CONFLICT OF LAWS

I. NATURE, STRUCTURE AND

METHODS

3.
Applicability

PRIVATE INTERNATIONAL LAW OR

CONFLICT OF LAWS
-

It is that part of Philippine law which is

applied by the court whenever it is seized of
a problem or a case containing a foreign
element. Rules of private international law
are national in character and are found in
various statutes and codes of Philippine law
or adopted by Philippine courts. They are
rules of domestic law, not of international
law. Every state or national legal system
has its own body of rules called private
international law or conflict of law rules.
It is that part of Philippine law which
governs the application and interpretation
of foreign law in Philippine jurisdiction in
resolution of cases involving foreign
element.

4.
As
Persons
Involved

5.
Transactions

6. Remedies

FOREIGN ELEMENT
-

A case has a foreign element if it has some

relevant fact which has a juridical or legal
connection with a foreign country or
jurisdiction and, for this reason, it raises
the issue:
a. whether it is Philippine law or foreign
law that the court should apply for the
resolution of the case, (Choice-of-law
problem) or
b. whether it is the Philippine or foreign
court that should have jurisdiction over
the case.
Examples of foreign element:
a. One of the parties is of a foreign
nationality.
b. The case involves a property situated
abroad.
c. A contract executed in the Philippines is
to be performed in another country.
d. The issue relates to the condition of the
goods
transported
to
a
foreign
destination.
e. A marriage between a Filipino and an
alien was celebrated abroad.

DISTINGUISHED FROM PUBLIC

INTERNATIONAL LAW
Basis

1. Nature or
Character

2. Sources

Public
International
Law
International
in character as
it applies in
the
international
sphere.
Custom, treaty
and
general
principles
of
law recognized
by
civilized
nations
and
judicial
decisions and
teachings
of
the
most
highly qualified

Private
International
Law
National,
municipal
or
local
in
character.

1.
2.

3.

Governs
only
states
and
internationally
recognized
organizations.
Recognizes
transactions in
which
sovereign
states
are
interested.
In
case
of
violation
of
international
law, the State
may resort to
diplomatic
protest,
negotiation,
arbitration or
adjudication by
the filing cases
before
international
tribunals
or
may
even
resort to the
use of force or
go to war.

Deals
with
rights
and
obligations of
private
individuals and
their
private
transactions
which involve a
foreign
element.
Governs
individuals or
corporations.

Assumes
control
over
transactions
strictly private
in nature.
All
remedies
are
provided
by
municipal
laws of the
State, such as
resort
to
courts
and
administrative
tribunals.

OBJECTIVES

To prescribe the conditions under which the

court is competent to assume jurisdiction
over the case.
To determine the particular national legal
system under which the rights of the
parties must be ascertained, based on the
appropriate legal category by which the
case may be classified; in other words, to
choose the appropriate law applicable.
To specify the conditions under which a
foreign judgment may be recognized or
enforced in the Philippines.

STAGES IN THE RESOLUTION OF A

CONFLICTS CASE
1.

2.
Generally
derived
from
the
internal
law of each
state; except
any conflict of
laws question
which
is
governed by a
treaty.

to

publicists.
Governs rights
and obligations
of states and
their
relationships
among
themselves.

The court first deals with the question

whether it possesses jurisdiction over the
parties and/or the subject matter; or of the
cause of action.
The court should next classify the cause of
action under its correct legal category such
as succession, breach of contract, or a
commission of a tort. This is a prerequisite
to ascertaining the appropriate conflicts rule
applicable and hence determine the lex
causae.
a.
Classification or Characterization
(of the cause of action) is the
allocation of the question raised by
the factual situation before the court
to its correct legal category, and its

3.

4.

object is to reveal the relevant rule for

the choice of law. (Cheshires
Private International Law by P.M.
North, 9th ed., pages 42-43.)
The next step is for the court to select the
lex causae or the legal system which under
the conflicts rule of the forum is applicable
to the given question. The selection of the
lex causae is based on a connecting
factor which is some outstanding fact
which establishes a natural connection
between the factual situation before the
court and a particular system of law.
(Cheshires Private International Law
by P.M. North, 9th ed., pages 41-42.)
The court will then apply the lex causae
which the court will determine as either the
lex fori or the foreign law.

Rule 132, Sec. 19(a), Rules of

Court.
As a public document, it must be
proved in the following manner: The
record of public documents referred
to in paragraph (a) of Section 19,
when admissible for any purpose,
may be evidenced by an official
publication thereof or by a copy
attested by the officer having the
legal custody of the record, or by his
deputy, and accompanied, if the
record is not kept in the Philippines,
with a certificate that such officer
has the custody. If the office in which
the record is kept is in foreign
country, the certificate may be made
by a secretary of the embassy or
legation, consul general, consul, vice
consul, or consular agent or by any
officer in the foreign service of the
Philippines stationed in the foreign
country in which the record is kept,
and authenticated by the seal of his
office. (Rule 132, Sec. 24, Rules
of Court.)

RENVOI
1.

2.

Single Renvoi. If a Philippine court is

directed by a conflicts rule in Philippine
law to resolve the case in accordance
with the law of another country, but
under the conflicts rule of that country
the case is referred to the Philippine
law, there is the application of renvoi
if the Philippine court accepts that
reference, or remission, and applies
Philippine internal law in deciding the
case. (Aznar vs. Garcia, 7 SCRA 95,
1963.)
Double Renvoi. If the Philippine court
is directed by a Philippine conflict rule
to a foreign legal system, which refers
back the question to Philippine law for
resolution, the court will not accept the
reference back but will refer back to the
foreign court, and it must apply
whatever law a court in that foreign
legal system would apply if seized of
the case. Whatever the foreign court
would do in resolving the case would
determine the decision of the Philippine
court.

b.

APPLICATION OF FOREIGN LAW

-

The Philippine court applies foreign law, or

rights acquired under foreign law, because
it is required or permitted to do so by
Philippine law. It is in the nature of conflicts
rule in Philippine law that the court is
authorized to resolve a controversy by
applying foreign law, under conditions laid
down by Philippine law.

When foreign law is to be applied pursuant

to a Philippine conflicts rule, there is the
requirement that it must be proved as a
fact. There are three ways by which this
may be done:
a.
by pleading and proof;
b.
by judicial notice; and
c.
by presumption.
As a general rule, it is required that the
foreign law must be pleaded and proved in
accordance with the Rules of Court.
a.
Written Law. Foreign law is a written
official act of a foreign country, hence,
it is treated as a public document
under Philippine law as provided for in

PROOF OF FOREIGN LAW

Unwritten Law. The opinion of a

witness on a matter requiring special
knowledge, skill, experience or training
which he shown to posses, may be
received in evidence. (Rule 130, Sec.
49, Rules of Court.)
Generally, Philippine
courts
are
not
authorized to take judicial notice of foreign
laws (In re Estate of Johnson, 39 Phil.
157, 1918.). However, there are certain
exceptions wherein the court may take
judicial notice of the content of the foreign
law:
a. In cases where the courts are evidently
familiar with the foreign law. (Delgado
vs. Republic, G.R. No. L-2546,
1950, and Pardo vs. Republic, 85
Phil. 323, 1950).
b. In instances when the foreign laws are
already within the actual knowledge of
the court, such as when they are well
and generally known or they have
actually been ruled upon in other cases
before it and none of the parties do not
claim otherwise. (PCIB vs. Escolin,
56 SCRA 266).
c. The pertinent law of the state of the
testator may be taken judicial notice of
without proof of such law having been
offered at the hearing of the project of
partition where it appears that said law
was admitted by the court as exhibit
during the probate of the will; that
same was introduced as evidence of a
motion of one of the appellants for
withdrawal of a certain sum of money;
and the other appellants do not dispute
the said law. (Philippine Trust Co.
vs. Bohanan, 106 Phil. 997, 1960).
Processual Presumption. Where there is
failure to prove foreign law, or in the
absence
of
evidence
thereof,
the
presumption applies that it is the same as
Philippine law. (Lim vs. Collector of
Customs, 36 Phil. 472; Beam vs. Yatco,
82 Phil. 30; Miciano vs. Brimo, 50 Phil.

867, 1927; CIR vs. Fisher, 110 Phil.

686, 1961).

EXCEPTIONS TO THE APPLICATION

OF FOREIGN LAW
-

In General
i. where its enforcement would run
counter to some important public
policy of the forum;
ii. when its application would lead to
an infringement of good morality in
the wider sense of the term, as
understood in the forum;
iii. when the foreign law is penal in
nature;
iv. when the foreign law is procedural
in nature;
v. when the question relates to
immovable property in the forum;
vi. when the foreign law is fiscal or
administrative in nature;
vii.
when the application of foreign
law would involve injustice or injury
to the nationals or residents of the
forum; and
viii.
when the application of foreign
law would endanger the foreign
relations or vital interests of the
State.
(Salonga.
Private
International Law. 1995. page
114.)
Exceptions under Philippine Law
a. In general. Prohibitive laws concerning
persons, their acts or property, and
those which have, for their object,
public order, public policy and good
customs
shall
not
be
rendered
ineffective by laws or judgments
promulgated, or by determinations or
conventions agreed upon in a foreign
country. (Article 17, paragraph 3,
Civil Code.)
b. Contracts. The contracting parties may
establish such stipulations, clauses,
terms and conditions as they may
deem convenient, provided they are not
contrary to law, morals, good customs,
public order, or public policy. (Article
1306, Civil Code.)
c. Marriage. All marriages solemnized
outside the Philippines in accordance
with the laws in force in the country
where they were solemnized (or the lex
loci celebrationis) and valid there as
such, shall also be valid in this country
except those prohibited under Articles
35 (1), (4), (5), and (6), 36, 37 and
38. (Article 26, paragraph 1, Family
Code.)
d. Wills. Joint wills executed by Filipinos in
a foreign country shall not be valid,
even though authorized by the laws of
the country where they may have been
executed. (Article 819, Civil Code.)

II. PERSONAL LAW SYSTEM

CONCEPT OF PERSONAL LAW
-

It is the law which governs persons, legal

condition, capacity, status, etc.
It governs a person wherever he goes.

There are two bases for legal nexus

between the individual and the State, from
the viewpoint of private international law,
namely: (a) the law of his nationality or lex
patriae and (b) the law of his place of
domicile or lex domicilii. His status or legal
condition in the society is defined either by
his nationality or domicile.

LEX PATRIAE OR NATIONALITY LAW

THEORY
-

The Philippine legal system adheres to lex

patriae.
Concrete application of lex patriae in
Philippine law can be found in the following
provisions:
a. Art. 15, CC: Laws relating to family
rights and duties, or to the status,
condition and legal capacity of
persons are binding upon citizens of
the Philippines, even though living
abroad.
b. Art. 16, par. 2, CC: However,
intestate
and
testamentary
successions, both with respect to the
order of succession and to the
amount of successional rights and
to
the
intrinsic
validity
of
testamentary provisions, shall be
regulated by the national law of the
person whose succession is under
consideration, whatever may be the
nature of the property and regardless
of the country wherein said property
may be found.
c.
Art. 1039, CC: Capacity to succeed
is governed by the law of the nation
of the decedent.
Under the Hague Convention, it is for
each State to determine who are its
nationals. But it must be consistent with
international treatises and customs and
principles of law generally recognized with
regard to nationality.
Problems in Applying the Nationality
Principle
a. Dual or Multiple Nationality
i. This arises from the concurrent
application of jus soli and jus
sanguinis at birth or from a refusal
of certain States to accept a full
application of the doctrine of
expatriation or from marriage or
from a formal and voluntary act.
ii. In matters of status, he is usually
considered by the forum as
exclusively its own national, his
additional foreign nationality is
disregarded.
iii. In case the litigation arises in a
third country, the law most
consistently applied is that of the
country of which the person is not
only a national but where he also
has his domicile or habitual
residence, or in the absence
thereof, his residence.
iv. a third state shall, of the
nationalities which any such person
possesses, recognize exclusively in
its territory either the nationality of
the country in which he is
habitually
and
principally
a
resident, or the nationality of the

country
with
which
in
the
circumstances he appears to be in
fact most closely connected. (Art.
5,
Hague
Convention
on
Conflict of Nationality Laws)
v. See R.A. No. 9225 Citizenship
Retention and Reacquisition Act of
2003.
b.

Statelessness
i. A person may become stateless if
he is deprived of his citizenship for
any cause such as the commission
of a crime or if he renounced his
nationality by certain acts, or by
voluntary release from his original
state, or if he is born in a country
which recognizes jus sanguinis of
parents whose law on the other
hand, recognizes only the principle
of jus soli.
ii. Stateless persons are generally
subject to the law of their domicile
or habitual residence, and in
default thereof, to the law of their
temporary residence.
iii. The
Convention
on
the
Reduction
of
Statelessness
(1961) mandates that the jus
sanguini
country
grant
its
nationality to a person born within
its territory if he would otherwise
be stateless, and the jus soli
country to extend its nationality to
a person who would otherwise be
considered stateless when one of
his parents is a citizen of the
contracting state.

LEX DOMICILII OR DOMICILLIARY

THEORY
-

The individuals private rights, condition,

status and capacity are determined by his
physical location.
The forum determines domicile according to
its own standards.
Domicile is the place of which a person has
a settled connection for certain legal
purposes, either because his home is there
or because that is the place assigned to him
by law.
In specified cases, Philippine law recognizes
lex domicilii. See Articles 50, 51, 99,
629 and 1251 paragraphs 3 and 4, CC.
General Rules on Domicile
a. No person shall be without domicile.
b. A person cannot have two simultaneous
domiciles.
c. Every natural person, as long as he is
free, may change his domicile at
pleasure.
d. Domicile once acquired is retained
unless a new one is gained.
e. The presumption is in favor of the
continuance of domicile. The burden of
proof is on the one who alleges that a
change of domicile has taken place.
f. To acquire a fresh domicile, residence
and intention must concur; to retain an
existing domicile, either residence there
or an intention to remain must be
present; to abandon a domicile,
residence in a new place and intention
to abandon the old place must concur.

Legal Classification of Domicile

a. Domicile of Origin It is a persons
domicile at birth.
b. Constructive Domicile It is a
domicile assigned by operation of law
to persons legally incapable of choosing
their
own
domicile,
ex.
Minors,
mentally disabled.
c. Domicile of Choice or Voluntary
Domicile It is the place freely chosen
by a person sui juris as his home and
to which whenever he is absent, he has
the intention of returning. To acquire
this, there must be a concurrence of
physical presence in the new place and
unqualified intention to make that place
ones home.

III. CHOICE OF LAW

A.
PERSONAL
CAPACITY
-

STATUS

AND

Art. 15, CC
In the determination of status and capacity
of persons, the CC follows the nationality
principle when dealing with Filipinos.
When dealing with aliens, it depends on
which principle their country follows, but if
the alien is in the Philippines, the
nationality theory is applied by implication.

B. FAMILY RELATIONS
1. MARRIAGE
EXTRINSIC VALIDITY
-

governed by the lex loci celebrationis

General Rule
a. The forms and solemnities of contracts,
wills, and other public instruments shall
be governed by the laws of the country
in which they are executed. (Art. 17,
par. 1, CC)
b. All marriages solemnized outside the
Philippines in accordance with the laws
in force in the country where they were
solemnized and valid there as such,
shall also be valid in this country. (Art.
26, paragraph 1, FC)
c. All states recognize as valid those
marriages
celebrated
in
foreign
countries if they comply with the
formalities prescribed therein. (Hague
Convention)
Exceptions (as provided for in Art. 26,
FC)
i. when either or both parties are
below 18 years of age even with
parental consent;
ii. bigamous
and
polygamous
marriages;
iii. mistake as to identity of a
contracting party;
iv. a subsequent marriage performed
without recording in the Civil
Registry
the
judgment
of
annulment or declaration of nullity,
partition,
and
distribution
of
properties and the delivery of the
childrens presumptive legitimes;

v. marriages where either spouse is

psychologically incapacitated;
vi. incestuous marriages; and
vii. void marriages by reason of public
policy.
Rules on Extrinsic Validity of Certain
Marriages
a. Proxy Marriages Where permitted
by the law of the place where the proxy
participates in the marriage ceremony,
proxy
marriages are entitled to
recognition in countries adhering to the
lex loci celebrationis rule, at least
insofar as formal validity is concerned.
Internal Philippine law does not allow
proxy marriages, it is doubtful whether
this will be recognized here.
b. Common Law Marriages If valid in
the State where the parties cohabited
while holding themselves out as man
and wife, it is given recognition in sister
states which do not permit this informal
method of entering into the marital
status. Philippine internal law does not
recognize common law marriages.
c. Marriage on board a vessel on high
seas This is governed by the law of
the nation whose flag the ship is flying
since that nation has jurisdiction over
the ship.
d. Consular Marriages The state
authorizes its consular or diplomatic
agents in foreign countries to solemnize
marriages in accordance with the
states domestic laws. Philippine law
allows this under Art. 10, FC. This
marriage performed by a consular and
diplomatic agent empowered by the
sending state to officiate the marriage
is valid in the receiving state only if the
latter has agreed to his acting in that
capacity.

ii. With respect to the extrinsic

validity
of
contracts
affecting
property not situated in the
Philippines and executed in the
country where the property is
situated; and
iii. With respect to the extrinsic
validity of contracts entered into in
the
Philippines
but
affecting
property situated in a foreign
country
whose
laws
require
different
formalities
for
their
extrinsic validity.
b.

c.

d.

DIVORCE AND SEPARATION

-

INTRINSIC VALIDITY
-

This is governed by the parties personal

laws which may either be the lex patriae or
the lex domicilii.
Philippine conflict rules: Art. 15, CC and
Art. 26, par. 1, FC. Note that the lex loci
celebrationis rule under Art. 26, FC also
applies to Filipinos married abroad.

CONSEQUENCES OF MARRIAGE
-

Personal
relations
between
the
spouses This is governed by the national
law of the parties (Art. 15, CC). If the
spouses
have
different
nationalities,
generally, the national law of the husband
may prevail as long as said law is not
contrary to law, customs and good morals
of the forum.
Property
relations
between
the
spouses
a. General Rule: In the absence of a
contrary stipulation in the marriage
settlements, the property relations of
the spouses shall be governed by
Philippine laws, regardless of the place
of the celebration of the marriage and
their residence. (Art. 80, FC)
Exceptions: (Art. 80, FC)
i. Where both spouses are aliens;

Note that Art. 16, par. 1, CC which

provides that Real property as well as
personal property is subject to the law
of the country where it is situated.
prevails over the rule embodied under
Art. 80, FC.
Under the Hague Convention, the
governing law on matrimonial property
regime is:
i. The internal law designated by the
spouses before marriage.
ii. In the absence thereof, the internal
law of the state in which the
spouses fix their first habitual
residence.
Doctrine
of
Immutability
of
Matrimonial Property Regime The
change of the nationality on the part of
the husband or wife or both does not
affect the original property regime
except when the law of the original
nationality itself changes the martial
regime, hence, the property regime has
to change accordingly.

General Rule: In the Philippines, only

relative divorce or legal separation is
observed. As a consequence of Art. 15,
CC, Filipino couples cannot obtain absolute
divorces abroad to be recognized here in
the Philippines.
Exception: Where a marriage between a
Filipino citizen and a foreigner is validly
celebrated and a divorce is thereafter
validly obtained abroad by the alien spouse
capacitating him or her to remarry, the
Filipino spouse shall have capacity to
remarry under Philippine law. (Art. 26,
par. 2, FC)
The Hague Convention provides that the
granting of divorce must comply with the
national law of the spouses and the law of
the place where the application for divorce
is made. The national law is the system of
law last common to each of the spouses.
The grounds for divorce are dictated by the
lex fori.
Aliens may secure relative divorce in the
Philippines, provided their national law is
willing to recognize Philippine jurisdiction
and separation is agreeable to the internal
law of the national state of the parties.

ANNULMENT AND DECLARATION OF

NULLITY
-

Jurisdiction to Annul This is vested in

the court of the domicile of the parties.
Jurisdiction over the non-resident defendant

is not essential. It is the status of the

plaintiff that is in issue, therefore, he
should be domiciled in the forum.
Governing Law Lex loci celebrationis
determines the consequences of any defect
as to form. Generally, the same applies with
reference to the substantive or intrinsic
validity except with regard to the capacity
of the parties to marry wherein their
national law is determinative.

2. PARENTAL RELATIONS

i.

DETERMINATION OF THE
LEGITIMACY OF THE CHILD

This is governed by the personal law of the

parents.
Philippine rule:
a.
In the Philippines, the legitimacy of
the child is governed by the national
law of the parents.
b.
If
parents
belong
to
different
nationalities, legitimacy is governed by
the national law of the father.
c.
Personal law of the illegitimate child is
the mothers personal law.
d.
If the child is later legitimated, the
personal law of the child follows that of
the father.
e.
Note: In the case of Tecson vs.
COMELEC (GR No. 161434, 2004),
the Court held that providing neither
conditions nor distinctions, the 1935
Constitution states that among the
citizens of the Philippines are those
whose fathers are citizens of the
Philippines, regardless of whether the
children are legitimate or illegitimate.

PARENTAL AUTHORITY OVER THE

CHILD
-

The personal law of the father controls the

rights and duties of parents and children.
Reference to the personal law of the father
may result in the joint exercise of parental
authority over the property of the child by
the father and the mother, example would
be Art. 221, FC.
The fathers personal law could also grant
parental authority to the mother of the
illegitimate child, example would be Art.
176, FC.

3. ADOPTION

INTER-COUNTRY ADOPTION (R.A.

NO. 8043)
-

An alien may adopt provided that

a.
he is of legal age
b.
he is in possession of civil capacity and
legal rights
c.
he is of good moral character
d.
he is not convicted of any crime
involving moral turpitude
e.
he is emotionally and psychologically
capable of caring for children
f.
he is at least sixteen years older than
the adoptee
g.
he is in a position to support and care
for his children
h.
his country has diplomatic relations
with the Philippines

A socio-legal process of adopting a Filipino

child by a foreigner or a Filipino citizen
permanently residing abroad where the
petition is filed, the supervised trial custody
is undertaken, and the decree of adoption is
issued outside the Philippines.
This is an alternative means of child care if
the child cannot be cared for in any suitable
manner in the Philippines.
Adoption is not one of the ways prescribed
for the acquisition of Filipino citizenship.
(Ching Leng vs. Galang, 57 O.G. 2312,
1958)

C. CONTRACTUAL RELATIONS
EXTRINSIC VALIDITY
-

Governed by the lex loci contractus as

embodied in Art. 17, par. 1, CC.

There is no specific provision in the Civil

Code. Thus, there are three possible laws
that may govern:
a. lex loci contractus or law of the place
where the contract is made
b. lex loci solutionis or law of the place of
performance
c. lex loci intentionis or law intended by
the parties
Lex loci intentionis is embodied in Art.
1306, CC.
a. The specific law stipulated by the
parties must bear a substantial
relationship to the transaction.
b. In the absence of an effective choice of
law, expressed or implied, the contract
will be governed, with respect to the
particular issue involved, by the law
which has the closest and most

INTRINSIC VALIDITY

DOMESTIC ADOPTION ACT OF 1998

(R.A. NO. 8552)
-

residence in the Philippines for at least

three continuous years prior to the
filing of the application for adoption
and maintains such residence until the
adoption decree is entered
j.
certificate of legal capacity to adopt in
his country to be issued by his
diplomatic or consular office, and
k.
his government allows the adoptee to
enter his country as his adopted son or
daughter.
The
requirement
on
residency
and
certificate of the aliens qualification to
adopt may be waived for the following:
a. a former Filipino citizen who seeks to
adopt a relative within the 4th degree of
consanguinity or affinity; or
b. one who seeks to adopt the legitimate
son or daughter of his or her Filipino
spouse; or
c. one who is married to a Filipino citizen
and seeks to adopt jointly with his or
her spouse a relative within the 4 th
degree of consanguinity or affinity of
the Filipino spouse.
The requirement of sixteen years difference
between the adopter and the adoptee may
be waived if the adopter is:
a. the biological parent of the adoptee; or
b. the spouse of the adoptees parent.

substantial
connection
with
transaction and the parties.

the

CAPACITY TO ENTER INTO

CONTRACTS

This is determined by the personal laws of

the contracting parties, either nationality or
domiciliary.
Art. 15, CC.

CHOICE OF LAW ISSUES IN

CONFLICTS CONTRACT CASES
1.

2.

3.

4.

Choice of Forum Clause

The parties may stipulate on the venue
of the suit in case of litigation
concerning the contract. 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.
Contracts with Arbitration Clause
In the Philippines, the provisions on
arbitration in the Civil Code and the
Arbitration Law (R.A. No. 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.
Many courts apply the law of the place
the parties have designated as
governing,
thus
sustaining
the
agreement to arbitrate.
Adhesion Contracts
Adhesion 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.
The contract is valid if it is reasonable
and just under the circumstances, and
has been fairly and freely agreed
upon. (Art. 1750, CC)
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.
Special Contracts
a.
Sale or Barter of Goods governed
by the lex situs
b.
Simple loan granted by financial
institutions law of the permanent
place of business
c.
Loan
granted
by
a
private
individual or where subject matter
of loan is personal law of the place
where the loan was obtained
d.
Pledge,
Chattel
Mortgage,
Antichresis lex situs
e.
Transportation by Sea

i. Philippine ports to Foreign ports

law of the country of destination
(Art. 1753, CC)
ii. Foreign ports to Philippine ports
*Primary law Civil Code
*Code of Commerce
*Carriage of Goods by Sea Act
f.
International Air Transportation
governed
by
the
Warsaw
Convention
i. Suits may be prosecuted in any of
the following places at the option of
the plaintiff-passenger:
*court of the domicile of the carrier
*court of the principal place of
business of the carrier
*court where the carrier has a
place of business through which
the contract was made
*court of the place of destination
ii. With respect to transportation by
successive
carriers

The
Guadalajara Protocol provides
that the contracting carrier shall
also be liable for the acts of the
actual carrier.

D. TORTS
GOVERNING LAW
-

Lex loci delicti commissi or law of the place

where the alleged tort was committed.
In the Philippines, there is no governing
specific statutory law but courts may give
due course on the theory of the 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 law
of the State where the injury was inflicted.
In case of intentional torts law of the
State where the actor initiated or carried
out the tortuous act.

CONCEPTS OF PLACE OF WRONG OR

THE LOCUS DELICTI

1.

2.

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. This is in line with the
vested rights theory.
Place of Conduct (civil law rule) views
the situs of torts as the place where the
tortuous act was committed.

OBLIGATION 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.

THEORY OF THE 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:

a.
b.
c.

place where the injury occurred

place of conduct causing the injury
domicile, residence, nationality, place
of incorporation and place of business
d.
place where relationship between the
parties is centered
Give 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.

CONDITIONS FOR THE

ENFORCEMENT OF TORT CLAIMS
1.
2.
3.

5.

6.

SPECIAL TYPES OF MOVABLE

PROPERTY
1.

Choses in possession (tangible physical

objects)
a.
General Rule: the law of the place
where the property is located at the
time of the transaction determines the
creation and transfer of interests (lex
situs)
b. Goods in transitu Seizure and
arrest:
The law of the temporary
resting place will determine whether
the seizure was lawful or whether a
lien, pledge, privilege or a similar right
was acquired.
c.
Goods in transitu Disposition of
goods: Governed by the law of any
place having substantial connection
with the transaction which will uphold
its validity. The owner may choose
from among several legal systems
such as the law of the temporary
resting place, lex loci actus, law of the
place of destination, or the law of the
last real situs of the goods.
d. Rules
Governing
Means
of
Transport
*Sea going vessels law of the flag;
or
*If the country has several states
law of the place of registry

2.

Choses in action (intangible movables)

a.
Debts
i. Voluntary
Transfer
or
Assignment of Choses in Action
there are three theories as to the
law which may govern:
*law of the domicile of the owner
*law of the place where the
assignment was executed
*law of the place where the debt is
recoverable

The 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; and
The judicial machinery of the forum is
adequate for its proper enforcement.

E. CRIMES
-

Penal laws and those of public security and

safety shall be obligatory upon all who live
or sojourn in the Philippine territory, subject
to the principles of public international law
and to treaty stipulations. (Art. 14, CC)
General Rule: Lex loci delicti or the law of
the place where the crime was committed.
Exceptions:
a.
crimes committed by state officials,
diplomatic representatives and officials
of
recognized
international
organizations. This is based on the
theory of state immunity from suits.
b.
crimes committed on board a foreign
vessel even if within the territorial
waters of the coastal state, as long as
the effect of such crime does not affect
the peace and order of the coastal
state.
c.
Crimes which, although committed by
Philippine
nationals
abroad
are
punishable under the local law
pursuant to the protective principle of
criminal jurisdiction as embodied in
Art. 2, Revised Penal Code.

F. PROPERTY
CONTROLLING LAW

Lex situs or lex rei sitae as embodied in

Art. 16, par. 1, CC.

CAPACITY TO TRANSFER OR
ACQUIRE PROPERTY
-

Governed by lex situs.

EXTRINSIC AND INTRINSIC

VALIDITY OF CONVEYANCES
-

General Rule: governed by lex situs.

Exceptions:
1.
Art. 16, par. 2, CC
2.
The issue is the rights and liabilities of
the parties as a matter of contract
even if the subject matter is land.
3.
The validity and effect of the obligation
which
the
encumbrance
on
an
immovable secures.
4.
Under a policy centered approach,
when the situs of the movable at the

time of the transfer was insignificant

or accidental.
When the issue involves consideration
other than the validity and effect of
the transfer the court may look into
the law of another state which has a
real interest in applying its law.
The validity of the contract to transfer
an immovable.

b.
c.

ii. Involuntary Transfer of Choses

in Action example would be
garnishment. Governed by the law
of the state where jurisdiction is
effectively exercisable against the
garnishee. This is the country
where the debt can be recovered,
i.e., any country in which the
debtor is present or can be served
effectively with process.
Negotiable Instrument governed
by the law of the place indicated in the
instrument or place of delivery.
Corporate Shares
i. As against the corporation and
third persons The transfer or
assignment is governed by the law
of the place of incorporation.
ii. As between the assignor and
assignees The transfer will be

d.

governed by the law most closely

connected to the transaction.
Goodwill governed by the law of the
principal place of business.

2.

G.
SUCCESSION
AND
ADMINISTRATION OF ESTATES
GENERAL RULE

Art. 16, par. 2, CC

EXTRINSIC VALIDITY OF WILLS

(Articles 17, par. 1 and 815 817,
CC)
TESTATOR
Filipino

Alien

PLACE OF
EXECUTION
Philippines
Foreign
country

Philippines

Foreign
country

Note:
1.

2.

GOVERNING
LAW
Philippine law
1. Lex
loci
contractus
or
2. Philippine
law
1. Philippine
law or
2. National
law
of
testator
1. National
law
of
testator or
2. Law
of
domicile or
3. Lex
loci
contractus
or
4. Philippine
law

Joint Wills executed by Filipinos in the

Philippines or abroad, even though
authorized by the foreign country in
which they may have been executed,
shall not be valid in the Philippines.
(Art. 819, CC) This prohibition applies
only to Filipino nationals.
The validity of the will as to its form
depends upon the observation of the
law in force at the time it is made.

INTRINSIC VALIDITY OF WILLS

governed by the national law of the person

whose will is under consideration in force at
the time of the testators death
Art. 16, par. 2, and Art. 1039, CC.

governed by the decedents national law

INTERPRETATION OF WILLS
REVOCATION OF WILLS (Art. 829,
CC)
PLACE OF
REVOCATION
Philippines

Outside
the
Philippines

TESTATORS
DOMICILE
Philippines
Foreign
country
Philippines

GOVERNING
LAW
Philippine law
Philippine law

Foreign
country

1.

Philippine law
law of the
place
where the
will
was

made or
law of the
place
in
which the
testator
had
his
domicile
at
the
time
of
the
revocatio
n.

PROBATE OF WILLS

Being procedural in nature, the law of the

forum governs the probate of the will.

ADMINISTRATION OF ESTATES
-

Philippine law follows the main principle of

territorialism. The national law of the
decedent governs the distribution while the
law
of
the
State
appointing
the
administrator or executor governs the
administration.
Administration is governed by the law of
the place where the administration takes
place, and that is the law of the country
from which the administrator derives his
authority.
Administration may either be principal
(administration in the jurisdiction of the
decedents last domicile) or ancillary (any
other administration outside the decedents
last domicile).
The administration extends only to assets
of the decedent found within the state or
country where it was granted. To administer
the property situated in a foreign state, the
administrator must be reappointed or a new
one named in that state.

DISTRIBUTION OF ESTATES

Regulated according to the national law of

the person whose succession is under
consideration. (Art. 16, par. 2 and Art.
1039, CC)

RIGHT OF THE STATE TO CLAIM THE

ESTATE OF THE DECEASED
-

Regardless of the claim of the foreign state,

as long as there are no private heirs or
beneficiaries, the rights of the State of the
situs over local assets will prevail.

H. BUSINESS ASSOCIATIONS
1. CORPORATION OR PARTNERSHIP
PERSONAL LAW
-

General Rule: Place of incorporation

Exceptions:
a.
Constitutional
and
statutory
restrictions
(Art.
XII,
1987
Constitution)
b. Control Test during war Courts
may pierce the veil of corporate
identity and look into the nationality of
the stockholders to determine the
citizenship of the corporation.

a.
b.
c.
d.

LAW OF THE PLACE OF

INCORPORATION IS APPLICABLE
ON THE FOLLOWING ISSUES:

When it is not fixed by the law creating the

corporation, it shall be understood to be the
place where their legal representation is or
where
they
exercise
their
principal
functions. (Art. 51, CC)
A foreign corporation granted license to
operate in the Philippines acquires domicile
here.

JURISDICTION OVER FOREIGN

CORPORATIONS
-

Because of the consent of the state, a

foreign corporation will be recognized and
will be allowed to transact business in any
state which gives it consent. This consent
doctrine is established in Sections 125
128, Corporation Code.
All foreign corporations lawfully doing
business here in the Philippines shall be
bound by all laws and rules and regulations
applicable to domestic corporations except
provisions for the creation, formation,
organization or dissolution of corporations
or liabilities, responsibilities or duties of
stockholders, members or officers of the
corporation to each other.
Service
of
summons
upon
foreign
corporations
doing
business
in
the
Philippines may be made:
a.
on its resident agent
b.
in the absence thereof, on the
government official designated by law
or any of its officers or agents within
the Philippines
c.
on any officer or agent of said
corporation in the Philippines
d.
by
serving
summons
through
diplomatic channels.

RIGHT OF A FOREIGN
CORPORATION TO BRING SUIT
-

c.

existence and the legal character of the

corporation
capacity and powers of the corporation
internal organization of the corporate
enterprise
alteration of the charter and the dissolution
of the corporation

DOMICILE OR RESIDENCE OF
FOREIGN CORPORATIONS

b.

General Rule: No foreign corporation

transacting business in the Philippines
without a license, or its successors or
assignees, shall be permitted to maintain or
intervene in any action, suit or proceeding
in any court or administrative agency of the
Philippines, but such corporation may be
sued or proceeded against before Philippine
courts or administrative tribunals on any
valid cause of action recognized under the
Philippine laws (Sec. 133, Corporation
Code). Hence, acquisition by a foreign
corporation of a license to transact business
in
the
Philippines
is
an
essential
prerequisite for the filing of suits before
courts.
Exceptions:
a.
isolated transactions

d.

action to protect trademark, trade

name, goodwill, patent or for unfair
competition
agreements fully transacted outside
the Philippines
petition filed is merely corollary
defense in a suit against the
corporation

EFFECT OF FAILURE TO SECURE A

LICENSE TO TRANSACT BUISNESS
-

The foreign corporation has no right to sue

in the Philippines but it can still be sued.
Although the contracts entered into may be
valid as between the parties, it may not be
enforced in the Philippine courts.

2. TRUSTS
-

When the trust contains an express choice

of law provision, that law shall be applied.
In the absence of express provision, the
courts will deem controlling the law that will
sustain the validity of the trust.

IV. FOREIGN JUDGMENTS

FOREIGN JUDGMENT
-

It is a decision rendered outside the forum

and encompasses judgments, decrees and
orders of courts of foreign countries.

RECOGNITION OF FOREIGN
JUDGMENT
-

Passive act of giving the same effect that it

has in the State where it was rendered with
respect to the parties, the subject matter of
the action and the issues involved without
the necessity of filing an action in the forum
giving effect to the judgment.
Examples of foreign judgments which can
only be recognized: declaratory judgments,
judgments which give no affirmative relief,
judgments which determine the parties
interests in a thing or status.

ENFORCEMENT OF A FOREIGN
JUDGMENT
-

A foreign judgment is enforced when, in

addition to being recognized, a party is
given affirmative relief to which the
judgment entitles him and it necessarily
requires the filing of an action.
This necessarily implies recognition.

REQUISITES FOR RECOGNITION OR

ENFORCEMENT
1.
2.
3.
4.
5.
6.

It must be a judgment in a judicial or

quasi-judicial action;
It must be a judgment on civil or
commercial
matters,
including
questions of status;
The court issuing the judgment must
be a court of competent jurisdiction;
The judgment must emanate from an
impartial court;
The judgment must be valid according
to the law of the court that delivered
it;
The judgment must be final and must
amount to res judicata in the country
where it was delivered;

7.
8.
9.

10.

11.
12.
13.

A judgment for the payment of money

must be for a fixed sum;
The foreign judgment must have
disposed of the controversy on its
merits;
The foreign judgment must not be
barred by prescription under the law of
the State in which it was promulgated
or under the law of the State in which
its recognition or enforcement is being
sought;
The foreign judgment must not be
contrary to the public policy or the
canons of morality of the place where
it is sought to be enforced or
recognized;
The foreign judgment must not be
contrary to natural or substantial
justice;
The foreign judgment should not have
been obtained by fraud; and
The foreign judgment must not
constitute a clear mistake of law or
fact.

(Salonga. Private International Law. 1995.

Chapter
XXIII,
Recognition
and
Enforcement of Foreign Judgments.)

PHILIPPINE RULE EFFECT OF

FOREIGN JUDGMENTS OR FINAL
ORDERS
The effect of a judgment or final order of a
tribunal of a foreign country, having jurisdiction
to render the judgment or final order is as
follows:
(a) In case of a judgment or final order upon a
specific thing, the judgment or final order is
conclusive upon the title to the thing; and
(b) In case of a judgment or final order against
a person, the judgment or final order is
presumptive evidence of a right as between the
parties and their successors in interest by a
subsequent title.
In either case, the judgment or final order may
be repelled by evidence of a want of
jurisdiction, want of notice to the party,
collusion, fraud, or clear mistake of law or fact.
(Section 48, Rule 39, Rules of Court)