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Miyerkules, Nobyembre 20, 2013

Anti-Graft League of the Philippines v. San Juan

FACTS: 
Marcos issued a decree establishing the Technological Colleges of Rizal. It directed the Board to provide funds for the purchase of 4 parcels of land which belonged to Ortigas &Co. For 12 yrs, the land was idle and construction did not materialize so the Board authorized the selling of the lot. This was sold to Valley View Realty. Ortigas filed for rescission of contract contending that it violated the terms of the contract by selling such lot to Valley View. The Board made a Resolution providing for the rescission of the deed of sale to Valley View.
Valley View filed a case against the Province of Rizal for specific performance but was dismissed. Thereafter, a compromise agreement was executed  between Province and Ortigas to reconvey the lots to Ortigas. The Anti-Graft League of the Philippines is a non-government organization, constituted to protect the interest of the Republic and its instrumentalities and political subdivisions against abuses its public official and employees, claims the instant petition for certiorari is a taxpayer’s suit because the Provincial Board of Rizal allegedly illegally disbursed public funds in transactions involving the land.

ISSUE: 
W/N this is a case of taxpayer’s suit.

HELD: 
To constitute a taxpayer’s suit, two requisites: (1) that public funds are disbursed by a political subdivision or instrumentality and (2) in doing so, a law is violated or some irregularity is committed, and that the petitioner is directly affected by the alleged ultra vires act.
In the case at bar, petitioner’s standing should not even be made an issue here since standing is a concept in constitutional law and here no constitutional question is actually involved. The disbursement of public funds was only made when the Province bought the lands from Ortigas. Petitioner never referred to such purchase as an illegal disbursement of public funds but focused on the alleged fraudulent reconveyance of said property to Ortigas because the price paid was lower than the prevailing market value of neighboring lots.
As a taxpayer, petitioner would somehow be adversely affected by an illegal use of public money. But when no such unlawful spending has been shown petitioner, even as a taxpayer, cannot question the transaction executed by the Province and Ortigas for the reason that it is not privy to said contract.   

Sabado, Setyembre 14, 2013

Republic v CA and Quintos (G.R. No. 159594)

Facts:
Eduardo and Catalina were married in civil rites. However, the couple were not blessed with a child because Catalina had a hysterectomy following her second marriage.

Eduardo filed a petition for declaration of nullity of marriage citing psychological incapacity as a ground. He alleged that Catalina always left the house without his consent; that she engaged in petty arguments with him; that she constantly refused to give in to his sexual needs; that she spent most of her time gossiping with neighbors instead of caring for their adopted daughter; that she gambled away all his remittances as an overseas worker; and that she abandoned the conjugal home with her paramour.

As support to his claim of psychological incapacity, he also presented the results of a neuro-psychiatric evaluation conducted by Dr. Annabelle Reyes stating that Catalina exhibited traits of a borderline personality disorder that was no longer treatable.

Catalina did not appear during trial but admitted her psychological incapacity. She denied flirting with different men and abandoning the conjugal home.

Issue:
Whether or not Catalina was psychologically incapacitated to fulfill marital duties.

Held:
No. Marriage remains valid.

Psychological incapacity is an incapacity/inability to take cognizance of and to assume basic marital obligations, and is not merely the difficulty, refusal or neglect in the performance of marital obligations.

In Republic v CA(Molina), the Supreme Court has established guidelines involving the nullity of marriage based on the ground of psychological incapacity. These were not met in the instant case since the gravity, root cause and incurability of Catalina's purported psychological incapacity were not sufficiently established.

Catalina's behavior of frequent gossiping, leaving the house without Eduardo's consent, refusal to do household chores, and take care of their adopted daughter were not established. Eduardo presented no other witness to corroborate these allegations.

Also, the RTC and CA heavily relied on Dr. Reyes' evaluation despite any factual foundation to support this claim. The report was vague about the root cause, gravity and incurability of the incapacity.Even the testimony of Dr. Reyes stated a general description of borderline personality disorder which did not explain the root cause as to why Catalina  was diagnosed as such. They did not specify the acts or omissions or the gravity which constituted the disorder. What was established was that Catalina was childish and immature.

Furthermore, Dr. Reyes had only one interview with Catalina. This lacks the depth and objectivity of an expert assessment.


From the scant evidence presented, it can be adduced that Catalina's immaturity and apparent refusal to perform her marital obligations do not constitute psychological incapacity alone. It must be shown that such immature acts were manifestations of a disordered personality that made the spouse completely unable to discharge the essential obligations of marriage.

Biyernes, Marso 1, 2013

Litimco v La Mallorca

Facts:
Tomas Litimco filed a petition before the Public Service Commission (PSC) praying for authority to operate a TPU service on the line Manila-Malolos via Sta. Isabel with the use of 10 units. Several operators filed written oppositions.

Before PSC could render its decision, La Mallorca, another operator, moved to reopen the case stating that if the petition to operate the line proposed be granted it would work to its prejudice and so it requested a reopening in order that it may file its opposition. The motion was granted.

However, instead of presenting evidence in support of its opposition, La Mallorca moved for postponement, only to announce days later that instead of merely objecting to the petition, it decided to file an application under a separate number (Case No. 63120) requesting for authority to operate the same line applied for by petitioner by rerouting 4 of its 10 round trip units of the line Malolos-Manila via Guiguinto.

The PSC rendered decision denying petitioner’s application but granting that of respondent on the ground that the latter has a better right to render the service applied for.

Petitioner contends that the Public Service Commission erred because:
1. his application was filed much ahead than that of respondent and as such it is entitled to preference
2. in awarding the line to respondent it in effect gave recognition to the unfair attitude of respondent
3. to grant the service in favor of respondent will work to the prejudice of the riding public for it would be allowing respondent to abandon a portion of its service on its original line Manila-Malolos via Guiguinto, a service which was previously found to promote the need and convenience of the people in said territory.

Respondent reasoned out that its:
1. application for rerouting will not involve any increase of trips or units nor will involve the purchase of new trucks, while that of petitioner would call for the use of 10 new trucks, which means a further depletion of the already depleted dollar reserve of our government
2. application for re-routing will not involve the acquisition of an operating right over the national highway from Malolos railroad crossing up to Guiguinto, while, on the other hand, petitioner’s application will involve the acquisition of a new operating right

Issue:
Who has a better right to render the service?

Held:
Litimco. Since it is admitted that he is financially competent and able to operate the line proposed and is also an operator of a bus line from Manila to Malolos via Bulacan, we see no plausible reason why he should not be given preference to operate the service applied for considering that he is the first one to apply for such line.

This is in accord with the policy to stave off any act of discrimination or partiality against any application for operation of a new line. While there may be cases where an applicant, even if ahead in time, was not given the service, it is because it was proven that he was financially incompetent, or otherwise disqualified, to render the service, If an applicant is qualified financially, and is able to undertake the service, he should be given the preference as a matter of fairness and justice.

Priority in the filing of the application for a certificate of public convenience is, other conditions being equal, an important factor in determining the right of the public service companies.

The argument that the application of petitioner for the operation of the new line calls for the purchase of 10 new trucks is of no consequence, if the operation will redound to the benefit of the riding public. The operation of a new line as a general proposition always involves a new investment which may happen even with old operators. In the course of operation, and with the passing of time, new equipment and facilities may be found necessary to maintain an efficient service, which additional expenditure cannot certainly be considered as a cause for disruption of the service. This is a matter of finance which concerns exclusively the one who desires to operate the new line.

At any rate, the new line merely covers 7 kilometers of new territory which traverses three sparsely populated barrios, and considering that respondent did not deem it necessary to cover said territory except after the passing of many years, and only thought of giving the service when petitioner filed his application, fairness requires that preference be given to petitioner.

Republic v PLDT

Facts:
PLDT and RCA Communications Inc (which is not a party to this case but has contractual relations with e parties) entered into an agreement where telephone messages, coming from the US and received by RCA's domestic station could automatically be transferred to the lines of PLDT and vice versa.

The Bureau of Telecommunications set up its own Government Telephone System (GTS) by renting the trunk lines of PLDT to enable government offices to call private parties. One of the many rules prohibits the use of the service for his private use.

Republic of the Philippines entered into an agreement with RCA for a joint overseas telephone service where the Bureau would convey radio-telephone overseas calls received by the RCA's station to and from local residents.

PLDT complained that the Bureau was violating the conditions for using the trunk lines not only for the use of government offices but even to serve private persons or the general public. PLDT gave a notice that if violations were not stopped, PLDT would sever the connections -which PLDT did.

Republic sued PLDT commanding PLDT to execute a contract, through the Bureau, for the use of the facilities of defendant's telephone system throughout the Philippines under such terms and conditions as the court finds it reasonable.

Issue:
Whether or not Republic can command PLDT to execute the contract.

Held:
No. The Bureau was created in pursuance of a state policy reorganizing the government offices to meet the exigencies attendant upon the establishment of a free Gov't of the Phil.

When the Bureau subscribed to the trunk lines, defendant knew or should have known that their use by the subscriber was more or less public and all embracing in nature.

The acceptance by the defendant of the payment of rentals, despite its knowledge that the plaintiff had extended the use of the trunk lines to commercial purposes, implies assent by the defendant to such extended use. Since this relationship has been maintained for a long time and the public has patronized both telephone systems, and their interconnection is to the public convenience, it is too late for the defendant to claim misuse of its facilities, and it is not now at liberty to unilaterally sever the physical connection of the trunk lines.

To uphold PLDT's contention is to subordinate the needs of the general public.

Mecenas v CA

Facts:
M/T Tacloban (barge-type oil tanker) collided with M/V Don Juan ( inter-island vessel carrying 750 passengers). When the collision occurred, the sea was calm, the weather fair and visibility good. As a result, M/V Don Juan sank and the passengers perished.

Petitioner was the parent of the passenger who died. They file an action for damages alleging the negligence of Capt. Santisteban (captain of Don Juan) and Negros Navigation (owner of Don Juan).

Issue:
1. Who was negligent?
2. Whether or not Capt. Santisteban and Negros Navigation was negligent.

Held:
1. M/V Tacloban was primarily and solely at fault. M/V Don Juan was also at fault.

Rule 18 of the International Rules of the Road which requires 2 power-driven vessels meeting end on or nearly end on each to alter her course to starboard so that each vessel may pass on the port side of each other.

In the case, M/V Tacloban, as held by the report of the Commandant of the Philippine Coast Guard, failed to follow the Rules. Hence, she was deemed negligent.

However, route observance of the International Rules of the Road will not relieve a vessel from responsibility if the collision could have been avoided by proper skill on her part or even a departure from the rules.

M/V Don Juan having sighted M/V Tacloban when it was still a long way off was negligent in failing to take early preventive action and in allowing the 2 vessels to come into close quarters as to render the collision inevitable when there was no necessity for passing so near M/V Tacloban for Don Juan could choose its own distance. It is noteworthy that M/V Tacloban upon turning hard to port shortly before the moment of collision, signaled its intention to do so by giving 2 short blasts with its horn. Don Juan gave no answering horn blast to signal it's own intention and proceeded to turn hard to starboard.

2. Yes. The behavior of the captain -playing mahjong "before and up to the time of collision" constituted gross negligence. This behavior is unacceptable on the part of the master of a vessel to whose hands the lives of at least 750 passengers were entrusted.

It does not matter that the Captain was off-duty or on-duty. Realistically speaking, there is no such thing as off-duty hours for the master of the vessel at sea that is a common carrier who is required extraordinary diligence. Hence, Negros Navigation in permitting or in failing to discover and correct such behavior is also grossly negligent.

Notes:
Starboard -right
Port -left

Wild Valley v CA

Facts:
Philippine Roxas (owned by Phil. Pres. Lines), vessel, arrived in Venezuela to load iron ore. When vessel was ready to leave the port, Mr. Vasquez (official pilot of Venezuela) was designated to navigate the vessel through the Orinoco River.

The master of the vessel, Captain Colon, was at the bridge with the pilot when the vessel left the port. Captain Colon left the bridge when the vessel was underway.

The vessel experienced some vibrations but the pilot assured that they were just a result of the shallowness of the vessel. The vessel again experienced vibrations which led to the vessel being run aground in the Orinoco River, obstructing the ingress and egress of vessels.

As a result of the blockage, the Malandrinon (vessel owned by Wildvalley Shipping) was unable to sail out that day. For this reason, Wild Valley commenced an action for damages.

Issue:
1. Whether or not fault can be attributed to the master(captain) of Philippine Roxas for the grounding of said vessel.

2. Whether or not the doctrine of res ipsa loquitor applies.

Held:
1. No. It's the pilot's fault!

There being no contractual obligation, the master was only required to give ordinary diligence in accordance with Article 1173 of the New Civil Code. In the case, the master exercised due diligence when the vessel sailed only after the main engine, machine rise and other auxiliaries were checked and found to be in good running condition and when the master left a competent officer - the pilot who is experienced in navigating the Orinoco River.

Philippine rules on pilotage enunciate the duties and responsibilities of a master of a vessel and its pilot. The law is explicit in saying that the master remains the overall commander of the vessel even when there is a pilot on board. He remains in control despite the presence of a pilot who is temporarily in charge of the vessel. It is NOT required of him to be on bridge while the vessel is being navigated by a pilot.

Furthermore, the Orinoco River being a compulsory pilotage channel necessitated the engaging of a pilot who was presumed to be knowledgeable of every shoal, bank, deep and shallow ends of the river. Admitting his limited knowledge of the River, Captain Colon deemed it best to rely on the knowledge and experience of pilot Vasquez to guide the vessel safely.

The pilot should have been aware of the portions which are shallow and which are not. His failure to determine the depth of the river and his decision to plod on his set course, in all probability, caused damage to the vessel. Thus, he is negligent and liable for the grounding.

2. NO. The elements of res ipsa loquitor are:
-accident was of such character as to warrant inference that it would not have happened except for defendant's negligence
-accident must have been caused by an agency/instrumentality within the exclusive management or control of the person charged with the negligence complained of
-accident must not have been due to any voluntary action or contribution on the part of the person injured.

There was a temporary shift of control over the ship from the master to the pilot on a compulsory pilotage channel. Thus, requisites 1 and 2 (negligence and control) are not present in the following situation.

Go, Sr. v Ramos

Facts:

Three cases arose from the same factual milieu. These petitions stemmed from the complaint-affidavit for deportation initiated by Luis T. Ramos before the Bureau of Immigration and Deportation (now Bureau of Immigration) against Jimmy T. Go alleging that the latter is an illegal and undesirable alien.

Luis alleged that while Jimmy represents himself as a Filipino citizen, Jimmy’s personal circumstances and other records indicate that he is not so. To prove his contention, Luis presented the birth certificate of Jimmy, issued by the Office of the Civil Registrar of Iloilo City, which indicated Jimmy’s citizenship as “FChinese.”

Luis argued that although it appears from Jimmy’s birth certificate that his parents, Carlos and Rosario Tan, are Filipinos, the document seems to be tampered, because only the citizenship of Carlos appears to be handwritten while all the other entries were typewritten.

He also averred that in September 1989, Jimmy, through stealth, machination and scheming managed to cover up his true citizenship, and with the use of falsified documents and untruthful declarations, was able to procure a Philippine passport from the Department of Foreign Affairs.

Jimmy refuted the allegations in his counter-affidavit, averring that the complaint for deportation initiated by Luis was merely a harassment case designed to oust him of his rightful share in their business dealings. He alleged that his father Carlos, who was the son of a Chinese father and Filipina mother, elected Philippine citizenship in accordance with Article IV, Section 1, paragraph 4 of the 1935 Constitution and Commonwealth Act No. 625 (Com. Act No. 625), as evidenced by his having taken the Oath of Allegiance on July 11, 1950 and having executed an Affidavit of Election of Philippine citizenship on July 12, 1950.

Although the said oath and affidavit were registered only on September 11, 1956, the reason behind such late registration was sufficiently explained in an affidavit. Jimmy added that he had even voted in the 1952 and 1955 elections. He denied that his father arrived in the Philippines as an undocumented alien, alleging that his father has no record of arrival in this country as alleged in the complaint-affidavit precisely because his father was born and raised in the Philippines, and in fact, speaks fluent Ilonggo and Tagalog.

With regard to the erroneous entry in his birth certificate that he is “FChinese,” he maintained that such was not of his own doing, but may be attributed to the employees of the Local Civil Registrar’s Office who might have relied on his Chinese-sounding surname when making the said entry. He asserted that the said office has control over his birth certificate; thus, if his father’s citizenship appears to be handwritten, it may have been changed when the employees of that office realized that his father has already taken his oath as a Filipino.

As regards the entry in his siblings’ certificates of birth, particularly Juliet Go and Carlos Go, Jr., that their father is Chinese, Jimmy averred that the entry was erroneous because it was made without prior consultation with his father.

In a Resolution dated February 14, 2001, Associate Commissioner Linda L. Malenab-Hornilla dismissed the complaint for deportation against Jimmy. She affirmed the findings of the National Bureau of Investigation tasked to investigate the case that Jimmy’s father elected Filipino citizenship in accordance with the provisions of the 1935 Philippine Constitution. By operation of law, therefore, the citizenship of Carlos was transmitted to Jimmy, making him a Filipino as well.

On March 8, 2001, the Board of Commissioners (Board) reversed said dismissal, holding that Carlos’ election of Philippine citizenship was made out of time. Finding Jimmy’s claim to Philippine citizenship in serious doubt by reason of his father’s questionable election thereof, the Board directed the preparation and filing of the appropriate deportation charges against Jimmy.

On July 3, 2001, the corresponding Charge Sheet was filed against Jimmy, charging him of violating provisions of The Philippine Immigration Act of 1940.

On November 9, 2001, Carlos and Jimmy filed a petition for certiorari and prohibition, docketed as SCA No. 2218, seeking to annul and set aside the March 8, 2001 Resolution of the Board of Commissioners, the Charge Sheet, and the proceedings. In essence, they challenged the jurisdiction of the Board to continue with the deportation proceedings.

In the interim, the Board issued a Decision ordering the apprehension and deportation of Jimmy.

In view of the said Decision, Carlos and Jimmy filed on June 13, 2002 a supplemental petition for certiorari and prohibition before the trial court and reiterated their application for injunctive reliefs. The trial court issued a writ of preliminary prohibitory injunction pending litigation on the main issue, enjoining the Bureau from enforcing the April 17, 2002 Decision. Later, however, the trial court dissolved the writ in a Decision dated January 6, 2004 as a consequence of the dismissal of the petition.

Carlos and Jimmy moved for reconsideration. But their motion was likewise denied.
Following the dismissal of the petition in SCA No. 2218, the Board issued a warrant of deportation which led to the apprehension of Jimmy. Jimmy commenced a petition for habeas corpus, but the same was eventually dismissed by reason of his provisional release on bail.

Carlos and Jimmy then questioned the Decision in SCA No. 2218 as well as the Resolution denying their motion for reconsideration by way of a petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP No. 85143. They imputed grave abuse of discretion by the trial court for passing upon their citizenship, claiming that what they asked for in their petition was merely the nullification of the March 8, 2001 Resolution and the charge sheet.

The appellate tribunal dismissed the petition. It did not find merit in their argument that the issue of citizenship should proceed only before the proper court in an independent action, and that neither the Bureau nor the Board has jurisdiction over individuals who were born in the Philippines and have exercised the rights of Filipino citizens. The appellate tribunal also rejected their claim that they enjoy the presumption of being Filipino citizens.

Unfazed with the said ruling, they moved for reconsideration. Their motion having been denied, Carlos and Jimmy each filed a petition for review on certiorari before the Supreme Court. Bureau of Immigration Commissioner Alipio F. Fernandez, Jr. issued Warrant of Deportation which resulted in the apprehension and detention of Jimmy at the Bureau of Immigration Bicutan Detention Center, pending his deportation to China.

On account of his detention, Jimmy once again filed a petition for habeas corpus before the RTC of Pasig City, Branch 167, docketed as SP. Proc. No. 11507 assailing his apprehension and detention despite the pendency of his appeal and his release on recognizance.

In an Order, the trial court dismissed the said petition ruling that the remedy of habeas corpus cannot be availed of to obtain an order of release once a deportation order has already been issued by the Bureau. Jimmy moved for reconsideration of the Order, but this was also denied by the trial court.

The Court of Appeals granted the petition and enjoined the deportation of Jimmy until the issue of his citizenship is settled with finality by the court.

Issue/s:
Whether or not the petition for habeas corpus should be dismissed?

Held:
Yes.

Bureau of Immigration maintains that the dismissal of the petition for habeas corpus by the trial court was proper. A petition for habeas corpus has for its purpose only the determination of whether or not there is a lawful ground for Jimmy’s apprehension and continued detention. They urge that the decision of the Board dated April 17, 2002 that ordered Jimmy’s deportation has already attained finality by reason of the belated appeal taken by Jimmy from the said decision on April 2, 2004 before the Office of the President, or after almost two years from the time the decision was rendered. Said decision of the Board, they insist, is the lawful ground that sanctions Jimmy’s apprehension and detention.

They also argue that Jimmy cannot rely on the bail on recognizance he was previously granted to question his subsequent apprehension and detention. Under the Philippine Immigration Act of 1940, the power to grant bail can only be exercised while the alien is still under investigation, and not when the order of deportation had already been issued by the Board. Hence, the bail granted was irregular as it has no legal basis. Furthermore, they said the petition for habeas corpus necessarily has to be dismissed because the same is no longer proper once the applicant thereof has been charged before the Board, which is the case with Jimmy. Nonetheless, they claim that the habeas corpus case is rendered moot and academic as Jimmy is no longer being detained.

On the other hand, Jimmy counters that the instant petition for certiorari and prohibition is the most appropriate, speedy and adequate remedy in spite of the availability of ordinary appeal considering that what is involved in this case is his cherished liberty. Grave abuse of discretion on the part of the petitioners in ordering his arrest and detention, he argues, all the more justifies the avails of the extraordinary writ.

Jimmy argues that the April 17, 2002 Decision of the Board has not attained finality owing to the availability of various remedies, one of which is an appeal, and in fact is actually void because it was rendered without due process. He also insists that the bail issued to him is valid and effective until the final determination of his citizenship before the proper courts. Moreover, he maintains that the petition for habeas corpus was proper since its object is to inquire into the legality of one’s detention, and if found illegal, to order the release of the detainee.

Jimmy also contends that the proceedings before the Board is void for failure to implead therein his father, and that he should have been given a full blown trial before a regular court where he can prove his citizenship.
Considering the arguments and contentions of the parties, we find the petition meritorious.

We have held in a litany of cases that the extraordinary remedies of certiorari, prohibition and mandamus are available only when there is no appeal or any plain, speedy and adequate remedy in the ordinary course of law. The writ of certiorari does not lie where an appeal may be taken or where another adequate remedy is available for the correction of the error.

The petitioners correctly argue that appeal should have been the remedy availed of as it is more plain, speedy and adequate. The 48-hour appeal period demonstrates the adequacy of such remedy in that no unnecessary time will be wasted before the decision will be re-evaluated.

A petition for the issuance of a writ of habeas corpus is a special proceeding governed by Rule 102 of the Revised Rules of Court. The objective of the writ is to determine whether the confinement or detention is valid or lawful. If it is, the writ cannot be issued. What is to be inquired into is the legality of a person’s detention as of, at the earliest, the filing of the application for the writ of habeas corpus, for even if the detention is at its inception illegal, it may, by reason of some supervening events, such as the instances mentioned in Section 4[98] of Rule 102, be no longer illegal at the time of the filing of the application.

Once a person detained is duly charged in court, he may no longer question his detention through a petition for issuance of a writ of habeas corpus. His remedy would be to quash the information and/or the warrant of arrest duly issued. The writ of habeas corpus should not be allowed after the party sought to be released had been charged before any court. The term “court” in this context includes quasi-judicial bodies of governmental agencies authorized to order the person’s confinement, like the Deportation Board of the Bureau of Immigration.

Likewise, the cancellation of his bail cannot be assailed via a petition for habeas corpus. When an alien is detained by the Bureau of Immigration for deportation pursuant to an order of deportation by the Deportation Board, the Regional Trial Courts have no power to release such alien on bail even in habeas corpus proceedings because there is no law authorizing it.

Given that Jimmy has been duly charged before the Board, and in fact ordered arrested pending his deportation, coupled by this Court’s pronouncement that the Board was not ousted of its jurisdiction to continue with the deportation proceedings, the petition for habeas corpus is rendered moot and academic.

Philippine Export and Foreign Loan Guarantee Corporation v V.P. Eusebio Construction Inc.

Facts:
1. The State Organization of Buildings (SOB), Ministry of Housing and Construction, Baghdad, Iraq awarded the construction of the Institute of Physical Therapy-Medical Rehabilitation Center in Iraq to Ayjal Trading and Contracting Company for a total contract price of about $18M.

2. Spouses Santos, in behalf of 3-Plex International, Inc., a local contractor engaged in construction business, entered into a joint venture agreement with Ayjal wherein the former undertook the execution of the entire a project, while the latter would be entitled to a commission of 4%.

3. 3-Plex not accredited by the Philippine Overseas Construction Board (POCB) assigned and transferred all its rights and interests to VPECI.

4. The SOB required the contractors to submit a performance bond representing 5% of the total contract price, an advance payment bond representing 10% of the advance payment to be released upon signing of the contract. To comply with these requirements 3-Plex and VPECI applied for a guarantee with Philguarantee, a government financial institution empowered to issue guarantees for qualified Filipino contractors.

5. But what SOB required was a guarantee from the Rafidain Bank of Baghdad so Rafidain Bank issued a performance bond in favor of SOB on the condition that another foreign bank (not Phil Guarantee) would issue the counter-guarantee. Hence, Al Ahli Bank of Kuwait was chosen to provide the counter guarantee.

6.Afterwards, SOB and the joint venture of VPECI and Ayjal executed the service contract. Under the contract, the joint venture would supply manpower and materials, SOB would refund 25% of the project cost in Iraqi Dinar and 75% in US dollars at an exchange rate of 1 Dinar to $3.37.

7.The project was not completed. Upon seeing the impossibility of meeting the deadline, the joint venture worked for the renewal or extension (12x) of the performance bond up to December 1986.

8. In October 1986, Al Ahli Bank sent a telex call demanding full payment of its performance bond counter-guarantee. Upon receipt, VPECI requested Iraq Trade and Economic Development Minister Fadhi Hussein to recall the telex for being in contravention of its mutual agreement that the penalty will be held in abeyance until completion of the project. It also wrote SOB protesting the telex since the Iraqi government lacks foreign exchange to pay VPECI and the non-compliance with the 75% billings in US dollars.

9. Philguarantee received another telex from Al Ahli stating that it already paid to Rafidain Bank. The Central Bank authorized the remittance to Al Ahli Bank representing the full payment of the performance counter-guarantee for VPECI's project in Iraq.

10. Philguarantee sent letters to respondents demanding the full payment of the surety bond. Respondents failed to pay so petitioner filed a civil case for collection of sum of money.

11. Trial Court ruling: Dismissed. Philguarantee had no valid cause of action against the respondents. The joint venture incurred no delay in the execution of the project considering that SOB's violations of the contract rendered impossible the performance of its undertaking.

12. CA: Affirmed.

Issue:
What law should be applied in determining whether or not contractor (joint venture) has defaulted?

Held:
The question of whether there is a breach of the agreement which includes default pertains to the INTRINSIC validity of the contract.

No conflicts rule on essential validity of contracts is expressly provided for in our laws. The rule followed by most legal systems is that the intrinsic validity of a contract must be governed by lex contractus (proper law of the contract). This may be the law voluntarily agreed upon by the parties (lex loci voluntatis) or the law intended by them either expressly or implicitly (lex loci intentionis). The law selected may be implied from factors such as substantial connection with the transaction, or the nationality or domicile of the parties. Philippine courts adopt this: to allow the parties to select the law applicable to their contract, SUBJECT to the limitation that it is not against the law, morals, public policy of the forum and that the chosen law must bear a substantive relationship to the transaction.

In the case, the service contract between SOB and VPECI contains no express choice of law. The laws of Iraq bear substantial connection to the transaction and one of the parties is the Iraqi government. The place of performance is also in Iraq. Hence, the issue of whether VPECI defaulted may be determined by the laws of Iraq.

BUT! Since foreign law was not properly pleaded or proved, processual presumption will apply.

According to Art 1169 of the Civil Code: In reciprocal obligations, neither party incurs in delay if the other party does not comply or is not ready to comply in a proper manner what is incumbent upon him.

As found by the lower courts: the delay or non-completion of the project was caused by factors not imputable to the Joint Venture, it was rather due to the persistent violations of SOB, particularly it's failure to pay 75% of the accomplished work in US dollars. Hence, the joint venture does not incur in delay if the other party(SOB) fails to perform the obligation incumbent upon him.

China Airlines v CA (G.R. No. 129988)

Facts:
Respondents, Antonio Salvador and Rolando Lao planned to travel to Los Angeles, California to pursue a cable business deal involving the distribution of Filipino films. Initially, Morelia Travel Agency booked their flight with China Airlines (CAL).

Upon discovering that Morelia charged higher rates than American Express Travel (Amexco), they dropped the services of Morelia. Lao called Amexco claiming that he and Salvador had a confirmed booking with CAL. Lao then gave to Amexco the record locator number that CAL issued previously to Morelia. CAL confirmed the booking.

When the respondents were at the airport, CAL prevented them from boarding because their names were not in the passenger's manifest. CAL cancelled the reservations when Morelia revoked the booking. But the respondents were able to get a flight with Northwest Airlines.

Issue/s:
1. Whether or not there was a breach in the contract of carriage.
2. Whether or not there there was bad faith.
3. Whether or not there was sufficient claims for damages.

Held:
1. Yes. When an airline issues a ticket to a passenger confirmed for a particular flight on a certain date, a contract of carriage arises. The passenger has every right to expect that he would fly on that flight and on that date.

When CAL did not allow respondents, who were in possession of the confirmed tickets, from boarding its airplane because their names were not in the manifest, it ocnsituted a breach of contract of carriage.

2. No. Bad faith should always be established by clear and convincing evidence since the law always presumes good faith.

In the case, there were three reasons why CAL cancelled the reservations. First was Amexco's unauthorized use of the record locator number. Second was CAL's negligence in confirming the reservations of Amexco. Third was the absence of the correct contact numbers of private respondents. There was no concerted effort on the part of CAL to cancel respondent's reservations in favor of other passengers.

3. Not entitled to moral damages because not every case of mental anguish, fright or anxiety calls for the award of moral damages.

Not entitled to exemplary damages because CAL was not in bad faith and its employees did not act in a wanton, fraudulent, reckless, oppressive or malevolent manner.

Not entitled to actual damages because respondents did not shell out any money for their CAL tickets. Respondents would have been entitled to the price difference between the tickets of CAL and Northwest had the latter cost more than the former but this was not the case. Evidence shows that Northwest tickets ($625) cost less than CAL tickets ($629). The court cannot order reimbursement of the Northwest tickets because this would have enabled respondents to fly for free. The cost of the tickets were a necessary expense that private respondents could not pass on to CAL.

Entitled to nominal damages of P5,000 when the plaintiff suffers some species of injury not enough to warrant an award of actual damages.

Boudard v Tait

Facts:
Emilie Boudard, as widow of Marie Theodore Boudard and as guardian of her children born during their marriage obtained a judgment in their favor from CFI Hanoi, French Indo-China for the sum of 40,000 piastras plus interest. The judgment was against Stewart Tait who had been declared in default for his failure to appear at the trial before court.

Theodore Boudard, who was an employee of Stewart Tait, was killed in Hanoi by other employees of Tait, although "outside of the fulfillment of a duty", according to the English translation of a certified copy of the French decision. The dismissal of the complaint was based principally on the lack of jurisdiction of the CFI Hanoi to render judgment. It was found that the Tait was not a resident of, nor domiciled in that country. Also, the evidence adduced at the trial proves that neither Tait nor his agent or employees were ever in Hanoi and that Theodore had never, at any time, been his employee.

Issue:
1. Whether or not court erred in admitting evidence for judicial foreign records (in this case, it was the Hanoi decision).

2. Whether or not the court erred in declaring that it was indispensable for Tait to be served with summons in Hanoi.

3. Whether or not the decision of CFI Hanoi was already conclusive.

Held:
1. Yes, Boudard failed to show that the proceedings against Tait in CFI Hanoi were in accordance with the laws of France then in force.

Further, Boudard failed to show that they are certified copies of judicial records. They argue that the papers are the original documents and that the French consul in the Philippines has confirmed this fact. This is not sufficient to authorize a deviation from the rule established by law. The best evidence of a foreign judicial proceeding is a certified copy with all the formalities required.

2. No. French law regarding summons states that: those who have no known residence in France shall be served summons in the place of their present residence; if the place is unknown, writ shall be placed at the main door of the hall of the court where the complaint is filed.

In the case, it was shown that summons were delivered in Manila to J.M. Shotwell, a representative or agent of Churchill and Tait, Inc. which is an entity entirely different from Tait. Also, evidence shows that Tait was not in Hanoi during the time the complaint was filed by Boudard. The rule is that judicial proceedings in a foreign country,regarding payment of money, are only effective against a party if summons is duly served on him within such foreign country before the proceedings.

3. No. The decision cannot be conclusive to such an extent that it cannot be contested. It merely constitutes prima facie evidence of the justness of Boudard's claim and admits proof to the contrary.

The effect of a judgment of any tribunal of a foreign country is:
- In case of judgment against a specific thing, the judgment is conclusive upon the title to the thing.

- In case of judgment against a person, the judgment is presumptive evidence of a right as between the parties and their successors-in-interest by a subsequent title, but the judgment may be repelled by evidence of:
-> want of jurisdiction
-> want of notice to the party
-> collusion
-> fraud
-> clear mistake of law or fact

Martes, Pebrero 26, 2013

Luque v Villegas

Facts:
Petitioners ( who are passengers from Cavite and Batangas who ride on buses to and from their province and Manila) and some public service operators of buses and jeeps assail the validity of Ordinance 4986and Administrative Order 1.

Ordinance 4986 states that PUB and PUJs shall be allowed to enter Manila only from 6:30am to 8:30pm every day except Sundays and holidays.

Petitioners contend that since they possess a valid CPC, they have already acquired a vested right to operate.

Administrative Order 1 issued by Commissioner of Public Service states that all jeeps authorized to operate from Manila to any point in Luzon, beyond the perimeter of Greater Manila, shall carry the words "For Provincial Operation".

Issue:
1. Whether or not the said regulations are valid.
2. Whether or not Ordinance 4986 destroys vested rights to operate in Manila.

Held:
1. YES! Using the doctrine in Lagman vs. City of Manila, Petitioner's Certificate of Public Convenience was issued subject to the condition that operators shall observe and comply with all the rules and regulations of the PSC relative to PUB service.

The purpose of the ban is to minimize the problem in Manila and the traffic congestion, delays and accidents resulting from the free entry into the streets of Manila and the operation around said streets.

Both Ordinance 4986 and AO 1 fit into the concept of promotion and regulation of general welfare.

2. NO! A vested right is some right or interest in the property which has become fixed and established and is no longer open to doubt or controversy. As far as the State is concerned, a CPC constitutes neither a franchise nor a contract, confers no property right, and is a mere license or privilege.

The holder does not acquire a property right in the route covered, nor does it confer upon the holder any proprietary right/interest/franchise in the public highways.

Neither do bus passengers have a vested right to be transported directly to Manila. The alleged right is dependent upon the manner public services are allowed to operate within a given area. It is no argument that the passengers enjoyed the privilege of having been continuously transported even before outbreak of war. Times have changed and vehicles have increased. Traffic congestion has moved from worse to critical. Hence, there is a need to regulate the operation of public services.

Linggo, Pebrero 10, 2013

Mirasol v The Robert Dollar Co. (G.R. No. L-29721)

Doctrine:
Shippers who are forced to ship goods on an ocean liner or any other ship have some legal rights, and when goods are delivered on board ship in good order and condition, and the shipowner delivers them to the shipper in bad order and condition, it then devolves upon the shipowner to both allege and prove that the goods were damaged by the reason of some fact which legally exempts him from liability; otherwise, the shipper would be left without any redress, no matter what may have caused the damage.

Facts:
As a third special defense, defendant quoted clause 13 of the bill of lading, in which it is stated that in no case shall it be held liable “for or in respect to said merchandise or property beyond the sum of S250 for any piece, package or any article not enclosed in a package, unless a higher value is stated herein and ad valorem freight paid or assessed thereon,” and that there was no other agreement.

The plaintiff wrote the defendant a letter as follows: "I wish to file claim of damage." Plaintiff contends that he is entitled to P700 for his Encyclopedia Britannica which was damaged during shipment.

Defendant alleges that the damage, if any, was caused by “sea water,” and that the bill of lading exempts defendant from liability for that cause. That damage by “sea water” is a shipper’s risk, and that defendant is not liable.

Issue: Whether or not damage by sea water is a shipper's risk.

Held:
In the case of The Kengsington decided by the Supreme Court of the U.S.:
The stipulation in a steamship passenger's ticket, which compels him to value his baggage, at a certain sum, far less than it is worth, or, in order to have a higher value put upon it, to subject it to the provisions of the Harter Act, by which the carrier would be exempted from all the liability therefore from
errors in navigation or management of the vessel of other negligence is unreasonable and in conflict with public policy.

In the case, defendant having received the two boxes in good condition, its legal duty was to deliver them to the plaintiff in the same condition in which it received them. From the time of their delivery to the defendant in New York until they are delivered to the plaintiff in Manila, the boxes were under the control and supervision of the defendant and beyond the control of the plaintiff. The defendant having admitted that the boxes were damaged while in transit and in its possession, the burden of proof then shifted, and it devolved upon the defendant to both allege and prove that the damage was caused by reason of some fact which exempted it from liability. As to how the boxes were damaged, when or where, was a matter peculiarly and exclusively within the knowledge of the defendant and in the very nature of things could not be in the knowledge of the plaintiff. To require the plaintiff to prove as to when and how the damage was caused would force him to call and rely upon the employees of the defendant’s ship, which in legal effect would be to say that he could not recover any damage for any reason. That is not the law.

Shippers who are forced to ship goods on an ocean liner or any other ship have some legal rights, and when goods are delivered on board ship in good order and condition, and the shipowner delivers them to the shipper in bad order and condition, it then devolves upon the shipowner to both allege and prove that the goods were damaged by the reason of some fact which legally exempts him from liability; otherwise, the shipper would be left without any redress, no matter what may have caused the damage.

The defendant has not even attempted to prove that the two cases were wet with sea water by fictitious event, force majeure or nature and defect of the things themselves. Consequently, it must be presumed that it was by causes entirely distinct and in no manner imputable to the plaintiff, and of which the steamer President Garfield or any of its crew could not have been entirely unaware.

The fact that the cases were damaged by “sea water,” standing alone and within itself, is not evidence that they were damaged by force majeure or for a cause beyond the defendant’s control. The words “perils of the sea,” as stated in defendant’s brief apply to “all kinds of marine casualties, such as shipwreck, foundering, stranding,” and among other things, it is said: “Tempest, rocks, shoals, icebergs and other obstacles are within the expression,” and “where the peril is the proximate cause of the loss, the shipowner is excused.” “Something fortuitous and out of the ordinary course is involved in both words ‘peril’ or ‘accident’.”

Universal Shipping Lines, Inc. v IAC (G.R. No. 74125)

Facts:
SEVALCO Limited, owned and operated by the petitioner, shipped from Rotterdam Netherlands, to Bangkok, Thailand, aboard its M/V "TAIWAN", 2 cargoes of 50 palletized cartons. They were respectively consigned to S. Lersen Company, Ltd. and Muang Ngarm Retreads,Ltd. Both shipments were insured with the private respondent, Alliance Assurance Company, Ltd., a foreign insurance company domiciled in London, England.

Despite the arrival of the vessel at Bangkok, the cargo covered by Bill of Lading No. RB-15 was not unloaded nor delivered to the consignee, S. Lersen Company, Ltd. The shipment under Bill of Lading No. RB-16 was delivered to Muang Ngarm Retreads, Ltd. with a shortage in weight because the cargoes had been either totally or partially dissolved in saltwater which flooded the vessel where they had been stored.

Upon arrival in Manila, Arturo C. Saavedra, master of M/V "TAIWAN" filed a marine protest stating that the source of the water could not be definitely ascertained where it comes from. He was suspecting of some leakage of suction pipes and that hold No. 2 cannot be inspected on account of the full cargoes inside the hold, rendering it to be inaccessible.

The consignees filed their respective formal claims for loss and damage to their cargoes. The insurer paid both claims in the amounts of £I2,180 and £2,547.18 for the loss and damage to their cargoes.

Private respondent, as insurer-subrogee, filed an action in the Court of First Instance of Manila to recover from the petitioner and its Manila agent, Carlos Go Thong & Company, what it paid the consignees of the cargo.

Issue:
1. Whether or not petitioner liable for the damage/loss suffered by the subject shipments

2. Whether or not private respondent has capacity to sue in this jurisdiction

3. Whether or not in private respondent's cause of action has not yet prescribed

Held:
1. No. It was incumbent upon the defendants to prove that the losses and damages were due to causes other than the negligence or fault of their employees. Said defendants have not adduced proof on this point. It having been shown that the losses and damages were incurred while the shipments were in the custody of the M/V' Taiwan' the liability of its owner/operator and shipping agent is clear-they must pay for the losses and damages sustained by the consignees as a consequence of the breach of contract of water transportation.

2. Yes, The private respondent may sue in Philippine courts upon the marine insurance policies issued by it abroad to cover international-bound cargoes shipped by a Philippine carrier, even if it has no license to do business in this country, for it is not the lack of the prescribed license (to do business in the Philippines) but doing business without such license, which bars a foreign corporation from access to our courts.

3. No. Section 3(6), Title I, of the Carriage of Goods by Sea Act (Commonwealth Act No. 65) which provides that:

... the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered. ...

This provision of the law admits of an xception: if the one-year period is suspended by express agreement of the parties for in such a case, their agreement becomes the law for them.

The exchange of correspondence between the parties and/or their associates/representatives shows that the parties had mutually agreed to extend the time within which the plaintiff or its predecessors-in-interest may file suit until December 27,1976. When the complaint was filed on June 25, 1976, that deadline had not yet expired.

Philippine Refining Co., Inc. v Jarque et. al.

Doctrine:
It is essential that a record of documents affecting the title to a vessel be entered in the record of the Collector of Customs at the port of entry. Otherwise a mortgage on a vessel is generally like other chattel mortgages as to its requisites and validity

Facts:
Philippine Refining Co., Inc., and Francisco Jarque executed three mortgages on the motor vessels Pandan and Zaragoza. These documents were recorded in the record of transfers and incumbrances of vessels for the port of Cebu and each was therein denominated a "chattel mortgage".

Neither of the first two mortgages had appended an affidavit of good faith. The third mortgage contained such an affidavit, but this mortgage was not registered in the customs house until the period of thirty days prior to the commencement of insolvency proceedings against Francisco Jarque;

A fourth mortgage was executed by Francisco Jarque and Ramon Aboitiz on the motorship Zaragoza and was entered in the chattel mortgage registry of the register of deeds on within the thirty-day period before the institution of insolvency proceedings.

Francisco was declared an insolvent with the result that an assignment of all the properties of the insolvent was executed in favor of Jose Corominas.

Judge Jose M. Hontiveros declined to order the foreclosure of the mortgages, but on the contrary sustained the special defenses of fatal defectiveness of the mortgages.

Issue:
Whether or not the mortgages were defective.

Yes. Vessels are considered personal property under the civil law. Similarly under the common law, vessels are personal property although occasionally referred to as a peculiar kind of personal property. They are subject to mortgage agreeably to the provisions of the Chattel Mortgage Law.

The only difference between a chattel mortgage of a vessel and a chattel mortgage of other personalty is that it is not now necessary for a chattel mortgage of a vessel to be noted in the registry of the register of deeds, but it is essential that a record of documents affecting the title to a vessel be entered in the record of the Collector of Customs at the port of entry. Otherwise a mortgage on a vessel is generally like other chattel mortgages as to its requisites and validity.

In the case, the absence of the affidavit vitiates a mortgage as against creditors and subsequent encumbrancers. As a consequence a chattel mortgage of a vessel wherein the affidavit of good faith required by the Chattel Mortgage Law is lacking, is unenforceable against third persons.

Savellano v Northwest Airlines

Facts:
Savellano, ex-Mayor and former Chairman of COMELEC and wife were expected to arrive at NAIA after 12 hours of travel coming from Seattle. The plane made an emergency landing because a fire started in one of the engines.

They passengers were brought to a hotel. At around midnight, they were awakened by a phone call from Northwest's personnel saying that they would be take a Seattle-Tokyo-Manila route on the flight back to Manila the next day. Upon arrival at the airport they were again advised that they would take an alternative and longer route (Seattle - Los Angeles - Seoul- Manila) back to Manila.

Meanwhile, the other passengers took the first route. Upon arrival of Savellano at Manila, they were teased for taking the longer and tiresome route. They also discovered that their luggage had been ransacked and the contents stolen.

Savellano demanded damages on the ground that they suffered inconvenience, embarrassment and humiliation for taking the longer route.

Issue:
1.Whether or not the bump-off was a breach of the air carriage contract
2. Whether or not Savellano is entitled to actual, moral and exemplary damages.

Held:
1. Yes. In the condition of the airline ticket, there is nothing authorizing Northwest to decide unilaterally what other stopping places Savellano should take and when they should fly. Substituting aircraft without notice is entirely different from changing stopping places or connecting cities without notice. Also, Northwest failed to show a case of necessity for changing the stopping place.

2. On moral damages: Northwest is not guilty of bad faith. It appears that the passengers of the distressed flight were randomly divided into 2 groups. One group taking the first route and the other taking the longer route of flight. The selection of who was to take the flight was handled via computer reservation system. Savellano failed to present convincing evidence to back the allegation that Northwest was guilty of bad faith.

On exemplary damages, it is not proper. The unexpected and sudden requirement of having to arrange connecting flights in just a few hours, in addition to the Northwest employees' normal workload was difficult to satisfy perfectly. Northwest is not liable for its imperfection of neglecting to consult with passengers beforehand.

Nominal damages are awarded in this case. The court considered that Savellano suffered the inconvenience of having to wake up early to catch the flight and that they were business class passengers who paid more for better service. It also considered Savellano's social and official status. The court awarded P150,000 as nominal damages in order to vindicate and recognize their right to be notified and consulted.

Notes:
*The rulings of Lopez, Zulueta and Ortigas are not applicable in this case there is no showing that the breach was done with the same entrepreneurial motive as in Lopez or with ill-will as in Zulueta and Ortigas.

*Good faith is presumed while bad faith is a matter of fact that needs to be proved by the party alleging it.

Air France v Carrascoso

Facts:
Air France issued to Carrascoso, a civil engineer, a 1st class round trip ticket from Manila - Rome. During the stopover at Bangkok, the Manager of Air France forced plaintiff to vacate the 1st class seat because there was a "white man" who had better right to the seat.

As a result, he filed a suit against Air France where the CFI Manila granted him moral and exemplary damages.

Issue:
Whether or not Carrascoso was entitled to the 1st class seat and consequently, whether or not he was entitled to the damages awarded.

Held:
Yes to both.
To achieve stability in the relation between passenger and air carrier, adherence to the ticket issued is desirable. Quoting the court, "We cannot understand how a reputable firm like Air France could have the indiscretion to give out tickets it never meant to honor at all. It received the corresponding amount in payment of the tickets and yet it allowed the passenger to be at the mercy of its employees. It is more in keeping with the ordinary course of business that the company should know whether or not the tickets it issues are to be honored or not."

Evidence of bad faith was presented without objection on the part of the Carrascoso. In the case, it could have been easy for Air France to present its manager to testify at the trial or secure his deposition but defendant did neither. There is also no evidence as to whether or not a prior reservation was made by the white man.

The manager not only prevented Carrascoso from enjoying his right to a 1st class seat, worse he imposed his arbitrary will. He forcibly ejected him from his seat, made him suffer the humiliation of having to go to tourist class just to give way to another passenger whose right was not established. Certainly, this is bad faith.

Passengers do not contract merely for transportation. They have a right to be treated by the carrier's employees with kindness, respect, courtesy and due consideration. They are entitled to be protected against personal is conduct, injurious language, indignities and abuse from such employees. Any discourteous conduct on the part of employees towards a passenger gives the latter an action for damages against the carrier.

Exemplary damages were also awarded. The manner of ejectment fits into the condition for exemplary damages that defendant acted in a wanton, fraudulent, reckless, oppressive or malevolent manner.

*Bad Faith - state of mind affirmatively operating with furtive design or with some motive of self-interest or ill will or for ulterior purpose

Sabado, Pebrero 9, 2013

Minucher v CA

Doctrine:
Filing a motion to quash, which, in effect already waives any defect in the service of summons by earlier asking an extension to file time to file an Answer and filing an Answer with Counterclaim.

Facts:
Khosrow Minucher is the Labor Attaché of the Embassy of Iran in the Phil. Arthur Scalzo, then connected with the American Embassy in Manila, was introduced to him by Jose Inigo (an informer belonging to the military intelligence community).

Accdg. to Inigo, Scalzo was interested in buying Iranian products like caviar and carpets. Minucher complained to Scalzo about his problems with the American Embassy regarding the expired visas of his wife, Abbas Torabian. Offering help, Scalzo gave Minucher a calling card showing that the former is an agent of the Drug Enforcement Administration (DEA) assigned to the American Embassy in Manila. As a result, Scalzo expressed his intent to buy caviar and further promised to arrange the renewal of the visas.

Scalzo went to Minucher's residence and asked to be entrusted with Persian silk carpets, for which he had a buyer. The next day, Scalzo returned and claimed that he had already made arrangements with his contacts concerning the visas and asked for $2,000.

It turned out that Scalzo prepared a plan to frame-up a Minucher and wife for alleged heroin trafficking. Both were falsely arrested and charged with violations of the Dangerous Drugs Act.

Minucher prays for actual and compensatory damages. However, counsel for Scalzo filed a motion to quash summons alleging that the defendant is beyond the processes of the Philippine court for the action for damages is a personal action and that Scalzo is outside the Philippines.

TC denied the motion. CA dismissed the motion for lack of merit on the basis of the erroneous assumption that because of the Diplomatic Note (advising the DFA that Scalzo is a member of the US diplomatic mission investigating Minucher for drug trafficking), Scalzo is clothed with diplomatic immunity.

Issue:
Whether or not a complaint for damages be dismissed in the sole basis of a statement complained in a Diplomatic Note.

Held:
No. Jurisdiction over the person of the defendant is acquired by either voluntary appearance or by the service of summons. In the case, Scalzo's counsel filed a motion to quash, which, in effect already waived any defect in the service of summons by earlier asking an extension to file time to file an Answer and filing an Answer with Counterclaim.

The complaint for damages cannot be dismissed. Said complaint contains sufficient allegations which indicate that Scalzo committed imputed acts in his personal capacity and outside the scope of his official duties and functions. The TC gave credit to Minucher's theory that he was a victim of frame-up hence, there is a prima facie showing that Scalzo could be held personally liable for his acts. Further, Scalzo did not come forward with evidence to, prove that he acted in his official capacity.

People v Castaneda

Facts:
Benjamin Manaloto was charged with the crime of Falsification of Public Document. The complaint was filed by his wife, Victoria Manaloto.

That on or about the 19th day of May, 1975, in the Municipality of San Fernando, province of Pampanga, Philippines, Benjamin falsified in a deed of sale the house and lot belonging to the conjugal partnership in favor of Ponciano Lacsamana, making it appear that his spouse gave her marital consent to said sale.

At the trial, the prosecution called the wife to the witness stand but the defense moved to disqualify her as a witness, invoking Sec. 20, Rule 130. The prosecution stated that it is a "criminal case for a crime committed by one against the other." Notwithstanding such opposition, respondent Judge granted the motion, disqualifying Victoria.

Issue:
Whether or not the criminal case for Falsification of Public Document may be considered as a criminal case for a crime committed by a husband against his wife and, therefore, an exception to the rule on marital disqualification.

Held:
No. The case is an exception to the marital disqualification rule. WHEN AN OFFENSE DIRECTLY ATTACKS, OR DIRECTLY AND VITALLY IMPAIRS, THE CONJUGAL RELATION, IT COMES WITHIN THE EXCEPTION to the statute that one shall not be a witness against the other except in a criminal prosecution for a crime committed (by) one against the other.

In the case, it must be noted that had the sale of the said house and lot, and the signing of the wife's name by her husband in the deed of sale, been made with the consent of the wife, no crime could have been charged against said husband. It is the husband's breach of his wife's confidence which gave rise to the offense charged. And it is this same breach of trust which prompted the wife to make the necessary complaint.

With more reason must the exception apply to the instant case where the victim of the crime and the person who stands to be directly prejudiced by the falsification is not a third person but the wife herself. And it is undeniable that the act had the effect of directly and vitally impairing the conjugal relation. This is apparent not only in the act of the wife in personally lodging her complaint with the Office of the Provincial Fiscal, but also in her insistent efforts in connection with the instant petition, which seeks to set aside the order disqualifying her from testifying against her husband. Taken collectively, the actuations of the witness-wife underscore the fact that the martial and domestic relations between her and the accused-husband have become so strained that there is no more harmony to be preserved said nor peace and tranquility which may be disturbed. In such a case, identity of interests disappears and the consequent danger of perjury based on that identity is nonexistent. Likewise, in such a situation, the security and confidence of private life which the law aims at protecting will be nothing but ideals which, through their absence, merely leave a void in the unhappy home.

DOLE PHILIPPINES, INC. v MARITIME COMPANY OF THE PHILIPPINES

Facts:

The cargo subject of the instant case was discharged in Dadiangas unto the custody of the consignee, Dole Philippines. The corresponding claim for the damages sustained by the cargo was filed by the plaintiff with the defendant, Maritime Company on May 4, 1972.

On June 11, 1973 the plaintiff filed a complaint in the CFI Manila embodying 3 causes of action involving 3 separate and different shipments. The third cause of action therein involved the cargo now subject of this present litigation.

On December 11, 1974, Judge Serafin Cuevas issued an Order dismissing the first two causes of action. The third cause of action which covered the cargo subject of this case now was likewise dismissed but without prejudice as it was not covered by the settlement. Because of the dismissal of the complaint with respect to the third cause of action, DOLE instituted this present complaint on January 6, 1975.

Maritime filed an answer pleading inter alia the affirmative defense of prescription under the provisions of the Carriage of Goods by Sea Act. The Trial Court granted the motion, scheduling the preliminary hearing on April 27, 1977. The record before the Court does not show whether or not that hearing was held, but under date of May 6, 1977, Maritime filed a formal motion to dismiss invoking once more the ground of prescription.

The Trial Court, after due consideration, resolved the matter in favor of Maritime and dismissed the complaint.

Issue:
Whether or not Article 1155 of the Civil Code applies in lieu of the COGSA.

Held:
No. Article 1155 of the Civil Code provides that the prescription of actions is interrupted by the making of an extrajudicial written demand by the creditor

Section 3, paragraph 6 of the COGSA provides that:

the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered; Provided, That, if a notice of loss or damage, either apparent or conceded, is not given as provided for in this section, that fact shall not affect or prejudice the right of the shipper to bring suit within one year after the delivery of the goods or the date when.the goods should have been delivered.

1. Dole argues that since the provisions of the Civil Code are, by express mandate of said Code, suppletory of deficiencies in the Code of Commerce and special laws in matters governed by the latter and there being a patent deficiency with respect to the tolling of the prescriptive period provided for in the Carriage of Goods by Sea Act, prescription under said Act is subject to the provisions of Article 1155 of the Civil Code on tolling. Since Dole's claim for loss or damage was filed on May 4, 1972 amounted to a written extrajudicial demand which would toll or interrupt prescription under Article 1155, it operated to toll prescription also in actions under the Carriage of Goods by Sea Act.

These arguments might merit weightier consideration were it not for the fact that the question has already received a definitive answer, adverse to the position taken by Dole, in The Yek Tong Lin Fire & Marine Insurance Co., Ltd. vs. American President Lines, Inc.

2. Dole argues that it was error for the court not to have considered the action of plaintiff-appellant suspended by the extrajudicial demand which took place, according to defendant's own motion to dismiss on August 22, 1952.

Court noticed that while plaintiff avoids stating any date when the goods arrived in Manila, it relies upon the allegation made in the motion to dismiss that a protest was filed on August 22, 1952 — which goes to show that plaintiff-appellant's counsel has not been laying the facts squarely before the court for the consideration of the merits of the case. We have already decided that in a case governed by the Carriage of Goods by Sea Act, the general provisions of the Code of Civil Procedure on prescription should not be made to apply. (Chua Kuy vs. Everett Steamship Corp., G.R. No. L-5554, May 27, 1953.) We hold that in such a case the general provisions of the new Civil Code (Art. 1155) cannot be made to apply, as such application would have the effect of extending the one-year period of prescription fixed in the law. It is desirable that matters affecting transportation of goods by sea be decided in as short a time as possible; the application of the provisions of Article 1155 of the new Civil Code would unnecessarily extend the period and permit delays in the settlement of questions affecting transportation, contrary to the clear intent and purpose of the law.

Under Dole's theory, when its claim was received by Maritime, the one-year prescriptive period was interrupted and began to run anew from May 4, 1972, affording Dole another period of one year counted from that date within which to institute action on its claim for damage. Unfortunately, Dole let the new period lapse without filing action. It instituted Civil Case No. 91043 only on June 11, 1973, more than one month after that period has expired and its right of action had prescribed.

People v Dumpo


Facts:
Moro Hassan and Mora Dumpo have been legally married according to the rites and practices of the Mohammedan religion. Without the marriage being dissolved, it has been alleged that Dumpo contracted another marriage with Moro Sabdapal after which they lived together as husband and wife.

Dumpo was prosecuted for bigamy in the CFI Zamboanga. Dumpo appealed.

It has been established by the defense, without the prosecution having presented objection or evidence to the contrary, that the alleged second marriage was null and void according to Mohammedan rites on the ground that her father (Moro Jalmani) had not given his consent.

Issue: Whether or not Dumpo was guilty of bigamy.

Held: No. Dumpo was acquitted.

The court formulated that there is no general statement regarding the requisites necessary for the validity of a marriage between Moros according to Mohammedan rites. This is a fact which must be subject to proof in every particular case.

In the case, the uncontradicted testimony of Tahari (Iman or Mohammedans priest authorized to solemnize marriages between Mohammedans) was that the effect of the consent of the father's bride is an indispensable requirement for the validity of such contracts.

It was easy for the prosecution to show that the marriage was void by refuting Tahari's testimony because there were 2 other Imans among the State witnesses in the case, but it failed to do so.

Granting the absolute necessity of the father's consent, tacit compliance may be presumed because it does not appear that Dumpo's father has signified his opposition to the 2nd marriage after he had been informed of its celebration. But this presumption should not be established over the affirmation of Dumpo's father saying that he did not give his consent to the 2nd marriage.

It is an essential element in bigamy that the 2nd marriage have all the essential requisites of a valid marriage. It appearing that the 2nd marriage cannot be considered as such, there is no justification to hold her guilty of bigamy.

Dissent:
There is no quotation from the Koran regarding the essentials of a marriage ceremony. Justice Hull agrees that the evidence relied upon is not worthy of serious consideration. If consent were in fact necessary, it can well be presumed from the subsequent actions of the girl.

Navida v Dizon


Facts:
Beginning 1993, a number of personal injury suits were filed in different Texas state courts by citizens of twelve foreign countries, including the Philippines. The thousands of plaintiffs sought damages for injuries they allegedly sustained from their exposure to dibromochloropropane (DBCP), a chemical used to kill nematodes (worms), while working on farms in 23 foreign countries. The cases were eventually transferred to, and consolidated in, the Federal District Court for the Southern District of Texas, Houston Division. The defendants in the consolidated cases prayed for the dismissal of all the actions under the doctrine of forum non conveniens.

In a Memorandum Order, the Federal District Court conditionally granted the defendants’ motion to dismiss provided the defendants:

(1) participated in expedited discovery in the United States

(2) either waived or accepted service of process and waived any other jurisdictional defense in any action commenced by a plaintiff in these actions in his home country or the country in which his injury occurred.

(3) waived any limitations-based defense that has matured since the commencement of these actions in the courts of Texas;

(4) stipulated that any discovery conducted during the pendency of these actions may be used in any foreign proceeding to the same extent as if it had been conducted in proceedings initiated there; and

(5) submitted an agreement binding them to satisfy any final judgment rendered in favor of plaintiffs by a foreign court.

In the event that the highest court of any foreign country finally affirms the dismissal for lack of jurisdiction of an action commenced by a plaintiff in these actions in his home country or the country in which he was injured, that plaintiff may return to this court and, upon proper motion, the court will resume jurisdiction over the action as if the case had never been dismissed for.

Case 1 (125078) and 2 (125598):

336 plaintiffs from General Santos City filed a Joint Complaint in the RTC of General Santos City. Named as defendants therein were: Shell Oil Co. (SHELL); Dow Chemical Co. (DOW); Occidental Chemical Corp. (OCCIDENTAL); Dole Food Co., Inc., Dole Fresh Fruit Co., Standard Fruit Co., Standard Fruit and Steamship Co. (hereinafter collectively referred to as DOLE); Chiquita Brands, Inc. and Chiquita Brands International, Inc. (CHIQUITA); Del Monte Fresh Produce N.A. and Del Monte Tropical Fruit Co. (hereinafter collectively referred to as DEL MONTE); Dead Sea Bromine Co., Ltd.; Ameribrom, Inc.; Bromine Compounds, Ltd.; and Amvac Chemical Corp. (The aforementioned defendants are hereinafter collectively referred to as defendant companies.)

NAVIDA, et al., prayed for the payment of damages in view of the illnesses and injuries to the reproductive systems which they allegedly suffered because of their exposure to DBCP. They claimed, among others, that they were exposed to this chemical during the early 1970’s up to the early 1980’s when they used the same in the banana plantations where they worked at; and/or when they resided within the agricultural area where such chemical was used. NAVIDA, et al., claimed that their illnesses and injuries were due to the fault or negligence of each of the defendant companies in that they produced, sold and/or otherwise put into the stream of commerce DBCP-containing products. According to NAVIDA, et al., they were allowed to be exposed to the said products, which the defendant companies knew, or ought to have known, were highly injurious to the former’s health and well-being.

Without resolving the motions filed by the parties, the RTC of General Santos City issued an Order dismissing the complaint. First, the trial court determined that it did not have jurisdiction to hear the case because the substance of the cause of action as stated in the complaint against the defendant foreign companies cites activity on their part which took place abroad and had occurred outside and beyond the territorial domain of the Philippines. These acts of defendants cited in the complaint included the manufacture of pesticides, their packaging in containers, their distribution through sale or other disposition, resulting in their becoming part of the stream of commerce. The subject matter stated in the complaint and which is uniquely particular to the present case, consisted of activity or course of conduct engaged in by foreign defendants outside Philippine territory, hence, outside and beyond the jurisdiction of Philippine Courts, including the present Regional Trial Court.

Second, the RTC of General Santos City adjudged that NAVIDA, et al., were coerced into submitting their case to the Philippine courts, merely to comply with the U.S. District Court’s Order and in order to keep open to the plaintiffs the opportunity to return to the U.S. District Court.

Third, the trial court ascribed little significance to the voluntary appearance of the defendant companies. Defendants have appointed their agents authorized to accept service of summons/processes in the Philippines pursuant to the agreement in the U.S. court that defendants will voluntarily submit to the jurisdiction of this court. While it is true that this court acquires jurisdiction over persons of the defendants through their voluntary appearance, it appears that such voluntary appearance of the defendants in this case is conditional. Thus in the “Defendants’ Amended Agreement Regarding Conditions of Dismissal for Forum Non Conveniens” filed with the U.S. District Court, defendants declared that “(t)he authority of each designated representative to accept service of process will become effective upon final dismissal of these actions by the Court”. The decision of the U.S. District Court dismissing the case is not yet final and executory since both the plaintiffs and defendants appealed therefrom. Consequently, since the authority of the agent of the defendants in the Philippines is conditioned on the final adjudication of the case pending with the U.S. courts, the acquisition of jurisdiction by this court over the persons of the defendants is also conditional.

Fourth, the RTC of General Santos City ruled that the act of NAVIDA, et al., of filing the case in the Philippine courts violated the rules on forum shopping and litis pendencia. This court frowns upon the fact that the parties herein are both vigorously pursuing their appeal of the decision of the U.S. District court dismissing the case filed thereat. To allow the parties to litigate in this court when they are actively pursuing the same cases in another forum, violates the rule on ‘forum shopping’ so abhorred in this jurisdiction. Moreover, the filing of the case in the U.S. courts divested this court of its own jurisdiction. This court takes note that the U.S. District Court did not decline jurisdiction over the cause of action. The case was dismissed on the ground of forum non conveniens, which is really a matter of venue. By taking cognizance of the case, the U.S. District Court has, in essence, concurrent jurisdiction with this court over the subject matter of this case. It is settled that initial acquisition of jurisdiction divests another of its own jurisdiction.

Case 3 (126654), 4 (127856), 5(128398)

Another joint complaint for damages against SHELL, DOW, OCCIDENTAL, DOLE, DEL MONTE, and CHIQUITA was filed before Branch 16 of the RTC of Davao City by 155 plaintiffs from Davao City. They alleged that as workers in the banana plantation and/or as residents near the said plantation, they were made to use and/or were exposed to nematocides, which contained the chemical DBCP. According to ABELLA, et al., such exposure resulted in “serious and permanent injuries to their health, including, but not limited to, sterility and severe injuries to their reproductive capacities.”

The RTC of Davao City, however, junked Civil Cases. The Court however is constrained to dismiss the case at bar not solely on the basis of the above but because it shares the opinion of legal experts given in the interview made by the Inquirer in its Special report “Pesticide Cause Mass Sterility,” Former Justice Secretary Demetrio Demetria in a May 1995 opinion said: The Philippines should be an inconvenient forum to file this kind of damage suit against foreign companies since the causes of action alleged in the petition do not exist under Philippine laws. There has been no decided case in Philippine Jurisprudence awarding to those adversely affected by DBCP. This means there is no available evidence which will prove and disprove the relation between sterility and DBCP.

Eventually, the cases reached the SC!

Present case:

The main contention of the petitioners states that the allegedly tortious acts and/or omissions of defendant companies occurred within Philippine territory. Said fact allegedly constitutes reasonable basis for our courts to assume jurisdiction over the case.

DOLE similarly maintains that the acts attributed to defendant companies constitute a quasi-delict, which falls under Article 2176 of the Civil Code. DOLE also argues that if indeed there is no positive law defining the alleged acts of defendant companies as actionable wrong, Article 9 of the Civil Code dictates that a judge may not refuse to render a decision on the ground of insufficiency of the law. The court may still resolve the case, applying the customs of the place and, in the absence thereof, the general principles of law.

CHIQUITA (another petitioner) argues that the courts a quo had jurisdiction over the subject matter of the cases filed before them. CHIQUITA avers that the pertinent matter is the place of the alleged exposure to DBCP, not the place of manufacture, packaging, distribution, sale, etc., of the said chemical. This is in consonance with the lex loci delicti commisi theory in determining the situs of a tort, which states that the law of the place where the alleged wrong was committed will govern the action. CHIQUITA and the other defendant companies also submitted themselves to the jurisdiction of the RTC by making voluntary appearances and seeking for affirmative reliefs during the course of the proceedings.

Issue:
Whether or not the RTCs have jurisdiction over the subject matter in these cases.

Held: Yes.

1. The rule is settled that jurisdiction over the subject matter of a case is conferred by law and is determined by the allegations in the complaint and the character of the relief sought, irrespective of whether the plaintiffs are entitled to all or some of the claims asserted therein. Once vested by law, on a particular court or body, the jurisdiction over the subject matter or nature of the action cannot be dislodged by anybody other than by the legislature through the enactment of a law.

At the time of the filing of the complaints, the jurisdiction of the RTC in civil cases under Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, was:

In all other cases in which the demand, exclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs or the value of the property in controversy exceeds One hundred thousand pesos (P100,000.00) or, in such other cases in Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two hundred thousand pesos (P200,000.00).

Supreme Court Administrative Circular No. 09-94, states:
The exclusion of the term “damages of whatever kind” in determining the jurisdictional amount under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applies to cases where the damages are merely incidental to or a consequence of the main cause of action. However, in cases where the claim for damages is the main cause of action, or one of the causes of action, the amount of such claim shall be considered in determining the jurisdiction of the court.

It is clear that the claim for damages is the main cause of action and that the total amount sought in the complaints is approximately P2.7 million for each of the plaintiff claimants. The RTCs unmistakably have jurisdiction over the cases filed in General Santos City and Davao City.

2. The jurisdiction of the court cannot be made to depend upon the defenses set up in the answer or upon the motion to dismiss, for otherwise, the question of jurisdiction would almost entirely depend upon the defendants. What determines the jurisdiction of the court is the nature of the action pleaded as appearing from the allegations in the complaint. The averments therein and the character of the relief sought are the ones to be consulted.

Clearly then, the acts and/or omissions attributed to the defendant companies constitute a quasi-delict which is the basis for the claim for damages filed by NAVIDA, et al., and ABELLA, et al., with individual claims of approximately P2.7 million for each plaintiff claimant, which obviously falls within the purview of the civil action jurisdiction of the RTCs.

3. It is, therefore, error on the part of the courts a quo when they dismissed the cases on the ground of lack of jurisdiction on the mistaken assumption that the cause of action narrated by NAVIDA, et al., and ABELLA, et al., took place abroad and had occurred outside and beyond the territorial boundaries of the Philippines, i.e., “the manufacture of the pesticides, their packaging in containers, their distribution through sale or other disposition, resulting in their becoming part of the stream of commerce,” and, hence, outside the jurisdiction of the RTCs.

Certainly, the cases below are not criminal cases where territoriality, or the situs of the act complained of, would be determinative of jurisdiction and venue for trial of cases. In personal civil actions, such as claims for payment of damages, the Rules of Court allow the action to be commenced and tried in the appropriate court, where any of the plaintiffs or defendants resides, or in the case of a non-resident defendant, where he may be found, at the election of the plaintiff.

In a very real sense, most of the evidence required to prove the claims of NAVIDA, et al., and ABELLA, et al., are available only in the Philippines. First, plaintiff claimants are all residents of the Philippines, either in General Santos City or in Davao City. Second, the specific areas where they were allegedly exposed to the chemical DBCP are within the territorial jurisdiction of the courts a quo wherein NAVIDA, et al., and ABELLA, et al., initially filed their claims for damages. Third, the testimonial and documentary evidence from important witnesses, such as doctors, co-workers, family members and other members of the community, would be easier to gather in the Philippines.

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Re: Jurisdiction over the person

The RTC of General Santos City and the RTC of Davao City validly acquired jurisdiction over the persons of all the defendant companies. All parties voluntarily, unconditionally and knowingly appeared and submitted themselves to the jurisdiction of the courts a quo. All the defendant companies submitted themselves to the jurisdiction of the courts a quo by making several voluntary appearances, by praying for various affirmative reliefs, and by actively participating during the course of the proceedings below.

In line herewith, this Court, in Meat Packing Corporation of the Philippines v. Sandiganbayan, held that jurisdiction over the person of the defendant in civil cases is acquired either by his voluntary appearance in court and his submission to its authority or by service of summons. Furthermore, the active participation of a party in the proceedings is tantamount to an invocation of the court’s jurisdiction and a willingness to abide by the resolution of the case, and will bar said party from later on impugning the court or body’s jurisdiction.

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Jurisdiction v Exercise of Jurisdiction

It may also be pertinently stressed that “jurisdiction” is different from the “exercise of jurisdiction.” Jurisdiction refers to the authority to decide a case, not the orders or the decision rendered therein. Accordingly, where a court has jurisdiction over the persons of the defendants and the subject matter, as in the case of the courts a quo, the decision on all questions arising therefrom is but an exercise of such jurisdiction. Any error that the court may commit in the exercise of its jurisdiction is merely an error of judgment, which does not affect its authority to decide the case, much less divest the court of the jurisdiction over the case.

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Re: Bad faith in filing cases to procure a dismissal and to allow petitioners to return to the forum of their choice.

This Court finds such argument much too speculative to deserve any merit.

It must be remembered that this Court does not rule on allegations that are unsupported by evidence on record. This Court does not rule on allegations which are manifestly conjectural, as these may not exist at all. This Court deals with facts, not fancies; on realities, not appearances.

* We REMAND the records of this case to the respective Regional Trial Courts of origin for further and appropriate proceedings in line with the ruling herein that said courts have jurisdiction over the subject matter of the amended complaints.