Labor Conflict of Laws

EDI-Staffbuilders International, Inc. vs. National Labor

Relations Commission

G.R. No. 145587. October 26, 2007.*

Labor Law; Appeals; Due Process; Service of Pleadings; The

failure of the appellant to furnish a copy of the appeal to the

adverse party is not fatal to the appeal—it is merely a formal

lapse, an excusable neglect, and hence, not a jurisdictional

defect; The duty that is imposed on the National Labor

Relations Commission (NLRC) is to require the appellant to

comply with the rule that the opposing party should be provided

with a copy of the appeal memorandum.—In a catena of cases,

it was ruled that failure of appellant to furnish a copy of the

appeal to the adverse party is not fatal to the appeal. In Estrada

v. National Labor Relations Commission, 112 SCRA 688 (1982),

this Court set aside the order of the NLRC which dismissed an

appeal on the sole ground that the appellant did not furnish

the appellee a memorandum of appeal contrary to the

requirements of Article 223 of the New Labor Code and Section

9, Rule XIII of its Implementing Rules and Regulations. Also,

in J.D. Magpayo Customs Brokerage Corp. v. NLRC, 118 SCRA

645 (1982), the order of dismissal of an appeal to the NLRC

based on the ground that “there is no showing whatsoever that

a copy of the appeal was served by the appellant on the appellee”

was annulled. The Court ratiocinated as follows: The failure to

give a copy of the appeal to the adverse party was a mere

formal lapse, an excusable neglect. Time and again We have

acted on petitions to review decisions of the Court of Appeals

even in the absence of proof of service of a copy thereof to the

Court of Appeals as required by Section 1 of Rule 45, Rules of

Court. We act on the petitions and simply require the

petitioners to comply with the rule. (Emphasis supplied.)

The J.D. Magpayo ruling was reiterated in Carnation

Philippines Employees Labor Union-FFW v. National Labor

Relations Commission, 125 SCRA 42 (1983), Pagdonsalan v.

NLRC, 127 SCRA 463 (1980), and in Sunrise Manning Agency,

Inc. v. NLRC, 443 SCRA 35 (2004). Thus, the doctrine that

evolved from these cases is that failure to furnish the adverse

party with a copy of the appeal is treated only as a formal

lapse, an excusable neglect, and hence, not a jurisdictional

defect. Accordingly, in such a situation, the appeal should not

be dismissed; however, it should not be given due course either.

As enunciated in J.D. Magpayo, the duty that is imposed on the

NLRC, in such a case, is to require the appellant to comply with

the rule that the opposing party should be provided with a copy

of the appeal memorandum.

Same; Same; Same; Same; The abject failure of the

National Labor Relations Commission (NLRC) to order the

appellant to furnish the appellee with the Appeal Memorandum

constitutes grave abuse of discretion.—While Gran’s failure to

furnish EDI with a copy of the Appeal Memorandum is

excusable, the abject failure of the NLRC to order Gran to

furnish EDI with the Appeal Memorandum constitutes grave

abuse of discretion. The records reveal that the NLRC

discovered that Gran failed to furnish EDI a copy of the Appeal

Memorandum. The NLRC then ordered Gran to present proof

of service. In compliance with the order, Gran submitted a copy

of Camp Crame Post Office’s list of mail/parcels sent on April 7,

1998. The post office’s list shows that private respondent Gran

sent two pieces of mail on the same date: one addressed to a

certain Dan O. de Guzman of Legaspi Village, Makati; and the

other appears to be addressed to Neil B. Garcia (or Gran), of

Ermita, Manila—both of whom are not connected with

petitioner. This mailing list, however, is not a conclusive proof

that EDI indeed received a copy of the Appeal Memorandum.

Same; Same; Same; Same; The glaring failure of the

National Labor Relations Commission (NLRC) to ensure that

the appellant should have furnished the appellee a copy of the

Appeal Memorandum before rendering judgment reversing the

dismissal of the complaint of the former constitutes an evasion

of the pertinent National Labor Relations Commission (NLRC)

Rules and established jurisprudence—worse, this failure

deprived the latter of procedural due process guaranteed by the

Constitution which can serve as basis for the nullification of

proceedings in the appeal before the National Labor Relations

Commission (NLRC).—After seeing that Gran failed to attach

the proof of service, the NLRC should not have simply accepted

the post office’s list of mail and parcels sent; but it should

have required Gran to properly furnish the opposing

parties with copies of his Appeal Memorandum as

prescribed in J.D. Magpayo and the other cases. The

NLRC should not have proceeded with the adjudication of the

case, as this constitutes grave abuse of discretion. The glaring

failure of NLRC to ensure that Gran should have furnished

petitioner EDI a copy of the Appeal Memorandum before

rendering judgment reversing the dismissal of Gran’s

complaint constitutes an evasion of the pertinent NLRC Rules

and established jurisprudence. Worse, this failure deprived

EDI of procedural due process guaranteed by the Constitution

which can serve as basis for the nullification of proceedings in

the appeal before the NLRC. One can only surmise the shock

and dismay that OAB, EDI, and ESI experienced when they

thought that the dismissal of Gran’s complaint became final,

only to receive a copy of Gran’s Motion for Execution of

Judgment which also informed them that Gran had obtained a

favorable NLRC Decision. This is not level playing field and

absolutely unfair and discriminatory against the employer and

the job recruiters. The rights of the employers to procedural

due process cannot be cavalierly disregarded for they too have

rights assured under the Constitution.

Labor Law; Overseas Filipino Workers (OFWs); In cases

involving Overseas Filipino Workers (OFWs), the rights and

obligations among and between the Overseas Filipino Worker

(OFW), the local recruiter/agent, and the foreign

employer/principal are governed by the employment contract.—

In cases involving OFWs, the rights and obligations among and

between the OFW, the local recruiter/agent, and the foreign

employer/principal are governed by the employment contract. A

contract freely entered into is considered law between the

parties; and hence, should be respected. In formulating the

contract, the parties may establish such stipulations, clauses,

terms and conditions as they may deem convenient, provided

they are not contrary to law, morals, good customs, public

order, or public policy. In the present case, the employment

contract signed by Gran specifically states that Saudi Labor

Laws will govern matters not provided for in the contract (e.g.

specific causes for termination, termination procedures, etc.).

Being the law intended by the parties (lex loci intentiones) to

apply to the contract, Saudi Labor Laws should govern all

matters relating to the termination of the employment of Gran.

Same; Same; Conflict of Laws; Doctrine of Processual

Presumption or Presumed Identity Approach; In international

law, the party who wants to have a foreign law applied to a

dispute or case has the burden of proving the foreign law; Where

a foreign law is not pleaded or, even if pleaded, is not proved,

the presumption is that foreign law is the same as Philippine

law.—In international law, the party who wants to have a

foreign law applied to a dispute or case has the burden of

proving the foreign law. The foreign law is treated as a

question of fact to be properly pleaded and proved as the judge

or labor arbiter cannot take judicial notice of a foreign law. He

is presumed to know only domestic or forum law.

Unfortunately for petitioner, it did not prove the pertinent

Saudi laws on the matter; thus, the International Law doctrine

ofpresumed-identity approach or processual presumption comes

into play. Where a foreign law is not pleaded or, even if

pleaded, is not proved, the presumption is that foreign law is

the same as ours. Thus, we apply Philippine labor laws in

determining the issues presented before us.

Same; Same; Termination of Employment; Illegal

Dismissals;Burden of Proof; In termination disputes or illegal

dismissal cases, the employer has the burden of proving that the

dismissal is for just and valid causes; and failure to do so

would necessarily mean that the dismissal was not justified and

therefore illegal—the employer is bound to adduce clear,

accurate, consistent, and convincing evidence to prove that the

dismissal is valid and legal.—It has been held that in

termination disputes or illegal dismissal cases, the employer

has the burden of proving that the dismissal is for just and

valid causes; and failure to do so would necessarily mean that

the dismissal was not justified and therefore illegal. Taking

into account the character of the charges and the penalty

meted to an employee, the employer is bound to adduce clear,

accurate, consistent, and convincing evidence to prove that the

dismissal is valid and legal. This is consistent with the

principle of security of tenure as guaranteed by the Constitution

and reinforced by Article 277 (b) of the Labor Code of the

Philippines.

Same; Same; Same; Incompetence; An allegation of

incompetence should have a factual foundation—incompetence

may be shown by weighing it against a standard, benchmark, or

criterion.—Petitioner’s imputation of incompetence on private

respondent due to his “insufficient knowledge in programming

and zero knowledge of the ACAD system” based only on the

above mentioned letters, without any other evidence, cannot be

given credence. An allegation of incompetence should have a

factual foundation. Incompetence may be shown by weighing it

against a standard, benchmark, or criterion. However, EDI

failed to establish any such bases to show how petitioner found

Gran incompetent.

Same; Same; Same; Willful Disobedience; Requisites.— The

elements that must concur for the charge of insubordination or

willful disobedience to prosper were not present. In Micro Sales

Operation Network v. NLRC, 472 SCRA 328 (2005), we held

that: For willful disobedience to be a valid cause for dismissal,

the following twin elements must concur: (1) the employee’s

assailed conduct must have been willful, that is, characterized

by a wrongful and perverse attitude; and (2) the order violated

must have been reasonable, lawful, made known to the

employee and must pertain to the duties which he had been

engaged to discharge.

Same; Same; Same; Burden of Proof; The burden of proving

that an Overseas Filipino Workers (OFWs) employment was

validly and legally terminated devolves not only upon the

foreign-based employer but also on the employment or

recruitment agency for the latter is not only an agent of the

former, but is also solidarily liable with the foreign principal for

any claims or liabilities arising from the dismissal of the

worker.—Even though EDI and/or ESI were merely the local

employment or recruitment agencies and not the foreign

employer, they should have adduced additional evidence to

convincingly show that Gran’s employment was validly and

legally terminated. The burden devolves not only upon the

foreign-based employer but also on the employment or

recruitment agency for the latter is not only an agent of the

former, but is also solidarily liable with the foreign principal

for any claims or liabilities arising from the dismissal of the

worker.

Same; Same; Same; Trade Tests; It is presumed that before

the deployment of Overseas Filipino Worker’s (OFW’s), they were

subjected to trade tests required by law to be conducted by the

recruiting agency to insure employment of only technically

qualified workers for the foreign principal; The purpose of the

trade test is to weed out incompetent applicants from the pool of

available workers.—In Prieto, this Court ruled that “[i]t is

presumed that before their deployment, the petitioners were

subjected to trade tests required by law to be conducted by the

recruiting agency to insure employment of only technically

qualified workers for the foreign principal.” The CA, using the

ruling in the said case, ruled that Gran must have passed the

test; otherwise, he would not have been hired. Therefore, EDI

was at fault when it deployed Gran who was allegedly

“incompetent” for the job. According to petitioner,

thePrieto ruling is not applicable because in the case at hand,

Gran misrepresented himself in his curriculum vitae as a

Computer Specialist; thus, he was not qualified for the job for

which he was hired. We disagree. The CA is correct in

applying Prieto. The purpose of the required trade test is to

weed out incompetent applicants from the pool of available

workers. It is supposed to reveal applicants with false

educational backgrounds, and expose bogus qualifications.

Since EDI deployed Gran to Riyadh, it can be presumed that

Gran had passed the required trade test and that Gran is

qualified for the job. Even if there was no objective trade test

done by EDI, it was still EDI’s responsibility to subject Gran to

a trade test; and its failure to do so only weakened its position

but should not in any way prejudice Gran. In any case, the

issue is rendered moot and academic because Gran’s

incompetency is unproved.

Termination of Employment; Due Process; Under the twin

notice requirement, the employees must be given two (2) notices

before their employment could be terminated—(1) a first notice

to apprise the employees of their fault, and (2) a second notice to

communicate to the employees that their employment is being

terminated, and in between the first and second notice, the

employees should be given a hearing or opportunity to defend

themselves personally or by counsel of their choice.—In Agabon

v. NLRC, 442 SCRA 573 (2004), this Court held that:

Procedurally, (1) if the dismissal is based on a just cause under

Article 282, the employer must give the employee two written

notices and a hearing or opportunity to be heard if requested by

the employee before terminating the employment: a notice

specifying the grounds for which dismissal is sought a hearing

or an opportunity to be heard and after hearing or opportunity

to be heard, a notice of the decision to dismiss; and (2) if the

dismissal is based on authorized causes under Articles 283 and

284, the employer must give the employee and the Department

of Labor and Employment written notices 30 days prior to the

effectivity of his separation. Under the twin notice

requirement, the employees must be given two (2) notices

before their employment could be terminated: (1) a first notice

to apprise the employees of their fault, and (2) a second notice

to communicate to the employees that their employment is

being terminated. In between the first and second notice, the

employees should be given a hearing or opportunity to defend

themselves personally or by counsel of their choice.

Same; Migrant Workers and Overseas Filipinos Act (R.A.

No. 8042); In cases arising before the effectivity of the Migrant

Workers and Overseas Filipinos Act on 25 August 1995, where

the contract is for a fixed term and the employees are dismissed

without just cause, they are entitled to the payment of their

salaries corresponding to the unexpired portion of their contract,

but for cases arising after the effectivity of the law, when the

termination of employment is without just, valid or authorized

cause as defined by law or contract, the worker shall be entitled

to the full reimbursement of his placement fee with interest of

twelve percent (12%) per annum, plus his salaries for the

unexpired portion of his employment contract or for three (3)

months for every year of the unexpired term whichever is less.—

We reiterate the rule that with regard to employees hired for a

fixed period of employment, in cases arising before the

effectivity of R.A. No. 8042 (Migrant Workers and Overseas

Filipinos Act) on August 25, 1995, that when the contract is for

a fixed term and the employees are dismissed without just

cause, they are entitled to the payment of their salaries

corresponding to the unexpired portion of their contract. On the

other hand, for cases arising after the effectivity of R.A. No.

8042, when the termination of employment is without just,

valid or authorized cause as defined by law or contract, the

worker shall be entitled to the full reimbursement of his

placement fee with interest of twelve percent (12%) per annum,

plus his salaries for the unexpired portion of his employment

contract or for three (3) months for every year of the unexpired

term whichever is less.

Quitclaims; Courts must undertake a meticulous and

rigorous review of quitclaims or waivers, more particularly

those executed by employees—they should be carefully

examined, in regard not only to the words and terms used, but

also the factual circumstances under which they have been

executed.—Courts must undertake a meticulous and rigorous

review of quitclaims or waivers, more particularly those

executed by employees. This requirement was clearly

articulated by Chief Justice Artemio V. Panganiban in Land

and Housing Development Corporation v. Esquillo, 471 SCRA

488 (2005), Quitclaims, releases and other waivers of benefits

granted by laws or contracts in favor of workers should be

strictly scrutinized to protect the weak and the

disadvantaged. The waivers should be carefully

examined, in regard not only to the words and terms

used, but also the factual circumstances under which

they have been executed. (Emphasis supplied.) This Court

had also outlined in Land and Housing Development

Corporation, citingPeriquet v. NLRC, 186 SCRA 724 (1990), the

parameters for valid compromise agreements, waivers, and

quitclaims: Not all waivers and quitclaims are invalid as

against public policy. If the agreement was voluntarily entered

into and represents a reasonable settlement, it is binding on

the parties and may not later be disowned simply because of a

change of mind. It is only where there is clear proof that the

waiver was wangled from an unsuspecting or gullible person,

or the terms of settlement are unconscionable on its face, that

the law will step in to annul the questionable transaction. But

where it is shown that the person making the waiver did so

voluntarily, with full understanding of what he was

doing, and the consideration for the quitclaim is

credible and reasonable, the transaction must be recognized

as a valid and binding undertaking. (Emphasis supplied.)

Same; Guidelines for a Valid and Enforceable Quitclaim.—

In order to prevent disputes on the validity and enforceability

of quitclaims and waivers of employees under Philippine laws,

said agreements should contain the following: 1. A fixed

amount as full and final compromise settlement; 2. The

benefits of the employees if possible with the corresponding

amounts, which the employees are giving up in consideration of

the fixed compromise amount; 3. A statement that the

employer has clearly explained to the employee in English,

Filipino, or in the dialect known to the employees—that by

signing the waiver or quitclaim, they are forfeiting or

relinquishing their right to receive the benefits which are due

them under the law; and 4. A statement that the employees

signed and executed the document voluntarily, and had fully

understood the contents of the document and that their consent

was freely given without any threat, violence, duress,

intimidation, or undue influence exerted on their person. It is

advisable that the stipulations be made in English and Tagalog

or in the dialect known to the employee. There should be two (2)

witnesses to the execution of the quitclaim who must also sign

the quitclaim. The document should be subscribed and sworn to

under oath preferably before any administering official of the

Department of Labor and Employment or its regional office, the

Bureau of Labor Relations, the NLRC or a labor attaché in a

foreign country. Such official shall assist the parties regarding

the execution of the quitclaim and waiver. This compromise

settlement becomes final and binding under Article 227 of the

Labor Code.

Same; Conflict of Laws; The foregoing rules on quitclaim or

waiver shall apply only to labor contracts of Overseas Filipino

Workers (OFWs) in the absence of proof of the laws of the foreign

country agreed upon to govern said contracts.—It is made clear

that the foregoing rules on quitclaim or waiver shall apply only

to labor contracts of OFWs in the absence of proof of the laws of

the foreign country agreed upon to govern said contracts.

Otherwise, the foreign laws shall apply.

Pioneer Concrete Philippines, Inc. vs. Todaro

G.R. No. 154830. June 8, 2007.*

Actions; Cause of Action; Elements.—Section 2, Rule 2 of

the Rules of Court, as amended, defines a cause of action as the

act or omission by which a party violates a right of another. A

cause of action exists if the following elements are present: (1)

a right in favor of the plaintiff by whatever means and under

whatever law it arises or is created; (2) an obligation on the

part of the named defendant to respect or not to violate such

right; and, (3) an act or omission on the part of such defendant

violative of the right of the plaintiff or constituting a breach of

the obligation of the defendant to the plaintiff for which the

latter may maintain an action for recovery of damages.

Same; Same; Pleadings and Practice; Motions to

Dismiss; To sustain a motion to dismiss for lack of cause of

action, the complaint must show that the claim for relief does

not exist, rather than that a claim has been defectively stated, or

is ambiguous, indefinite or uncertain.—In Hongkong and

Shanghai Banking Corporation Limited v. Catalan, 440 SCRA

498 (2004), this Court held: The elementary test for failure to

state a cause of action is whether the complaint alleges facts

which if true would justify the relief demanded. Stated

otherwise, may the court render a valid judgment upon the

facts alleged therein? The inquiry is into the sufficiency, not

the veracity of the material allegations. If the allegations in the

complaint furnish sufficient basis on which it can be

maintained, it should not be dismissed regardless of the

defense that may be presented by the defendants. Moreover,

the complaint does not have to establish or allege facts proving

the existence of a cause of action at the outset; this will have to

be done at the trial on the merits of the case. To sustain a

motion to dismiss for lack of cause of action, the complaint

must show that the claim for relief does not exist, rather than

that a claim has been defectively stated, or is ambiguous,

indefinite or uncertain.

Labor Law; Jurisdictions; Employer-Employee

Relationship; Where no employer-employee relationship exists

between the parties and no issue is involved which may be

resolved by reference to the Labor Code, other labor statutes or

any collective bargaining agreement, it is the Regional Trial

Court that has jurisdiction; It is settled that an action for

breach of contractual obligation is intrinsically a civil

dispute.—As to the question of jurisdiction, this Court has

consistently held that where no employer-employee

relationship exists between the parties and no issue is involved

which may be resolved by reference to the Labor Code, other

labor statutes or any collective bargaining agreement, it is the

Regional Trial Court that has jurisdiction. In the present case,

no employer-employee relationship exists between petitioners

and respondent. In fact, in his complaint, private respondent is

not seeking any relief under the Labor Code, but seeks

payment of damages on account of petitioners’ alleged breach of

their obligation under their agreement to employ him. It is

settled that an action for breach of contractual obligation is

intrinsically a civil dispute. In the alternative, respondent

seeks redress on the basis of the provisions of Articles 19 and

21 of the Civil Code. Hence, it is clear that the present action is

within the realm of civil law, and jurisdiction over it belongs to

the regular courts.

Conflict of Laws; Forum Non-Conveniens; Words and

Phrases; The doctrine of forum non conveniens, literally

meaning “the forum is inconvenient,” emerged in private

international law to deter the practice of global forum shopping,

that is to prevent non-resident litigants from choosing the forum

or place wherein to bring their suit for malicious reasons, such

as to secure procedural advantages, to annoy and harass the

defendant, to avoid overcrowded dockets, or to select a more

friendly venue.—With respect to the applicability of the

principle of forum non conveniens in the present case, this

Court’s ruling in Bank of America NT & SA v. Court of Appeals,

400 SCRA 156 (2003), is instructive, to wit: The doctrine

of forum non-conveniens, literally meaning ‘the forum is

inconvenient,’ emerged in private international law to deter the

practice of global forum shopping, that is to prevent non-

resident litigants from choosing the forum or place wherein to

bring their suit for malicious reasons, such as to secure

procedural advantages, to annoy and harass the defendant, to

avoid overcrowded dockets, or to select a more friendly venue.

Under this doctrine, a court, in conflicts of law cases, may

refuse impositions on its jurisdiction where it is not the most

“convenient” or available forum and the parties are not

precluded from seeking remedies elsewhere. Whether a suit

should be entertained or dismissed on the basis of said doctrine

depends largely upon the facts of the particular case and is

addressed to the sound discretion of the trial court. In the case

of Communication Materials and Design, Inc. vs. Court of

Appeals, this Court held that “x x x [a] Philippine Court may

assume jurisdiction over the case if it chooses to do so;

provided, that the following requisites are met: (1) that the

Philippine Court is one to which the parties may conveniently

resort to; (2) that the Philippine Court is in a position to make

an intelligent decision as to the law and the facts; and, (3) that

the Philippine Court has or is likely to have power to enforce

its decision.” Moreover, this Court enunciated in Philsec.

Investment Corporation vs. Court of Appeals, that the doctrine

of forum non conveniens should not be used as a ground for a

motion to dismiss because Sec. 1, Rule 16 of the Rules of Court

does not include said doctrine as a ground. This Court further

ruled that while it is within the discretion of the trial court to

abstain from assuming jurisdiction on this ground, it should do

so only after vital facts are established, to determine whether

special circumstances require the court’s desistance; and that

the propriety of dismissing a case based on this principle

of forum non conveniensrequires a factual determination, hence

it is more properly considered a matter of defense.

Cadalin vs. POEA's Administrator

G.R. No. 104776. December 5, 1994.*

Conflict of Laws; As a general rule, a foreign procedural

law will not be applied in the forum.—As a general rule, a

foreign procedural law will not be applied in the forum.

Procedural matters, such as service of process, joinder of

actions, period and requisites for appeal, and so forth, are

governed by the laws of the forum. This is true even if the

action is based upon a foreign substantive law (Restatement of

the Conflict of Laws, Sec. 685; Salonga, Private International

Law, 131 [1979]).

Same; Prescription; A law on prescription of actions is sui

generis in Conflict of Laws.—A law on prescription of actions

issui generis in Conflict of Laws in the sense that it may be

viewed either as procedural or substantive, depending on the

characterization given such a law. Thus in Bournias v. Atlantic

Maritime Company, supra, the American court applied the

statute of limitations of New York, instead of the Panamanian

law, after finding that there was no showing that the

Panamanian law on prescription was intended to be

substantive. Being considered merely a procedural law even in

Panama, it has to give way to the law of the forum on

prescription of actions.

Same; Same; Actions; Words and Phrases; “Borrowing

Statute,” Explained; One form of “borrowing statutes” provides

that an action barred by the laws of the place where it accrued,

will not be enforced in the forum even though the local statute

has not run against it.—However, the characterization of a

statute into a procedural or substantive law becomes irrelevant

when the country of the forum has a “borrowing statute.” Said

statute has the practical effect of treating the foreign statute of

limitation as one of substance (Goodrich, Conflict of Laws 152-

153 [1938]). A “borrowing statute” directs the state of the forum

to apply the foreign statute of limitations to the pending claims

based on a foreign law (Siegel, Conflicts 183 [1975]). While

there are several kinds of “borrowing statutes,” one form

provides that an action barred by the laws of the place where it

accrued, will not be enforced in the forum even though the local

statute has not run against it (Goodrich and Scoles, Conflict of

Laws, 152-153 [1938]). Section 48 of our Code of Civil

Procedure is of this kind. Said Section provides: “If by the laws

of the state or country where the cause of action arose, the

action is barred, it is also barred in the Philippine Islands.”

Same; Same; Same; Section 48 of the Code of Civil

Procedure has not been repealed or amended by the Civil

Code.—Section 48 has not been repealed or amended by the

Civil Code of the Philippines. Article 2270 of said Code

repealed only those provisions of the Code of Civil Procedure as

to which were inconsistent with it. There is no provision in the

Civil Code of the Philippines, which is inconsistent with or

contradictory to Section 48 of the Code of Civil Procedure

(Paras, Philippine Conflict of Laws, 104 [7th ed.]).

Same; Same; Labor Law; The courts of the forum will not

enforce any foreign claim obnoxious to the forum’s public

policy.—In the light of the 1987 Constitution, however, Section

48 cannot be enforced ex proprio vigore insofar as it ordains the

application in this jurisdiction of Section 156 of the Amiri

Decree No. 23 of 1976. The courts of the forum will not enforce

any foreign claim obnoxious to the forum’s public policy

(Canadian Northern Railway Co. v. Eggen, 252 U.S. 553, 40 S.

Ct. 402, 64 L. ed. 713 [1920]). To enforce the one-year

prescriptive period of the Amiri Decree No. 23 of 1976 as

regards the claims in question would contravene the public

policy on the protection to labor.

Labor Law; Overseas Contract

Workers; Prescription; Article 291 of the Labor Code applies to

money claims arising from employer-employee relations,

including those arising from application of foreign laws

providing for greater employee benefits.—Section 7-a of the

Eight-Hour Labor Law provides the prescriptive period for

filing “actions to enforce any cause of action under said law.”

On the other hand, Article 291 of the Labor Code of the

Philippines provides the prescriptive period for filing “money

claims arising from employer-employee relations.” The claims

in the cases at bench all arose from the employer-employee

relations, which is broader in scope than claims arising from a

specific law or from the collective bargaining agreement. The

contention of the POEA Administrator, that the three-year

prescriptive period under Article 291 of the Labor Code of the

Philippines applies only to money claims specifically

recoverable under said Code, does not find support in the plain

language of the provision. Neither is the contention of the

claimants in G.R. No. 104911-14 that said Article refers only to

claims “arising from the employer’s violation of the employee’s

right,” as provided by the Labor Code supported by the facial

reading of the provision.

Same; Same; Right to Speedy Disposition of Cases; “Speedy

disposition of cases” is a relative term, a flexible concept

consistent with delays and depends upon the circumstances of

each case.—It is true that the constitutional right to “a speedy

disposition of cases” is not limited to the accused in criminal

proceedings but extends to all parties in all cases, including

civil and administrative cases, and in all proceedings, including

judicial and quasi-judicial hearings. Hence, under the

Constitution, any party to a case may demand expeditious

action on all officials who are tasked with the administration of

justice. However, as held inCaballero v. Alfonso, Jr., 153 SCRA

153 (1987), “speedy disposition of cases” is a relative term. Just

like the constitutional guarantee of “speedy trial” accorded to

the accused in all criminal proceedings, “speedy disposition of

cases” is a flexible concept. It is consistent with delays and

depends upon the circumstances of each case. What the

Constitution prohibits are unreasonable, arbitrary and

oppressive delays which render rights nugatory.

Same; Same; Same; Even if the cases took seven years to be

disposed of in the administrative level there is no violation of

the constitutional right to speedy disposition of cases where the

cases are not of the run-of-the-mill variety, involve a total of

1,767 claimants hired on various dates, with claims totalling

more than US$65 million.—The cases at bench are not of the

run-of-the-mill variety, such that their final disposition in the

administrative level after seven years from their inception,

cannot be said to be attended by unreasonable, arbitrary and

oppressive delays as to violate the constitutional rights to a

speedy disposition of the cases of complainants. The amended

complaint filed on June 6, 1984 involved a total of 1,767

claimants. Said complaint had undergone several amendments,

the first being on April 3, 1985. The claimants were hired on

various dates from 1975 to 1983. They were deployed in

different areas, one group in and the other groups outside of,

Bahrain. The monetary claims totalled more than US$65

million.

Same; Same; Actions; Class Suits; Where the claims are for

benefits granted under the Bahrain law, only the claimants who

worked in Bahrain shall be entitled to file their claims in a

class suit, excluding those who worked elsewhere.—A class suit

is proper where the subject matter of the controversy is one of

common or general interest to many and the parties are so

numerous that it is impracticable to bring them all before the

court (Revised Rules of Court, Rule 3, Sec. 12). While all the

claims are for benefits granted under the Bahrain law, many of

the claimants worked outside Bahrain. Some of the claimants

were deployed in Indonesia and Malaysia under different terms

and conditions of employment. NLRC and the POEA

Administrator are correct in their stance that inasmuch as the

first requirement of a class suit is not present (common or

general interest based on the Amiri Decree of the State of

Bahrain), it is only logical that only those who worked in

Bahrain shall be entitled to file their claims in a class suit.

Same; Same; Same; Same; A principle basic to the concept

of “class suit” is that plaintiffs brought on the record must fairly

represent and protect the interests of the others, such that if it

appears that each claimant is only interested in collecting his

own claims and has no concern in protecting the interests of the

others, the most that can be accorded to them is to be allowed to

join as plaintiffs in one complaint.—It appears that each

claimant is only interested in collecting his own claims. A

claimant has no concern in protecting the interests of the other

claimants as shown by the fact, that hundreds of them have

abandoned their co-claimants and have entered into separate

compro-mise settlements of their respective claims. A principle

basic to the concept of “class suit” is that plaintiffs brought on

the record must fairly represent and protect the interests of the

others (Dimayuga v. Court of Industrial Relations, 101 Phil.

590 [1957]). For this matter, the claimants who worked in

Bahrain can not be allowed to sue in a class suit in a judicial

proceeding. The most that can be accorded to them under the

Rules of Court is to be allowed to join as plaintiffs in one

complaint (Revised Rules of Court, Rule 3, Sec. 6).

Same; Same; Same; Same; The Supreme Court is extra-

cautious in allowing class suits because they are the exceptions

to the condition sine qua non, requiring the joinder of all

indispensable parties.—The Court is extra-cautious in allowing

class suits because they are the exceptions to the condition sine

qua non, requiring the joinder of all indispensable parties. In

an improperly instituted class suit, there would be no problem

if the decision secured is favorable to the plaintiffs. The

problem arises when the decision is adverse to them, in which

case the others who were impleaded by their self-appointed

representatives, would surely claim denial of due process.

Actions; Forum Shopping; Before Administrative Circular

No. 04-94, the Anti-Forum Shopping Rule (Revised Circular No.

28-91) applied only to petitions filed with the Supreme Court

and the Court of Appeals.—The Anti-Forum Shopping Rule

(Revised Circular No. 28-91) is intended to put a stop to the

practice of some parties of filing multiple petitions and

complaints involving the same issues, with the result that the

courts or agencies have to resolve the same issues. Said Rule,

however, applies only to petitions filed with the Supreme Court

and the Court of Appeals. It is entitled “Additional

Requirements For Petitions Filed with the Supreme Court and

the Court of Appeals To Prevent Forum Shopping or Multiple

Filing of Petitioners and Complainants.” The first sentence of

the circular expressly states that said circular applies to and

governs the filing of petitions in the Supreme Court and the

Court of Appeals. While Administrative Circular No. 04-94

extended the application of the anti-forum shopping rule to the

lower courts and administrative agencies, said circular took

effect only on April 1, 1994.

Jurisdiction; Legal Ethics; Attorneys; The NLRC and the

POEA have no jurisdiction to investigate charges of unethical

conduct of lawyers.—POEA and NLRC could not have

entertained the complaint for unethical conduct against Atty.

De Castro because NLRC and POEA have no jurisdiction to

investigate charges of unethical conduct of lawyers.

Same; Same; Same; Complaints for violation of the Code of

Professional Responsibility should be filed in a separate and

appropriate proceeding.—The complaint of Atty. Gerardo A. Del

Mundo to cite Atty. Florante De Castro and Atty. Katz Tierra

for violation of the Code of Professional Responsibility should

be filed in a separate and appropriate proceeding.

Same; Attorney’s Liens; A statement of a claim for a

charging lien should be filed with the court or administrative

agency which renders and executes the money judgment.—A

statement of a claim for a charging lien shall be filed with the

court or administrative agency which renders and executes the

money judgment secured by the lawyer for his clients. The

lawyer shall cause written notice thereof to be delivered to his

clients and to the adverse party (Revised Rules of Court, Rule

138, Sec. 37). The statement of the claim for the charging lien

of Atty. Del Mundo should have been filed with the

administrative agency that rendered and executed the

judgment.

Evidence; Conflict of Laws; Administrative Law; An official

document from a foreign government can be admitted in

evidence in proceedings before an administrative body even

without observing the rule provided in Section 24, Rule 132 of

the 1989 Revised Rules on Evidence.—Claimants presented a

Memorandum of the Ministry of Labor of Bahrain dated April

16, 1983. While said document was presented to the POEA

without observing the rule on presenting official documents of a

foreign government as provided in Section 24, Rule 132 of the

1989 Revised Rules on Evidence, it can be admitted in evidence

in proceedings before an administrative body. The opposing

parties have a copy of the said memorandum, and they could

easily verify its authenticity and accuracy.

Same; Offer to Compromise; In civil cases, an offer to settle

a claim is not an admission that anything is due and is not

admissible in evidence against the offeror.—The admissibility of

the offer of compromise made by BRII as contained in the

memorandum is another matter. Under Section 27, Rule 130 of

the 1989 Revised Rules on Evidence, an offer to settle a claim is

not an admission that anything is due. Said Rule provides:

“Offer of compromise not admissible.—In civil cases, an offer of

compromise is not an admission of any liability, and is not

admissible in evidence against the offeror.” This Rule is not

only a rule of procedure to avoid the cluttering of the record

with unwanted evidence but a statement of public policy. There

is great public interest in having the protagonists settle their

differences amicably before these ripen into litigation. Every

effort must be taken to encourage them to arrive at a

settlement. The submission of offers and counter-offers in the

negotiation table is a step in the right direction. But to bind a

party to his offers, as what claimants would make this Court

do, would defeat the salutary purpose of the Rule.

Contracts; Overseas Contract Workers; Any ambiguity in

the overseas-employment contracts should be interpreted

against the parties who drafted them.—The overseas-

employment contracts could have been drafted more

felicitously. While a part thereof provides that the

compensation to the employee may be “adjusted downward so

that the total computation (thereunder) plus the non-waivable

benefits shall be equivalent to the compensation” therein

agreed, another part of the same provision categorically states

“that total remuneration and benefits do not fall below that of

the host country regulation and custom.” Any ambiguity in the

overseas-employment contracts should be interpreted against

AIBC and BRII, the parties that drafted it (Eastern Shipping

Lines, Inc. v. Margarine-Verkaufs-Union, 93 SCRA 257 [1979]).

Same; Conflict of Laws; Parties to a contract may select the

law by which it is to be governed, and instead of adopting the

entire mass of the foreign law, the parties may just agree that

specific provisions of a foreign statute shall be deemed

incorporated into their contract “as a set of terms.”—The parties

to a contract may select the law by which it is to be governed

(Cheshire, Private International Law, 187 [7th ed.]). In such a

case, the foreign law is adopted as a “system” to regulate the

relations of the parties, including questions of their capacity to

enter into the contract, the formalities to be observed by them,

matters of performance, and so forth (16 Am Jur 2d, 150-161).

Instead of adopting the entire mass of the foreign law, the

parties may just agree that specific provisions of a foreign

statute shall be deemed incorporated into their contract “as a

set of terms.” By such reference to the provisions of the foreign

law, the contract does not become a foreign contract to be

governed by the foreign law. The said law does not operate as a

statute but as a set of contractual terms deemed written in the

contract (Anton, Private International Law, 197 [1967]; Dicey

and Morris, The Conflict of Laws, 702-703, [8th ed.]).

Same; Same; The choice of law must, however, bear some

relationship to the parties or their transaction.—A basic policy

of contract is to protect the expectation of the parties (Reese,

Choice of Law in Torts and Contracts, 16 Columbia Journal of

Transnational Law 1, 21 [1977]). Such party expectation is

protected by giving effect to the parties’ own choice of the

applicable law (Fricke v. Isbrandtsen Co. Inc., 151 F. Supp.

465, 467 [1957]). The choice of law must, however, bear some

relationship to the parties or their transaction (Scoles and

Hayes, Conflict of Law, 644-647 [1982]). There is no question

that the contracts sought to be enforced by claimants have a

direct connection with the Bahrain law because the services

were rendered in that country.

Administrative Law; Due Process; There is no denial of due

process even if the respondents had no opportunity to refute the

evidence of the claimants before the POEA where they had all

the opportunity to rebut said evidence and to present their

counter-evidence before the NLRC.—NLRC noted that so many

pieces of evidentiary matters were submitted to the POEA

Administrator by the claimants after the cases were deemed

submitted for resolution and which were taken cognizance of by

the POEA Administrator in resolving the cases. While AIBC

and BRII had no opportunity to refute said evidence of the

claimants before the POEA Administrator, they had all the

opportunity to rebut said evidence and to present their counter-

evidence before NLRC. As a matter of fact, AIBC and BRII

themselves were able to present before NLRC additional

evidence which they failed to present before the POEA

Administrator. Under Article 221 of the Labor Code of the

Philippines, NLRC is enjoined to “use every and all reasonable

means to ascertain the facts in each case speedily and

objectively and without regard to technicalities of law or

procedure, all in the interest of due process.”

Same; Same; While technical rules of procedure and

evidence do not apply to the proceedings conducted by

administrative agencies, there are cardinal rules which must be

observed by the hearing officers in order to comply with the due

process requirements of the Constitution.—A principle well

embedded in Administrative Law is that the technical rules of

procedure and evidence do not apply to the proceedings

conducted by administrative agencies (First Asian Transport &

Shipping Agency Inc. v. Ople, 142 SCRA 542 [1986]; Asiaworld

Publishing House, Inc. v. Ople, 152 SCRA 219 [1987]). This

principle is enshrined in Article 221 of the Labor Code of the

Philippines and is now the bedrock of proceedings before

NLRC. Notwithstanding the non-applicability of technical rules

of procedure and evidence in administrative proceedings, there

are cardinal rules which must be observed by the hearing

officers in order to comply with the due process requirements of

the Constitution. These cardinal rules are collated in Ang

Tibay v. Court of Industrial Relations, 69 Phil. 635 (1940).

PCL Shipping Philippines, Inc. vs. National Labor

Relations Commission

G.R. No. 153031. December 14, 2006.*

Labor Law; Appeals; Administrative Law; Judicial review

by the Supreme Court does not extend to a re-evaluation of the

sufficiency of the evidence upon which the proper labor tribunal

has based its determination.—It is a settled rule that under

Rule 45 of the Rules of Court, only questions of law may be

raised in this Court. Judicial review by this Court does not

extend to a re-evaluation of the sufficiency of the evidence upon

which the proper labor tribunal has based its determination.

Firm is the doctrine that this Court is not a trier of facts, and

this applies with greater force in labor cases. Factual issues

may be considered and resolved only when the findings of facts

and conclusions of law of the Labor Arbiter are inconsistent

with those of the NLRC and the CA. The reason for this is that

the quasi-judicial agencies, like the Arbitration Board and the

NLRC, have acquired a unique expertise because their

jurisdictions are confined to specific matters. In the present

case, the question of whether private respondent is guilty of

desertion is factual. The Labor Arbiter, NLRC and the CA are

unanimous in their findings that private respondent is not

guilty of desertion and that he has been illegally terminated

from his employment. After a review of the records of the

instant case, this Court finds no cogent reason to depart from

the findings of these tribunals.

Same; Seamen; Desertion; Evidence; Without any

corroborative evidence, Marine Note Protests and entries in the

logbook which were neither notarized nor authenticated by the

proper authorities cannot be used as bases for concluding that

the seaman was guilty of desertion.—Petitioners assert that the

entries in the logbook of MV Cem-tex General and in the

Marine Note Protest which they submitted to the NLRC

confirm the fact that private respondent abandoned the vessel

in which he was assigned. However, the genuineness of the

Marine Note Protest as well as the entries in the logbook are

put in doubt because aside from the fact that they were

presented only during petitioners’ Motion for Reconsideration

filed with the NLRC, both the Marine Note Protest and the

entry in the logbook which were prepared by the officers of the

vessel were neither notarized nor authenticated by the proper

authorities. Moreover, a reading of these entries simply shows

that private respondent was presumed to have deserted his

post on the sole basis that he was found missing while the MV

Cemtex General was anchored at the port of Takehara, Japan.

Hence, without any corroborative evidence, these documents

cannot be used as bases for concluding that private respondent

was guilty of desertion.

Same; Same; Same; For a seaman to be considered as guilty

of desertion, it is essential that there be evidence to prove that if

he leaves the ship or vessel in which he had engaged to perform

a voyage, he has the clear intention of abandoning his duty and

of not returning to the ship or vessel.—As correctly defined by

petitioners, desertion, in maritime law is: The act by which a

seaman deserts and abandons a ship or vessel, in which he had

engaged to perform a voyage, before the expiration of his time,

and without leave. By desertion, in maritime law, is meant, not

a mere unauthorized absence from the ship, without leave, but

an unauthorized absence from the ship with an intention not

to return to her service; or as it is often expressed, animo

non revertendi, that is, with an intention to desert. (emphasis

supplied) Hence, for a seaman to be considered as guilty of

desertion, it is essential that there be evidence to prove that if

he leaves the ship or vessel in which he had engaged to perform

a voyage, he has the clear intention of abandoning his duty and

of not returning to the ship or vessel. In the present case,

however, petitioners failed to present clear and convincing

proof to show that when private respondent jumped ship, he no

longer had the intention of returning. The fact alone that he

jumped off the ship where he was stationed, swam to shore and

sought medical assistance for the injury he sustained is not a

sufficient basis for petitioners to conclude that he had the

intention of deserting his post.

Same; Same; Same; The employer may not claim that it

ended the seaman’s services because he is guilty of desertion and

at the same time argue that it exercised its option to

prematurely terminate his employment, even without cause,

simply because it has the right to do so under the contract.—The

Court agrees with private respondent’s contention that

petitioners’ arguments are misplaced. Petitioners may not use

the above-quoted provision as basis for terminating private

respondent’s employment because it is incongruent with their

primary defense that the latter’s dismissal from employment

was for cause. Petitioners may not claim that they ended

private respondent’s services because he is guilty of desertion

and at the same time argue that they exercised their option to

prematurely terminate his employment, even without cause,

simply because they have the right to do so under their

contract. These grounds for termination are inconsistent with

each other such that the use of one necessarily negates resort

to the other. Besides, it appears from the records that

petitioners’ alternative defense was pleaded merely as an

afterthought because it was only in their appeal with the

NLRC that they raised this defense. The only defense raised by

petitioners in their Answer with Counterclaim filed with the

office of the Labor Arbiter is that private respondent was

dismissed from employment by reason of desertion. Under the

Rules of Court, which is applicable in a suppletory character in

labor cases before the Labor Arbiter or the NLRC pursuant to

Section 3, Rule I of the New Rules of Procedure of the NLRC,

defenses which are not raised either in a motion to dismiss or

in the answer are deemed waived.

Same; Same; Conflict of Laws; Lex Loci Contractus; The

provisions of the Constitution as well as the Labor Code which

afford protection to labor apply to Filipino employees whether

working within the Philippines or abroad; The principle of lex

loci contractus (the law of the place where the contract is made)

governs in this jurisdiction.—Petitioners admit that they did

not inform private respondent in writing of the charges against

him and that they failed to conduct a formal investigation to

give him opportunity to air his side. However, petitioners

contend that the twin requirements of notice and hearing

applies strictly only when the employment is within the

Philippines and that these need not be strictly observed in

cases of international maritime or overseas employment. The

Court does not agree. The provisions of the Constitution as well

as the Labor Code which afford protection to labor apply to

Filipino employees whether working within the Philippines or

abroad. Moreover, the principle of lex loci contractus (the law of

the place where the contract is made) governs in this

jurisdiction. In the present case, it is not disputed that the

Contract of Employment entered into by and between

petitioners and private respondent was executed here in the

Philippines with the approval of the Philippine Overseas

Employment Administration (POEA). Hence, the Labor Code

together with its implementing rules and regulations and other

laws affecting labor apply in this case.

Same; Same; Migrant Workers and Overseas Filipinos Act

of 1995 (R.A. No. 8042); What is included in the computation of

the amount due to the overseas worker are only his salaries—

allowances are excluded.—The Court finds no basis in the

NLRC’s act of including private respondent’s living allowance

as part of the three months salary to which he is entitled under

Section 10 of Republic Act (RA) No. 8042, otherwise known as

the “Migrant Workers and Overseas Filipinos Act of 1995.” The

pertinent provisions of the said Act provides: Sec. 10. Money

Claims.—x x x x In case of termination of overseas employment

without just, valid or authorized cause as defined by law or

contract, the worker shall be entitled to the full reimbursement

of his placement fee with interest at twelve percent (12%) per

annum, plus his salaries for the unexpired portion of his

employment contract or for three (3) months for every year of

the unexpired term, whichever is less. x x x x It is clear from

the abovequoted provision that what is included in the

computation of the amount due to the overseas worker are only

his salaries. Allowances are excluded. In the present case, since

private respondent received a basic monthly salary of

US$400.00, he is, therefore, entitled to receive a sum of

US$1200.00, representing three months of said salary.

Same; Same; Overtime Pay; The correct criterion in

determining whether or not sailors are entitled to overtime pay

is not whether they were on board and can not leave ship beyond

the regular eight working hours a day, but whether they

actually rendered service in excess of said number of hours.—

With respect to the award of overtime pay, the correct criterion

in determining whether or not sailors are entitled to overtime

pay is not whether they were on board and can not leave ship

beyond the regular eight working hours a day, but whether

they actually rendered service in excess of said number of

hours. In the present case, the Court finds that private

respondent is not entitled to overtime pay because he failed to

present any evidence to prove that he rendered service in

excess of the regular eight working hours a day.

Same; Attorney’s Fees; Words and Phrases; There are two

commonly accepted concepts of attorney’s fees, the so-called

ordinary and extraordinary; In its ordinary concept, an

attorney’s fee is the reasonable compensation paid to a lawyer by

his client for the legal services he has rendered to the latter,

while in its extraordinary concept, attorney’s fees are deemed

indemnity for damages ordered by the court to be paid by the

losing party in a litigation; The extraordinary concept of

attorney’s fees is the one contemplated by Article 111 of the

Labor Code, which is an exception to the declared policy of strict

construction in the awarding of attorney’s fees.—As to the

award of attorney’s fees, this Court ruled in Reyes v. Court of

Appeals, 409 SCRA 267 (2003), as follows: x x x [T]here are two

commonly accepted concepts of attorney’s fees, the so-called

ordinary and extraordinary. In its ordinary concept, an

attorney’s fee is the reasonable compensation paid to a lawyer

by his client for the legal services he has rendered to the latter.

The basis of this compensation is the fact of his employment by

and his agreement with the client. In its extraordinary concept,

attorney’s fees are deemed indemnity for damages ordered by

the court to be paid by the losing party in a litigation. The

instances where these may be awarded are those enumerated

in Article 2208 of the Civil Code, specifically par. 7 thereof

which pertains to actions for recovery of wages, and is payable

not to the lawyer but to the client, unless they have agreed that

the award shall pertain to the lawyer as additional

compensation or as part thereof. The extraordinary concept of

attorney’s fees is the one contemplated in Article 111 of the

Labor Code, which provides: Art. 111. Attorney’s fees.—(a) In

cases of unlawful withholding of wages, the culpable party may

be assessed attorney’s fees equivalent to ten percent of the

amount of wages recovered x x x The aforequoted Article

111 is an exception to the declared policy of strict

construction in the awarding of attorney’s fees.

Although an express finding of facts and law is still

necessary to prove the merit of the award, there need

not be any showing that the employer acted maliciously

or in bad faith when it withheld the wages. There need

only be a showing that the lawful wages were not paid

accordingly, as in this case.

Saudi Arabian Airlines vs. Court of Appeals

G.R. No. 122191. October 8, 1998.*

Conflict of Laws; Actions; Where the factual antecedents

satisfactorily establish the existence of a foreign element, the

problem could present a “conflicts” case.—Where the factual

antecedents satisfactorily establish the existence of a foreign

element, we agree with petitioner that the problem herein

could present a “conflicts” case. A factual situation that cuts

across territorial lines and is affected by the diverse laws of two

or more states is said to contain a “foreign element.” The

presence of a foreign element is inevitable since social and

economic affairs of individuals and associations are rarely

confined to the geographic limits of their birth or conception.

Same; Same; The forms in which a foreign element may

appear are many, such as the fact that one party is a resident

Philippine national, and that the other is a resident foreign

corporation.—The forms in which this foreign element may

appear are many. The foreign element may simply consist in

the fact that one of the parties to a contract is an alien or has a

foreign domicile, or that a contract between nationals of one

State involves properties situated in another State. In other

cases, the foreign element may assume a complex form. In the

instant case, the foreign element consisted in the fact that

private respondent Morada is a resident Philippine national,

and that petitioner SAUDIA is a resident foreign corporation.

Also, by virtue of the employment of Morada with the

petitioner SAUDIA as a flight stewardess, events did transpire

during her many occasions of travel across national borders,

particularly from Manila, Philippines to Jeddah, Saudi Arabia,

and vice versa, that caused a “conflicts” situation to arise.

Same; Same; Damages; While Article 19 of the Civil Code

merely declares a principle of law, Article 21 gives flesh to its

provisions; Violations of Articles 19 and 21 are actionable, with

judicially enforceable remedies in the municipal forum.—

Although Article 19 merely declares a principle of law, Article

21 gives flesh to its provisions. Thus, we agree with private

respondent’s assertion that violations of Articles 19 and 21 are

actionable, with judicially enforceable remedies in the

municipal forum. Based on the allegations in the Amended

Complaint, read in the light of the Rules of Court on

jurisdiction we find that the Regional Trial Court (RTC) of

Quezon City possesses jurisdiction over the subject matter of

the suit. Its authority to try and hear the case is provided for

under Section 1 of Republic Act No. 7691.

Same; Same; Forum Non Conveniens; Forum

Shopping;Plaintiff may not, by choice of an inconvenient forum,

‘vex,’ ‘harass,’ or ‘oppress’ the defendant, e.g. by inflicting upon

him needless expense or disturbance, but unless the balance is

strongly in favor of the defendant, the plaintiff’s choice of forum

should rarely be disturbed.—Pragmatic considerations,

including the convenience of the parties, also weigh heavily in

favor of the RTC Quezon City assuming jurisdiction.

Paramount is the private interest of the litigant. Enforceability

of a judgment if one is obtained is quite obvious. Relative

advantages and obstacles to a fair trial are equally important.

Plaintiff may not, by choice of an inconvenient forum, ‘vex,’

‘harass,’ or ‘oppress’ the defendant, e.g.by inflicting upon him

needless expense or disturbance. But unless the balance is

strongly in favor of the defendant, the plaintiff’s choice of forum

should rarely be disturbed.

Same; Same; Forcing a party to seek remedial action in a

place where she no longer maintains substantial connections

would cause a fundamental unfairness to her.—Weighing the

relative claims of the parties, the court a quo found it best to

hear the case in the Philippines. Had it refused to take

cognizance of the case, it would be forcing plaintiff (private

respondent now) to seek remedial action elsewhere, i.e. in the

Kingdom of Saudi Arabia where she no longer maintains

substantial connections. That would have caused a

fundamental unfairness to her.

Same; Same; A party effectively submits to the trial court’s

jurisdiction by praying for the dismissal of the complaint on

grounds other than lack of jurisdiction.—The records show that

petitioner SAUDIA has filed several motions praying for the

dismissal of Morada’s Amended Complaint. SAUDIA also filed

an Answer In Ex Abundante Cautelam dated February 20,

1995. What is very patent and explicit from the motions filed, is

that SAUDIA prayed for other reliefs under the premises.

Undeniably, petitioner SAUDIA has effectively submitted to

the trial court’s jurisdiction by praying for the dismissal of the

Amended Complaint on grounds other than lack of jurisdiction.

Same; Choice-of-law problems seek to answer two important

questions: (1) What legal system should control a given situation

where some of the significant facts occurred in two or more

states; and (2) to what extent should the chosen legal system

regulate the situation.—As to the choice of applicable law, we

note that choice-of-law problems seek to answer two important

questions: (1) What legal system should control a given

situation where some of the significant facts occurred in two or

more states; and (2) to what extent should the chosen legal

system regulate the situation.

Same; Although ideally, all choice-of-law theories should

intrinsically advance both notions of justice and predictability,

they do not always do so, in which case the forum is then faced

with the problem of deciding which of these two important

values should be stressed.—Several theories have been

propounded in order to identify the legal system that should

ultimately control. Although ideally, all choice-of-law theories

should intrinsically advance both notions of justice and

predictability, they do not always do so. The forum is then

faced with the problem of deciding which of these two

important values should be stressed.

Same; Characterization or Doctrine of Qualification; Words

and Phrases; Characterization is the “process of deciding

whether or not the facts relate to the kind of question specified

in a conflicts rule.”—Before a choice can be made, it is

necessary for us to determine under what category a certain set

of facts or rules fall. This process is known as

“characterization,” or the “doctrine of qualification.” It is the

“process of deciding whether or not the facts relate to the kind

of question specified in a conflicts rule.” The purpose of

“characterization” is to enable the forum to select the proper

law.

Same; Same; An essential element of conflict rules is the

indication of a “test” or “connecting factor” or “point of

contact.”—Our starting point of analysis here is not a legal

relation, but a factual situation, event, or operative fact. An

essential element of conflict rules is the indication of a “test” or

“connecting factor” or “point of contact.” Choice-of-law rules

invariably consist of a factual relationship (such as property

right, contract claim) and a connecting factor or point of

contact, such as the situs of the res, the place of celebration, the

place of performance, or the place of wrongdoing.

Same; Same; “Test Factors” or “Points of Contact” or

“Connecting Factors.”—Note that one or more circumstances

may be present to serve as the possible test for the

determination of the applicable law. These “test factors” or

“points of contact” or “connecting factors” could be any of the

following: “(1) the nationality of a person, his domicile, his

residence, his place of sojourn, or his origin; (2) the seat of a

legal or juridical person, such as a corporation; (3) the situs of a

thing, that is, the place where a thing is, or is deemed to be

situated. In particular, the lex situs is decisive when real rights

are involved; (4) the place where an act has been done, the locus

actus, such as the place where a contract has been made, a

marriage celebrated, a will signed or a tort committed. The lex

loci actus is particularly important in contracts and torts; (5)

the place where an act is intended to come into effect, e.g., the

place of performance of contractual duties, or the place where a

power of attorney is to be exercised; (6) the intention of the

contracting parties as to the law that should govern their

agreement, the lex loci intentionis; (7) the place where judicial

or administrative proceedings are instituted or done. The lex

fori—the law of the forum—is particularly important because,

as we have seen earlier, matters of ‘procedure’ not going to the

substance of the claim involved are governed by it; and because

the lex fori applies whenever the content of the otherwise

applicable foreign law is excluded from application in a given

case for the reason that it falls under one of the exceptions to

the applications of foreign law; and (8) the flag of a ship, which

in many cases is decisive of practically all legal relationships of

the ship and of its master or owner as such. It also covers

contractual relationships particularly contracts of

affreightment.” (Italics ours.)

Same; Same; Same; Torts; Where the action is one involving

torts, the “connecting factor” or “point of contact” could be the

place or places where the tortious conduct or lex loci actus

occurred; The Philippines is the situs of the tort where it is in

the Philippines where the defendant allegedly deceived the

plaintiff, a citizen residing and working here, and the fact that

certain acts or parts of the injury occurred in another country is

of no moment, for what is important is the place where the over-

all harm or the totality of the injury to the person, reputation,

social standing and human rights of the plaintiff had lodged.—

Considering that the complaint in the court a quo is one

involving torts, the “connecting factor” or “point of contact”

could be the place or places where the tortious conduct or lex

loci actus occurred. And applying the torts principle in a

conflicts case, we find that the Philippines could be said as a

situs of the tort (the place where the alleged tortious conduct

took place). This is because it is in the Philippines where

petitioner allegedly deceived private respondent, a Filipina

residing and working here. According to her, she had honestly

believed that petitioner would, in the exercise of its rights and

in the performance of its duties, “act with justice, give her her

due and observe honesty and good faith.” Instead, petitioner

failed to protect her, she claimed. That certain acts or parts of

the injury allegedly occurred in another country is of no

moment. For in our view what is important here is the place

where the over-all harm or the totality of the alleged injury to

the person, reputation, social standing and human rights of

complainant, had lodged, according to the plaintiff below

(herein private respondent). All told, it is not without basis to

identify the Philippines as the situs of the alleged tort.

Same; Same; Same; Same; “State of the Most Significant

Relationship” Rule; The “State of the most significant

relationship” rule is the appropriate modern theory on tort

liability to apply in the instant case.—With the widespread

criticism of the traditional rule of lex loci delicti commissi,

modern theories and rules on tort liability have been advanced

to offer fresh judicial approaches to arrive at just results. In

keeping abreast with the modern theories on tort liability, we

find here an occasion to apply the “State of the most significant

relationship” rule, which in our view should be appropriate to

apply now, given the factual context of this case. In applying

said principle to determine the State which has the most

significant relationship, the following contacts are to be taken

into account and evaluated according to their relative

importance with respect to the particular issue: (a) the place

where the injury occurred; (b) the place where the conduct

causing the injury occurred; (c) the domicile, residence,

nationality, place of incorporation and place of business of the

parties; and (d) the place where the relationship, if any,

between the parties is centered.

Same; Same; Same; Same; Same; Where the Philippines is

the situs of the tort complained of and the place “having the

most interest in the problem,” the Philippine law on tort liability

should have paramount application to and control in the

resolution of the legal issues arising therein.—As already

discussed, there is basis for the claim that over-all injury

occurred and lodged in the Philippines. There is likewise no

question that private respondent is a resident Filipina

national, working with petitioner, a resident foreign

corporation engaged here in the business of international air

carriage. Thus, the “relationship” between the parties was

centered here, although it should be stressed that this suit is

not based on mere labor law violations. From the record, the

claim that the Philippines has the most significant contact with

the matter in this dispute, raised by private respondent as

plaintiff below against defendant (herein petitioner), in our

view, has been properly established. Prescinding from this

premise that the Philippines is the situs of the tort complained

of and the place “having the most interest in the problem,” we

find, by way of recapitulation, that the Philippine law on tort

liability should have paramount application to and control in

the resolution of the legal issues arising out of this case.

Further, we hold that the respondent Regional Trial Court has

jurisdiction over the parties and the subject matter of the

complaint; the appropriate venue is in Quezon City, which

could properly apply Philippine law.

Same; Pleadings and Practice; Evidence; A party whose

cause of action is based on a Philippine law has no obligation to

plead and prove the law of another State.—We find untenable

petitioner’s insistence that “[s]ince private respondent

instituted this suit, she has the burden of pleading and proving

the applicable Saudi law on the matter.” As aptly said by

private respondent, she has “no obligation to plead and prove

the law of the Kingdom of Saudi Arabia since her cause of

action is based on Articles 19 and 21” of the Civil Code of the

Philippines. In her Amended Complaint and subsequent

pleadings, she never alleged that Saudi law should govern this

case. And as correctly held by the respondent appellate court,

“considering that it was the petitioner who was invoking the

applicability of the law of Saudi Arabia, then the burden was

on it [petitioner] to plead and to establish what the law of

Saudi Arabia is.”

Manila Hotel Corp. vs. National Labor Relations

Commission

G.R. No. 120077. October 13, 2000.*

Certiorari; Pleadings and Practice; Where the petition

involves pure questions of law, the same may be exempted from

the ruling in St. Martin Funeral Home v. NLRC, 295 SCRA 494

(1998).—On October 7, 1997, we resolved to give due course to

the petition (Rollo, p. 217). Petitioners filed their memorandum

on December 1, 1997. The petition involves pure questions of

law; thus, we except this case from the ruling in St. Martin

Funeral Home vs. NLRC, 295 SCRA 494 [1998]. Rather than

refer the case to the Court of Appeals, whose decision would be

appealable to the Supreme Court, our ruling would finally put

an end to the litigation.

Conflict of Laws; Forum Non Conveniens; Not all cases

involving Filipino citizens can be tried in the Philippines.—The

NLRC was a seriously inconvenient forum. We note that the

main aspects of the case transpired in two foreign jurisdictions

and the case involves purely foreign elements. The only link

that the Philippines has with the case is that respondent

Santos is a Filipino citizen. The Palace Hotel, and MHICL are

foreign corporations. Not all cases involving our citizens can be

tried here.The employment contract.—Respondent Santos was

hired directly by the Palace Hotel, a foreign employer, through

correspondence sent to the Sultanate of Oman, where

respondent Santos was then employed. He was hired without

the intervention of the POEA or any authorized recruitment

agency of the government.

Same; Same; Requisites before a Philippine court or agency

may assume jurisdiction over a conflict of laws case.—Under

the rule of forum non conveniens, a Philippine court or

agency mayassume jurisdiction over the case if it chooses to do

so provided: (1) that the Philippine court is one to which the

parties may conveniently resort to; (2) that the Philippine court

is in a position to make an intelligent decision as to the law and

the facts; and (3) that the Philippine court has or is likely to

have power to enforce its decision. The conditions are

unavailing in the case at bar.

Same; Same; Labor Law; The Supreme Court cannot see

how the NLRC is a convenient forum where all the incidents of

the case–from the time of recruitment, to employment to

dismissal occurred outside the Philippines, an inconvenience is

compounded by the fact that the proper defendants are not

nationals of the Philippines.—We fail to see how the NLRC is a

convenient forum given that all the incidents of the case—from

the time of recruitment, to employment to dismissal occurred

outside the Philippines. The inconvenience is compounded by

the fact that the proper defendants, the Palace Hotel and

MHICL are not nationals of the Philippines. Neither are they

“doing business in the Philippines.” Likewise, the main

witnesses, Mr. Shmidt and Mr. Henk are non-residents of the

Philippines.

Same; Same; Same; An intelligent decision cannot be made

as to the law governing the employment contract where the same

was perfected in foreign soil.—Neither can an intelligent

decision be made as to the law governing the employment

contract as such was perfected in foreign soil. This calls to fore

the application of the principle of lex loci contractus (the law of

the place where the contract was made). The employment

contract was not perfected in the Philippines. Respondent

Santos signified his acceptance by writing a letter while he was

in the Republic of Oman. This letter was sent to the Palace

Hotel in the People’s Republic of China.

Same; Same; Same; The NLRC cannot determine the facts

surrounding the alleged illegal dismissal where all acts

complained of took place in a foreign country.—Neither can the

NLRC determine the facts surrounding the alleged illegal

dismissal as all acts complained of took place in Beijing,

People’s Republic of China. The NLRC was not in a position to

determine whether the Tiannamen Square incident truly

adversely affected operations of the Palace Hotel as to justify

respondent Santos’ retrenchment.

Same; Same; Same: Principle of Effectiveness; Jurisdiction;

Even if a proper decision could be reached by the NLRC, the

same would not have any binding effect against the foreign

employer, an incorporated under the laws of a foreign state

which was not even served with summons.—Even assuming

that a proper decision could be reached by the NLRC, such

would not have any binding effect against the employer, the

Palace Hotel. The Palace Hotel is a corporation incorporated

under the laws of China and was not even served with

summons. Jurisdiction over its person was not acquired.

Corporation Law; Piercing the Veil of Corporate

Fiction; The fact that a corporation owns fifty percent (50%) of

the capital stock of another corporation is not enough to pierce

the veil of corporate fiction between the two corporations.—Even

if we assume two things: (1) that the NLRC had jurisdiction

over the case, and (2) that MHICL was liable for Santos’

retrenchment, still MHC, as a separate and distinct juridical

entity, cannot be held liable. True, MHC is an incorporator of

MHICL and owns fifty percent (50%) of its capital stock.

However, this is not enough to pierce the veil of corporate

fiction between MHICL and MHC. Piercing the veil of

corporate entity is an equitable remedy. It is resorted to when

the corporate fiction is used to defeat public convenience,

justify wrong, protect fraud or defend a crime. It is done only

when a corporation is a mere alter ego or business conduit of a

person or another corporation.

Same; Same; Tests in determining whether the corporate

veil may be pierced.—The tests in determining whether the

corporate veil may be pierced are: First, the defendant must

have control or complete domination of the other corporation’s

finances, policy and business practices with regard to the

transaction attacked. There must be proof that the other

corporation had no separate mind, will or existence with

respect the act complained of. Second,control must be used by

the defendant to commit fraud or wrong. Third, the aforesaid

control or breach of duty must be the proximate cause of the

injury or loss complained of. The absence of any of the elements

prevents the piercing of the corporate veil.

Same; Same; Evidence; Clear and convincing evidence is

needed to pierce the veil of corporate fiction.—It is basic that a

corporation has a personality separate and distinct from those

composing it as well as from that of any other legal entity to

which it may be related. Clear and convincing evidence is

needed to pierce the veil of corporate fiction. In this case, we

find no evidence to show that MHICL and MHC are one and

the same entity.

Evidence; Witnesses; Words and Phrases; When one “notes”

a contract, one is not expressing his agreement or approval, as a

party would– the person so noting has merely taken cognizance

of the existence of an act or declaration, without exercising a

judicious deliberation or rendering a decision on the matter.—

When one “notes” a contract, one is not expressing his

agreement or approval, as a party would. In Sichangco v.

Board of Commissioners of Immigration, the Court recognized

that the term “noted” means that the person so noting has

merely taken cognizance of the existence of an act or

declaration, without exercising a judicious deliberation or

rendering a decision on the matter.

Same; Same; Same; The “witnessing part” of the document

is that which, “in a deed or other formal instrument is that part

which comes after the recitals, or where there are no recitals,

after the parties.”—Mr. Cergueda merely signed the

“witnessing part” of the document. The “witnessing part” of the

document is that which, “in a deed or other formal instrument

is that part whichcomes after the recitals, or where there are no

recitals, after the parties (emphasis ours).” As opposed to a

party to a contract, a witness is simply one who, “being present,

personally sees or perceives a thing; a beholder, a spectator, or

eyewitness.” One who “notes” something just makes a “brief

written statement” a memorandum or observation.

Labor Law; Employer-Employee Relationships; Elements.—

More importantly, there was no existing employer-employee

relationship between Santos and MHICL. In determining the

existence of an employer-employee relationship, the following

elements are considered: “(1) the selection and engagement of

the employee; “(2) the payment of wages; “(3) the power to

dismiss; and “(4) the power to control employee’s conduct.”

Corporation Law; Piercing the Veil of Corporate

Fiction; The fact that the Palace Hotel is a member of the

“Manila Hotel Group” is not enough to pierce the corporate

veil.—Likewise, there is no evidence to show that the Palace

Hotel and MHICL are one and the same entity. The fact that

the Palace Hotel is a member of the “Manila Hotel Group” is

not enough to pierce the corporate veil between MHICL and the

Palace Hotel.

Pakistan International Airlines Corporation us. Ople

G.R. No. 61594. September 28, 1990

Labor Relations; Due Process; Petitioner's right to

procedural due process was not violated even if no formal or

oral hearing was conducted, considering that it had ample

opportunity to explain its side.—The second contention of

petitioner PIA is that, even if the Regional Director had

jurisdiction, still his order was null and void because it had

been issued in violation of petitioner's right to procedural due

process. This claim, however, cannot be given serious

consideration. Petitioner was ordered by the Regional Director

to submit not only its position paper but also such evidence in

its favor as it might have. Petitioner opted to rely solely upon

its position paper; we must assume it had no evidence to

sustain its assertions. Thus, even if no formal or oral hearing

was conducted, petitioner had ample opportunity to explain its

side. Moreover, petitioner PIA was able to appeal his case to

the Ministry of Labor and Employment.

Contracts; Parties may not contract away applicable

provisions of law especially peremptory provisions dealing with

matters heavily impressed with public interest. The principle of

party autonomy in contracts is not absolute.—A contract freely

entered into should, of course, be respected, as PIA argues,

since a contract is the law between the parties. The principle of

party autonomy in contracts is not, however, an absolute

principle. The rule in Article 1306, of our Civil Code is that the

contracting parties may establish such stipulations as they

may deem convenient, "provided they are not contrary to law,

morals, good customs, public order or public policy." Thus,

counterbalancing the principle of autonomy of contracting

parties is the equally general rule that provisions of applicable

law, especially provisions relating to matters affected with

public policy, are deemed written into the contract. Put a little

differently, the governing principle is that parties may not

contract away applicable provisions of law especially

peremptory provisions dealing with matters heavily impressed

with public interest. The law relating to labor and employment

is clearly such an area and parties are not at liberty to insulate

themselves and their relationships from the impact of labor

laws and regulations by simply contracting with each other. It

is thus necessary to appraise the contractual provisions

invoked by petitioner PIA in terms of their consistency with

applicable Philippine law and regulations.

Labor Law; A contract providing for employment with a

fixed period was not necessarily unlawful.—In Brent School,

Inc., et al. v. Ronaldo Zamora, etc., et al., the Court had

occasion to examine in detail the question of whether

employment for a fixed term has been outlawed under the

above quoted provisions of the Labor Code. After an extensive

examination of the history and development of Articles 280 and

281, the Court reached the conclusion that a contract providing

for employment with a fixed period was not necessarily

unlawful: "There can of course be no quarrel with the

proposition that where from the circumstances it is apparent

that periods have been imposed to preclude acquisition of

tenurial security by the employee, they should be struck down or

disregarded as contrary to public policy, morals, etc. But where

no such intent to circumvent the law is shown, or stated

otherwise, where the reason for the law does not exist, e.g.,

where it is indeed the employee himself who insists upon a

period or where the nature of the engagement is such that,

without being seasonal or for a specific project, a definite date

of termination is a sine qua non, would an agreement fixing a

period be essentially evil or illicit, therefore anathema? Would

such an agreement come within the scope of Article 280 which

admittedly was enacted 'to prevent the circumvention of the

right of the employee to be secured in x x (his) employment?' As

it is evident from even only the three examples already given

that Article 280 of the Labor Code, under a narrow and literal

interpretation, not only fails to exhaust the gamut of

employment contracts to which the lack of a fixed period would

be an anomaly, but would also appear to restrict, without

reasonable distinctions, the right of an employee to freely

stipulate with his employer the duration of his engagement, it

logically follows that such a literal interpretation should be

eschewed or avoided. The law must be given reasonable

interpretation, to preclude absurdity in its application.

Outlawing the whole concept of term employment and

subverting to boot the principle of freedom of contract to

remedy the evil of employers' using it as a means to prevent

their employees from obtaining security of tenure is like cutting

off the nose to spite the face or, more relevantly, curing a

headache by lopping off the head. xxx xxx xxx Accordingly,

and since the entire purpose behind the development of

legislation culminating in the present Article 280 of the Labor

Code clearly appears to have been, as already observed,to

prevent circumvention of the employee's right to be secure in his

tenure, the clause in said article indiscriminately and

completely ruling out all written or oral agreements conflicting

with the concept of regular employment as defined

therein should be construed to refer to the substantive evil that

the Code itself has singled out: agreements entered into precisely

to circumvent security of tenure. It should have no application

to instances where a fixed period of employment was agreed

upon knowingly and voluntarily by the parties, without any

force, duress or improper pressure being brought to bear upon

the employee and absent any other circumstances vitiating his

consent, or where it satisfactorily appears that the employer

and employee dealt with each other on more or less equal terms

with no moral dominance whatever being exercised by the

former over the latter. Unless thus limited in its purview, the

law would be made to apply to purposes other than those

explicitly stated by its framers; it thus becomes pointless and

arbitrary, unjust in its effects and apt to lead to absurd and

unintended consequences." (Italics supplied)

Same; Contracts; Conflicts of Law; When the relationship

between the parties is much affected by public interest, the

otherwise applicable Philippine laws and regulations cannot be

rendered illusory by the parties agreeing upon some other law to

govern their relationship.—Petitioner PIA cannot take refuge in

paragraph 10 of its employment agreement which specifies,

firstly, the law of Pakistan as the applicable law of the

agreement and, secondly, lays the venue for settlement of any

dispute arising out of or in connection with the

agreement "only [in] courts of Karachi, Pakistan". The first

clause of paragraph 10 cannot be invoked to prevent the

application of Philippine labor laws and regulations to the

subject matter of this case, i.e., the employer-employee

relationship between petitioner PIA and private respondents.

We have already pointed out that that relationship is much

affected with public interest and that the otherwise applicable

Philippine laws and regulations cannot be rendered illusory by

the parties agreeing upon some other law to govern their

relationship. Neither may petitioner invoke the second clause

of paragraph 10, specifying the Karachi courts as the sole

venue for the settlement of disputes between the contracting

parties. Even a cursory scrutiny of the relevant circumstances

of this case will show the multiple and substantive contacts

between Philippine law and Philippine courts, on the one hand,

and the relationship between the parties, upon the other: the

contract was not only executed in the Philippines, it was also

performed here, at least partially; private respondents are

Philippine citizens and residents, while petitioner, although a

foreign corporation, is licensed to do business (and actually

doing business) and hence resident in the Philippines; lastly,

private respondents were based in the Philippines in between

their assigned flights to the Middle East and Europe. All the

above contacts point to the Philippine courts and

administrative agencies as a proper forum for the resolution of

contractual disputes between the parties. Under these

circumstances, paragraph 10 of the employment agreement

cannot be given effect so as to oust Philippine agencies and

courts of the jurisdiction vested upon them by Philippine law.

Finally, and in any event, the petitioner PIA did not undertake

to plead and prove the contents of Pakistan law on the matter;

it must therefore be presumed that the applicable provisions of

the law of Pakistan are the same as the applicable provisions of

Philippine law.