Conflict of Laws Case Digest: Guerrero's Transport Services

vs BETEA-Kilusan, et.al.

GUERRERO'S TRANSPORT SERVICES, INC. vs.

BLAYLOCK TRANSPORTATION SERVICES
EMPLOYEES ASSOCIATION-KILUSAN (BTEA-
KILUSAN), LABORARBITER FRANCISCO M. DE LOS
REYES and JOSE CRUZ
FACTS

In 1972, the US Naval Base authorities in Subic conducted a public bidding for a 5-year contract
for the right to operate and/or manage the transportation services inside the naval base. This
bidding was won by Santiago Guerrero, owner-operator of Guerrero’s Transport Services, Inc.
(Guerrero), over ConcepcionBlayblock, the then incumbent concessionaire doing business under
the name of Blayblock Transport Services Blayblock. Blayblock’s 395 employees are members of
the union BTEA-KILUSAN (the Union).

When Guererro commenced its operations, it refused to employ the members of the Union. Thus,
the Union filed acomplaint w/ the NLRC against Guerrero to compel it to employ its members,
pursuant to Art. 1, Sec. 2 of the RP-US Base Agreement. The case was dismissed by the NLRC
upon Guerrero’s MTD on jurisdictional grounds, there being no employer-employee relationship
between the parties. Upon appeal, the Sec. of Labor remanded the case to the NLRC. The NLRC
issued a Resolution ordering Guererro to “absorb all complainants who filed their applications on
or before the deadline” set by Guerrero, except those who may have derogatory records w/ the US
Naval Authorities in Subic. The Sec. of Labor affirmed.

Guerrero claims that it substantially complied w/ the decision of the Sec. of Labor affirming the
NLRC Resolution, & that any non-compliance was attributable to the individual complainants who
failed to submit themselves for processing & examination. The LaborArbiter ordered the
reinstatement of 129 individuals. The Union filed a Motion for Issuance of Writ of Execution. The
order wasn’t appealed so it was declared final & executory

Subsequently, the parties arrived at a CompromiseAgreement wherein they agreed to submit to the
Sec. of Labor the determination of members of the Union who shall be reinstated by Guerrero, w/c
determination shall be final. The agreement is deemed to have superseded the Resolution of the
NLRC. The Sec. of Labor ordered the absorption of 175 members of the Union subject to 2
conditions.

ISSUE

Whether or not the said members of the Union were entitled to be reinstated by Guerrero.
 RULING

YES. Pursuant to Sec. 6 of Art. I of the RP-US Labor Agreement, the US Armed Forces undertook,
consistent w/ military requirements, "to provide security for employment, and, in the
event certain services are contracted out, the US Armed Forces shall require the contractor or
concessioner to give priority consideration to affected employees for employment.

A treaty has 2 aspects — as an international agreement between states, and as municipal law for
the people of each state to observe. As part of the municipal law, the aforesaid provision of the
treaty enters into and forms part of the contract between Guerrero and the US Naval Base
authorities. In view of said stipulation, the new contractor (Guerrero) is, therefore, bound to give
"priority" to the employment of the qualified employees of the previous contractor (Blaylock). It
is obviously in recognition of such obligation that Guerrero entered into the
aforementioned Compromise Agreement.

Under the Compromise Agreement, the parties agreed to submit to the Sec. of Labor the
determination as to who of the members of the Union shall beabsorbed or employed by Guerrero,
and that such determination shall be considered as final. The Sec. of Labor issued an Order
directing the NLRC, through Labor Arbiter Francisco de los Reyes, to implement the absorption
of the 175 members into Guerrero's Transport Services, subject to the following conditions:

a) that they were bona fide employees of the Blaylock Transport Service at the time
its concessionexpired; and
b) that they should pass final screening and approvalby the appropriate authorities of the U.S. Naval
Base concerned.

For this purpose, Guerrero is ordered to submit to and secure from the appropriate authorities of
the U.S. naval Base at Subic, Zambales the requisite screening andapproval, the names of the
members of the Union.

Considering that the Compromise Agreement of the parties is more than a mere contract and has
the force and effect of any other judgment, it is, therefore, conclusive upon the parties and their
privies. For it is settled that a compromise has, upon the parties, the effect and authority of res
judicata and is enforceable by execution upon approval by the court.
Conflicts Of Laws Case Digest: Saudi Arabian Airlines V.
CA

G.R. No. 122191 October 8, 1998

Laws Applicable: Art 19 and 21 of Civil Code

Lessons Applicable: Conflict of Laws, factual situation, connecting factor, characterization,

choice of law, State of the most significant relationship

FACTS:

 Saudi Arabian Airlines (SAUDIA), foreign airlines corporation doing business in the
Philippines and may be served summons in agent in Makati, hired Milagros P. Morada as
a flight attendant for its airlines based in Jeddah, Saudi Arabia.
 April 27, 1990: While on a lay-over in Jakarta, Indonesia, Morada went to a disco dance
with fellow crew members Thamer Al-Gazzawi and Allah Al-Gazzawi, both Saudi
nationals. It was almost morning when they returned to their hotels so they agreed to
have breakfast together at the room of Thamer. Shortly after Allah left the room, Thamer
attempted to rape Morada. Fortunately, a roomboy and several security personnel heard
her cries for help and rescued her. Indonesian police arrested Thamer and Allah Al-
Gazzawi, the latter as an accomplice.
 When Morada returned to Jeddah, SAUDIA officials interrogated her about the Jakarta
incident and requested her to go back to Jakarta to help arrange the release of Thamer and
Allah. In Jakarta, SAUDIA Legal Officers negotiated with the police for the immediate
release of the detained crew members but did not succeed. Afraid that she might be
tricked into something she did not want because of her inability to understand the local
dialect, Morado refused to cooperate and declined to sign a blank paper and a document
written in the local dialect. Eventually, SAUDIA allowed Morada to return to Jeddah but
barred her from the Jakarta flights.
 Indonesian authorities agreed to deport Thamer and Allah and they were again put in
service. While, Morada was transferred to Manila.
 January 14, 1992: Morada was asked to see Mr. Ali Meniewy, Chief Legal Officer of
SAUDIA, in Jeddah, Saudi Arabia. He brought her to the police station where the police
took her passport and questioned her about the Jakarta incident. The police pressured her
to drop the case against Thamer and Allah. Not until she agreed to do so did the police
return her passport and allowed her to catch the afternoon flight out of Jeddah.
 June 16, 1993: Morada, while in Riyadh Saudi Arabia, was not allowed to board the
plane to Manila and instead ordered to take a later flight to Jeddah to see Mr.
Miniewy. Khalid of the SAUDIA office brought her to a Saudi court where she was
asked to sign a document written in Arabic. They told her that this was necessary to close
the case against Thamer and Allah but it was actually a notice for her to appear before the
court on June 27, 1993. Plaintiff then returned to Manila.
 June 27, 1993: SAUDIA's Manila manager, Aslam Saleemi, assured Morada that the
investigation was routinary and that it posed no danger to her so she reported to Miniewy
in Jeddah for further investigation. She was brought to the Saudi court.
 June 28, 1993: Saudi judge interrogated Morada through an interpreter about the Jakarta
incident for an hour and let her go. SAUDIA officers forbidden her to take flight. She
was told to go the Inflight Service Office where her passport was taken and they told her
to remain in Jeddah, at the crew quarters, until further orders.
 July 3, 1993: She was brought to court again and to her astonishment and shock, rendered
a decision, translated to her in English, sentencing her to five months imprisonment and
to 286 lashes. The court tried her, together with Thamer and Allah, and found her guilty
of (1) adultery (2) going to a disco, dancing and listening to the music in violation of
Islamic laws and (3) socializing with the male crew, in contravention of Islamic tradition.
 Failing to seek the assistance of her employer, SAUDIA, she asked the Philippine
Embassy in Jeddah to help her while her case is on appeal. She continued to workon the
domestic flight of SAUDIA, while Thamer and Allah continued to serve in the
international flights.
 Because she was wrongfully convicted, the Prince of Makkah dismissed the case against
her and allowed her to leave Saudi Arabia. Before her return to Manila, she was
terminated from the service by SAUDIA, without her being informed of the cause.
 November 23, 1993: Morada filed a Complaint for damages against SAUDIA, and
Khaled Al-Balawi, its country manager.
 January 19, 1994: SAUDIA filed an Omnibus Motion To Dismiss on following grounds:
(1) that the Complaint states no cause of action against SAUDIA (2) that defendant Al-
Balawi is not a real party in interest (3) that the claim or demand set forth in the
Complaint has been waived, abandoned or otherwise extinguished and (4) that the trial
court has no jurisdiction to try the case.
  After opposition to the motion to dismiss by Morada and reply by SAUDIA, Morada
filed an Amended Complaint dropping Al-Balawi. SAUDIA filed its
Manifestation, Motion to Dismiss Amended Complaint, subsequently motion for
reconsideration which were all denied.
 SAUDIA filed its Petition for Certiorari and Prohibition with Prayer for Issuance of Writ
of Preliminary Injunction and/or Temporary Restraining Order with the Court of
Appeals. TRO was granted but Writ of Preliminary Injunction was denied.
 CA: Philippines is an appropriate forum considering that the Amended Complaint's basis
for recovery of damages is Article 21 of the Civil Code, and thus, clearly within the
jurisdiction of respondent Court. It further held that certiorari is not the proper remedy in
a denial of a Motion to Dismiss, inasmuch as the petitioner should have proceeded to
trial, and in case of an adverse ruling, find recourse in an appeal.
 SAUDIA filed its Supplemental Petition for Review with Prayer for Temporary
Restraining Order:
o It is a conflict of laws that must be settled at the outset:

§ Morada's claim for alleged abuse of rights occurred in the Kingdom of Saudi Arabia.

§ Existence of a foreign element qualifies the instant case for the application of the law of the
Kingdom of Saudi Arabia, by virtue of the lex loci delicti commissi rule.

 Morada: Amended Complaint is based on Articles 19 and 21 of the Civil Code which is a
matter of domestic law

ISSUE: W/N the RTC of Quezon City has jurisdiction over the case and it is the proper forum
for recovery of damages under Art. 21 of the Civil Code which should govern.

HELD: YES. petition for certiorari is hereby DISMISSED. REMANDED to RTC of Quezon
City, Branch 89 for further proceedings

 Where the factual antecedents satisfactorily establish the existence of a foreign element,
the problem could present a "conflicts" case
 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".
o Morada is a resident Philippine national

o SAUDIA is a resident foreign corporation

o by virtue of the employment of Morada with the SAUDIA as a flight stewardess, events did
transpire during her many occasions of travel across national borders, particularly from Manila,
Philippines to Jeddah, Saudi Arabia, and vice versa, that caused a "conflicts" situation to arise

 Forms of foreign element:

o Simple: one of the parties to a contract is an alien or has a foreign domicile, or that a contract
between nationals of one State involves properties situated in another State

o Complex

 Violations of Articles 19 and 21 are actionable, with judicially enforceable remedies in

the municipal forum. RTC of Quezon City possesses jurisdiction over the subject matter
of the suit.
 Pragmatic considerations, including the convenience of the parties, also weigh heavily in
favor of the RTC Quezon City assuming jurisdiction:
o private interest of the litigant

o enforceability of a judgment if one is obtained

o relative advantages and obstacles to a fair trial

§ Plaintiff may not, by choice of an inconvenient forum, "vex", "harass", or "oppress" the defendant,
e.g. by inflicting upon him needless expense or disturbance. but unless the balance is strongly in
favor of the defendant, the plaintiffs choice of forum should rarely be disturbed.

 Weighing the relative claims of the parties, the court a quo found it best to hear the case
in the Philippines. Had it refused to take cognizance of the case, it would be forcing
plaintiff (private respondent now) to seek remedial action elsewhere, i.e. in the Kingdom
of Saudi Arabia where she no longer maintains substantial connections. That would have
caused a fundamental unfairness to her. Moreover, by hearing the case in the Philippines
no unnecessary difficulties and inconvenience have been shown by either of the parties.
 Trial court possesses jurisdiction over the persons of the parties
o By filing her Complaint and Amended Complaint with the trial court, private respondent has
voluntary submitted herself to the jurisdiction of the court

o SAUDIA has effectively submitted to the trial court's jurisdiction by praying for the dismissal of
the Amended Complaint on grounds other than lack of jurisdiction.

 As to the choice of applicable law, it seeks to answer 2 important questions:

o (1) What legal system should control a given situation where some of the significant facts
occurred in two or more states

o (2) to what extent should the chosen legal system regulate the situation
  Although ideally, all choice-of-law theories should intrinsically advance both notions of
justice and predictability, they do not always do so. The forum is then faced with the
problem of deciding which of these two important values should be stressed.
 Before a choice can be made, it is necessary for us to determine under what category a
certain set of facts or rules fall
o "characterization" or the "doctrine of qualification”

§ process of deciding whether or not the facts relate to the kind of question specified in a conflicts
rule

§ purpose: to enable the forum to select the proper law

 Choice-of-law rules invariably consist of: (essential element of conflict rules)

o factual situation/relationship or operative fact (such as property right, contract claim); and

§ starting point of analysis

o test or connecting factor or point of contact (such as the situs of the res, the place of celebration,
the place of performance, or the place of wrongdoing) – could be:

§ (1) The nationality of a person, his domicile, his residence, his place of sojourn, or his origin

§ (2) the seat of a legal or juridical person, such as a corporation

§ (3) the situs of a thing, that is, the place where a thing is, or is deemed to be situated. In particular,
the lex situs is decisive when real rights are involved

§ (4) the place where an act has been done, the locus actus, such as the place where a contract has
been made, a marriage celebrated, a will signed or a tort committed. The lex loci actus is
particularly important in contracts and torts

§ (5) the place where an act is intended to come into effect, e.g., the place of performance of
contractual duties, or the place where a power of attorney is to be exercised

§ (6) the intention of the contracting parties as to the law that should govern their agreement, the lex
loci intentionis;

§ (7) the place where judicial or administrative proceedings are instituted or done. The lex fori —
the law of the forum — is particularly important because, as we have seen earlier, matters of
"procedure" not going to the substance of the claim involved are governed by it; and because the
lex fori applies whenever the content of the otherwise applicable foreign law is excluded from
application in a given case for the reason that it falls under one of the exceptions to the
applications of foreign law; and
§ (8) the flag of a ship, which in many cases is decisive of practically all legal relationships of the
ship and of its master or owner as such. It also covers contractual relationships particularly
contracts of affreightment

 Note that one or more circumstances may be present to serve as the possible test for the
determination of the applicable law.
 Based on pleadings on record, including allegations in the Amended Complaint:
o Morada was made to face trial for very serious charges, including adultery and violation of
Islamic laws and tradition

o SAUDIA may have acted beyond its duties as employer by handing over the person of Morada to
Jeddah officials which contributed to and amplified or even proximately caused additional
humiliation, misery and suffering. It also took advantage of the trust, confidence and faith in the
guise of authority as employer.

o Conviction and imprisonment was wrongful but injury or harm was inflicted upon her person and
reputation which must be compensated or redress for the wrong doing

 Complaint involving torts

 "connecting factor" or "point of contact" - place or places where the tortious conduct or
lex loci actus occurred = Philippines where SAUDIA deceived Morada, a Filipina
residing and working here.
 "State of the most significant relationship" – applied
o taken into account and evaluated according to their relative importance with respect to the
particular issue:

§ (a) the place where the injury occurred

§ (b) the place where the conduct causing the injury occurred

§ (c) the domicile, residence, nationality, place of incorporation and place of business of the parties

§ (d) the place where the relationship, if any, between the parties is centered

v private respondent is a resident Filipina national, working here

v a resident foreign corporation engaged here in the business of international air carriage
Case Digest: G.R. No. 92013 July 25, 1990

Salvador H. Laurel, petitioner, vs. Ramon Garcia, as head of

the Asset Privatization Trust, Raul Manglapus, as Secretary
of Foreign Affairs, and Catalino Macaraig, as Executive
Secretary, respondents.
_______________________________________________________________________
Facts: The subject property in this case is one of the 4 properties in Japan acquired by the Philippine
government under the Reparations Agreement entered into with Japan, the Roppongi property. The said
property was acquired from the Japanese government through Reparations Contract No. 300. It consists of
the land and building for the Chancery of the Philippine Embassy. As intended, it became the site of the
Philippine Embassy until the latter was transferred to Nampeidai when the Roppongi building needed major
repairs. President Aquino created a committee to study the disposition/utilization of Philippine government
properties in Tokyo and Kobe, Japan. The President issued EO 296 entitling non-Filipino citizens or entities
to avail of separations' capital goods and services in the event of sale, lease or disposition.

Issues: Whether or not the Chief Executive, her officers and agents, have the authority and jurisdiction, to
sell the Roppongi property.

Ruling: It is not for the President to convey valuable real property of the government on his or her own
sole will. Any such conveyance must be authorized and approved by a law enacted by the Congress. It
requires executive and legislative concurrence. It is indeed true that the Roppongi property is valuable not
so much because of the inflated prices fetched by real property in Tokyo but more so because of its symbolic
value to all Filipinos, veterans and civilians alike. Whether or not the Roppongi and related properties will
eventually be sold is a policy determination where both the President and Congress must concur.
Considering the properties' importance and value, the laws on conversion and disposition of property of
public dominion must be faithfully followed.
HERBERT BROWNELL, JR.versusSUN LIFE ASSURANCE
COMPANY OF CANADA
G.R. No. L-5731 – June 22, 1954
FACTS:
Subject of this petition is the endowment policy which insured Aihara
andG a ya p a n a n d u p o n i t s m a t u r i t y t h e p r o c e e d s w e r e p a ya b l e t o s a i d i n s u r e
d . Brownell instituted this case to compel Sun Life to comply with the demand topay
representing the half of the proceeds of endowment policy and payable toone
Naogiro Aihara, a Japanese national. Such claim is based on Section 5(b)(2) of the
Trading with the Enemy Act of the United States. Which claim
wasa p p r o v e d a n d g r a n t e d b y t h e l o w e r c o u r t o r d e r i n g S L A C O C t o p
a y h e r e i n petitioner.

ISSUE:
Whether or not such Act is still binding despite t
h e c o m p l e t e independence of the Philippines from American government?

HELD:
Yes. T h e e x t e n s i o n o f t h e P h i l i p p i n e P r o p e r t y A c t o f 1 9 4 6 i s c l e a r l y
i m p l i e d from the acts of the President of the Philippines and the Secretary of
ForeignAffairs, as well as by the enactment of R.A. Nos. 7, 8 and 477.
 HONGKONG SHANGAI BANKING
CORPORATION v. SHERMAN
G.R. No. 72494 August 11, 1989

FACTS
In 1981, Eastern Book Supply Service PTE, Ltd., (Eastern) a company incorporated in Singapore
applied w/, & was granted by the Singapore branch of HSBC an overdraft facility in the max
amount of Singapore $200,000 (w/c amount was subsequently increased to Singapore $375,000)
w/ interest at 3% over HSBC prime rate, payable monthly, on amounts due under said overdraft
facility. As a security for the repayment by Eastern of sums advanced by HSBC to it through the
aforesaid overdraft facility, in 1982, Jack Sherman, Dodato Reloj, and a Robin de Clive Lowe, all
of whom were directors of Eastern at such time, executed a Joint and Several Guarantee in favor
of HSBC whereby Sherman, Reloj and Lowe agreed to pay, jointly and severally, on demand all
sums owed by Eastern to HSBC under the aforestated overdraft facility.

The Joint and Several Guarantee provides that: “This guarantee and all rights, obligations and
liabilities arising hereunder shall be construed and determined under and may be enforced in
accordance with the laws of the Republic of Singapore. We hereby agree that the Courts of
Singapore shall have jurisdiction over all disputes arising under this guarantee.”

Eastern failed to pay its obligation. Thus, HSBC demanded payment of the obligation from
Sherman & Reloj, conformably w/ the provisions of the Joint and Several Guarantee. Inasmuch as
Sherman & Reloj still failed to pay, HSBC filed a complaint for collection of a sum of money
against them. Sherman & Reloj filed a motion to dismiss on the grounds that (1) the court has no
jurisdiction over the subject matter of the complaint, and (2) the court has no jurisdiction over the
person of the defendants.

ISSUE
W/N Philippine courts should have jurisdiction over the suit.

RULING
YES. While it is true that "the transaction took place in Singaporean setting" and that the Joint and
Several Guarantee contains a choice-of-forum clause, the very essence of due process dictates that
the stipulation that "this guarantee and all rights, obligations & liabilities arising hereunder shall
be construed & determined under & may be enforced in accordance w/ the laws of the Republic
of Singapore. We hereby agree that the Courts in Singapore shall have jurisdiction over all disputes
arising under this guarantee" be liberally construed. One basic principle underlies all rules of
jurisdiction in International Law: a State does not have jurisdiction in the absence of some
reasonable basis for exercising it, whether the proceedings are in rem quasi in rem or in personam.
To be reasonable, the jurisdiction must be based on some minimum contacts that will not offend
traditional notions of fair play and substantial justice. Indeed, as pointed-out by HSBC at the outset,
the instant case presents a very odd situation. In the ordinary habits of life, anyone would be
disinclined to litigate before a foreign tribunal, w/ more reason as a defendant. However, in this
case, Sherman & Reloj are Philippine residents (a fact which was not disputed by them) who would
rather face a complaint against them before a foreign court and in the process incur considerable
expenses, not to mention inconvenience, than to have a Philippine court try and resolve the case.
Their stance is hardly comprehensible, unless their ultimate intent is to evade, or at least delay, the
payment of a just obligation.

The defense of Sherman & Reloj that the complaint should have been filed in Singapore is based
merely on technicality. They did not even claim, much less prove, that the filing of the action here
will cause them any unnecessary trouble, damage, or expense. On the other hand, there is no
showing that petitioner BANK filed the action here just to harass Sherman & Reloj.

The parties did not thereby stipulate that only the courts of Singapore, to the exclusion of all the
rest, has jurisdiction. Neither did the clause in question operate to divest Philippine courts of
jurisdiction. In International Law, jurisdiction is often defined as the light of a State to exercise
authority over persons and things w/in its boundaries subject to certain exceptions. Thus, a State
does not assume jurisdiction over travelling sovereigns, ambassadors and diplomatic
representatives of other States, and foreign military units stationed in or marching through State
territory w/ the permission of the latter's authorities. This authority, which finds its source in the
concept of sovereignty, is exclusive w/in and throughout the domain of the State. A State is
competent to take hold of any judicial matter it sees fit by making its courts and agencies assume
jurisdiction over all kinds of cases brought before them.
CADALIN ET AL VS. POEA ET AL
MARCH 28, 2013 ~ VBDIAZ
BIENVENIDO M. CADALIN, ROLANDO M. AMUL,
DONATO B. EVANGELISTA, and the rest of 1,767
NAMED-COMPLAINANTS, thru and by their Attorney-in-
fact, Atty. GERARDO A. DEL MUNDOvs. PHILIPPINE
OVERSEAS EMPLOYMENT ADMINISTRATION’S
ADMINISTRATOR, NLRC, BROWN & ROOT
INTERNATIONAL, INC. AND/OR ASIA
INTERNATIONAL BUILDERS CORPORATION
GRN 104776, December 5,1994.
FACTS:
This is a consolidation of 3 cases of SPECIAL CIVIL ACTIONS in the Supreme Court for
Certiorari.

On June 6, 1984, Cadalin, Amul and Evangelista, in their own behalf and on behalf of 728 other
OCWs instituted a class suit by filing an “Amended Complaint” with the POEA for money
claims arising from their recruitment by ASIA INTERNATIONAL BUILDERS
CORPORATION (AIBC) and employment by BROWN & ROOT INTERNATIONAL, INC
(BRI) which is a foreign corporation with headquarters in Houston, Texas, and is engaged in
construction; while AIBC is a domestic corporation licensed as a service contractor to recruit,
mobilize and deploy Filipino workers for overseas employment on behalf of its foreign
principals.

The amended complaint sought the payment of the unexpired portion of the employment
contracts, which was terminated prematurely, and secondarily, the payment of the interest of the
earnings of the Travel and Reserved Fund; interest on all the unpaid benefits; area wage and
salary differential pay; fringe benefits; reimbursement of SSS and premium not remitted to the
SSS; refund of withholding tax not remitted to the BIR; penalties for committing prohibited
practices; as well as the suspension of the license of AIBC and the accreditation of BRII
On October 2, 1984, the POEA Administrator denied the “Motion to Strike Out of the Records”
filed by AIBC but required the claimants to correct the deficiencies in the complaint pointed out.

AIB and BRII kept on filing Motion for Extension of Time to file their answer. The POEA kept
on granting such motions.

On November 14, 1984, claimants filed an opposition to the motions for extension of time and
asked that AIBC and BRII declared in default for failure to file their answers.

On December 27, 1984, the POEA Administrator issued an order directing AIBC and BRII to
file their answers within ten days from receipt of the order.

(at madami pang motions ang na-file, new complainants joined the case, ang daming inavail na
remedies ng both parties)
On June 19, 1987, AIBC finally submitted its answer to the complaint. At the same hearing, the
parties were given a period of 15 days from said date within which to submit their respective
position papers. On February 24, 1988, AIBC and BRII submitted position paper. On October
27, 1988, AIBC and BRII filed a “Consolidated Reply,” POEA Adminitartor rendered his
decision which awarded the amount of $824, 652.44 in favor of only 324 complainants.
Claimants submitted their “Appeal Memorandum For Partial Appeal” from the decision of the
POEA. AIBC also filed its MR and/or appeal in addition to the “Notice of Appeal” filed earlier.

NLRC promulgated its Resolution, modifying the decision of the POEA. The resolution removed
some of the benefits awarded in favor of the claimants. NLRC denied all the MRs. Hence, these
petitions filed by the claimants and by AlBC and BRII.

The case rooted from the Labor Law enacted by Bahrain where most of the complainants were
deployed. His Majesty Ise Bin Selman Al Kaifa, Amir of Bahrain, issued his Amiri Decree No.
23 on June 16, 1176, otherwise known re the Labour Law for the Private Sector. Some of the
provision of Amiri Decree No. 23 that are relevant to the claims of the complainants-appellants
are as follows:
“Art. 79: x x x A worker shall receive payment for each extra hour equivalent to his wage
entitlement increased by a minimum of twenty-rive per centurn thereof for hours worked during
the day; and by a minimum off fifty per centurn thereof for hours worked during the night which
shall be deemed to being from seven o’clock in the evening until seven o’clock in the morning .”

Art. 80: Friday shall be deemed to be a weekly day of rest on full pay.
If employee worked, 150% of his normal wage shall be paid to him x x x.”

Art. 81; x x x When conditions of work require the worker to work on any official holiday, he
shall be paid an additional sum equivalent to 150% of his normal wage.”

Art. 84: Every worker who has completed one year’s continuous service with his employer shall
be entitled to Laos on full pay for a period of not less than 21 days for each year increased to a
period not less than 28 days after five continuous years of service.”

A worker shall be entitled to such leave upon a quantum meruit in respect of the proportion of
his service in that year.”

Art. 107: A contract of employment made for a period of indefinite duration may be terminated
by either party thereto after giving the other party prior notice before such termination, in
writing, in respect of monthly paid workers and fifteen days’ notice in respect of other workers.
The party terminating a contract without the required notice shall pay to the other party
compensation equivalent to the amount of wages payable to the worker for the period of such
notice or the unexpired portion thereof.”

Art. Ill: x x x the employer concerned shall pay to such worker, upon termination of
employment, a leaving indemnity for the period of his employment calculated on the basis of
fifteen days’ wages for each year of the first three years of service and of one month’s wages for
each year of service thereafter. Such worker shall be entitled to payment of leaving indemnity
upon a quantum meruit in proportion to the period of his service completed within a year.”
ISSUE:
1. WON the foreign law should govern or the contract of the parties.(WON the complainants
who have worked in Bahrain are entitled to the above-mentioned benefits provided by Amiri
Decree No. 23 of Bahrain).

2. WON the Bahrain Law should apply in the case. (Assuming it is applicable WON
complainants’ claim for the benefits provided therein have prescribed.)

3. Whether or not the instant cases qualify as; a class suit (siningit ko nalang)
(the rest of the issues in the full text of the case refer to Labor Law)

RULING:
1. NLRC set aside Section 1, Rule 129 of the 1989 Revised Rules on Evidence governing the
pleading and proof of a foreign law and admitted in evidence a simple copy of the Bahrain’s
Amiri Decree No. 23 of 1976 (Labour Law for the Private Sector).

NLRC applied the Amiri Deere, No. 23 of 1976, which provides for greater benefits than those
stipulated in the overseas-employment contracts of the claimants. It was of the belief that where
the laws of the host country are more favorable and beneficial to the workers, then the laws of
the host country shall form part of the overseas employment contract. It approved the
observation of the POEA Administrator that in labor proceedings, all doubts in the
implementation of the provisions of the Labor Code and its implementing regulations shall be
resolved in favor of labor.

The overseas-employment contracts, which were prepared by AIBC and BRII themselves,
provided that the laws of the host country became applicable to said contracts if they offer terms
and conditions more favorable than those stipulated therein. However there was a part of the
employment contract which provides that the compensation of the employee may be “adjusted
downward so that the total computation plus the non-waivable benefits shall be equivalent to the
compensation” therein agree,’ another part of the same provision categorically states “that total
remuneration and benefits do not fall below that of the host country regulation and custom.”
Any ambiguity in the overseas-employment contracts should be interpreted against AIBC and
BRII, the parties that drafted it. Article 1377 of the Civil Code of the Philippines provides:
‘The interpretation of obscure words or stipulations in a contract shall not favor the party who
caused the obscurity.”

Said rule of interpretation is applicable to contracts of adhesion where there is already a prepared
form containing the stipulations of the employment contract and the employees merely “take it or
leave it.” The presumption is that there was an imposition by one party against the other and that
the employees signed the contracts out of necessity that reduced their bargaining power.
We read the overseas employment contracts in question as adopting the provisions of the Amiri
Decree No. 23 of 1976 as part and parcel thereof. The parties to a contract may select the law by
which it is to be governed. In such a case, the foreign law is adopted as a “system” to 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, and so forth. Instead of adopting the
entire mass of the foreign law, the parties may just agree that specific provisions of a foreign
statute shall be deemed incorporated into their contract “as a set of terms.” By such reference to
the provisions of the foreign law, the contract does not become a foreign contract to be governed
by the foreign law. The said law does not operate as a statute but as a set of contractual terms
deemed written in the contract.

A basic policy of contract is to protect the expectation of the parties. Such party expectation is
protected by giving effect to the parties’ own choice of the applicable law. The choice of law
must, however, bear some relationship the parties or their transaction. There is no question that
the contracts sought to be enforced by claimants have a direct connection with the Bahrain law
because the services were rendered in that country.

2. NLRC ruled that the prescriptive period for the filing of the claims of the complainants was 3
years, as provided in Article 291 of the Labor Code of the Philippines, and not ten years as
provided in Article 1144 of the Civil Code of the Philippines nor one year as provided in the
Amiri Decree No. 23 of 1976.
Article 156 of the Amiri Decree No. 23 of 1976 provides:
“A claim arising out of a contract of employment shall not actionable after the lapse of one year
from the date of the expiry of the Contract”.

As a general rule, a foreign procedural law will not be applied in the forum (local court),
Procedural matters, such as service of process, joinder of actions, period and requisites for
appeal, and so forth, are governed by the laws of the forum. This is true even if the action is
based upon a foreign substantive law.

A law on prescription of actions is sui generis in Conflict of Laws in the sense that it may be
viewed either as procedural or substantive, depending on the characterization given such a law.
In Bournias v. Atlantic Maritime Company (220 F. 2d. 152, 2d Cir. [1955]), where the issue was
the applicability of the Panama Labor Code in a case filed in the State of New York for claims
arising from said Code, the claims would have prescribed under the Panamanian Law but not
under the Statute of Limitations of New York. The U.S. Circuit Court of Appeals held that the
Panamanian Law was procedural as it was not “specifically intended to be substantive,” hence,
the prescriptive period provided in the law of the forum should apply. The Court observed: “. . .
we are dealing with a statute of limitations of a foreign country, and it is not clear on the face of
the statute that its purpose was to limit the enforceability, outside as well as within the foreign
country concerned, of the substantive rights to which the statute pertains. We think that as a
yardstick for determining whether that was the purpose, this test is the most satisfactory one.

The Court further noted: “Applying that test here it appears to us that the libellant is entitled to
succeed, for the respondents have failed to satisfy us that the Panamanian period of limitation in
question was specifically aimed against the particular rights which the libellant seeks to enforce.
The Panama Labor Code is a statute having broad objectives.” The American court applied the
statute of limitations of New York, instead of the Panamanian law, after finding that there was no
showing that the Panamanian law on prescription was intended to be substantive. Being
considered merely a procedural law even in Panama, it has to give way to the law of the forum
(local Court) on prescription of actions.
However the characterization of a statute into a procedural or substantive law becomes irrelevant
when the country of the forum (local Court) has a “borrowing statute.” Said statute has the
practical effect of treating the foreign statute of limitation as one of substance. A “borrowing
statute” directs the state of the forum (local Court) to apply the foreign statute of limitations to
the pending claims based on a foreign law. While there are several kinds of “borrowing statutes,”
one form provides that an action barred by the laws of the place where it accrued will not be
enforced in the forum even though the local statute was not run against it.

Section 48 of Code of Civil Procedure is of this kind. It provides: “If by the laws of the state or
country where the cause of action arose, the action is barred, it is also barred in the Philippine
Islands.”

Section 48 has not been repealed or amended by the Civil Code of the Philippines. In the light of
the 1987 Constitution, however, Section 48 cannot be enforced ex proprio vigore insofar as it
ordains the application in this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976.

The courts of the forum (local Court) will not enforce any foreign claim obnoxious to the
forum’s public policy. To enforce the one-year prescriptive period of the Amiri Decree No. 23 of
1976 as regards the claims in question would contravene the public policy on the protection to
labor.

In the Declaration of Principles and State Policies, the 1987 Constitution emphasized that:“The
state shall promote social justice in all phases of national development” (Sec. 10).
‘The state affirms labor as a primary social economic force. It shall protect the rights of workers
and promote their welfare” (Sec. 18).

In Article XIII on Social Justice and Human Rights, the 1987 Constitution provides:
“Sec. 3. The State shall afford full protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of employment opportunities for all.”

Thus, the applicable law on prescription is the Philippine law.

The next question is whether the prescriptive period governing the filing of the claims is 3 years,
as provided by the Labor Code or 10 years, as provided by the Civil Code of the Philippines.

Article 1144 of the Civil Code of the Philippines provides:

“The following actions must be brought within ten years from the time the right of action
accross:

(1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment”
In this case, the claim for pay differentials is primarily anchored on the written contracts between
the litigants, the ten-year prescriptive period provided by Art. 1144(l) of the New Civil Code
should govern.

3. NO. A class suit is proper where the subject matter of the controversy is one of common or
general interest to many and the parties are so numerous that it is impracticable to bring them all
before the court. When all the claims are for benefits granted under the Bahrain law many of the
claimants worked outside Bahrain. Some of the claimants were deployed in Indonesia under
different terms and condition of employment.

Inasmuch as the First requirement of a class suit is not present (common or general interest based
on the Amiri Decree of the State of Bahrain), it is only logical that only those who worked in
Bahrain shall be entitled to rile their claims in a class suit.

While there are common defendants (AIBC and BRII) and the nature of the claims is the same
(for employee’s benefits), there is no common question of law or fact. While some claims are
based on the Amiri Law of Bahrain, many of the claimants never worked in that country, but
were deployed elsewhere. Thus, each claimant is interested only in his own demand and not in
the claims of the other employees of defendants. A claimant has no concern in protecting the
interests of the other claimants as shown by the fact, that hundreds of them have abandoned their
co-claimants and have entered into separate compromise settlements of their respective claims.
The claimants who worked in Bahrain can not be allowed to sue in a class suit in a judicial
proceeding.WHEREFORE, all the three petitioners are DISMISSED
OH HEK HOW vs REPUBLIC 29 SCRA 94
Facts:
Petitioner Oh Hek How having been granted naturalization through his petition filed a motion
alleging that he had complied with the requirements of Republic Act No. 530 and praying that he
be allowed to take his oath of allegiance as such citizen and issued the corresponding certificate
of naturalization. The Court of First Instance of Zamboanga del Norte issued forthwith an order
authorizing the taking of said oath. On that same date, petitioner took it and the certificate of
naturalization was issued to him. The Government seasonably gave notice of its intention to
appeal from said order of February9, 1966 and filed its record on appeal among the grounds that
the oath was taken prior to judgment having been final and executory.
Issue:
- Is the oath valid
- Whether or not a permission to renounce citizenship is necessary from the Minister of the
Interior of Nationalist China.
Held:
First issue:
The order of February 9, 1966 (oath-taking) had not — and up to the present has not become
final andexecutory in view of the appeal duly taken by the Government.
2nd Issue:
It is argued that the permission is not required by our laws and that the naturalization of an alien,
as a citizen of the Philippines, is governed exclusively by such laws and cannot be controlled by
any foreign law.
However, the question of how a Chinese citizen may strip himself of that status is necessarily
governed —pursuant to Articles 15 and 16 of our Civil Code — by the laws of China, not by
those of the Philippines. As a consequence, a Chinese national cannot be naturalized as a citizen
of the Philippines, unless he has complied with the laws of Nationalist China requiring previous
permission of its Minister of the Interior for the renunciation of nationality.
Section 12 of Commonwealth Act No.473 provides, however, that before the naturalization
certificate is issued, the petitioner shall "solemnly swear," interalia, that he renounces "absolutely
and forever all allegiance and fidelity to any foreign prince, potentate" and particularly to the
state "of which" he is "a subject or citizen." The obvious purpose of this requirement is to divest
him of his former nationality, before acquiring Philippine citizenship, because, otherwise, he
would have two nationalities and owe allegiance to two (2) distinct sovereignties, which our laws
do not permit, except that, pursuant to Republic Act No. 2639, "the acquisition of citizenship by
a natural-born Filipino citizen from one of the Iberian and any friendly democratic Ibero-
American countries shall not produce loss or forfeiture of his Philippine citizenship, if the law of
that country grants the same privilege to its citizens and such had been agreed upon by treaty
between the Philippines and the foreign country from which citizenship is acquired."