, and parricide Where the intended victim was (not where the aggressor was situated) so long as the weapon or the bullet either touched him or fell inside the territory where he was.

The Locus Delicti of Certain CrimesFor Bigamy where the illegal marriage was performedFor Theft and Robbery where the property was unlawfully taken from the victim (not the place to which the criminal went after the commission of the crime)For Estafa or swindling through false representations where the object of the crime was received (not where the false representations were made)

The Locus Delicti of Certain CrimesFor Conspiracy to commit treason, rebellion or sedition where the conspiracy was formed (not where the overt act of treason, rebellion or sedition was committed)For Libel where published or circulatedFor continuing crimes any place where the offense begins, exists or continuesFor complex crimes any place where any of the essential elements of the crime took place.

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***Transport by Sea:Philippine ports to Foreign ports LAW OF THE COUNTRY OF DESTINATIONForeign ports to Philippine ports Civil Code primary lawCode of CommerceCarriage of Goods by Sea Act

*Transport by Sea:Philippine ports to Foreign ports LAW OF THE COUNTRY OF DESTINATIONForeign ports to Philippine ports Civil Code primary lawCode of CommerceCarriage of Goods by Sea Act

*Transport by Sea:Philippine ports to Foreign ports LAW OF THE COUNTRY OF DESTINATIONForeign ports to Philippine ports Civil Code primary lawCode of CommerceCarriage of Goods by Sea Act

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