G.R. No. 112573 February 9, 1995

NORTHWEST ORIENT AIRLINES, INC. petitioner, vs.COURT OF APPEALS and C.F. SHARP & COMPANY INC., respondents.

PADILLA, JR., J.:

This petition for review on certiorari seeks to set aside the decision of the Court of Appeals affirming the dismissal of the petitioner's complaint to enforce the judgment of a Japanese court. The principal issue here is whether a Japanese court can acquire jurisdiction over a Philippine corporation doing business in Japan by serving summons through diplomatic channels on the Philippine corporation at its principal office in Manila after prior attempts to serve summons in Japan had failed.

Petitioner Northwest Orient Airlines, Inc. (hereinafter NORTHWEST), a corporation organized under the laws of the State of Minnesota, U.S.A., sought to enforce in Civil Case No. 83-17637 of the Regional Trial Court (RTC), Branch 54, Manila, a judgment rendered in its favor by a Japanese court against private respondent C.F. Sharp & Company, Inc., (hereinafter SHARP), a corporation incorporated under Philippine laws.

As found by the Court of Appeals in the challenged decision of 10 November 1993, 1 the following are the factual and procedural antecedents of this controversy:

On May 9, 1974, plaintiff Northwest Airlines and defendant C.F. Sharp & Company, through its Japan branch, entered into an International Passenger Sales Agency Agreement, whereby the former authorized the latter to sell its air transportation tickets. Unable to remit the proceeds of the ticket sales made by defendant on behalf of the plaintiff under the said agreement, plaintiff on March 25, 1980 sued defendant in Tokyo, Japan, for collection of the unremitted proceeds of the ticket sales, with claim for damages.

On April 11, 1980, a writ of summons was issued by the 36th Civil Department, Tokyo District Court of Japan against defendant at its office at the Taiheiyo Building, 3rd floor, 132, Yamashita-cho, Naka-ku, Yokohoma, Kanagawa Prefecture. The attempt to serve the summons was unsuccessful because the bailiff was advised by a person in the office that Mr. Dinozo, the person believed to be authorized to receive court processes was in Manila and would be back on April 24, 1980.

On April 24, 1980, bailiff returned to the defendant's office to serve the summons. Mr. Dinozo refused to accept the same claiming that he was no longer an employee of the defendant.

After the two attempts of service were unsuccessful, the judge of the Tokyo District Court decided to have the complaint and the writs of summons served at the head office of the defendant in Manila. On July 11, 1980, the Director of the Tokyo District Court requested the Supreme Court of Japan to serve the summons through diplomatic channels upon the defendant's head office in Manila.

On August 28, 1980, defendant received from Deputy Sheriff Rolando Balingit the writ of summons (p. 276, Records). Despite receipt of the same, defendant failed to appear at the scheduled hearing. Thus, the Tokyo Court proceeded to hear the plaintiff's complaint and on [January 29, 1981], rendered judgment ordering the defendant to pay the plaintiff the sum of 83,158,195 Yen and damages for delay at the rate of 6% per annum from August 28, 1980 up to and until payment is completed (pp. 12-14, Records).

On March 24, 1981, defendant received from Deputy Sheriff Balingit copy of the judgment. Defendant not having appealed the judgment, the same became final and executory.

Plaintiff was unable to execute the decision in Japan, hence, on May 20, 1983, a suit for enforcement of the judgment was filed by plaintiff before the Regional Trial Court of Manila Branch 54. 2

On July 16, 1983, defendant filed its answer averring that the judgment of the Japanese Court sought to be enforced is null and void and unenforceable in this jurisdiction having been rendered without due and proper notice to the defendant and/or with collusion or fraud and/or upon a clear mistake of law and fact (pp. 41-45, Rec.).

Unable to settle the case amicably, the case was tried on the merits. After the plaintiff rested its case, defendant on April 21, 1989, filed a Motion for Judgment on a Demurrer to Evidence based on two grounds: (1) the foreign judgment sought to be enforced is null and void for want of jurisdiction and (2) the said judgment is contrary to Philippine law and public policy and rendered without due process of law. Plaintiff filed its opposition after which the court a quo rendered the now assailed decision dated June 21, 1989 granting the demurrer motion and dismissing the complaint (Decision, pp. 376-378, Records). In granting the demurrer motion, the trial court held that:

The foreign judgment in the Japanese Court sought in this action is null and void for want of jurisdiction over the person of the defendant considering that this is an action in personam; the Japanese Court did not acquire jurisdiction over the person of the defendant because jurisprudence requires that the defendant be served with summons in Japan in order for the Japanese Court to acquire jurisdiction over it, the process of the Court in Japan sent to the Philippines which is outside Japanese jurisdiction cannot confer jurisdiction over the defendant in the case before the Japanese Court of the case at bar. Boudard versus Tait 67 Phil. 170. The plaintiff contends that the Japanese Court acquired jurisdiction because the defendant is a resident of Japan, having four (4) branches doing business therein and in fact had a permit from the Japanese government to conduct business in Japan (citing the exhibits presented by the plaintiff); if this is so then service of summons should have been made upon the defendant in Japan in any of these alleged four branches; as admitted by

the plaintiff the service of the summons issued by the Japanese Court was made in the Philippines thru a Philippine Sheriff. This Court agrees that if the defendant in a foreign court is a resident in the court of that foreign court such court could acquire jurisdiction over the person of the defendant but it must be served upon the defendant in the territorial jurisdiction of the foreign court. Such is not the case here because the defendant was served with summons in the Philippines and not in Japan.

Unable to accept the said decision, plaintiff on July 11, 1989 moved for reconsideration of the decision, filing at the same time a conditional Notice of Appeal, asking the court to treat the said notice of appeal "as in effect after and upon issuance of the court's denial of the motion for reconsideration."

Defendant opposed the motion for reconsideration to which a Reply dated August 28, 1989 was filed by the plaintiff.

On October 16, 1989, the lower court disregarded the Motion for Reconsideration and gave due course to the plaintiff's Notice of Appeal. 3

In its decision, the Court of Appeals sustained the trial court. It agreed with the latter in its reliance upon Boudard vs. Tait 4 wherein it was held that "the process of the court has no extraterritorial effect and no jurisdiction is acquired over the person of the defendant by serving him beyond the boundaries of the state." To support its position, the Court of Appeals further stated:

In an action strictly in personam, such as the instant case, personal service of summons within the forum is required for the court to acquire jurisdiction over the defendant (Magdalena Estate Inc. vs. Nieto, 125 SCRA 230). To confer jurisdiction on the court, personal or substituted service of summons on the defendant not extraterritorial service is necessary (Dial Corp vs. Soriano, 161 SCRA 739).

But while plaintiff-appellant concedes that the collection suit filed is an action in personam, it is its theory that a distinction must be made between an action in personam against a resident defendant and an action in personam against a non-resident defendant. Jurisdiction is acquired over a non-resident defendant only if he is served personally within the jurisdiction of the court and over a resident defendant if by personal, substituted or constructive service conformably to statutory authorization. Plaintiff-appellant argues that since the defendant-appellee maintains branches in Japan it is considered a resident defendant. Corollarily, personal, substituted or constructive service of summons when made in compliance with the procedural rules is sufficient to give the court jurisdiction to render judgment in personam.

Such an argument does not persuade.

It is a general rule that processes of the court cannot lawfully be served outside the territorial limits of the jurisdiction of the court from which it issues (Carter vs. Carter; 41 S.E. 2d 532, 201) and this is regardless of the residence or citizenship of the party thus served (Iowa-Rahr vs. Rahr, 129 NW 494, 150 Iowa 511, 35 LRC, NS, 292, Am. Case 1912 D680). There must be actual service within the proper territorial limits on defendant or someone authorized to accept service for him. Thus, a defendant, whether a resident or not in the forum where the action is filed, must be served with summons within that forum.

But even assuming a distinction between a resident defendant and non-resident defendant were to be adopted, such distinction applies only to natural persons and not in the corporations. This finds support in the concept that "a corporation has no home or residence in the sense in which those terms are applied to natural persons" (Claude Neon Lights vs. Phil. Advertising Corp., 57 Phil. 607). Thus, as cited by the defendant-appellee in its brief:

Residence is said to be an attribute of a natural person, and can be predicated on an artificial being only by more or less imperfect analogy. Strictly speaking, therefore, a corporation can have no local residence or habitation. It has been said that a corporation is a mere ideal existence, subsisting only in contemplation of law — an invisible being which can have, in fact, no locality and can occupy no space, and therefore cannot have a dwelling place. (18 Am. Jur. 2d, p. 693 citing Kimmerle v. Topeka, 88 370, 128 p. 367; Wood v. Hartfold F. Ins. Co., 13 Conn 202)

Jurisprudence so holds that the foreign or domestic character of a corporation is to be determined by the place of its origin where its charter was granted and not by the location of its business activities (Jennings v. Idaho Rail Light & P. Co., 26 Idaho 703, 146 p. 101), A corporation is a "resident" and an inhabitant of the state in which it is incorporated and no other (36 Am. Jur. 2d, p. 49).

Defendant-appellee is a Philippine Corporation duly organized under the Philippine laws. Clearly, its residence is the Philippines, the place of its incorporation, and not Japan. While defendant-appellee maintains branches in Japan, this will not make it a resident of Japan. A corporation does not become a resident of another by engaging in business there even though licensed by that state and in terms given all the rights and privileges of a domestic corporation (Galveston H. & S.A.R. Co. vs. Gonzales, 151 US 496, 38 L ed. 248, 4 S Ct. 401).

On this premise, defendant appellee is a non-resident corporation. As such, court processes must be served upon it at a place within the state in which the action is brought and not elsewhere (St. Clair vs. Cox, 106 US 350, 27 L ed. 222, 1 S. Ct. 354). 5

It then concluded that the service of summons effected in Manila or beyond the territorial boundaries of Japan was null and did not confer jurisdiction upon the Tokyo District Court over the person of SHARP; hence, its decision was void.

Unable to obtain a reconsideration of the decision, NORTHWEST elevated the case to this Court contending that the respondent court

erred in holding that SHARP was not a resident of Japan and that summons on SHARP could only be validly served within that country.

A foreign judgment is presumed to be valid and binding in the country from which it comes, until the contrary is shown. It is also proper to presume the regularity of the proceedings and the giving of due notice therein. 6

Under Section 50, Rule 39 of the Rules of Court, a judgment in an action in personam of a tribunal of a foreign country having jurisdiction to pronounce the same is presumptive evidence of a right as between the parties and their successors-in-interest by a subsequent title. The judgment may, however, be assailed by evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact. Also, under Section 3 of Rule 131, a court, whether of the Philippines or elsewhere, enjoys the presumption that it was acting in the lawful exercise of jurisdiction and has regularly performed its official duty.

Consequently, the party attacking a foreign judgment has the burden of overcoming the presumption of its validity. 7 Being the party challenging the judgment rendered by the Japanese court, SHARP had the duty to demonstrate the invalidity of such judgment. In an attempt to discharge that burden, it contends that the extraterritorial service of summons effected at its home office in the Philippines was not only ineffectual but also void, and the Japanese Court did not, therefore acquire jurisdiction over it.

It is settled that matters of remedy and procedure such as those relating to the service of process upon a defendant are governed by the lex fori or the internal law of the forum. 8 In this case, it is the procedural law of Japan where the judgment was rendered that determines the validity of the extraterritorial service of process on SHARP. As to what this law is is a question of fact, not of law. It may not be taken judicial notice of and must be pleaded and proved like any other fact. 9 Sections 24 and 25, Rule 132 of the Rules of Court provide that it may be evidenced by an official publication or by a duly attested or authenticated copy thereof. It was then incumbent upon SHARP to present evidence as to what that Japanese procedural law is and to show that under it, the assailed extraterritorial service is invalid. It did not. Accordingly, the presumption of validity and regularity of the service of summons and the decision thereafter rendered by the Japanese court must stand.

Alternatively in the light of the absence of proof regarding Japanese law, the presumption of identity or similarity or the so-called processual presumption 10 may be invoked. Applying it, the Japanese law on the matter is presumed to be similar with the Philippine law on service of summons on a private foreign corporation doing business in the Philippines. Section 14, Rule 14 of the Rules of Court provides that if the defendant is a foreign corporation doing business in the Philippines, service may be made: (1) on its resident agent designated in accordance with law for that purpose, or, (2) if there is no such resident agent, on the government official designated by law to that effect; or (3) on any of its officers or agents within the Philippines.

If the foreign corporation has designated an agent to receive summons, the designation is exclusive, and service of summons is without force and gives the court no jurisdiction unless made upon him. 11

Where the corporation has no such agent, service shall be made on the government official designated by law, to wit: (a) the Insurance Commissioner in the case of a foreign insurance company; (b) the Superintendent of Banks, in the case of a foreign banking corporation; and (c) the Securities and Exchange Commission, in the case of other foreign corporations duly licensed to do business in the Philippines. Whenever service of process is so made, the government office or official served shall transmit by mail a copy of the summons or other legal proccess to the corporation at its home or principal office. The sending of such copy is a necessary part of the service. 12

SHARP contends that the laws authorizing service of process upon the Securities and Exchange Commission, the Superintendent of Banks, and the Insurance Commissioner, as the case may be, presuppose a situation wherein the foreign corporation doing business in the country no longer has any branches or offices within the Philippines. Such contention is belied by the pertinent provisions of the said laws. Thus, Section 128 of the Corporation Code 13 and Section 190 of the Insurance Code 14 clearly contemplate two situations: (1) if the corporation had left the Philippines or had ceased to transact business therein, and (2) if the corporation has no designated agent. Section 17 of the General Banking Act 15 does not even speak a corporation which had ceased to transact business in the Philippines.

Nowhere in its pleadings did SHARP profess to having had a resident agent authorized to receive court processes in Japan. This silence could only mean, or least create an impression, that it had none. Hence, service on the designated government official or on any of SHARP's officers or agents in Japan could be availed of. The respondent, however, insists that only service of any of its officers or employees in its branches in Japan could be resorted to. We do not agree. As found by the respondent court, two attempts at service were made at SHARP's Yokohama branch. Both were unsuccessful. On the first attempt, Mr. Dinozo, who was believed to be the person authorized to accept court process, was in Manila. On the second, Mr. Dinozo was present, but to accept the summons because, according to him, he was no longer an employee of SHARP. While it may be true that service could have been made upon any of the officers or agents of SHARP at its three other branches in Japan, the availability of such a recourse would not preclude service upon the proper government official, as stated above.

As found by the Court of Appeals, it was the Tokyo District Court which ordered that summons for SHARP be served at its head office in the Philippine's after the two attempts of service had failed. 16 The Tokyo District Court requested the Supreme Court of Japan to cause the delivery of the summons and other legal documents to the Philippines. Acting on that request, the Supreme Court of Japan sent the summons together with the other legal documents to the Ministry of Foreign Affairs of Japan which, in turn, forwarded the same to the Japanese Embassy in Manila . Thereafter, the court processes were delivered to the Ministry (now Department) of Foreign Affairs of the Philippines, then to the Executive Judge of the Court of First Instance (now Regional Trial Court) of Manila, who forthwith ordered Deputy Sheriff Rolando Balingit to serve the same on SHARP at its principal office in Manila. This service is equivalent to service on the proper

government official under Section 14, Rule 14 of the Rules of Court, in relation to Section 128 of the Corporation Code. Hence, SHARP's contention that such manner of service is not valid under Philippine laws holds no water. 17

In deciding against the petitioner, the respondent court sustained the trial court's reliance on Boudard vs. Tait 18 where this Court held:

The fundamental rule is that jurisdiction in personam over nonresidents, so as to sustain a money judgment, must be based upon personal service within the state which renders the judgment.

xxx xxx xxx

The process of a court, has no extraterritorial effect, and no jurisdiction is acquired over the person of the defendant by serving him beyond the boundaries of the state. Nor has a judgment of a court of a foreign country against a resident of this country having no property in such foreign country based on process served here, any effect here against either the defendant personally or his property situated here.

Process issuing from the courts of one state or country cannot run into another, and although a nonresident defendant may have been personally served with such process in the state or country of his domicile, it will not give such jurisdiction as to authorize a personal judgment against him.

It further availed of the ruling in Magdalena Estate, Inc. vs. Nieto 19 and Dial Corp. vs. Soriano, 20 as well as the principle laid down by the Iowa Supreme Court in the 1911 case of Raher vs. Raher. 21

The first three cases are, however, inapplicable. Boudard involved the enforcement of a judgment of the civil division of the Court of First Instance of Hanoi, French Indo-China. The trial court dismissed the case because the Hanoi court never acquired jurisdiction over the person of the defendant considering that "[t]he, evidence adduced at the trial conclusively proves that neither the appellee [the defendant] nor his agent or employees were ever in Hanoi, French Indo-China; and that the deceased Marie Theodore Jerome Boudard had never, at any time, been his employee." In Magdalena Estate, what was declared invalid resulting in the failure of the court to acquire jurisdiction over the person of the defendants in an action in personam was the service of summons through publication against non-appearing resident defendants. It was claimed that the latter concealed themselves to avoid personal service of summons upon them. In Dial, the defendants were foreign corporations which were not, domiciled and licensed to engage in business in the Philippines and which did not have officers or agents, places of business, or properties here. On the other hand, in the instant case, SHARP was doing business in Japan and was maintaining four branches therein.

Insofar as to the Philippines is concerned, Raher is a thing of the past. In that case, a divided Supreme Court of Iowa declared that the principle that there can be no jurisdiction in a court of a territory to render a personal judgment against anyone upon service made outside its limits was applicable alike to cases of residents and non-residents. The principle was put at rest by the United States Supreme Court when it ruled in the 1940 case of Milliken vs. Meyer 22 that domicile in the state is alone sufficient to bring an absent defendant within the reach of the state's jurisdiction for purposes of a personal judgment by means of appropriate substituted service or personal service without the state. This principle is embodied in section 18, Rule 14 of the Rules of Court which allows service of summons on residents temporarily out of the Philippines to be made out of the country. The rationale for this rule was explained in Milliken as follows:

[T]he authority of a state over one of its citizens is not terminated by the mere fact of his absence from the state. The state which accords him privileges and affords protection to him and his property by virtue of his domicile may also exact reciprocal duties. "Enjoyment of the privileges of residence within the state, and the attendant right to invoke the protection of its laws, are inseparable" from the various incidences of state citizenship. The responsibilities of that citizenship arise out of the relationship to the state which domicile creates. That relationship is not dissolved by mere absence from the state. The attendant duties, like the rights and privileges incident to domicile, are not dependent on continuous presence in the state. One such incident of domicile is amenability to suit within the state even during sojourns without the state, where the state has provided and employed a reasonable method for apprising such an absent party of the proceedings against him. 23

The domicile of a corporation belongs to the state where it was incorporated. 24 In a strict technical sense, such domicile as a corporation may have is single in its essence and a corporation can have only one domicile which is the state of its creation. 25

Nonetheless, a corporation formed in one-state may, for certain purposes, be regarded a resident in another state in which it has offices and transacts business. This is the rule in our jurisdiction and apropos thereto, it may be necessery to quote what we stated in State Investment House, Inc, vs. Citibank, N.A., 26 to wit:

The issue is whether these Philippine branches or units may be considered "residents of the Philippine Islands" as that term is used in Section 20 of the Insolvency Law . . . or residents of the state under the laws of which they were respectively incorporated. The answer cannot be found in the Insolvency Law itself, which contains no definition of the term, resident, or any clear indication of its meaning. There are however other statutes, albeit of subsequent enactment and effectivity, from which enlightening notions of the term may be derived.

The National Internal Revenue Code declares that the term "'resident foreign corporation' applies to a foreign corporation engaged in

trade or business within the Philippines," as distinguished from a "'non-resident foreign corporation' . . . (which is one) not engaged in trade or bussiness within the Philippines." [Sec. 20, pars. (h) and (i)].

The Offshore Banking Law, Presidential Decree No. 1034, states "that branches, subsidiaries, affiliation, extension offices or any other units of corporation or juridical person organized under the laws of any foreign country operating in the Philippines shall be considered residents of the Philippines. [Sec. 1(e)].

The General Banking Act, Republic Act No. 337, places "branches and agencies in the Philippines of foreign banks . . . (which are) called Philippine branches," in the same category as "commercial banks, savings associations, mortgage banks, development banks, rural banks, stock savings and loan associations" (which have been formed and organized under Philippine laws), making no distinction between the former and the latter in so far as the terms "banking institutions" and "bank" are used in the Act [Sec. 2], declaring on the contrary that in "all matters not specifically covered by special provisions applicable only to foreign banks, or their branches and agencies in the Philippines, said foreign banks or their branches and agencies lawfully doing business in the Philippines "shall be bound by all laws, rules, and regulations applicable to domestic banking corporations of the same class, except such laws, rules and regulations as provided for the creation, formation, organization, or dissolution of corporations or as fix the relation, liabilities, responsibilities, or duties of members, stockholders or officers of corporation. [Sec. 18].

This court itself has already had occasion to hold [Claude Neon Lights, Fed. Inc. vs. Philippine Advertising Corp., 57 Phil. 607] that a foreign corporation licitly doing business in the Philippines, which is a defendant in a civil suit, may not be considered a non-resident within the scope of the legal provision authorizing attachment against a defendant not residing in the Philippine Islands; [Sec. 424, in relation to Sec. 412 of Act No. 190, the Code of Civil Procedure; Sec. 1(f), Rule 59 of the Rules of 1940, Sec. 1(f), Rule 57, Rules of 1964] in other words, a preliminary attachment may not be applied for and granted solely on the asserted fact that the defendant is a foreign corporation authorized to do business in the Philippines — and is consequently and necessarily, "a party who resides out of the Philippines." Parenthetically, if it may not be considered as a party not residing in the Philippines, or as a party who resides out of the country, then, logically, it must be considered a party who does reside in the Philippines, who is a resident of the country. Be this as it may, this Court pointed out that:

. . . Our laws and jurisprudence indicate a purpose to assimilate foreign corporations, duly licensed to do business here, to the status of domestic corporations. (Cf. Section 73, Act No. 1459, and Marshall Wells Co. vs. Henry W. Elser & Co., 46 Phil. 70, 76; Yu Cong Eng vs. Trinidad, 47 Phil. 385, 411) We think it would be entirely out of line with this policy should we make a discrimination against a foreign corporation, like the petitioner, and subject its property to the harsh writ of seizure by attachment when it has complied not only with every requirement of law made specially of foreign corporations, but in addition with every requirement of law made of domestic corporations. . . .

Obviously, the assimilation of foreign corporations authorized to do business in the Philippines "to the status of domestic corporations, subsumes their being found and operating as corporations, hence, residing, in the country.

The same principle is recognized in American law: that the residence of a corporation, if it can be said to have a residence, is necessarily where it exercises corporate functions . . .;" that it is considered as dwelling "in the place where its business is done . . .," as being "located where its franchises are exercised . . .," and as being "present where it is engaged in the prosecution of the corporate enterprise;" that a "foreign corporation licensed to do business in a state is a resident of any country where it maintains an office or agent for transaction of its usual and customary business for venue purposes;" and that the "necessary element in its signification is locality of existence." [Words and Phrases, Permanent Ed., vol. 37, pp. 394, 412, 493].

In as much as SHARP was admittedly doing business in Japan through its four duly registered branches at the time the collection suit against it was filed, then in the light of the processual presumption, SHARP may be deemed a resident of Japan, and, as such, was amenable to the jurisdiction of the courts therein and may be deemed to have assented to the said courts' lawful methods of serving process. 27

Accordingly, the extraterritorial service of summons on it by the Japanese Court was valid not only under the processual presumption but also because of the presumption of regularity of performance of official duty.

We find NORTHWEST's claim for attorney's fees, litigation expenses, and exemplary damages to be without merit. We find no evidence that would justify an award for attorney's fees and litigation expenses under Article 2208 of the Civil Code of the Philippines. Nor is an award for exemplary damages warranted. Under Article 2234 of the Civil Code, before the court may consider the question of whether or not exemplary damages should be awarded, the plaintiff must show that he is entitled to moral, temperate, or compensatory damaged. There being no such proof presented by NORTHWEST, no exemplary damages may be adjudged in its favor.

WHEREFORE, the instant petition is partly GRANTED, and the challenged decision is AFFIRMED insofar as it denied NORTHWEST's claims for attorneys fees, litigation expenses, and exemplary damages but REVERSED insofar as in sustained the trial court's dismissal of NORTHWEST's complaint in Civil Case No. 83-17637 of Branch 54 of the Regional Trial Court of Manila, and another in its stead is hereby rendered ORDERING private respondent C.F. SHARP L COMPANY, INC. to pay to NORTHWEST the amounts adjudged in the foreign judgment subject of said case, with interest thereon at the legal rate from the filing of the complaint therein until the said foreign judgment is fully satisfied.

Costs against the private respondent.SO ORDERED.

G.R. No. L-45193             April 5, 1939

EMILIE ELMIRA RENEE BOUDARD, RAYMOND ANTONIN BOUDARD, GINETTE ROSE ADELAIDE BOUDARD and MONIQUE VICTOIRE BOUDARD, plaintiffs-appellants, vs.STEWART EDDIE TAIT, defendant-appellee.

Ramirez and Ortigas for appellants.Gibbs, McDonough and Ozaeta for appellee.

DIAZ, J.:

Plaintiffs appeal from a judgment of the Court of First Instance of Manila dismissing the case instituted by them, thereby overruling their complaint, and sentencing them to pay the costs. They now contend in their brief that:

I. The lower court erred in not admitting Exhibits D, E, F and H to M-1 of plaintiffs.

II. The lower court erred in declaring that it was indispensable for the defendant to be served with summons in Hanoi.

III. The lower court erred in declaring that service by publication, with personal notice by the French Consul in Manila, was not sufficient.

IV. The lower court erred in declaring that the Court of Hanoi had no jurisdiction over the person of the defendant.

V. The lower court erred in dismissing this case, instead of sentencing the defendant to pay to the plaintiffs the amounts claimed in the complaint as adjudged by the Court of Hanoi; and

VI. The lower court erred in denying the motion for new trial on the ground that the decision is contrary to the law and the evidence.

Briefly stated, the pertinent facts of the case, that we glean from the records, are as follows: The appellant Emilie Elmira Renee Boudard, in her capacity as widow of Marie Theodore Jerome Boudard and as guardian of her coappellants, her children born during her marriage with the deceased, obtained a judgment in their favor from the civil division of the Court of First Instance of Hanoi, French Indo-China, on June 27, 1934, for the sum of 40,000 piastras, equivalent, according to the rate of exchange at the time of the rendition of the judgment, to P56,905.77, Philippine currency, plus interest the amount or rate of which is not given. The judgment was rendered against Stewart Eddie Tait who had been declared in default for his failure to appear at the trial before said court.

Appellants' action, by virtue of which they obtained the foregoing judgment, was based on the fact that Marie Theodore Jerome Boudard, who was an employee of Stewart Eddie Tait, was killed in Hanoi by other employees of said Tait, although "outside of the fulfillment of a duty", according to the English translation of a certified copy of the decision in French, presented by the appellants. The dismissal of appellants' complaint by the lower court was based principally on the lack of jurisdiction of the Court of Hanoi to render the judgment in question, for the execution of which this action was instituted in this jurisdiction. The lack of jurisdiction was discovered in the decision itself of the Court of Hanoi which states that the appellee was not a resident of, nor had a known domicile in, that country.

The evidence adduced at the trial conclusively proves that neither the appellee nor his agent or employees were ever in Hanoi, French Indo-China; and that the deceased Marie Theodore Jerome Boudard had never, at any time, been his employee. The appellee's first intimation of his having been sued and sentenced to pay a huge sum by the civil division of the Court of First Instance of Hanoi was when he was served with summons in the present case.

Passing now to the consideration of the errors assigned by the appellants, we must say that it was really unnecessary for the lower court to admit Exhibit D, E, F and H to M-1, nor can these exhibits be admitted as evidence, for, as to the first point, the appellants failed to show that the proceedings against the appellee in the Court of Hanoi were in accordance with the laws of France then in force; and as to the second point, it appears that said documents are not of the nature mentioned in sections 304 and 305 of Act No. 190. They are not copies of the judicial record of the proceedings against the appellee in the Court of Hanoi, duly certified by the proper authorities there, whose signatures should be authenticated by the Consul or some consular agent of the United States in said country. The appellants argue that the papers are the original documents and that the Honorable French Consul in the Philippines had confirmed this fact. Such argument is not sufficient to authorize a deviation from a rule established and sanctioned by law. To comply with the rule, the best evidence of foreign judicial proceedings is a certified copy of the same with all the formalities required in said sections 304 and 305 for only thus can one be absolutely sure of the authenticity of the record. On the other hand said exhibits or documents, if admitted, would only corroborate and strengthen the evidence of the appellee which in itself is convincing, and the conclusion of the lower court that the appellee is not liable for the amount to which he was sentenced, as alleged, for he was not duly tried or even summoned in conformity with the law. It is said that the French law regarding summons, according to its English translation presented by the appellants, is of the following tenor:

"SEC. 69 (par. 8). Those who have no known residence in France, in the place of their present residence: if the place is unknown, the writ shall be posted at the main door of the hall of the court where the complaint has been filed; a second copy shall be given to the Attorney-General of the Republic who shall visae the original." But then, Exhibits E, E-1, F and F-1 show that the summons alleged to have been addressed to the appellee, was delivered in Manila on September 18, 1933, to J. M. Shotwell, a representative or agent of Churchill & Tait Inc., which is an entity entirely different from the appellee.

Moreover, the evidence of record shows that the appellee was not in Hanoi during the time mentioned in the complaint of the appellants, nor were his employees or representatives. The rule in matters of this nature 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.

The fundamental rule is that jurisdiction in personam over nonresidents, so as to sustain a money judgment, must be based upon personal service within the state which renders the judgment. (Pennoyer vs. Neff, 95 U. S., 714; 24 Law. ed., 565; Twining vs. New Jersy, 211 U. S., 78; 29 S. Ct., 14; 53 Law. ed., 97; Continental National Bank of Boston vs. Thurber, 143 N. Y., 648; 37 N. E., 828.)

The process of a court of one state cannot run into another and summon a party there domiciled to respond to proceedings against him. (Hess vs. Pawloski, 274 U. S., 352, 355; 47 S. Ct., 632, 633 [71 Law. ed., 109].) Notice sent outside the state to a nonresident is unavailing to give jurisdiction in an action against him personally for money recovery. (Pennoyer vs. Neff, 95 U. S., 741 [24 Law. ed., 565].) There must be actual service within the State of notice upon him or upon some one authorized to accept service for him. (Goldey vs. Morning News, 156 U. S., 518 [15 S. Ct., 559; 39 Law. ed., 517].) A personal judgment rendered against a nonresident, who has neither been served with process nor appeared in the suit, is without validity. (McDonald vs. Mabee, 243 U. S., 90 [37 S. Ct., 343; 61 Law, ed., 608; L. R. A. 1917F, 485].) The mere transaction of business in a state by nonresident natural persons does not imply consent to be bound by the process of its courts. (Flexner vs. Farson, 248 U. S., 289 [39 S. Ct., 97; 63 Law. ed., 250].)" (Cited in Skandinaviska Granit Aktiebolaget vs. Weiss, 234 N. Y. S., 202, 206, 207.)

The process of a court has no extraterritorial effect, and no jurisdiction is acquired over the person of the defendant by serving him beyond the boundaries of the state. Nor has a judgment of a court of a foreign country against a resident of his country having no property in such foreign country based on process served here, any effect here against either the defendant personally or his property situated here. (5 R. C. L., 912.)

Process issuing from the courts of one state or country cannot run into another, and although a nonresident defendant may have been personally served with such process in the state or country of his domicile, it will not give such jurisdiction as to authorize a personal judgment against him. (23 Cyc., 688.)

It can not be said that the decision rendered by the Court of Hanoi should be conclusive to such an extent that it cannot be contested, for it merely constitutes, from the viewpoint of our laws, prima facie evidence of the justness of appellants' claim, and, as such, naturally admits proof to the contrary. This is precisely the provision of section 311 of Act No. 190, as interpreted in the case of Ingenohl vs. Walter E. Olsen & Co. (47 Phil., 189):0

The effect of a judgment of any other tribunal of a foreign country, having jurisdiction to pronounce the judgment, is as follows:

1. In case of a judgment against a specific thing, the judgment is conclusive upon the title to the thing;

2. In case of a 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 a want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact. (Sec. 311 of Act No. 190.)

In view of the foregoing considerations, our conclusion is that we find no merit in the errors assigned to the lower court and the appealed judgment is in accordance with the law.

Wherefore, the judgment is affirmed, with costs against the appellants. So ordered.

G.R. No. L-3693             July 29, 1950

MARGARET QUERUBIN, recurrente-apelante, vs.SILVESTRE QUERUBIN, recurrido-apelado.

Manuel A. Argel en representacion del recurrente y apelante.Maximino V. Bello en representacion del recurrido y apelado.

PABLO, J.:

Silvestre Querubin es de Caoayan, Ilocos Sur, de padres filipinos. En 1926 se marcho a los Estados Unidos con el objeto de estudiar pero con el proposito de volver despues a su pais natal. Obtuvo el titulo de "Master of Arts and Sciences" en la "University of Southern California," institucion domiciliada en los Angeles, California, en donde el recurrido empezo a vivir desde 1934.

En 20 de octubre de 1943, Silvestre Querubin contrajo matrimonio con la recurrente, Margaret Querubin, en Albuquerque, New Mexico. Como fruto de este matrimonio nacio Querubina Querubin, quien, al tiempo de la vista de la causa en el Juzgado de primera instancia de Ilocos Sur, tenia cuatro años de edad poco mas o menos.

La recurrente entablo en 1948 una demanda de divorcio contra el recurrido, fundada en "crueldad mental." En 7 de febrero de 1948 el divorcio fue concedido al marido en virtud de una contrademanda presentada por el y fundada en la infidelidad de su esposa. En 5 de abril de 1949, y a peticion del demandado y contrademandante, (recurrido enesta actuacion de habeas corpus) el Juzgado superior de Los Angeles dicto una orden interlocutoria disponiendo lo siguiente:

It is therefore ordered, adjudged and decreed that the interlocutory judgment of divorce hereinbefore entered on February 27, 1948, in Book 1891, page 319, be and the same is hereby modified in the following particulars in connection with the custody of the minor child of the parties only:

(1) The care, custody and control of the minor child of the parties, Querubina Querubin, is hereby awarded to defendant and cross-complainants;

(2) Said child is to be maintained in a neutral home, subject to the right of reasonable visitation on the part of both parties to this action;

(3) Each party shall have the right to take said child away from said neutral home but plaintiff and cross-defendant is restrained from taking said child to her place of residence;

(4) Each party is restrained from molesting the other, or in any way interfering with the other's right of reasonable visitation of said child;

(5) Each party is restrained from removing the child from the State of California without first securing the permission of the court; said parties are further restrained from keeping the child out of the County of Los Angeles for more than one day without first securing the consent of the court.

El recurrido salio de San Francisco en 7 de noviembre de 1949, arribando a Manila en 25 del mismo mes. En 27 de susodicho mes llego a Caoayan, Ilocos Sur, donde vive actualmente, llevandose consigo a la niña Querubina, a quien trajo a Filipinas porque, en su calidad de padre, queria evitar que llegase a conocimiento de ella la conducta indecorosa de su propia madre. El recurrido queria que su hija fuera educada en un ambiente de elevada moralidad.

A peticion de la recurrente Margaret, el Juzgado superior de los Angeles, California, en 30 de noviembre de 1949 modifico su orden de 5 de abril de 1949, disponiendo lo siguiente:

Under interlocutory decree of March 7, 1949, the child, a girl now 3 1/2 years old, was granted to deft husband, but the child was to be kept in a neutral home; both parties were given reasonable visitation and both were restrained from removing the child out of the state. Deft has taken the child with him to the Philippine Islands. At time of trial custody was apparently denied pft because she was then living with another man. She is now married to this man and they have a well equipped home. Ptf appears to be a devoted mother. She has one child, the issue of her present marriage, and is also caring for a child that was abandoned by certain friends of hers. Ptf's husband is regularly and permanently employed. Witnesses testified in behalf of the ptf in reference to her motherly qualities and the condition of her home. She visited the child in question sufficiently when the child was in the neutral home and brought her toys and other articles. Service of the order to show cause was made on deft's attorneys of record.

The interlocutory decree is modified so as to provide that custody of the child shall be awarded to ptf and deft shall have the right of reasonable visitation. Deft shall pay ptf for the support of the child $30 each month on the 1st day thereof, commencing Jan. 1950.

En el dia de la vista de esta causa de habeas corpus en Ilocos Sur, el recurrido declaro que nunca intento cambiar su ciudadania; que cuando vino al pais tenia unos P2,000 de ahorro; que tres semanas despues de su arribo recibio oferta para enseñar con sueldo P250 mensual en el colegio establecido por el Dr. Sobrepeña en Villasis, Pangasinan; que nunca se le ha privado de patria potestad por sentencia judicial, ni declarado ausente de Filipinas, ni sujeto a interdiccion civil. Segun el juzgado a quo, el recurrido es de irreprochable conducta.

En 10 de febrero de 1950 la recurrente Margaret Querubin, por medio de su abogado, presento en el Juzgado de primera instancia de Ilocos Sur una solicitud de habeas corpus reclamando la custodia de su hija Querubina, alegando como fundamento el decreto interlocutorio del juzgado de California que concedio a ella dicha custodia. Despues de la vista correspondiente, el Juzgado a quo, en 28 de febrero de 1950 denego la solicitud. La recurrente acude en apelacion ante este Tribunal.

La recurrente sostiene que bajo el articulo 48 de la Regla 39, el decreto Exhibit A-1 del Juzgado de los Angeles, California, debe cumplirse en Filipinas. Su parte dispositiva dice textualmente:

The interlocutory decree is modified so as to the provide that custody of the child shall be awarded to ptf and deft shall have the right to reasonable visitation. Deft shall pay ptf for the support of the child $30 each month on the 1st day thereof, commencing Jan. 1950.

Un decreto interlocutorio sobre la custodia de un menor no es una decision final. Por su naturaleza no es firme. Esta sujeto a cambios como cambian las circunstancias. En el primer decreto se dio al padre la custodia de la menor. A peticion del padre, se dicto el decreto de 5 de abril prohibiendo a la madre que llavase a la menos a su casa porque estaba otra vez en relaciones adulterinas con otro hombre. Cuando ya no estaba el recurrido en Los Angeles, porque ya habian venido a Filipinas, se enmendo la ultima orden y se dispuso que la custodia estuviese encomendada a la recurrente, pagando a ella el recurrido $30 al mes para la manutencion de la menor. La pension no es fija y se aumenta o disminuye como aumentan o disminuyen las necesidades del pensionista o como exijan las condiciones economicasdel que la da.

Porque el decreto interlocutorio, Exhibit A-1, no constituye decision final, no cabe pedir su cumplimiento en Filipinas. En los mismos Estados Unidos no puede pedirse el cumplimiento de una orden interlocutoria en el juzgado de otro estado.

The rule is of common knowledge that the definitive judgment of a court of another state between the same parties on the same cause of action, on the merits of the case is conclusive, but it must be a definitive judgment on the merits only. Where the judgment is merely interlocutory, the determination of the question by the court which rendered it did not settle and adjudge finally the rights of the parties." (National Park Bank vs. Old Colony Trust Co., 186 N.Y.S., 717.)

As already stated the Minnesota decree, to the extent that it is final and not subject to modification, is entitled to the protection of the full faith and credit clause of the federal Constitution and must be enforced in this state. If, however, a part of the Minnesota decree in not final, but is subject to modification by the court which rendered it, then neither the United States Constitution nor the principle of comity compels the courts of this state to enforce that part of the decree; for no court other than the one granting the original decree could undertake to administer relief without bringing about a conflict of authority. (Levine vs. Levine, 187 Pac., 609.)

A judgment rendered by a competent court, having jurisdiction in one state, is conclusive on the merits in the courts of every other state, when made the basis of an action and the merits cannot be reinvestigated. Our own Supreme Court so holds. Cook vs. Thornhill, 13 Tex. 293, 65 Am. Dec. 63. But before such a judgment rendered in one state is entitled to acceptance, in the courts of another state, as conclusive on the merits, it must be a final judgment and not merely an interlocutory decree. Freeman on Judgment, Sec. 575; Baugh vs. Baugh, 4 Bibb (7 Ky.) 556; Brinkley vs. Brinkley, 50 N.Y. 184, 10 Am. Rep. 460; Griggs, vs. Becker, 87 Wis. 313, 58 N.W. 396. (Walker vs. Garland et al., 235 S.W., 1078.)

En general, un decreto de divorcio encomendando la custodia de un hijo del matrimonio a uno de los conyuges se respeta por los juzgados de otros estados "at the time and under the circumstances of its rendition but that such a decree has no controlling effects in another state as to facts or conditions arising subsequently to the date of the decree; and the courts of the latter state may, in proper proceedings, award the custody otherwise upon proof of matters subsequent to the decree which justify the change in the interest of the child." (20 A.L.R., 815.)

En el caso presente las circunstancias han cambiado. Querubina ya no esta en los Angeles sino en Caoayan, Ilocos Sur. Esta bajo el cuidado de su padre. Hay una distancia enorme desde Los Angeles y el presente domicilio de la menor y el costo del pasaje hasta aquella ciudad seria muy elevado, y aun es posible que este fuera del alcance de la recurrente. No hay pruebas de que ella esta en condiciones de pagar los gastos de viaje de la menor y del que la acompañe. Ella no es un paquete de cigarrillos que se puede enviar por correo a Los Angeles.

No consta que las circunstancias que se daban en noviembre de 1949 en Los Angeles, prevalecian en el mismo estado hasta el momento en que se vio la causa en el Juzgado de primera instancia de Ilocos Sur. Tampoco hay pruebas de que la recurrente dispone de suficientes fondos para costear el viaje de la niña Querubina desde Caoayan, Ilocos Sur, hasta Los Angeles, California, y para responder de su alimentacion, cuidado y educacion, y constando en autos que el padre, mas que nadie, esta interesado en el cuidado y educacion de su hija, y que tiene ahorros de mas de P2,000 depositados en un banco, creemos que el Juzgado a quo no erro al denegar la solicitud.

El Juzgado no podia, sin prueba satisfactoria, disponer sin remordimiento de conciencia la entrega de la niña al abogado de la recurrente: es su obligacion velar por la seguridad y bienestar de ella. No se trata solo de resolver el derecho preferente del padre y de la madre en la custodia. La vital y trascendental cuestion del porvenir de la niña es superior a toda consideracion. El Estado vela por sus ciudadanos. El articulo 171 del Codigo Civil dispone que "Los Tribunales podran privar a los padres de la patria potestad, o suspender el ejercicio de esta, si trataren a sus hijos con dureza excesiva, o si les dieren ordenes, consejos o ejemplos corrutores." En Cortes contra Castillo y otra (41 Jur. Fil., 495), este Tribunal declaro que no erro el Juzgado de primera instancia al nombrar a la abuela, como tutora de dos menores, en vez de su madre que fue condenada por adulterio.

El articulo 154 del Codigo Civil dispone que "El padre, y en su defecto la madre, tienen potestad sobre sus hijos legitimos no emancipados." Con todo, si se hace indebido ejercicio de esta facultad, los tribunales, como ya hemos dicho, pueden privarie de ella y encomendar el cuidadano del menor a otras instituciones, como dispone el articulo 6 de la Regla 100, que es reproduccion del articulo 771 de la Ley No. 190. En el asunto de Lozano contra Martinez y De Vega (36 Jur. Fil., 1040), en que el primero, en un recurso de habeas corpus, reclamaba contra su esposa la custodia de su hijo menor de 10 años, este Tribunal, en apelacion, declaro que el juzgado a quo no abuso de la discrecion conferida a el por el articulo 771 del Codigo de procedimiento civil al denegar la solicitud. Esta interpretacion del articulo en cuanto al debido ejercicio de la discrecion de un Juzgado de primera instancia ha sido reafirmada en el asunto de Pelayo contra Lavin (40 Jur. Fil., 529).

En la solicitud presentada, no hay siquiera alegacion de que el juzgado a quo haya abusado de su discrecion. Este Tribunal no debe revocar su actuacion.

En la vista de la causa en el Juzgado de Primera Instancia de Ilocos Sur, el recurrido declaro que habia traido su hija a Filipinas porque queria evitar que ella tuviera conocimiento de la conducta impropia y de la infidelidad cometida por la madre, impidiendo que la viese convivir con el hombre que habia ofendido a su padre. El recurrido dijo que queria que su hija se criase en un ambiente de elevada moral, y que no se sancionara indirectamente la infidelidad de la esposa. Bajo la Ley de Divorcio No. 2710, el conyuge culpable no tiene derecho a la custodia de los hijos menores. La legislacion vigente, las buenas costumbres y los interesesdel orden publico aconsejan que la niña debe estar fuera del cuidado de una madre que ha violado el juramento de fidelidad a su marido. Creemos que este Tribunal no debe hacer cumplir un decreto dictado por un tribunal extranjero, que contraviene nuestras leyes y los sanos principios de moralidad que informan nuestra estructura social sobre relaciones familiares.

En el asunto de Manuela Barretto Gonzales contra Augusto Gonzales (58 Jur. Fil., 72), se pidio por la demandante que el divorcio obtenido por el demandado en Reno, Nevada, en 28 de noviembre de 1927, fuera confirmado y ratificado por el Juzgado de primera instancia de Manila. Este juzgado dicto sentencia a tenor de la peticion. Teniendo en cuenta el articulo 9 del Codigo civil que dispone que "Las leyes relativas a los derechos y deberes de familia, o al estado, condicion y capacidad legal de las personas, obligan a los espanoles (filipinos) aunque residan en pais extranjero" y el articulo 11 del mismo codigo que dice en parte qye ". . . las leyes prohibitivas concernientes a las personas, sus actos o sus bienes, y las que tienen por objeto el orden publico y las buenas costumbres, no quedaran sin efecto por leyes o sentencias dictadas, ni por disposiciones o convenciones acordades en pais extranjero," este Tribunal, en apelacion, declaro: "Los litigantes, mediante convenio mutuo, no pueden obligar a los tribunales a que aprueben sus propios actos, ni que permitan que las relaciones personales de los ciudadanos de estas Islas queden afectadas por decretos de paises extranjeros en una forma que nuestro Gobierno cree que es contraria al orden publico y a la recta moral," y revoco la decision del juzgado inferior.

Las sentencias de tribunales extranjeros no pueden properse en vigor en Filipinas si son contrarias a la leyes, costumbres y orden publico. Si dichas decisiones, por la simple teoria de reciprocidad, cortesia judicial y urbanidad internacional son base suficiente para que nuestros tribunales decidan a tenor de las mismas, entonces nuestros juzgados estarian en la pobre tesitura de tener que dictar sentencias contrarias a nuestras leyes, costumbres y orden publico. Esto es absurdo.

En Ingenohl contra Olsen & Co. (47 Jur. Fil., 199), se discutio el alcanse de la cortesia internacional. El articulo 311 del Codigo de Procedimiento Civil que es hoy el articulo 48, Regla 39, fue la base de la accion presentada por Ingenohl. Pidio en su demanda que el Juzgado de primera instancia de Manila dictase sentencia de acuerdo con la dictada por el Tribunal Supremo de Hongkong. Despues de la vista correspondiente, el juzgado dicto sentencia a favor del demandante con intereses legales y costas. En apelacion, se alego que el juzgado inferior erro al no declarar que la decision y sentencia del Tribunal Supremo de Hongkong se dicto y registro como resultado de un error manifiesto de hecho y de derecho. Este Tribunal declaro que "Es principio bien sentado que, a falta de un tratado o ley, y en virtud de la cortesia y del derecho internacional, una sentencia dictada por un tribunal de jurisdiccion competente de un pais extranjero, en el que las partes han comparecido y discutido un asunto en el fondo, sera reconocido y puesta en vigor en cualquier otro pais extranjero." Pero teniendo en cuenta el articulo 311 del Codigo de Procedimiento Civil que dispone que "la sentencia puede ser rechazada mediante prueba de falta de competencia, o de haber sido dictada sin la previa notificacion a la parte, o que hubo connivencia, fraude o error manifiesto de derecho o de hecho," concluyo: "En virtud de esa Ley cuando una persona trata de hacer cumplir una sentencia extranjera, el demandado tiene derecho a ejercitar cualquier defensa de esas, y si se llegara a demostrar que existe propiamente alguna de ellas, destruira los efectos de la sentencia." Revoco la decision del juzgado inferior y declaro y fallo que "la sentencia dictada por el Tribunal de Hongkong, contra la demandada, constituyo un error manifesto de hecho y de derecho, y, por tal razon, no debe exigirse su cumplimiento en las Islas Filipinas."

Si se concede la solicitud, la menor estaria bajo el cuidadode su madre que fued declarada judicialmente culpable de infidelidad conyugal; viviria bajo un techo juntamente con el hombre que deshonro a su madre y ofendio a su padre; jugaria y creceria con el fruto del amor adulterino de su madre; llegaria a la pubertad con la idea de que una mujer que fue infiel a su marido tiene derecho a custodiar a su hija. En semejante medio ambiente no puede criarse a una niña de una manera adecuada: si llegara a saber durante su adolescencia que su padre ha sido traicionado por su madre con el hombre con quien vive, esa niña viviria bajo una impresion de inferioridad moral de incalculables consecuencias, y por ello nunca seria feliz; y si, bajo la influencia de su madre, llegara a creer que la infidelidad de una esposa es solo un incidente tan pasajero como cambiar de tocado, la niña iria por el camino de la perdicion. Y la educacion moral que puede darle su padrasto dificilmente puede ser mejor.

Si se deniega la solicitud, la niña viviria con su padre con el beneficio de un cuidado paternal exclusivo, y no con la dividida atencion de una madre que tiene que atender a su esposo, a sus dos hijas y a una tercera niña, la protegida. Para el bienestar de la menor Querubina, que es lo que mas importa en el caso presente, su custodia por el padre debe considerarse preferente.

En los mismos Estados Unidos, el punto cardinal que tienen en cuenta los juzgados, no es la reclamacion de las partes o la fuerza del decreto interlocutorio, sino el bienestar del menor.

A consideration of all the facts and circumstances leads to the conclusion that comity does not require the courts of this state, regardless of the well-being of the child, to lend their aid to the enforcement of the Iowa decree by returning Winifred to the custody of her grandmother. A child is not a chattel to which title and the right of possession may be secured by the decree of any court. If the decree had been rendered by a domestic court of competent jurisdiction, it would not have conclusively established the right to the custody of the child. In a contest between rival claimants, this court would have been free, notwithstanding the decree, to award the custody solely with an eye to the child's welfare. (State ex rel. Aldridge vs. Aldridge, 204 N.W. 324.)

On habeas corpus by the mother to obtain possession from the father of two children aged four and six years, whose custody she alleged had been awarded her in divorce proceedings in another state, it appeared that the mother was without property, and had no means of support save her personal earnings of $15 per month, was in poor health, and lived with her mother, in immoral surroundings, and that the father was an industrious and sober man, earnings $100 per month. Held, that the welfare of the children was the only thing to be considered, and a judgment awarding their custody to the mother should be reversed. (Kentzler vs. Kentzler, 28 Pac., 370.)

La recurrente, como ultimo recurso, invoca la comity of nations. La reciprocidad, la cortesia entre naciones no es absoluta. Rige cuando hay tratado y hay igualdad de legislacion. Se adopta la doctrina de reciprocidad cuando el tribunal extranjero tiene jurisdiccion para conocer de la causa, las partes han comparecido y discutido el asunto en el fondo. Algunas veces se concede como privilegio pero no como estricto derecho. La cortesia pedida no ha sido reconocida por este Tribunal cuando declaro que los derechos y deberes de familia, estado, condicion y capacidad legal de las personas se rigen por las leyes de Filipinas y no por las de America (Gonzales contra Gonzales, supra) y no dio validez a la decision del Tribunal Supremo de Hongkong porque era erronea en sus conclusiones de hecho y de derecho (Ingenohl contra Olsen y Co., supra).

La reciprocidad entre los estados de la Union Americana no es absoluta. No es regla inquebrantable. Los varios casos citados mas arriba lo demuestran. He ahi otro caso:

On the question of comity, this court said in the habeas corpus case of In re Stockman, 71 Mich. 180, 38 N.W. 876:

"Comity cannot be considered in a case like this, when the future welfare of the child is the vital question in the case. The good of the child is superior to all other considerations. It is the polar star to guide to the conclusion in all cases of infants, whether the question is raised upon a writ of habeas corpus or in a court of chancery." (Ex parte Leu, 215 N.W., 384.)

Ya hemos visto que la orden interlocutoria cediendo la custodia de la menor a la recurrente esta en pugna con las disposiciones expresas de la legislacion vigente en Filipinas. En el primer decreto y en el enmendatorio se encomendo la custodia de la menor al padre y se prohibio, en la orden enmendada, a la madre llevar a la menor a su casa porque estaba otra vez en relaciones ilegales con otro hombre. Pero el ultimo decreto enmendatorio, contrario al sentido de justicia, a la ley, y a las buenas costumbres, encomendo la custodia de la menor a la que fue esposa infiel porque ya estaba casada con quien cometio adulterio. Y bajo la doctrina de la comity of nations, la recurrente contiende que debe cumplirse en Filipinas ese decreto. Opinamos que por las varias razones arriba expuestas, la pretension es insostenible.

Se confirma la sentencia apelada. La recurrente pagara las costas.

G.R. No. 140288             October 23, 2006

ST. AVIATION SERVICES CO., PTE., LTD., petitioner, vs.GRAND INTERNATIONAL AIRWAYS, INC., respondent.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

Challenged in the instant Petition for Review on Certiorari are the Decision of the Court of Appeals dated July 30, 1999 and its Resolution dated September 29, 1999 in CA-G.R. SP No. 51134 setting aside the Orders dated October 30, 1998 and December 16, 1998 of the Regional Trial Court (RTC), Branch 117, Pasay City in Civil Case No. 98-1389.

St. Aviation Services Co., Pte., Ltd., petitioner, is a foreign corporation based in Singapore. It is engaged in the manufacture, repair, and maintenance of airplanes and aircrafts. Grand International Airways, Inc., respondent, is a domestic corporation engaged in airline operations.

Sometime in January 1996, petitioner and respondent executed an "Agreement for the Maintenance and Modification of Airbus A 300 B4-103 Aircraft Registration No. RP-C8882" (First Agreement). Under this stipulation, petitioner agreed to undertake maintenance and modification works on respondent's aircraft. The parties agreed on the mode and manner of payment by respondent of the contract price, including interest in case of default. They also agreed that the "construction, validity and performance thereof" shall be governed by the laws of Singapore. They further agreed to submit any suit arising from their agreement to the non-exclusive jurisdiction of the Singapore courts.

At about the same time, or on January 12, 1996, the parties verbally agreed that petitioner will repair and undertake maintenance works on respondent's other aircraft, Aircraft No. RP-C8881; and that the works shall be based on a General Terms of Agreement (GTA). The GTA terms are similar to those of their First Agreement.

Petitioner undertook the contracted works and thereafter promptly delivered the aircrafts to respondent. During the period from March 1996 to October 1997, petitioner billed respondent in the total amount of US$303,731.67 or S$452,560.18. But despite petitioner's repeated demands, respondent failed to pay, in violation of the terms agreed upon.

On December 12, 1997, petitioner filed with the High Court of the Republic of Singapore an action for the sum of S$452,560.18, including interest and costs, against respondent, docketed as Suit No. 2101. Upon petitioner's motion, the court issued a Writ of Summons to be served extraterritorially or outside Singapore upon respondent. The court sought the assistance of the sheriff of Pasay City to effect service of the summons upon respondent. However, despite receipt of summons, respondent failed to answer the claim.

On February 17, 1998, on motion of petitioner, the Singapore High Court rendered a judgment by default against respondent.

On August 4, 1998, petitioner filed with the RTC, Branch 117, Pasay City, a Petition for Enforcement of Judgment, docketed as Civil Case No. 98-1389.

Respondent filed a Motion to Dismiss the Petition on two grounds: (1) the Singapore High Court did not acquire jurisdiction over its person; and (2) the foreign judgment sought to be enforced is void for having been rendered in violation of its right to due process.

On October 30, 1998, the RTC denied respondent's motion to dismiss, holding that "neither one of the two grounds (of Grand) is among the grounds for a motion to dismiss under Rule 16 of the 1997 Rules of Civil Procedure."

Respondent filed a motion for reconsideration but was denied by the RTC in its Order dated December 16, 1998.

On February 15, 1999, respondent filed with the Court of Appeals a Petition for Certiorari assailing the RTC Order denying its motion to dismiss. Respondent alleged that the extraterritorial service of summons on its office in the Philippines is defective and that the Singapore court did not acquire jurisdiction over its person. Thus, its judgment sought to be enforced is void. Petitioner, in its comment, moved to dismiss the petition for being unmeritorious.

On July 30, 1999, the Court of Appeals issued its Decision granting the petition and setting aside the Orders dated October 30, 1998 and December 16, 1998 of the RTC "without prejudice to the right of private respondent to initiate another proceeding before the proper court to enforce its claim." It found:

In the case at bar, the complaint does not involve the personal status of plaintiff, nor any property in which the defendant has a claim or interest, or which the private respondent has attached but purely an action for collection of debt. It is a personal action as well as an action in personam, not an action in rem or quasi in rem. As a personal action, the service of summons should be personal or substituted, not extraterritorial, in order to confer jurisdiction on the court.

Petitioner seasonably filed a motion for reconsideration but it was denied on September 29, 1999.

Hence, the instant Petition for Review on Certiorari.

The issues to be resolved are: (1) whether the Singapore High Court has acquired jurisdiction over the person of respondent by the service of summons upon its office in the Philippines; and (2) whether the judgment by default in Suit No. 2101 by the Singapore High Court is enforceable in the Philippines.

Generally, in the absence of a special contract, no sovereign is bound to give effect within its dominion to a judgment rendered by a tribunal of another country; however, under the rules of comity, utility and convenience, nations have established a usage among civilized states by which final judgments of foreign courts of competent jurisdiction are reciprocally respected and rendered efficacious under certain conditions that may vary in different countries.1 Certainly, the Philippine legal system has long ago accepted into its jurisprudence and procedural rules the viability of an action for enforcement of foreign judgment, as well as the requisites for such valid enforcement, as derived from internationally accepted doctrines.2

The conditions for the recognition and enforcement of a foreign judgment in our legal system are contained in Section 48, Rule 39 of the 1997 Rules of Civil Procedure, as amended, thus:

SEC. 48. Effect of foreign judgments. – The effect of a judgment or final order of a tribunal of a foreign country, having jurisdiction to render the judgment or final order is as follows:

(a) In case of a judgment or final order upon a specific thing, the judgment or final order is conclusive upon the title to the thing; and

(b) In case of a judgment or final order against a person, the judgment or final order is presumptive evidence of a right as between the parties and their successors in interest by a subsequent title;

In either case, the judgment or final order may be repelled by evidence of a want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact.

Under the above Rule, a foreign judgment or order against a person is merely presumptive evidence of a right as between the parties. It may be repelled, among others, by want of jurisdiction of the issuing authority or by want of notice to the party against whom it is enforced. The party attacking a foreign judgment has the burden of overcoming the presumption of its validity.3

Respondent, in assailing the validity of the judgment sought to be enforced, contends that the service of summons is void and that the Singapore court did not acquire jurisdiction over it.

Generally, matters of remedy and procedure such as those relating to the service of process upon a defendant are governed by the lex fori or the internal law of the forum,4 which in this case is the law of Singapore. Here, petitioner moved for leave of court to serve a copy of the Writ of Summons outside Singapore. In an Order dated December 24, 1997, the Singapore High Court granted "leave to serve a copy of the Writ of Summons on the Defendant by a method of service authorized by the law of the Philippines for service of any originating process issued by the Philippines at ground floor, APMC Building, 136 Amorsolo corner Gamboa Street, 1229 Makati City, or elsewhere in the Philippines."5 This service of summons outside Singapore is in accordance with Order 11, r. 4(2) of the Rules of Court 19966 of Singapore, which provides.

(2) Where in accordance with these Rules, an originating process is to be served on a defendant in any country with respect to which there does not subsist a Civil Procedure Convention providing for service in that country of process of the High Court, the originating process may be served –

a) through the government of that country, where that government is willing to effect service;

b) through a Singapore Consular authority in that country, except where service through such an authority is contrary to the law of the country; or

c) by a method of service authorized by the law of that country for service of any originating process issued by that country.

In the Philippines, jurisdiction over a party is acquired by service of summons by the sheriff,7 his deputy or other proper court officer either personally by handing a copy thereof to the defendant8 or by substituted service.9 In this case, the Writ of Summons issued by the Singapore High Court was served upon respondent at its office located at Mercure Hotel (formerly Village Hotel), MIA Road, Pasay City. The Sheriff's Return shows that it was received on May 2, 1998 by Joyce T. Austria, Secretary of the General Manager of respondent company. 10 But respondent completely ignored the summons, hence, it was declared in default.

Considering that the Writ of Summons was served upon respondent in accordance with our Rules, jurisdiction was acquired by the Singapore High Court over its person. Clearly, the judgment of default rendered by that court against respondent is valid.

WHEREFORE, we GRANT the petition. The challenged Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 51134 are set aside.

The RTC, Branch 117, Pasay City is hereby DIRECTED to hear Civil Case No. 98-1389 with dispatch.

SO ORDERED.

G.R. No. 186571               August 11, 2010

GERBERT R. CORPUZ, Petitioner, vs.DAISYLYN TIROL STO. TOMAS and The SOLICITOR GENERAL, Respondents.

D E C I S I O N

BRION, J.:

Before the Court is a direct appeal from the decision1 of the Regional Trial Court (RTC) of Laoag City, Branch 11, elevated via a petition for review on certiorari2 under Rule 45 of the Rules of Court (present petition).

Petitioner Gerbert R. Corpuz was a former Filipino citizen who acquired Canadian citizenship through naturalization on November 29, 2000. 3 On January 18, 2005, Gerbert married respondent Daisylyn T. Sto. Tomas, a Filipina, in Pasig City.4 Due to work and other professional commitments, Gerbert left for Canada soon after the wedding. He returned to the Philippines sometime in April 2005 to surprise Daisylyn, but was shocked to discover that his wife was having an affair with another man. Hurt and disappointed, Gerbert returned to Canada and filed a petition for divorce. The Superior Court of Justice, Windsor, Ontario, Canada granted Gerbert’s petition for divorce on December 8, 2005. The divorce decree took effect a month later, on January 8, 2006.5

Two years after the divorce, Gerbert has moved on and has found another Filipina to love. Desirous of marrying his new Filipina fiancée in the Philippines, Gerbert went to the Pasig City Civil Registry Office and registered the Canadian divorce decree on his and Daisylyn’s marriage certificate. Despite the registration of the divorce decree, an official of the National Statistics Office (NSO) informed Gerbert that the marriage between him and Daisylyn still subsists under Philippine law; to be enforceable, the foreign divorce decree must first be judicially recognized by a competent Philippine court, pursuant to NSO Circular No. 4, series of 1982.6

Accordingly, Gerbert filed a petition for judicial recognition of foreign divorce and/or declaration of marriage as dissolved (petition) with the RTC. Although summoned, Daisylyn did not file any responsive pleading but submitted instead a notarized letter/manifestation to the trial court. She offered no opposition to Gerbert’s petition and, in fact, alleged her desire to file a similar case herself but was prevented by financial and personal circumstances. She, thus, requested that she be considered as a party-in-interest with a similar prayer to Gerbert’s.

In its October 30, 2008 decision,7 the RTC denied Gerbert’s petition. The RTC concluded that Gerbert was not the proper party to institute the action for judicial recognition of the foreign divorce decree as he is a naturalized Canadian citizen. It ruled that only the Filipino spouse can avail of the remedy, under the second paragraph of Article 26 of the Family Code, 8 in order for him or her to be able to remarry under Philippine law. 9

Article 26 of the Family Code reads:

Art. 26. All marriages solemnized outside the Philippines, in accordance with the laws in force in the country where they were solemnized, and valid there as such, shall also be valid in this country, except those prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.

Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall likewise have capacity to remarry under Philippine law.

This conclusion, the RTC stated, is consistent with the legislative intent behind the enactment of the second paragraph of Article 26 of the Family Code, as determined by the Court in Republic v. Orbecido III;10 the provision was enacted to "avoid the absurd situation where the Filipino spouse remains married to the alien spouse who, after obtaining a divorce, is no longer married to the Filipino spouse."11

THE PETITION

From the RTC’s ruling,12 Gerbert filed the present petition.13

Gerbert asserts that his petition before the RTC is essentially for declaratory relief, similar to that filed in Orbecido; he, thus, similarly asks for a determination of his rights under the second paragraph of Article 26 of the Family Code. Taking into account the rationale behind the second paragraph of Article 26 of the Family Code, he contends that the provision applies as well to the benefit of the alien spouse. He claims that the RTC ruling unduly stretched the doctrine in Orbecido by limiting the standing to file the petition only to the Filipino spouse – an interpretation he claims to be contrary to the essence of the second paragraph of Article 26 of the Family Code. He considers himself as a proper party, vested with sufficient legal interest, to institute the case, as there is a possibility that he might be prosecuted for bigamy if he marries his Filipina fiancée in the Philippines since two marriage certificates, involving him, would be on file with the Civil Registry Office. The Office of the Solicitor General and Daisylyn, in their respective Comments,14 both support Gerbert’s position.

Essentially, the petition raises the issue of whether the second paragraph of Article 26 of the Family Code extends to aliens the right to petition a court of this jurisdiction for the recognition of a foreign divorce decree.

THE COURT’S RULING

The alien spouse can claim no right under the second paragraph of Article 26 of the Family Code as the substantive right it establishes is in favor of the Filipino spouse

The resolution of the issue requires a review of the legislative history and intent behind the second paragraph of Article 26 of the Family Code.

The Family Code recognizes only two types of defective marriages – void15 and voidable16 marriages. In both cases, the basis for the judicial declaration of absolute nullity or annulment of the marriage exists before or at the time of the marriage. Divorce, on the other hand, contemplates the dissolution of the lawful union for cause arising after the marriage.17 Our family laws do not recognize absolute divorce between Filipino citizens.18

Recognizing the reality that divorce is a possibility in marriages between a Filipino and an alien, President Corazon C. Aquino, in the exercise of her legislative powers under the Freedom Constitution,19 enacted Executive Order No. (EO) 227, amending Article 26 of the Family Code to its present wording, as follows:

Art. 26. All marriages solemnized outside the Philippines, in accordance with the laws in force in the country where they were solemnized, and valid there as such, shall also be valid in this country, except those prohibited under Articles 35(1), (4), (5) and (6), 36, 37 and 38.

Where a marriage between a Filipino citizen and a foreigner is validly celebrated and a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or her to remarry, the Filipino spouse shall likewise have capacity to remarry under Philippine law.

Through the second paragraph of Article 26 of the Family Code, EO 227 effectively incorporated into the law this Court’s holding in Van Dorn v. Romillo, Jr.20 and Pilapil v. Ibay-Somera.21 In both cases, the Court refused to acknowledge the alien spouse’s assertion of marital rights after a foreign court’s divorce decree between the alien and the Filipino. The Court, thus, recognized that the foreign divorce had already severed the marital bond between the spouses. The Court reasoned in Van Dorn v. Romillo that:

To maintain x x x that, under our laws, [the Filipino spouse] has to be considered still married to [the alien spouse] and still subject to a wife's obligations x x x cannot be just. [The Filipino spouse] should not be obliged to live together with, observe respect and fidelity, and render support to [the alien spouse]. The latter should not continue to be one of her heirs with possible rights to conjugal property. She should not be discriminated against in her own country if the ends of justice are to be served.22

As the RTC correctly stated, the provision was included in the law "to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who, after obtaining a divorce, is no longer married to the Filipino spouse."23 The legislative intent is for the benefit of the Filipino spouse, by clarifying his or her marital status, settling the doubts created by the divorce decree. Essentially, the second paragraph of Article 26 of the Family Code provided the Filipino spouse a substantive right to have his or her marriage to the alien spouse considered as dissolved, capacitating him or her to remarry.24 Without the second paragraph of Article 26 of the Family Code, the judicial recognition of the foreign decree of divorce, whether in a proceeding instituted precisely for that purpose or as a related issue in another proceeding, would be of no significance to the Filipino spouse since our laws do not recognize divorce as a mode of severing the marital bond; 25 Article 17 of the Civil Code provides that the policy against absolute divorces cannot be subverted by judgments promulgated in a foreign country. The inclusion of the second paragraph in Article 26 of the Family Code provides the direct exception to this rule and serves as basis for recognizing the dissolution of the marriage between the Filipino spouse and his or her alien spouse.

Additionally, an action based on the second paragraph of Article 26 of the Family Code is not limited to the recognition of the foreign divorce decree. If the court finds that the decree capacitated the alien spouse to remarry, the courts can declare that the Filipino spouse is likewise capacitated to contract another marriage. No court in this jurisdiction, however, can make a similar declaration for the alien spouse (other than that already established by the decree), whose status and legal capacity are generally governed by his national law.26

Given the rationale and intent behind the enactment, and the purpose of the second paragraph of Article 26 of the Family Code, the RTC was correct in limiting the applicability of the provision for the benefit of the Filipino spouse. In other words, only the Filipino spouse can invoke the second paragraph of Article 26 of the Family Code; the alien spouse can claim no right under this provision.

The foreign divorce decree is presumptive evidence of a right that clothes the party with legal interest to petition for its recognition in this jurisdiction

We qualify our above conclusion – i.e., that the second paragraph of Article 26 of the Family Code bestows no rights in favor of aliens – with the complementary statement that this conclusion is not sufficient basis to dismiss Gerbert’s petition before the RTC. In other words, the unavailability of the second paragraph of Article 26 of the Family Code to aliens does not necessarily strip Gerbert of legal interest to petition the RTC for the recognition of his foreign divorce decree. The foreign divorce decree itself, after its authenticity and conformity with the alien’s national law have been duly proven according to our rules of evidence, serves as a presumptive evidence of right in favor of Gerbert, pursuant to Section 48, Rule 39 of the Rules of Court which provides for the effect of foreign judgments. This Section states:

SEC. 48. Effect of foreign judgments or final orders.—The effect of a judgment or final order of a tribunal of a foreign country, having jurisdiction to render the judgment or final order is as follows:

(a) In case of a judgment or final order upon a specific thing, the judgment or final order is conclusive upon the title of the thing; and

(b) In case of a judgment or final order against a person, the judgment or final order is presumptive evidence of a right as between the parties and their successors in interest by a subsequent title.

In either case, the judgment or final order may be repelled by evidence of a want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact.

To our mind, direct involvement or being the subject of the foreign judgment is sufficient to clothe a party with the requisite interest to institute an

action before our courts for the recognition of the foreign judgment. In a divorce situation, we have declared, no less, that the divorce obtained by an alien abroad may be recognized in the Philippines, provided the divorce is valid according to his or her national law.27

The starting point in any recognition of a foreign divorce judgment is the acknowledgment that our courts do not take judicial notice of foreign judgments and laws. Justice Herrera explained that, as a rule, "no sovereign is bound to give effect within its dominion to a judgment rendered by a tribunal of another country."28 This means that the foreign judgment and its authenticity must be proven as facts under our rules on evidence, together with the alien’s applicable national law to show the effect of the judgment on the alien himself or herself.29 The recognition may be made in an action instituted specifically for the purpose or in another action where a party invokes the foreign decree as an integral aspect of his claim or defense.

In Gerbert’s case, since both the foreign divorce decree and the national law of the alien, recognizing his or her capacity to obtain a divorce, purport to be official acts of a sovereign authority, Section 24, Rule 132 of the Rules of Court comes into play. This Section requires proof, either by (1) official publications or (2) copies attested by the officer having legal custody of the documents. If the copies of official records are not kept in the Philippines, these must be (a) accompanied by a certificate issued by the proper diplomatic or consular officer in the Philippine foreign service stationed in the foreign country in which the record is kept and (b) authenticated by the seal of his office.

The records show that Gerbert attached to his petition a copy of the divorce decree, as well as the required certificates proving its authenticity,30

but failed to include a copy of the Canadian law on divorce.31 Under this situation, we can, at this point, simply dismiss the petition for insufficiency of supporting evidence, unless we deem it more appropriate to remand the case to the RTC to determine whether the divorce decree is consistent with the Canadian divorce law.

We deem it more appropriate to take this latter course of action, given the Article 26 interests that will be served and the Filipina wife’s (Daisylyn’s) obvious conformity with the petition. A remand, at the same time, will allow other interested parties to oppose the foreign judgment and overcome a petitioner’s presumptive evidence of a right by proving want of jurisdiction, want of notice to a party, collusion, fraud, or clear mistake of law or fact. Needless to state, every precaution must be taken to ensure conformity with our laws before a recognition is made, as the foreign judgment, once recognized, shall have the effect of res judicata32 between the parties, as provided in Section 48, Rule 39 of the Rules of Court.33

In fact, more than the principle of comity that is served by the practice of reciprocal recognition of foreign judgments between nations, the res judicata effect of the foreign judgments of divorce serves as the deeper basis for extending judicial recognition and for considering the alien spouse bound by its terms. This same effect, as discussed above, will not obtain for the Filipino spouse were it not for the substantive rule that the second paragraph of Article 26 of the Family Code provides.

Considerations beyond the recognition of the foreign divorce decree

As a matter of "housekeeping" concern, we note that the Pasig City Civil Registry Office has already recorded the divorce decree on Gerbert and Daisylyn’s marriage certificate based on the mere presentation of the decree.34 We consider the recording to be legally improper; hence, the need to draw attention of the bench and the bar to what had been done.

Article 407 of the Civil Code states that "[a]cts, events and judicial decrees concerning the civil status of persons shall be recorded in the civil register." The law requires the entry in the civil registry of judicial decrees that produce legal consequences touching upon a person’s legal capacity and status, i.e., those affecting "all his personal qualities and relations, more or less permanent in nature, not ordinarily terminable at his own will, such as his being legitimate or illegitimate, or his being married or not."35

A judgment of divorce is a judicial decree, although a foreign one, affecting a person’s legal capacity and status that must be recorded. In fact, Act No. 3753 or the Law on Registry of Civil Status specifically requires the registration of divorce decrees in the civil registry:

Sec. 1. Civil Register. – A civil register is established for recording the civil status of persons, in which shall be entered:

(a) births;

(b) deaths;

(c) marriages;

(d) annulments of marriages;

(e) divorces;

(f) legitimations;

(g) adoptions;

(h) acknowledgment of natural children;

(i) naturalization; and

(j) changes of name.

x x x x

Sec. 4. Civil Register Books. — The local registrars shall keep and preserve in their offices the following books, in which they shall, respectively make the proper entries concerning the civil status of persons:

(1) Birth and death register;

(2) Marriage register, in which shall be entered not only the marriages solemnized but also divorces and dissolved marriages.

(3) Legitimation, acknowledgment, adoption, change of name and naturalization register.

But while the law requires the entry of the divorce decree in the civil registry, the law and the submission of the decree by themselves do not ipso facto authorize the decree’s registration. The law should be read in relation with the requirement of a judicial recognition of the foreign judgment before it can be given res judicata effect. In the context of the present case, no judicial order as yet exists recognizing the foreign divorce decree. Thus, the Pasig City Civil Registry Office acted totally out of turn and without authority of law when it annotated the Canadian divorce decree on Gerbert and Daisylyn’s marriage certificate, on the strength alone of the foreign decree presented by Gerbert.

Evidently, the Pasig City Civil Registry Office was aware of the requirement of a court recognition, as it cited NSO Circular No. 4, series of 1982,36

and Department of Justice Opinion No. 181, series of 198237 – both of which required a final order from a competent Philippine court before a foreign judgment, dissolving a marriage, can be registered in the civil registry, but it, nonetheless, allowed the registration of the decree. For being contrary to law, the registration of the foreign divorce decree without the requisite judicial recognition is patently void and cannot produce any legal effect.1avvphi1

Another point we wish to draw attention to is that the recognition that the RTC may extend to the Canadian divorce decree does not, by itself, authorize the cancellation of the entry in the civil registry. A petition for recognition of a foreign judgment is not the proper proceeding, contemplated under the Rules of Court, for the cancellation of entries in the civil registry.

Article 412 of the Civil Code declares that "no entry in a civil register shall be changed or corrected, without judicial order." The Rules of Court supplements Article 412 of the Civil Code by specifically providing for a special remedial proceeding by which entries in the civil registry may be judicially cancelled or corrected. Rule 108 of the Rules of Court sets in detail the jurisdictional and procedural requirements that must be complied with before a judgment, authorizing the cancellation or correction, may be annotated in the civil registry. It also requires, among others, that the verified petition must be filed with the RTC of the province where the corresponding civil registry is located; 38 that the civil registrar and all persons who have or claim any interest must be made parties to the proceedings;39 and that the time and place for hearing must be published in a newspaper of general circulation.40 As these basic jurisdictional requirements have not been met in the present case, we cannot consider the petition Gerbert filed with the RTC as one filed under Rule 108 of the Rules of Court.

We hasten to point out, however, that this ruling should not be construed as requiring two separate proceedings for the registration of a foreign divorce decree in the civil registry – one for recognition of the foreign decree and another specifically for cancellation of the entry under Rule 108 of the Rules of Court. The recognition of the foreign divorce decree may be made in a Rule 108 proceeding itself, as the object of special proceedings (such as that in Rule 108 of the Rules of Court) is precisely to establish the status or right of a party or a particular fact. Moreover, Rule 108 of the Rules of Court can serve as the appropriate adversarial proceeding41 by which the applicability of the foreign judgment can be measured and tested in terms of jurisdictional infirmities, want of notice to the party, collusion, fraud, or clear mistake of law or fact.

WHEREFORE, we GRANT the petition for review on certiorari, and REVERSE the October 30, 2008 decision of the Regional Trial Court of Laoag City, Branch 11, as well as its February 17, 2009 order. We order the REMAND of the case to the trial court for further proceedings in accordance with our ruling above. Let a copy of this Decision be furnished the Civil Registrar General. No costs.

SO ORDERED.

G.R. No. 110263       July 20, 2001

ASIAVEST MERCHANT BANKERS (M) BERHAD, petitioner, vs.COURT OF APPEALS and PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, respondents.

DELEON, JR., J.:

Before us is a petition for review on certiorari of the Decision1 of the Court of Appeals dated May 19,1993 in CA-G.R. CY No. 35871 affirming the Decision2 dated October 14,1991 of the Regional Trial Court of Pasig, Metro Manila, Branch 168 in Civil Case No. 56368 which dismissed the complaint of petitioner Asiavest Merchant Bankers (M) Berhad for the enforcement of the money of the judgment of the High Court of Malaysia in Kuala Lumpur against private respondent Philippine National Construction Corporation.1âwphi1.nêt

The petitioner Asiavest Merchant Bankers (M) Berhad is a corporation organized under the laws of Malaysia while private respondent Philippine National Construction Corporation is a corporation duly incorporated and existing under Philippine laws.

It appears that sometime in 1983, petitioner initiated a suit for collection against private respondent, then known as Construction and Development Corporation of the Philippines, before the High Court of Malaya in Kuala Lumpur entitled "Asiavest Merchant Bankers (M) Berhad v. Asiavest CDCP Sdn. Bhd. and Construction and Development Corporation of the Philippines."3

Petitioner sought to recover the indemnity of the performance bond it had put up in favor of private respondent to guarantee the completion of the Felda Project and the nonpayment of the loan it extended to Asiavest-CDCP Sdn. Bhd. for the completion of Paloh Hanai and Kuantan By Pass; Project.

On September 13, 1985, the High Court of Malaya (Commercial Division) rendered judgment in favor of the petitioner and against the private respondent which is also designated therein as the "2nd Defendant. "

The judgment reads in full:

SUIT NO. C638 of 1983

Between

Asiavest Merchant Bankers (M) Berhad Plaintiffs

And

1. Asiavest -CDCP Sdn. Bhd. Defendant

2. Construction & Development Corporation of the Philippines

JUDGMENT

The 2nd Defendant having entered appearance herein and the Court having under Order 14, rule 3 ordered that judgment as hereinafter provided be entered for the Plaintiffs against the 2nd Defendant.

IT IS THIS DAY ADJUDGED that the 2nd defendant do pay the Plaintiffs the sum of $5, 108,290.23 (Ringgit Five million one hundred and eight thousand two hundred and ninety and Sen twenty-three) together with interest at the rate of 12% per annum on

(i) the sum of $2,586,866.91 from the 2nd day of March 1983 to the date of payment; and

(ii) the sum of $2,521,423.32 from the 11th day of March 1983 to the date of payment; and $350.00 (Ringgit Three Hundred and Fifty) costs.

Dated the 13th day of September, 1985.

Senior Assistant Registrar, High Court, Kuala Lumpur

This Judgment is filed by Messrs. Skrine & Co., 3 rd Floor, Straits Trading Building, No.4, Leboh Pasar, Besar, Kuala Lumpur, Solicitors for the Plaintiffs abovenamed. (VP/Ong/81194.7/83)4

On the same day, September 13, 1985, the High Court of Malaya issued an Order directing the private respondent (also designated therein as the "2nd Defendant") to pay petitioner interest on the sums covered by the said Judgment, thus:

SUIT NO. C638 of 1983

Between

Asiavest Merchant Bankers (M) Berhad Plaintiffs

And

1. Asiavest -CDCP Sdn. Bhd. Defendants

2. Construction & Development Corporation of the Philippines

BEFORE THE SENIOR ASSISTANT REGISTRAR

CIK SUSILA S. PARAM THIS 13th DAY OF SEPTEMBER 1985 IN CHAMBERS

ORDER

Upon the application of Asiavest Merchant Bankers (M) Berhad, the Plaintiffs in this action AND UPON READING the Summons in Chambers dated the 16th day of August, 1984 and the Affidavit of Lee Foong Mee affirmed on the 14th day of August 1984 both filed herein AND UPON HEARING Mr. T. Thomas of Counsel for the Plaintiffs and Mr. Khaw Chay Tee of Counsel for the 2nd Defendant abovenamed on the 26th day of December 1984 IT WAS ORDERED that the Plaintiffs be at liberty to sign final judgment against the 2nd Defendant for the sum of $5,108,290.23 AND IT WAS ORDERED that the 2nd Defendant do pay the Plaintiffs the costs of suit at $350.00 AND IT WAS FURTHER ORDERED that the plaintiffs be at liberty to apply for payment of interest AND upon the application of the Plaintiffs for payment of interest coming on for hearing on the 1st day of August in the presence of Mr. Palpanaban Devarajoo of Counsel for the Plaintiffs and Mr. Khaw Chay Tee of Counsel for the 2nd Defendant above-named AND UPON HEARING Counsel as aforesaid BY CONSENT IT WAS ORDERED that the 2nd Defendant do pay the Plaintiffs interest at a rate to be assessed AND the same coming on for assessment this day in the presence of Mr. Palpanaban Devarajoo of Counsel for the Plaintiffs and Mr. Khaw Chay Tee of Counsel for the 2nd Defendant AND UPON HEARING Counsel as aforesaid BY CONSENT IT IS ORDERED that the 2nd Defendant do pay the Plaintiffs interest at the rate of 12% per annum on:

(i) the sum of $2,586,866.91 from the 2nd day of March 1983 to the date of payment; and

(ii) the sum Of $2,521,423.32 from the 11th day of March 1983 to the date of Payment.

Dated the 13th day of September,1985.

Senior Assistant Registrar, High Court, Kuala Lumpur.5

Following unsuccessful attempts6 to secure payment from private respondent under the judgment, petitioner initiated on September 5, 1988 the complaint before Regional Trial Court of Pasig, Metro Manila, to enforce the judgment of the High Court of Malaya.7

Private respondent sought the dismissal of the case via a Motion to Dismiss filed on October 5, 1988, contending that the alleged judgment of the High Court of Malaya should be denied recognition or enforcement since on in face, it is tainted with want of jurisdiction, want of notice to private respondent, collusion and/or fraud, and there is a clear mistake of law or fact.8 Dismissal was, however, denied by the trial court considering that the grounds relied upon are not the proper grounds in a motion to dismiss under Rule 16 of the Revised Rules of Court. 9

On May 22, 1989, private respondent filed its Answer with Compulsory Counter claim's10 and therein raised the grounds it brought up in its motion to dismiss. In its Reply filed11 on June 8, 1989, the petitioner contended that the High Court of Malaya acquired jurisdiction over the Person of private respondent by its voluntary submission the court's jurisdiction through its appointed counsel, Mr. Khay Chay Tee. Furthermore, private respondent's counsel waived any and all objections to the High Court's jurisdiction in a pleading filed before the court.

In due time, the trial court rendered its Decision dated October 14, 1991 dismissing petitioner's complaint. Petitioner interposed an appeal with the Court of Appeals, but the appellate court dismissed the same and affirmed the decision of the trial court in a Decision dated May 19, 1993.

Hence, the instant Petition which is anchored on two (2) assigned errors,12 to wit:

I

THE COURT OF APPEALS ERRED IN HOLDING THAT THE MALAYSIAN COURT DID NOT ACQUIRE PERSONAL JURISDICTION OVER PNCC, NOTWITHSTANDING THAT (a) THE FOREIGN COURT HAD SERVED SUMMONS ON PNCC AT ITS MALAYSlA OFFICE, AND (b) PNCC ITSELF APPEARED BY COUNSEL IN THE CASE BEFORE THAT COURT.

II

THE COURT OF APPEALS ERRED IN DENYING RECOGNITION AND ENFORCEMENT TO (SIC) THE MALAYSIAN COURT JUDGMENT.

Generally, in the absence of a special compact, no sovereign is bound to give effect within its dominion to a judgment rendered by a tribunal of another

country;13 however, the rules of comity, utility and convenience of nations have established a usage among civilized states by which final judgments of foreign courts of competent jurisdiction are reciprocally respected and rendered efficacious under certain conditions that may vary in different countries.14

In this jurisdiction, a valid judgment rendered by a foreign tribunal may be recognized insofar as the immediate parties and the underlying cause of action are concerned so long as it is convincingly shown that there has been an opportunity for a full and fair hearing before a court of competent jurisdiction; that the trial upon regular proceedings has been conducted, following due citation or voluntary appearance of the defendant and under a system of jurisprudence likely to secure an impartial administration of justice; and that there is nothing to indicate either a prejudice in court and in the system of laws under which it is sitting or fraud in procuring the judgment.15

A foreign judgment is presumed to be valid and binding in the country from which it comes, until a contrary showing, on the basis of a presumption of regularity of proceedings and the giving of due notice in the foreign forum Under Section 50(b), 16 Rule 39 of the Revised Rules of Court, which was the governing law at the time the instant case was decided by the trial court and respondent appellate court, a judgment, against a person, of a tribunal of a foreign country having jurisdiction to pronounce the same is presumptive evidence of a right as between the parties and their successors in interest by a subsequent title. The judgment may, however, be assailed by evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact. In addition, under Section 3(n), Rule 131 of the Revised Rules of Court, a court, whether in the Philippines or elsewhere, enjoys the presumption that it was acting in the lawful exercise of its jurisdiction. Hence, once the authenticity of the foreign judgment is proved, the party attacking a foreign judgment, is tasked with the burden of overcoming its presumptive validity.

In the instant case, petitioner sufficiently established the existence of the money judgment of the High Court of Malaya by the evidence it offered. Vinayak Prabhakar Pradhan, presented as petitioner's sole witness, testified to the effect that he is in active practice of the law profession in Malaysia; 17 that he was connected with Skrine and Company as Legal Assistant up to 1981;18 that private respondent, then known as Construction and Development Corporation of the Philippines, was sued by his client, Asiavest Merchant Bankers (M) Berhad, in Kuala Lumpur;19 that the writ of summons were served on March 17, 1983 at the registered office of private respondent and on March 21, 1983 on Cora S. Deala, a financial planning officer of private respondent for Southeast Asia operations;20 that upon the filing of the case, Messrs. Allen and Gledhill, Advocates and Solicitors, with address at 24th Floor, UMBC Building, Jalan Sulaiman, Kuala Lumpur, entered their conditional appearance for private respondent questioning the regularity of the service of the writ of summons but subsequently withdrew the same when it realized that the writ was properly served;21 that because private respondent failed to file a statement of defense within two (2) weeks, petitioner filed an application for summary judgment and submitted affidavits and documentary evidence in support of its claim;22 that the matter was then heard before the High Court of Kuala Lumpur in a series of dates where private respondent was represented by counsel; 23 and that the end result of all these proceedings is the judgment sought to be enforced.

In addition to the said testimonial evidence, petitioner offered the following documentary evidence:

(a) A certified and authenticated copy of the Judgment promulgated by the Malaysian High Court dated September 13, 1985 directing private respondent to pay petitioner the sum of $5,108,290.23 Malaysian Ringgit plus interests from March 1983 until fully paid;24

(b) A certified and authenticated copy of the Order dated September 13,1985 issued by the Malaysian High Court in Civil Suit No. C638 of 1983;25

(c) Computation of principal and interest due as of January 31, 1990 on the amount adjudged payable to petitioner by private respondent;26

(d) Letter and Statement of Account of petitioner's counsel in Malaysia indicating the costs for prosecuting and implementing the Malaysian High Court's Judgment;27

(e) Letters between petitioner's Malaysian counsel, Skrine and Co., and its local counsel, Sycip Salazar Law Offices, relative to institution of the action in the Philippines;28

(f) Billing Memorandum of Sycip Salazar Law Offices dated January 2, 1990 showing attorney's fees paid by and due from petitioner; 29

(g) Statement of Claim, Writ of Summons and Affidavit of Service of such writ in petitioner's suit against private respondent before the Malaysian High Court;30

(h) Memorandum of Conditional Appearance dated March 28, 1983 filed by counsel for private respondent with the Malaysian High Court;31

(i) Summons in Chambers and Affidavit of Khaw Chay Tee, cotmsel for private respondent, submitted during the proceedings before the Malaysian High Court;32

(j) Record of the Court's Proceedings in Civil Case No. C638 of 1983.33

(k) Petitioner 's verified Application for Summary Judgment dated August 14, 1984;34 and

(l) Letter dated November 6, 1985 from petitioner's Malaysian Counsel to private respondent's counsel in Malaysia.35

Having thus proven, through the foregoing evidence, the existence and authenticity of the foreign judgment, said foreign judgment enjoys presumptive validity and the burden then fell upon the party who disputes its validity, herein private respondent, to prove otherwise.

Private respondent failed to sufficiently discharge the burden that fell upon it - to prove by clear and convincing evidence the grounds which it relied upon to prevent enforcement of the Malaysian High Court judgment, namely, (a) that jurisdiction was not acquired by the Malaysian Court over the person of private respondent due to alleged improper service of summons upon private respondent and the alleged lack of authority of its counsel to appear and represent private respondent in the suit; (b) the foreign judgment is allegedly tainted by evident collusion, fraud and clear mistake of fact or law; and (c) not only were the requisites for enforcement or recognition allegedly not complied with but also that the Malaysian judgment is allegedly contrary to the

Constitutional prescription that the "every decision must state the facts and law on which it is based."36

Private respondent relied solely on the testimony of its two (2) witnesses, namely, Mr. Alfredo. Calupitan, an accountant of private respondent, and Virginia Abelardo, Executive Secretary and a member of the staff of the Corporate Secretariat Section of the Corporate Legal Division, of private respondent, both of whom failed to shed light and amplify its defense or claim for non-enforcement of the foreign judgment against it.

Mr. Calupitan's testimony centered on the following: that from January to December 1982 he was assigned in Malaysia as Project Comptroller of the Pahang Project Package A and B for road construction under the joint venture of private respondent and Asiavest Holdings; 37 that under the joint venture, Asiavest Holdings would handle the financial aspect of the project, which is fifty-one percent (51 %) while private respondent would handle the technical aspect of the project, or forty-nine percent (49%);38 and, that Cora Deala was not authorized to receive summons for and in behalf of the private respondent.39 Ms. Abelardo's testimony, on the other hand, focused on the following: that there was no board resolution authorizing Allen and Gledhill to admit all the claims of petitioner in the suit brought before the High Court of Malaya, 40 though on cross-examination she admitted that Allen and Gledhill were the retained lawyers of private respondent in Malaysia. 41

The foregoing reasons or grounds relied upon by private respondent in preventing enforcement and recognition of the Malaysian judgment primarily refer to matters of remedy and procedure taken by the Malaysian High Court relative to the suit for collection initiated by petitioner. Needless to stress, the recognition to be accorded a foreign judgment is not necessarily affected by the fact that the procedure in the courts of the country in which such judgment was rendered differs from that of the courts of the country in which the judgment is relied on.42 Ultimately, matters of remedy and procedure such as those relating to the service of summons or court process upon the defendant, the authority of counsel to appear and represent a defendant and the formal requirements in a decision are governed by the lex fori or the internal law of the forum,43 i.e., the law of Malaysia in this case.

In this case, it is the procedural law of Malaysia where the judgment was rendered that determines the validity of the service of court process on private respondent as well as other matters raised by it. As to what the Malaysian procedural law is, remains a question of fact, not of law. It may not be taken judicial notice of and must be pleaded and proved like any other fact. Sections 24 and 25 of Rule 132 of the Revised Rules of Court provide that it may be evidenced by an official publication or by a duly attested or authenticated copy thereof. It was then incumbent upon private respondent to present evidence as to what that Malaysian procedural law is and to show that under it, the assailed service of summons upon a financial officer of a corporation, as alleged by it, is invalid. It did not. Accordingly, the presumption of validity and regularity of service of summons and the decision thereafter rendered by the High Court of Malaya must stand.44

On the matter of alleged lack of authority of the law firm of Allen and Gledhill to represent private respondent, not only did the private respondent's witnesses admit that the said law firm of Allen and Gledhill were its counsels in its transactions in Malaysia, 45 but of greater significance is the fact that petitioner offered in evidence relevant Malaysian jurisprudence46 to the effect that (a) it is not necessary under Malaysian law for counsel appearing before the Malaysian High Court to submit a special power of attorney authorizing him to represent a client before said court, (b) that counsel appearing before the Malaysian High Court has full authority to compromise the suit, and (c) that counsel appearing before the Malaysian High Court need not comply with certain pre-requisites as required under Philippine law to appear and compromise judgments on behalf of their clients before said court.47

Furthermore, there is no basis for or truth to the appellate court's conclusion that the conditional appearance of private respondent's counsel who was allegedly not authorized to appear and represent, cannot be considered as voluntary submission to the jurisdiction of the High Court of Malaya, inasmuch as said conditional appearance was not premised on the alleged lack of authority of said counsel but the conditional appearance was entered to question the regularity of the service of the writ of summons. Such conditional appearance was in fact subsequently withdrawn when counsel realized that the writ was properly served.48

On the ground that collusion, fraud and, clear mistake of fact and law tainted the judgment of the High Court of Malaya, no clear evidence of the same was adduced or shown. The facts which the trial court found "intriguing" amounted to mere conjectures and specious observations. The trial court's finding on the absence of judgment against Asiavest-CDCP Sdn. Bhd. is contradicted by evidence on record that recovery was also sought against Asiavest-CDCP Sdn. Bhd. but the same was found insolvent.49 Furthermore, even when the foreign judgment is based on the drafts prepared by counsel for the successful party, such is not per se indicative of collusion or fraud. Fraud to hinder the enforcement within the jurisdiction of a foreign judgment must be extrinsic, i.e., fraud based on facts not controverted or resolved in the case where judgment is rendered, 50 or that which would go to the jurisdiction of the court or would deprive the party against whom judgment is rendered a chance to defend the action to which he has a meritorious defense. 51 Intrinsic fraud is one which goes to the very existence of the cause of action is deemed already adjudged, and it, therefore, cannot militate against the recognition or enforcement of the foreign judgment.52 Evidence is wanting on the alleged extrinsic fraud. Hence, such unsubstantiated allegation cannot give rise to liability therein.

Lastly, there is no merit to the argument that the foreign judgment is not enforceable in view of the absence of any statement of facts and law upon which the award in favor of the petitioner was based. As aforestated, the lex fori or the internal law of the forum governs matters of remedy and procedure. 53

Considering that under the procedural rules of the High Court of Malaya, a valid judgment may be rendered even without stating in the judgment every fact and law upon which the judgment is based, then the same must be accorded respect and the courts in the jurisdiction cannot invalidate the judgment of the foreign court simply because our rules provide otherwise.

All in all, private respondent had the ultimate duty to demonstrate the alleged invalidity of such foreign judgment, being the party challenging the judgment rendered by the High Court of Malaya. But instead of doing so, private respondent merely argued, to which the trial court agreed, that the burden lay upon petitioner to prove the validity of the money judgment. Such is clearly erroneous and would render meaningless the presumption of validity accorded a foreign judgment were the party seeking to enforce it be required to first establish its validity.54

WHEREFORE, the instant petition is GRANTED. The Decision of the Court of Appeals dated May 19,1993 in CA-G.R CY No. 35871 sustaining the Decision dated October 14, 1991 in Civil Case No. 56368 of the Regional Trial Court of Pasig, Branch 168 denying the enforcement of the Judgment dated September 13, 1985 of the High Court of Malaya in Kuala Lumpur is REVERSED and SET ASIDE, and another in its stead is hereby rendered ORDERING private respondent Philippine National Construction Corporation to pay petitioner Asiavest Merchant Bankers (M) Berhad the amounts adjudged in the said foreign Judgment, subject of the said case.

Costs against the private respondent.

SO ORDERED.