CONFLICT OF LAWS

(Important Terms)

The part of the law of each State

or nation which determines

whether in dealing with a legal

situation, the law or some other

State or nation will be

recognized, given effect or

applied.

DEFINITIONBranch of international law which

regulates comity of states in giving

effect in one to the municipal law of

another relating private persons, or

concerns the rights of persons within

its territory and dominion of one state

or nation; by reason of acts, private or

publicdone within the dominion of anotherand which is based on the general principle that one country will

respect and give effect to the laws of

another so far as done consistently

with its own interests.

ALSO

PRIVATE

INTERNATIONAL

LAW

A factual situation that

cuts across territorial

lines and is thus

affected by diverse laws

of two or more states.

FOREIGN

ELEMENT

The recognition which one state

allows within its own territory to the

legislative, executive or judicial acts

of one state, having due regard both

to international duty and

convenience and to the rights of its

own citizens or of other persons who

are under the protection of its laws.

COMITY

Applicable law regarding

the acquisition, transfer

and devolution of the title

to property is the law

where the property is

located.

LEX SITUS

Law of the forum

where the case is

filed.

LEX FORI

Law of the place

where the act is

done.

LEX LOCI

ACTUS

Law of the place

where the contract

is entered into

LEX LOCI

CELEBRATIONIS

The proper law

applicable in

deciding the rights

and liabilities of the

contracting parties

LEX LOCI

CONTRACTUS

Law of the place

where the offense

or wrong took place

LEX LOCI

DELICTUS

Law of the place of

the domicile of the

person

LEX LOCI

DOMICILUS

A rule to the effect that the

forum is not bound by the law

of the place of injury or death

as to the limitation on

damages for wrongful act

because such rule is

procedural and hence the law

of the forum governs the issue.

KILBERG

DOCTRINE

Choice of law problems in

conflict of laws are resolved by

the application of the law of the

jurisdiction which has the most

significant relationship to or

contact with events and parties

to litigation and the issue

therein.

CENTER OF

GRAVITY

DOCTRINE

GENERAL RULE in CHOICE

OF LAW

Law of one country has no

application and force in

another country. Hence, PH

laws have NO extra-territorial

effect.

Exception:

1. CONSENTwhen our laws provide extraterritorial effect to our laws with

respect to citizens and nationals.

2. COMITYwhere foreign laws and judgments are given force and effect in our

country, because of growing

interdependence of states and on the basis

of the principle of comity.

TWO REMEDIES INVOLVED:

1. Enforcement of rights of an individual

2. Recognition and enforcement of a

foreign judgment

How to determine if

there is a conflicts

case?

(Saudi Arabia Airlines v.

CA)

Saudi Arabia Airlines v. CA states that there

is a conflict case if:

A factual situation that cuts across territorial lines and is affected by the

diverse laws of two or more states is said

to contain a foreign element The presence of a foreign element is inevitable

since social and economic affairs of

individuals and associations are rarely

confined to the geographical limits of their

birth or conception.

Foreign element may simply consist of

the fact that one of the parties to a

contract is an alien or has a foreign

domicile, or that the contract between

nationals of one State involves

properties situated in another State.

In other cases, foreign element may

assume a complex form.

In this case, Morada is a resident

Philippine national, and that petitioner

SAUDIA is a resident foreign

corporation.

Also by virtue of Moradas employment to SAUDIA as a flight

stewardess, events did transpire

during her many occasions of travel

across national borders, particularly

from Manila to Jeddh and vice versa

that caused conflicts situation to arise.

Three ways of

solving conflict of

laws problem

Court might refuse to

hear it based on lack

of jurisdiction or on

the principle of

forum non

conveniens

Court decides the

case in its own

local law

Court decides the

case by special

rules formulated

to address the

problem

Characterization

(Doctrine of

Qualification)

Process of deciding

whether or not the

facts relate to the kind

of question specified in

a conflicts rule; to

enable the forum to

select the proper law.

DEFINITION

(1) Foreign element

(2) Points of contract

(3) Proper law

applicable

ELEMENTS OF

CHARACTERIZATION

Nationality of a person, his domicile, residence,

place of sojourn

Seat of a legal juridical person such as corporation

Situs of a thing, place where the thing is deemed

to be situated

Place where the act has been donelocal actus Place where the act is intended to come into effect

Intention of the contracting parties as to the law

that should govern their agreementlex loci intentionis

Place where juridical or admin proceedings are

instituted

Lex fori

Flag of shiplegal relationships of the ship and of its master or owner as such. It covers contractual

relationships particularly contracts of

affreightment.

TEST FACTORS

IN POINT OF CONTRACT

MOST SIGNIFICANT

RELATIONSHIP

RULE case

MORADA is a flight stewardess in SAUDIA. She is raped

by a SAUDIA crewmembers in Indonesia. She returned to

Manila and while there, she was convinced to go to Jeddah

to sign some papers appearing to be release forms to

these crewmemberswhich turned out as court summons and court orders trying and finding her guilty of adultery in

Islamic tradition.

The Court ruled that the lex loci actus of the place is

Manila, since this is where she was convinced to go to

Jeddah. The most significant rule is also applied as it is in

the PH where the overall harm and injury to the person,

reputation and social standing and human rights had

lodged.

CASE IN POINT:

Saudi Arabia Airlines v. CA

MORADA, a Filipino

national, is

attemptedly raped by a

Saudi Arabian national

crewmembers in

Indonesia.

She returned to Manila and

while there, she was convinced

by SAUDIA manager to go to

Jeddah and sign some papers,

purporting to be release forms

in favor of her fellow

crewmembers.

It turned out that the

documents were court

summons and orders,

trying and finding her

guilty of adultery and

other violations of

Islamic tradition.

Upon her release and

return to Manila, she

filed a case for damages

based on Art. 19 and 21

of the Civil Code.

Was there a

conflicts problem?

There isas Morada is employed by a resident foreign

corporation, an international

carrier; and some of the acts

complained of occured in

Jeddah.

The trial court has jurisdiction

over the subject matteras damaged suit is based on Art.

19 and 21, and over the

persons of Morada (plaintiff)

and SAUDIA (voluntary

submission by filing answer)

Does the Philippine trial

court has jurisdiction over

the subject matter?

How is the point of

contract

categorized?

The point of contract is considered the lex loci

actus or the place where the tortuous act

causing the injury occured.

In this case, Manila, PH since this is where

SAUDIA deceived Morada. The most significant

relationship rule is also applied, SC holding that

the Philippines is where over-all harm of the

injury to the person, reputation, social standing

and human rights of Morada has lodged.

In sum: Morada is

entitled to recovery

of damages

Important Questions

in a Choice of Law

Problem

1. What legal system should control a

situation where some of the significant

factors occured in two or more states?

(solved by characterization)

2. To what extent should the chosen

system regulate the situation?

Philippine Statutory

Directives in the

Choice of Law

Personal Law =

Nationality Rule

Property = Lex Rei

Sitae

1. Family rights and duties = family

relations such as between husband and

wife, between parent and child, among

other ascendants, among brothers and

sisters

2. Status = birth, marriage, death, legal

separation, annulment, judgment declaring

nullity of marriage, legitimization, adoption,

acknowledgment of natural children,

naturalization, loss of recovery of

citizenship, civil interdiction, judicial

determination of filiation, voluntary

emancipation of a minor, change of name

Law of the place

where the property is

situated.

Bellis v. Bellis

G.R. L-23678

(1967)

FACTS:

Amos Bellis, a US citizen, died a

resident of Texas. He left two

willsone, devising a certain amount of money to his first wife

and three illegitimate children.

Before partition, the illegitimate

children who are Filipinos opposed

on the ground that they are

deprived of their legitimes.

ISSUE:

Whether the applicable law

on partition is the Texas

law or the Philippine law?

COURT RULING:

Applying the nationality rule, the law of Texas should govern

the intrinsic validity of the will and therefore answer the

question on entitlement to legitimes.

But since the law of Texas was never proven, the doctrine of

processual presumption was applied. Hence, the SC assumed

that Texas law is the same as Philippine laws, which upholds

the nationality rule.

Renvoi doctrine is not applicable because there is no conflict

as to the nationality and domicile of Bellis. He is both a citizen

and a resident of Texas. So even if assuming the law of Texas

applies the domiciliary rule, it is still Texas law that governs

because his domicile is in Texas.

PERSONAL LAW: Nationality Rule, Renvoi

Doctrine, Doctrine of Processual Presumption

Renvoi DoctrineDoctrine of Processual

Presumption

It is a subset of the choice of law

rules and it may be applied

whenever a forum court is

directed to consider the law of

another state.

The foreign law, whenever

applicable, should be proved by

the proponent thereof, otherwise,

such law shall be presumed to be

exactly the same as the law of

the forum.

PERSONAL LAW: Legal Capacity, Law of the

Place Where the Contract was Entered Into (Lex

Loci Celebrationis)

Government v.

Frank G.R. 2935

(1909)

FACTS:

In Chicago, Illinois; Frank entered into an

employment contract as stenographer

with the Government. The contract is to

be performed in the Philippines.

Upon arrival in the Philippines, Frank left

the service. Government thus sued him

for breach.

Frank raised the defense of minority,

contending that by Philippine laws, he

does not have legal capacity to enter into

contracts.

ISSUE:

Whether or not Frank

has capacity to enter

into contracts?

COURT RULING:

It is not disputed that at the time and place of the

making of the contract, Frank has the capacity to make

the same. No rule is better settled in law than that

matters bearing upon the execution, interpretation and

validity of the contract are determined by the law of the

place where the contract is made.

Matters connected with its performance are regulated

by the law prevailing at the place of performance.

But matters respecting a remedy, such as the bringing

of suit, admissibility of evidence, and statute of

limitations, depend upon the law of the place where the

suit is brought.

Frank, being qualified to enter into the contract at the

time and place the contract is made, cannot implead

infancy as a defense at a place where the contract is

being enforced.

GR: No foreign law may

or should interfere with

the operation and

application of Philippine

laws

EXCEPTIONS:

When the Philippine legislature, has, by law, given its

consent to the extension of a specific foreign law to

the Philippines

When the Congress enacts a law adopting or

copying a specific foreign statute

When State enters into a treaty or convention

When parties themselves stipulate that foreign law

governs their relationship

Borrowing statute- a statute which directs the

court of the forum to apply the foreign statute to

the pending claims based on a foreign law.

When Philippine conflict of laws rule refer to foreign

law as applicable law (nationality principle)

Exception to the borrowing statuteCadalin v. POEA

G.R. L-104776 (

1994)

FACTS:

Cadalin et al are OCWs deployed to

various Middle Eastern countries,

including Bahrain. Under the contracts,

the choice of applicable law is Bahrain

law in case of contract disputes. The

contracts were later pre-terminated so

Cadalin et al filed with RTC a case for

recovery of unpaid wages, etc. Under

Bahrain law, the action has already

prescribed.

ISSUE:

Whether or not Bahrain

law should be applied

on the question of

prescription of action

COURT RULING:

Statute of limitations is sui generisit may be procedural or substantive, depending on the characterization given such law. This

distinction however becomes irrelevant when there is a borrowing

statute, as in the case of our Rules of Court, which provides that

any action barred under the law of the country where the cause of

action arose is also barred in the Philippines.

But in this case, SC did not apply the Rules of Court on the ground

that doing so would contravene the constitutional provision on

protecting the rights of labor.

The courts of the forum will not enforce a foreign claim obnoxious to

the forums public policy.

Agreement on

Applicable Law

GENERAL RULE:

Parties are free to stipulate

as to the applicable foreign

law to govern their dispute

arising from the contract.

EXCEPTIONS:

When there is some basis for applying

the law of the forum (minimum contract)

Where plaintiff and defendant are both

residents of the forum

Where a reasonable reading of the

choice of law and forum agreement does

not preclude the filing of the action in the

residence of the plaintiff or defendant

BUT IF THERE IS NO AGREEMENT AS TO THE

APPLICABLE LAW GOVERNING CONTRACT

Apply the law of the State of the Most Significant

Relationship, taking into account the following:

1. Place of contracting

2. Place of negotiation of the contract

3. Place of performance

4. Location of the subject matter of the contract

5. Domicile, residence, nationality, place of incorporation and

place of business of the contracting parties

Choice of law jurisdiction treated as

choice of venue

FACTS:

A Singaporean company applied with and was granted

by the Singaporean branch of HSBC an overdraft

facility, secured by a Joint and Several Guarantee

executed by the formers directors (Filipino residents).

In the Guarantee, there is a clause stipulating that

jurisdiction over any dispute arising from the transaction

is vested with the Singaporean courts.

When the Singaporean company defaulted, HSBC filed

a suit against the directors in the Philippines.

ISSUE:

Whether or not the

choice of law clause

should be upheld?

COURT RULING:

Jurisdiction, which finds its source in sovereignty, cannot be

bargained away by the parties. The State can assume jurisdiction

when there is reasonable basis of exercising it.

To be reasonable, the jurisdiction must be based on some

minimum contacts that will not offend traditional notions on fair play

and substantial justice.

In the present case, the minimum contact considered is the

Philippine residence of the private respondents. In assuming

jurisdiction, SC held that the parties did not stipulate that only the

courts of Singapore, to the exclusion of all the rest, has jurisdiction.

Because jurisdiction cannot be stipulated upon, the choice of

jurisdiction was treated as a choice of venue. And applying thus, the

choice of venue is only permissive, in the absence of restrictive

words to lend exclusivity to the chosen forum.

HSBC v. Sherman

G.R. 72494 (1989)

NOTA BENE:

When faced with a

case that potentially

involves the

application of Conflict

of Laws principle:

1. Determine

the jurisdiction

of the forum

No jurisdiction (dismiss)

Has jurisdiction but refuses to

exercise it (forum non

conveniens)

Has jurisdiction and exercises it

(move to the second step)

1. Determine

the foreign

element/s

involved

No foreign element (apply the

local law)

Has foreign element (move to the

third step)

3. Determine

the existence of

conflict of laws

No conflict (apply foreign or local

law, as the case may be)

Has conflict (move to the fourth

step)

4. Determine

the choice of

law applicable

Local law

Foreign law

Conflicts.vsdPage-1Page-2Page-3Page-4Page-5Page-6Page-7Page-8Page-9Page-10Page-11