FACTS
Philippine National Construction Corporation (PNCC) and Asiavest Holdings (M) Sdn. Bhd. (Asiavest Holdings) caused the incorporation of an associate company known as Asiavest-CDCP Sdn. Bhd. (Asiavest-CDCP), through which they entered into contracts to construct rural roads and bridges for the State of Pahang, Malaysia. In connection with this construction contract, PNCC obtained various guarantees and bonds from Asiavest Merchant Bankers (M) Berhad to guarantee the due performance of its obligations. The four contracts of guaranty stipulate that Asiavest Merchant Bankers (M) Berhad shall guarantee to the State of Pahang "the due performance by PNCC of its construction contracts and the repayment of the temporary
advances given to PNCC." These contracts were understood to be governed by the laws of Malaysia.
There was failure to perform the obligations under the construction contract, prompting the State of Pahang to demand payment against Asiavest Merchant Bankers (M) Berhad's performance bonds. Asiavest Merchant Bankers (M) Berhad filed a Complaint16 for recovery of sum of money against PNCC before the Regional Trial Court of Pasig. It based its action on Malaysian laws. Specifically, it invoked Section 9818 of the Malaysian Contracts Act of 1950 and Section 1119 of the Malaysian Civil Law Act of 1956. The trial court declared PNCC in default for failure to file any responsive pleading and allowed Asiavest Merchant Bankers (M) Berhad to present its evidence ex parte and rendered judgment in favor of Asiavest Merchant Bankers (M) Berhad. The trial court found that Asiavest Merchant Bankers (M) Berhad complied with the requisites for proof of written foreign laws.24 The Malaysian laws invoked were found to be similar with Articles 2066 and 2067 of the Civil Code.
The trial court denied PNCC's Motion to Lift Order of and also denied PNCC's Motion for Reconsideration Ad Cautelam. PNCC brought its case before the Court of Appeals. The Court of Appeals dismissed PNCC's appeal for raising pure questions of law exclusively cognizable by this court. It likewise denied reconsideration. Hence, PNCC filed this Petition.
ISSUE
Whether or not our courts have subject matter jurisdiction over an action for recovery of sum of money filed by a Malaysian corporation against a Philippine corporation involving a contract executed and performed in Malaysia, and the applicability of the forum non conveniens principle.
RATIO
Yes. Jurisdiction over the subject matter is conferred by law. Batas Pambansa Blg. 129, otherwise known as The Judiciary Reorganization Act of 1980, is one such law that provides for the jurisdiction of our courts. A plain reading of Section 19 shows that civil actions for payment of sum of money are within the exclusive original jurisdiction of trial courts:
SEC. 19. Jurisdiction in civil cases. -Regional Trial Courts shall exercise exclusive original
jurisdiction:
(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses, and costs or the value of the property in controversy exceeds One hundred thousand pesos (P100,000) or, in such other cases in
Metro Manila, where the demand, exclusive of the above mentioned items exceeds Two hundred thousand pesos (P200,000).
These jurisdictional amounts were adjusted to P300,000.00, and P400,000.00 in the case of Metro Manila. Thus, the Regional Trial Court of Pasig has jurisdiction over respondent's complaint for recovery of the sum of Malaysian Ringgit (MYR) 3,915,053.54.
"Forum non conveniens literally translates to 'the forum is inconvenient.' This doctrine applies in conflicts of law cases. It gives courts the choice of not assuming jurisdiction when it appears that it is not the most convenient forum and the parties may seek redress in another one.97 It is a device "designed to frustrate illicit means for securing advantages and vexing litigants that would otherwise be possible if the venue of litigation (or dispute resolution) were left entirely to the whim of either party.
In the case of Puyat v. Zabarte, the court enumerated practical reasons when courts may refuse to entertain a case even though the exercise of jurisdiction is authorized by law:
1) The belief that the matter can be better tried and decided elsewhere, either because the main aspects of the case transpired in a foreign jurisdiction or the material witnesses have their residence there;
2) The belief that the non-resident plaintiff sought the forum, a practice known as forum shopping merely to secure procedural advantages or to convey or harass the defendant;
3) The unwillingness to extend local judicial facilities to non-residents or aliens when the docket may already be overcrowded;
4) The inadequacy of the local judicial machinery for effectuating the right sought to be maintained; and
5) The difficulty of ascertaining foreign law.
On the other hand, courts may choose to assume jurisdiction subject to the following requisites: "(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 determination of whether to entertain a case is addressed to the sound discretion of the court, which must carefully consider the facts of the particular case. A mere invocation of the doctrine of forum non conveniens or an easy averment that foreign elements exist cannot operate to automatically divest a court of its jurisdiction. It is crucial for courts to determine first if facts were established such that special circumstances exist to warrant its desistance from assuming jurisdiction.
The trial court assumed jurisdiction and explained in its Order dated August 11, 1995 that on the contrary, to try the case in the Philippines, it is believed, would be more convenient to defendant corporation as its principal office is located in the Philippines, its records will be more accessible, witnesses would be readily available and entail less expenses in terms of legal services."
Petitioner is a domestic corporation with its main office in the Philippines. It is safe to assume that all of its pertinent documents in relation to its business would be available in its main office. Most of petitioner's officers and employees who were involved in the construction contract in Malaysia could most likely also be found in the Philippines. Thus, it is unexpected that a Philippine corporation would rather engage this civil suit before Malaysian courts. Our courts would be "better positioned to enforce [the] judgment and, ultimately, to dispense" in this case against petitioner. Also, petitioner failed to plead and show real and present danger that another jurisdiction commenced litigation and the foreign tribunal chose to exercise jurisdiction.
FALLO
WHEREFORE, the Petition is DENIED for lack of merit.
Friday, July 19, 2019
SAUDI ARABIAN AIRLINES V REBESENCIO
G.R. No. 198587, January 14, 2015
FACTS
Petitioner Saudi Arabian Airlines (Saudia) is a foreign corporation established and existing under the laws of Jeddah, Kingdom of Saudi Arabia. Respondents were recruited and hired by Saudia as Flight Attendants with the accreditation and approval of the Philippine Overseas Employment Administration (POEA). Respondents continued their employment with Saudia until they were separated from service on various dates in 2006. The respondents contended that the termination of their employment was illegal.
They alleged that the termination was made solely because they were pregnant. As respondents alleged, they had informed Saudia of their respective pregnancies and had gone through the necessary procedures to process their maternity leaves. Initially, Saudia had given its approval but later on informed respondents that its management in Jeddah, Saudi Arabia had disapproved their maternity leaves. In addition, it required respondents to file their resignation letters. Respondents were told that if they did not resign, Saudia would terminate them all the same. The threat of termination entailed the loss of benefits, such as separation pay and ticket discount entitlements. The respondents were required to report to the office one month into their maternity leave.
Saudia anchored its disapproval of respondents' maternity leaves and demand for their resignation on its "Unified Employment Contract for Female Cabin Attendants" (Unified Contract) which provides that if the Air Hostess becomes pregnant at any time during the term of this contract, this shall render her employment contract as void and she will be terminated due to lack of medical fitness. The respondents averred that the Unified Contract took effect after the approval of their maternity leaves. Rather than comply and tender resignation letters, respondents filed separate appeal letters that were all rejected. Faced with the dilemma of resigning or totally losing their benefits, respondents executed handwritten resignation letters.
ISSUE
1. Whether or not the respondents voluntarily resigned or were illegally terminated.
2. Whether or not the Philippine courts have jurisdiction over the case
RATIO
1. Yes, the respondents were illegally dismissed. The petitioner Saudia themselves stated that the Saudi law does not allow the termination of employment of women who take maternity leaves Under the Labor Laws of Saudi Arabia and the Philippines, it is illegal and unlawful to terminate the employment of any woman by virtue of pregnancy. The law in Saudi Arabia is even more harsh and strict in that no employer can terminate the employment of a female worker or give her a warning of the same while on Maternity Leave, the specific provision of Saudi Labor Laws on the matter is hereto quoted as follows: “An employer may not terminate the employment of a female worker or give her a warning of the same while on maternity leave.” (Article 155, Labor Law of the Kingdom of Saudi Arabia, Royal Decree No. M/51.)
2. Yes, the Philippine court has jurisdiction over the case. Saudia asserts that stipulations set in the Cabin Attendant contracts require the application of the laws of Saudi Arabia. It insists that the need to comply with these stipulations calls into operation the doctrine of forum non conveniens and, in turn, makes it necessary for Philippine tribunals to refrain from exercising jurisdiction. Forum non conveniens, like the rules of forum shopping, litis pendentia, and res judicata, is a means of addressing the problem of parallel litigation. While the rules of forum shopping, litis pendentia, and res judicata are designed to address the problem of parallel litigation within a single jurisdiction, forum non conveniens is a means devised to address parallel litigation arising in multiple jurisdictions. On the matter of pleading forum non conveniens, the court state the rule, thus: Forum non conveniens must not only be clearly pleaded as a ground for dismissal; it must be pleaded as such at the earliest possible opportunity. Otherwise, it shall be deemed waived.
It further stated: Forum non conveniens finds no application and does not operate to divest Philippine tribunals of jurisdiction and to require the application of foreign law. Saudia invokes forum non conveniens to supposedly effectuate the stipulations of the Cabin Attendant contracts that require the application of the laws of Saudi Arabia.
As argued by respondents, Saudia’s policy entails the termination of employment of flight attendants who become pregnant. At the risk of stating the obvious, pregnancy is an occurrence that pertains specifically to women. Saudia’s policy excludes from and restricts employment on the basis of no other consideration but sex.
The court do not lose sight of the reality that pregnancy does present physical limitations that may render difficult the performance of functions associated with being a flight attendant. Nevertheless, it would be the height of iniquity to view pregnancy as a disability so permanent and immutable that it must entail the termination of one’s employment. It is clear that any individual, regardless of gender, may be subject to exigencies that limit the performance of functions. However, they fail to appreciate how pregnancy could be such an impairing occurrence that it leaves no other recourse but the complete termination of the means through which a woman earns a living. Oddly enough, the petitioner Saudia themselves stated that the Saudi law does not allow the termination of employment of women who take maternity leaves;
Consistent with lex loci intentionis, to the extent that it is proper and practicable (i.e., “to make an intelligent decision”), Philippine tribunals may apply the foreign law selected by the parties. In fact, (albeit without meaning to make a pronouncement on the accuracy and reliability of respondents’ citation) in this case, respondents themselves have made averments as to the laws of Saudi Arabia.
FALLO
WHEREFORE, with the MODIFICATIONS that first, petitioner Brenda J. Betia is not solidarily liable with petitioner Saudi Arabian Airlines, and second, that petitioner Saudi Arabian Airlines is liable for moral and exemplary damages. The June 16, 2011 Decision and the September 13, 2011 Resolution of the Court of Appeals in CA-G.R. SP. No. 113006 are hereby AFFIRMED in all other respects. Accordingly, petitioner Saudi Arabian Airlines is ordered to pay respondents:
(1) Full backwages and all other benefits computed from the respective dates in which each of the respondents were illegally terminated until the finality of this Decision;
(2) Separation pay computed from the respective dates in which each of the respondents commenced employment until the finality of this Decision at the rate of one ( 1) month's salary for every year of service, with a fraction of a year of at least six ( 6) months being counted as one ( 1) whole year;
(3) Moral damages in the amount of Pl00,000.00 per respondent;
(4) Exemplary damages in the amount of P200,000.00 per respondent; and
(5) Attorney's fees equivalent to 10% of the total award. Interest of 6% per annum shall likewise be imposed on the total judgment award from the finality of this Decision until full satisfaction thereof.
This case is REMANDED. to the Labor Arbiter to make a detailed computation of the amounts due to respondents which petitioner Saudi Arabian Airlines should pay without delay.
Petitioner Saudi Arabian Airlines (Saudia) is a foreign corporation established and existing under the laws of Jeddah, Kingdom of Saudi Arabia. Respondents were recruited and hired by Saudia as Flight Attendants with the accreditation and approval of the Philippine Overseas Employment Administration (POEA). Respondents continued their employment with Saudia until they were separated from service on various dates in 2006. The respondents contended that the termination of their employment was illegal.
They alleged that the termination was made solely because they were pregnant. As respondents alleged, they had informed Saudia of their respective pregnancies and had gone through the necessary procedures to process their maternity leaves. Initially, Saudia had given its approval but later on informed respondents that its management in Jeddah, Saudi Arabia had disapproved their maternity leaves. In addition, it required respondents to file their resignation letters. Respondents were told that if they did not resign, Saudia would terminate them all the same. The threat of termination entailed the loss of benefits, such as separation pay and ticket discount entitlements. The respondents were required to report to the office one month into their maternity leave.
Saudia anchored its disapproval of respondents' maternity leaves and demand for their resignation on its "Unified Employment Contract for Female Cabin Attendants" (Unified Contract) which provides that if the Air Hostess becomes pregnant at any time during the term of this contract, this shall render her employment contract as void and she will be terminated due to lack of medical fitness. The respondents averred that the Unified Contract took effect after the approval of their maternity leaves. Rather than comply and tender resignation letters, respondents filed separate appeal letters that were all rejected. Faced with the dilemma of resigning or totally losing their benefits, respondents executed handwritten resignation letters.
ISSUE
1. Whether or not the respondents voluntarily resigned or were illegally terminated.
2. Whether or not the Philippine courts have jurisdiction over the case
RATIO
1. Yes, the respondents were illegally dismissed. The petitioner Saudia themselves stated that the Saudi law does not allow the termination of employment of women who take maternity leaves Under the Labor Laws of Saudi Arabia and the Philippines, it is illegal and unlawful to terminate the employment of any woman by virtue of pregnancy. The law in Saudi Arabia is even more harsh and strict in that no employer can terminate the employment of a female worker or give her a warning of the same while on Maternity Leave, the specific provision of Saudi Labor Laws on the matter is hereto quoted as follows: “An employer may not terminate the employment of a female worker or give her a warning of the same while on maternity leave.” (Article 155, Labor Law of the Kingdom of Saudi Arabia, Royal Decree No. M/51.)
2. Yes, the Philippine court has jurisdiction over the case. Saudia asserts that stipulations set in the Cabin Attendant contracts require the application of the laws of Saudi Arabia. It insists that the need to comply with these stipulations calls into operation the doctrine of forum non conveniens and, in turn, makes it necessary for Philippine tribunals to refrain from exercising jurisdiction. Forum non conveniens, like the rules of forum shopping, litis pendentia, and res judicata, is a means of addressing the problem of parallel litigation. While the rules of forum shopping, litis pendentia, and res judicata are designed to address the problem of parallel litigation within a single jurisdiction, forum non conveniens is a means devised to address parallel litigation arising in multiple jurisdictions. On the matter of pleading forum non conveniens, the court state the rule, thus: Forum non conveniens must not only be clearly pleaded as a ground for dismissal; it must be pleaded as such at the earliest possible opportunity. Otherwise, it shall be deemed waived.
It further stated: Forum non conveniens finds no application and does not operate to divest Philippine tribunals of jurisdiction and to require the application of foreign law. Saudia invokes forum non conveniens to supposedly effectuate the stipulations of the Cabin Attendant contracts that require the application of the laws of Saudi Arabia.
As argued by respondents, Saudia’s policy entails the termination of employment of flight attendants who become pregnant. At the risk of stating the obvious, pregnancy is an occurrence that pertains specifically to women. Saudia’s policy excludes from and restricts employment on the basis of no other consideration but sex.
The court do not lose sight of the reality that pregnancy does present physical limitations that may render difficult the performance of functions associated with being a flight attendant. Nevertheless, it would be the height of iniquity to view pregnancy as a disability so permanent and immutable that it must entail the termination of one’s employment. It is clear that any individual, regardless of gender, may be subject to exigencies that limit the performance of functions. However, they fail to appreciate how pregnancy could be such an impairing occurrence that it leaves no other recourse but the complete termination of the means through which a woman earns a living. Oddly enough, the petitioner Saudia themselves stated that the Saudi law does not allow the termination of employment of women who take maternity leaves;
Consistent with lex loci intentionis, to the extent that it is proper and practicable (i.e., “to make an intelligent decision”), Philippine tribunals may apply the foreign law selected by the parties. In fact, (albeit without meaning to make a pronouncement on the accuracy and reliability of respondents’ citation) in this case, respondents themselves have made averments as to the laws of Saudi Arabia.
FALLO
WHEREFORE, with the MODIFICATIONS that first, petitioner Brenda J. Betia is not solidarily liable with petitioner Saudi Arabian Airlines, and second, that petitioner Saudi Arabian Airlines is liable for moral and exemplary damages. The June 16, 2011 Decision and the September 13, 2011 Resolution of the Court of Appeals in CA-G.R. SP. No. 113006 are hereby AFFIRMED in all other respects. Accordingly, petitioner Saudi Arabian Airlines is ordered to pay respondents:
(1) Full backwages and all other benefits computed from the respective dates in which each of the respondents were illegally terminated until the finality of this Decision;
(2) Separation pay computed from the respective dates in which each of the respondents commenced employment until the finality of this Decision at the rate of one ( 1) month's salary for every year of service, with a fraction of a year of at least six ( 6) months being counted as one ( 1) whole year;
(3) Moral damages in the amount of Pl00,000.00 per respondent;
(4) Exemplary damages in the amount of P200,000.00 per respondent; and
(5) Attorney's fees equivalent to 10% of the total award. Interest of 6% per annum shall likewise be imposed on the total judgment award from the finality of this Decision until full satisfaction thereof.
This case is REMANDED. to the Labor Arbiter to make a detailed computation of the amounts due to respondents which petitioner Saudi Arabian Airlines should pay without delay.
Tuesday, July 16, 2019
PEDRO ARCE V CAPITAL INSURANCE
G.R. No. L-28501 September 30, 1982
FACTS
The Petitioner (insured) is the owner of a residential house in Tondo, Manila, which had been insured with the respondent insurance company since 1961. In November 1965, the respondent sent to the petitioner a Renewal Certificate to cover the period from December 5, 1965 to December 5,1966 and requested payment of the corresponding premium. Anticipating that the premium could not be paid on time, the petitioner asked for an extension which was granted by the respondent. After the lapse of the requested extension, petitioner still failed to pay the premium.
Thereafter, the house of the petitioner was totally destroyed by fire. Upon petitioner’s presentation of claim for indemnity, he was told that no indemnity was due because the premium was not paid. Nonetheless the respondent tendered a check for P300.00 as financial aid which was received by his daughter. The petitioner sued the respondent for indemnity. The trial court held the respondent liable to indemnify the petitioner on the ground that since the Insurance company could have demanded payment of the premium, mutuality of obligation required that it should be liable on the policy. Hence, this appeal by the respondent on question of law.
ISSUE
Whether or not the petitioners are entitled to claim from their policy despite non-payment of their premium.
RATIO
No. The parties in this case had stipulated that notwithstanding anything to the contrary contained in the policy, the insurance will be deemed valid and binding upon the Company only when the premium and documentary stamps therefor have actually been paid in full and duly acknowledged in an official receipt signed by an authorized official/representative of the Company.
It is obvious from both the Insurance Act, as amended, and the stipulation of the parties that time is of the essence in respect of the payment of the insurance premium so that if it is not paid the contract does not take effect unless there is still another stipulation to the contrary. In the instant case, the INSURED was given a grace period to pay the premium but the period having expired with no payment made, he cannot insist that the COMPANY is nonetheless obligated to him.
FALLO
WHEREFORE, the decision of the court a quo is reversed; the appellee's complaint is dismissed. No special pronouncement as to costs.
The Petitioner (insured) is the owner of a residential house in Tondo, Manila, which had been insured with the respondent insurance company since 1961. In November 1965, the respondent sent to the petitioner a Renewal Certificate to cover the period from December 5, 1965 to December 5,1966 and requested payment of the corresponding premium. Anticipating that the premium could not be paid on time, the petitioner asked for an extension which was granted by the respondent. After the lapse of the requested extension, petitioner still failed to pay the premium.
Thereafter, the house of the petitioner was totally destroyed by fire. Upon petitioner’s presentation of claim for indemnity, he was told that no indemnity was due because the premium was not paid. Nonetheless the respondent tendered a check for P300.00 as financial aid which was received by his daughter. The petitioner sued the respondent for indemnity. The trial court held the respondent liable to indemnify the petitioner on the ground that since the Insurance company could have demanded payment of the premium, mutuality of obligation required that it should be liable on the policy. Hence, this appeal by the respondent on question of law.
ISSUE
Whether or not the petitioners are entitled to claim from their policy despite non-payment of their premium.
RATIO
No. The parties in this case had stipulated that notwithstanding anything to the contrary contained in the policy, the insurance will be deemed valid and binding upon the Company only when the premium and documentary stamps therefor have actually been paid in full and duly acknowledged in an official receipt signed by an authorized official/representative of the Company.
It is obvious from both the Insurance Act, as amended, and the stipulation of the parties that time is of the essence in respect of the payment of the insurance premium so that if it is not paid the contract does not take effect unless there is still another stipulation to the contrary. In the instant case, the INSURED was given a grace period to pay the premium but the period having expired with no payment made, he cannot insist that the COMPANY is nonetheless obligated to him.
FALLO
WHEREFORE, the decision of the court a quo is reversed; the appellee's complaint is dismissed. No special pronouncement as to costs.
TRANSIMEX CO v. MAFRE ASIAN INSURANCE CORP
G.R. No. 190271, September 14, 2016
FACTS
On 21 May 1996, M/V Meryem Ana received a shipment of Prilled Urea Fertilizer from Helm Duengemittel GMBH at Odessa, Ukraine. The shipment was covered by two separate bills of lading and consigned to Fertiphil for delivery to two ports - one in Poro Point, San Fernando, La Union; and the other in Tabaco, Albay. Fertiphil insured the cargo against all risks under Marine Risk Note issued by respondent.
The present controversy involves only this second delivery. When the cargo was subsequently weighed, it was discovered that there is an alleged shortage of 349.65 metric tons. In line with this, Fertiphil filed a claim with respondent for P1,617,527.37 which was found compensable. After paying the claim of Fertiphil, respondent demanded reimbursement from petitioner based on the right of subrogation. The claim was denied, prompting respondent to file a Complaint with the RTC for recovery of sum of money. In support of its claim, respondent presented a Report of Survey and a Certification from David Cargo Survey Services to prove the shortage. In the report, the adjuster also stated that the shortage was attributable to the melting of the fertilizer while inside the hatches, when the vessel took on water because of the bad weather experienced at sea.
The RTC ruled in favor of respondent and ordered petitioner to pay the claim based on the reason that there was indeed a shortage in the cargo delivered, for which the common carrier must be held responsible under Article 1734 of the Civil Code. To excuse a common carrier fully of any liability, Article 1739 of the Civil Code requires that the fortuitous event must have been the proximate and only cause of the loss. Moreover, it should have exercised due diligence to prevent or minimize the loss before, during and after the occurrence of the fortuitous event.
Petitioner appealed to the Court of Appeals but was denied and it affirmed the ruling of the RTC. In the present case, defendants-appellants did not present proof that the "bad weather" they encountered was a "storm" as contemplated by Article 1734(1). Petitioner moved for reconsideration of the CA Decision, but the motion was denied. Hence this petition.
ISSUES
1. Whether the transaction is governed by the provisions of the Civil Code on common carriers or by the provisions of Carriage of Goods at Sea Act (COGSA)
2. Whether petitioner is liable for the loss or damage sustained by the cargo because of bad weather.
RATIO
1. The provision of the Civil Code governs. Supreme Court upholds the ruling of the CA with respect to the applicable law. As expressly provided in Article 1753 of the Civil Code, "[t]he law of the country to which the goods are to be transported shall govern the liability of the common carrier for their loss, destruction or deterioration." Since the cargo in this case was transported from Odessa, Ukraine, to Tabaco, Albay, the liability of petitioner for the alleged shortage must be determined in accordance with the provisions of the Civil Code on common carriers.
2. Yes,petitioner is liable for the shortage incurred by the shipment. petitioner failed to prove the existence of a storm or a peril of the sea within the context of Article 1734(1) of the Civil Code or Section 4(2)(c) of COGSA. Furthermore, there was no sufficient proof that the damage to the shipment was solely and proximately caused by bad weather. It must be emphasized that not all instances of bad weather may be categorized as "storms" or "perils of the sea" within the meaning of the provisions of the Civil Code and COGSA on common carriers. To be considered absolutory causes under either statute, bad weather conditions must reach a certain threshold of severity. Nonetheless, to our mind it would not be enough to categorize the weather condition at the time as a "storm" within the absolutory causes enumerated in the law. Significantly, no typhoon was observed within the Philippine area of responsibility during that period.
In this case, the documentary and testimonial evidence cited by petitioner indicates that M/V Meryem Ana faced winds of only up to 40 knots while at sea. This wind force clearly fell short of the 48 to 55 knots required for "storms" under Article 1734(1) of the Civil Code based on the threshold established by PAGASA. Petitioner also failed to prove that the inclement weather encountered by the vessel was unusual, unexpected, or catastrophic. In particular, the strong winds and waves, which allegedly assaulted the ship, were not shown to be worse than what should have been expected in that particular location during that time of the year. Consequently, this Court cannot consider these weather conditions as "perils of the sea" that would absolve the carrier from liability. The Supreme Court emphasized that common carriers are automatically presumed to have been at fault or to have acted negligently if the goods they were transporting were lost, destroyed or damaged while in transit. Therefore, the Court cannot absolve petitioner from liability for the shortage incurred by the shipment.
FALLO
WHEREFORE, the Petition is DENIED. The Court of Appeals Decision and Resolution dated 27 August 2009 and 10 November 2009, respectively, are hereby AFFIRMED.
On 21 May 1996, M/V Meryem Ana received a shipment of Prilled Urea Fertilizer from Helm Duengemittel GMBH at Odessa, Ukraine. The shipment was covered by two separate bills of lading and consigned to Fertiphil for delivery to two ports - one in Poro Point, San Fernando, La Union; and the other in Tabaco, Albay. Fertiphil insured the cargo against all risks under Marine Risk Note issued by respondent.
The present controversy involves only this second delivery. When the cargo was subsequently weighed, it was discovered that there is an alleged shortage of 349.65 metric tons. In line with this, Fertiphil filed a claim with respondent for P1,617,527.37 which was found compensable. After paying the claim of Fertiphil, respondent demanded reimbursement from petitioner based on the right of subrogation. The claim was denied, prompting respondent to file a Complaint with the RTC for recovery of sum of money. In support of its claim, respondent presented a Report of Survey and a Certification from David Cargo Survey Services to prove the shortage. In the report, the adjuster also stated that the shortage was attributable to the melting of the fertilizer while inside the hatches, when the vessel took on water because of the bad weather experienced at sea.
The RTC ruled in favor of respondent and ordered petitioner to pay the claim based on the reason that there was indeed a shortage in the cargo delivered, for which the common carrier must be held responsible under Article 1734 of the Civil Code. To excuse a common carrier fully of any liability, Article 1739 of the Civil Code requires that the fortuitous event must have been the proximate and only cause of the loss. Moreover, it should have exercised due diligence to prevent or minimize the loss before, during and after the occurrence of the fortuitous event.
Petitioner appealed to the Court of Appeals but was denied and it affirmed the ruling of the RTC. In the present case, defendants-appellants did not present proof that the "bad weather" they encountered was a "storm" as contemplated by Article 1734(1). Petitioner moved for reconsideration of the CA Decision, but the motion was denied. Hence this petition.
ISSUES
1. Whether the transaction is governed by the provisions of the Civil Code on common carriers or by the provisions of Carriage of Goods at Sea Act (COGSA)
2. Whether petitioner is liable for the loss or damage sustained by the cargo because of bad weather.
RATIO
1. The provision of the Civil Code governs. Supreme Court upholds the ruling of the CA with respect to the applicable law. As expressly provided in Article 1753 of the Civil Code, "[t]he law of the country to which the goods are to be transported shall govern the liability of the common carrier for their loss, destruction or deterioration." Since the cargo in this case was transported from Odessa, Ukraine, to Tabaco, Albay, the liability of petitioner for the alleged shortage must be determined in accordance with the provisions of the Civil Code on common carriers.
2. Yes,petitioner is liable for the shortage incurred by the shipment. petitioner failed to prove the existence of a storm or a peril of the sea within the context of Article 1734(1) of the Civil Code or Section 4(2)(c) of COGSA. Furthermore, there was no sufficient proof that the damage to the shipment was solely and proximately caused by bad weather. It must be emphasized that not all instances of bad weather may be categorized as "storms" or "perils of the sea" within the meaning of the provisions of the Civil Code and COGSA on common carriers. To be considered absolutory causes under either statute, bad weather conditions must reach a certain threshold of severity. Nonetheless, to our mind it would not be enough to categorize the weather condition at the time as a "storm" within the absolutory causes enumerated in the law. Significantly, no typhoon was observed within the Philippine area of responsibility during that period.
In this case, the documentary and testimonial evidence cited by petitioner indicates that M/V Meryem Ana faced winds of only up to 40 knots while at sea. This wind force clearly fell short of the 48 to 55 knots required for "storms" under Article 1734(1) of the Civil Code based on the threshold established by PAGASA. Petitioner also failed to prove that the inclement weather encountered by the vessel was unusual, unexpected, or catastrophic. In particular, the strong winds and waves, which allegedly assaulted the ship, were not shown to be worse than what should have been expected in that particular location during that time of the year. Consequently, this Court cannot consider these weather conditions as "perils of the sea" that would absolve the carrier from liability. The Supreme Court emphasized that common carriers are automatically presumed to have been at fault or to have acted negligently if the goods they were transporting were lost, destroyed or damaged while in transit. Therefore, the Court cannot absolve petitioner from liability for the shortage incurred by the shipment.
FALLO
WHEREFORE, the Petition is DENIED. The Court of Appeals Decision and Resolution dated 27 August 2009 and 10 November 2009, respectively, are hereby AFFIRMED.
INDUSTRIAL PERSONNEL v. JOSE G. DE VERA
GR No. 205703, Mar 07, 2016
FACTS
Petitioner Industrial Personnel & Management Services, Inc. (IPAMS) is a local placement agency duly organized and existing under Philippine laws. Petitioner SNC Lavalin Engineers & Contractors, Inc. (SNC-Lavalin) is the principal of IPAMS, a Canadian company with business interests in several countries.
Respondent Alberto Arriola, a licensed general surgeon in the Philippines, was hired by SNC-Lavalin, through its local manning agency, IPAMS, as a safety officer in its Ambatovy Project site in Madagascar. After three months, Arriola received a notice of pre-termination of employment due to diminishing workload in the area of his expertise and the unavailability of alternative assignments. Consequently, Arriola was repatriated and he filed a complaint against the petitioners for illegal dismissal and non-payment of overtime pay, vacation leave and sick leave pay before the Labor Arbiter (LA).
He claimed that SNC-Lavalin still owed him unpaid salaries equivalent to the three-month unexpired portion of his contract and asserted that the latter never offered any valid reason for his early termination and that he was not given enough notice regarding the same. He also insisted that the petitioners must prove the applicability of Canadian law before the same could be applied to his employment contract.
The petitioner denied the charge of illegal dismissal against them. They relied on a copy of the Employment Standards Act (ESA) of Ontario, which was duly authenticated by the Canadian authorities and certified by the Philippine Embassy. They insisted that all of Arriola's employment documents were processed in Canada, not to mention that SNC Lavalin's office was in Ontario, the principle of lex loci celebrationis was applicable. Hence, they insisted that Canadian laws governed the contract.
The said foreign law did not require any ground for early termination of employment, and the only requirement was the written notice of termination. Even if Philippine laws should apply, Arriola would still be validly dismissed because domestic law recognized retrenchment and redundancy as legal grounds for termination.
The Labor Arbiter (LA) dismissed the complaint of Arriola, while the NLRC reversed the LA's ruling stating the Filipino workers are protected by our labor laws wherever they may be working. The petitioners filed a petition for certiorari before the CA arguing that it should be the ESA, or the Ontario labor law, that should be applied in Arriola's employment contract, but the Court of Appeals affirmed NLRC. Hence, this petition.
ISSUES
ISSUE Whether or not Canadian law shall be applied to this case.
RATIO
No, the foreign law invoked is contrary to the Constitution and the Labor Code. As a rule, Philippine laws apply even to overseas employment contracts. This rule is rooted in the constitutional provision of Section 3, Article XIII that the State shall afford full protection to labor, whether local or overseas. Hence, even if the OFW has his employment abroad, it does not strip him of his rights to security of tenure, humane conditions of work and a living wage under our Constitution. As an exception, the parties may agree that a foreign law shall govern the employment contract. A synthesis of the existing laws and jurisprudence reveals that this exception is subject to the following requisites:
1. That it is expressly stipulated in the overseas employment contract that a specific foreign law shall govern;
2.That the foreign law invoked must be proven before the courts pursuant to the Philippine rules on evidence;
3.That the foreign law stipulated in the overseas employment contract must not be contrary to law, morals, good customs, public order, or public policy of the Philippines; and
4.That the overseas employment contract must be processed through the POEA.
The Court is of the view that these four (4) requisites must be complied with before the employer could invoke the applicability of a foreign law to an overseas employment contract. With these requisites, the State would be able to abide by its constitutional obligation to ensure that the rights and well-being of our OFWs are fully protected. Lacking any one of the four requisites would invalidate the application of the foreign law, and the Philippine law shall govern the overseas employment contract.
In the present case, as correctly held by the CA, even though an authenticated copy of the ESA was submitted, it did not mean that said foreign law could be automatically applied to this case. The petitioners miserably failed to adhere to the two other requisites. The petitioners failed to comply with the first requisite because no foreign law was expressly stipulated in the overseas employment contract with Arriola. The petitioners did not directly cite any specific provision or stipulation in the said labor contract which indicated the applicability of the Canadian labor laws or the ESA. They failed to show on the face of the contract that a foreign law was agreed upon by the parties. Rather, they simply asserted that the terms and conditions of Arriola’s employment were embodied in the Expatriate Policy, Ambatovy Project - Site, Long Term.
The provisions of the ESA are patently inconsistent with the right to security of tenure.Both the Constitution and the Labor Code provide that this right is available to any employee. In a host of cases, the Court has upheld the employee's right to security of tenure in the face of oppressive management behavior and management prerogative. Security of tenure is a right which cannot be denied on mere speculation of any unclear and nebulous basis. Furthermore, not only do these provisions collide with the right to security of tenure, but they also deprive the employee of his constitutional right to due process by denying him of any notice of termination and the opportunity to be heard.
In fine, as the petitioners failed to meet all the four (4) requisites on the applicability of a foreign law, then the Philippine labor laws must govern the overseas employment contract of Arriola.
FALLO
WHEREFORE, the petition is DENIED. The January 24, 2013 Decision of the Court of Appeals in CA-G.R. SP No. 118869 is AFFIRMED in toto.
CHIQUITA BRANDS, INC. v GEORGE E. OMELIO
G.R. No. 189102
June 07, 2017
FACTS
On August 31, 1993, thousands of banana plantation workers from over 14 countries instituted class suits for damages in the United States against 11 foreign corporations which includes the petitioner. The banana plantation workers claimed to have been exposed to dibromochloropropane (DBCP), a pesticide used against roundworms and threadworms that thrive on and damage tropical fruits such as bananas and pineapples as a result, these workers suffered serious and permanent injuries to their reproductive systems. Unfortunately, the United States courts dismissed the actions on the ground of forum non conveniens and directed the claimants to file actions in their respective home countries.
Filipino claimants filed a complaint for damages against the same foreign corporations before the Regional Trial Court in Davao City. Before pre-trial these foreign companies entered into a worldwide settlement in the United States with all the banana plantation workers. The parties executed a document denominated as the "Compromise Settlement, Indemnity, and Hold Harmless Agreement" (Compromise Agreement). The Compromise Agreement provided, among others, that the settlement amount should be deposited in an escrow account, which should be administered by a mediator. After the claimants execute individual releases, the mediator shall give the checks representing the settlement amounts to the claimants' counsel, who shall then distribute the checks to each claimant.
The RTC of Panabo approved the compromised agreement and dismissed the petition of the claimant. Several claimants moved for the execution of the judgment on compromise but Chiquita, Dow, Occidental, Shell, and Del Monte opposed the execution on the ground of mootness. They argued that they had already complied with their obligation under the Compromise Agreement by depositing the settlement amounts into an escrow account, which was administered by the designated mediator. Hence, there was nothing left for the court to execute.Chiquita pointed out that the claimants' execution of individual quitclaims was an acknowledgement that they had received their respective share in the settlement amount.
After dismissal of the civil claim the claimants moved for the execution of the compromise agreement. The petitioner opposed the execution on the ground of mootness; they argued that they had already complied with their obligation by depositing the settlement amount into an escrow account. However, RTC of Panabo granted the motion for execution because there was no proof that they have fulfilled their obligation.
On May 2003 petitioner filed a motion to suspend the execution and be allowed to present evidence on their behalf. During the hearing of the case, the claimants picketed outside the court room and accused the RTC judge of Panabo as a corrupt official who delayed the execution. Petitioner requested for change of venue and was granted.
The case was transferred and now under the jurisdiction of the RTC of Davao city. On July 2009, the RTC of Davao city through Judge Omelio ordered the execution of the compromised agreement. Aggrieved by the RTC’s decision, the petitioner filed for a petition for certiorari even without a prior appeal to the CA.
Petitioner allege that the respondent Judge committed grave abuse of discretion in issuing the writ of execution and ordering them to directly pay each of the claimant contrary to the compromise agreement between petitioner and claimant.
ISSUES
1. Whether the hierarchy of courts was violated when the petitioner filed for certiorari to the Supreme Court without appealing first to the CA.
2. Whether or not Judge Omelio committed grave abuse of discretion.
RATIO
1. No. Under the principle of hierarchy or courts, direct recourse to the Supreme Court is improper because Supreme Court is a court of last resort and must remain to be so in order for it to satisfactorily perform its constitutional functions. Nonetheless, the invocation of the Supreme Court’s original jurisdiction to issue writs of certiorari has been allowed in certain instances on the ground of special and important reasons clearly stated in the petition, such as, 1. When dictated by public welfare and advancement of public policy, 2. When demanded by broader interest of justice, 3. Where the challenged orders were patent nullities or 4. When analogous exceptional and compelling circumstances called for and justified the immediate and direct handling of the case.
The Supreme Court took cognizance of this case in the interest of judicial economy and efficiency. The records of this case are enough for this Court to decide on the issues raised by the parties. Any further delay would unduly prejudice the parties.
2. Yes. Courts can neither amend nor modify the terms and conditions of a compromise validly entered into by the parties. In any case, a compromise validly entered has the authority and effect of res judicata as between the parties. A writ of execution that varies the respective obligation of the parties under a judicially approved compromise settlement is void. Under the judicially approved Compromise Agreement, petitioners are obliged to deposit the settlement amount in escrow within 10 business days after they receive a signed Compromise Agreement from the counsel of the claimants. There was nothing in the Compromise Agreement that required petitioners to ensure the distribution of the settlement amount to each claimant. Petitioners' obligation under the Compromise Agreement was limited to depositing the settlement amount in escrow. On the other hand, the actual distribution of the settlement amounts was delegated to the chosen mediator, Mr. Mills.
Consequently, the Omnibus Order dated December 14, 2006, which directed the implementation of the Writ of Execution, is likewise void. Ordinarily, courts have the ministerial duty to grant the execution of a final judgment.230 The prevailing party may immediately move for execution of the judgment, and the issuance of the writ follows as a matter of course.
A writ of execution may be stayed or quashed when "facts and circumstances transpire" after judgment has been rendered that would make "execution impossible or unjust." the Compromise Agreement did not impose solidary liability on the parties' subsidiaries, affiliates, controlled, and related entities, successors, and assigns but merely allowed them to benefit from its effects. Thus, respondent Judge Omelio gravely abused his discretion in holding that the petitioners' subsidiaries and affiliates were solidarily liable under the Compromise Agreement. Furthermore, there is no reason for respondent court to pierce the veil of corporate fiction. There is hardly any evidence to shew that petitioners abused their separate juridical identity to evade their obligation under the Compromise Agreement.
Hence Judge Omelio committed grave abuse of discretion.
FALLO
WHEREFORE, the Petition for Certiorari is GRANTED. The assailed orders and writs are ANNULLED and SET ASIDE for having been issued with grave abuse of discretion
On August 31, 1993, thousands of banana plantation workers from over 14 countries instituted class suits for damages in the United States against 11 foreign corporations which includes the petitioner. The banana plantation workers claimed to have been exposed to dibromochloropropane (DBCP), a pesticide used against roundworms and threadworms that thrive on and damage tropical fruits such as bananas and pineapples as a result, these workers suffered serious and permanent injuries to their reproductive systems. Unfortunately, the United States courts dismissed the actions on the ground of forum non conveniens and directed the claimants to file actions in their respective home countries.
Filipino claimants filed a complaint for damages against the same foreign corporations before the Regional Trial Court in Davao City. Before pre-trial these foreign companies entered into a worldwide settlement in the United States with all the banana plantation workers. The parties executed a document denominated as the "Compromise Settlement, Indemnity, and Hold Harmless Agreement" (Compromise Agreement). The Compromise Agreement provided, among others, that the settlement amount should be deposited in an escrow account, which should be administered by a mediator. After the claimants execute individual releases, the mediator shall give the checks representing the settlement amounts to the claimants' counsel, who shall then distribute the checks to each claimant.
The RTC of Panabo approved the compromised agreement and dismissed the petition of the claimant. Several claimants moved for the execution of the judgment on compromise but Chiquita, Dow, Occidental, Shell, and Del Monte opposed the execution on the ground of mootness. They argued that they had already complied with their obligation under the Compromise Agreement by depositing the settlement amounts into an escrow account, which was administered by the designated mediator. Hence, there was nothing left for the court to execute.Chiquita pointed out that the claimants' execution of individual quitclaims was an acknowledgement that they had received their respective share in the settlement amount.
After dismissal of the civil claim the claimants moved for the execution of the compromise agreement. The petitioner opposed the execution on the ground of mootness; they argued that they had already complied with their obligation by depositing the settlement amount into an escrow account. However, RTC of Panabo granted the motion for execution because there was no proof that they have fulfilled their obligation.
On May 2003 petitioner filed a motion to suspend the execution and be allowed to present evidence on their behalf. During the hearing of the case, the claimants picketed outside the court room and accused the RTC judge of Panabo as a corrupt official who delayed the execution. Petitioner requested for change of venue and was granted.
The case was transferred and now under the jurisdiction of the RTC of Davao city. On July 2009, the RTC of Davao city through Judge Omelio ordered the execution of the compromised agreement. Aggrieved by the RTC’s decision, the petitioner filed for a petition for certiorari even without a prior appeal to the CA.
Petitioner allege that the respondent Judge committed grave abuse of discretion in issuing the writ of execution and ordering them to directly pay each of the claimant contrary to the compromise agreement between petitioner and claimant.
ISSUES
1. Whether the hierarchy of courts was violated when the petitioner filed for certiorari to the Supreme Court without appealing first to the CA.
2. Whether or not Judge Omelio committed grave abuse of discretion.
RATIO
1. No. Under the principle of hierarchy or courts, direct recourse to the Supreme Court is improper because Supreme Court is a court of last resort and must remain to be so in order for it to satisfactorily perform its constitutional functions. Nonetheless, the invocation of the Supreme Court’s original jurisdiction to issue writs of certiorari has been allowed in certain instances on the ground of special and important reasons clearly stated in the petition, such as, 1. When dictated by public welfare and advancement of public policy, 2. When demanded by broader interest of justice, 3. Where the challenged orders were patent nullities or 4. When analogous exceptional and compelling circumstances called for and justified the immediate and direct handling of the case.
The Supreme Court took cognizance of this case in the interest of judicial economy and efficiency. The records of this case are enough for this Court to decide on the issues raised by the parties. Any further delay would unduly prejudice the parties.
2. Yes. Courts can neither amend nor modify the terms and conditions of a compromise validly entered into by the parties. In any case, a compromise validly entered has the authority and effect of res judicata as between the parties. A writ of execution that varies the respective obligation of the parties under a judicially approved compromise settlement is void. Under the judicially approved Compromise Agreement, petitioners are obliged to deposit the settlement amount in escrow within 10 business days after they receive a signed Compromise Agreement from the counsel of the claimants. There was nothing in the Compromise Agreement that required petitioners to ensure the distribution of the settlement amount to each claimant. Petitioners' obligation under the Compromise Agreement was limited to depositing the settlement amount in escrow. On the other hand, the actual distribution of the settlement amounts was delegated to the chosen mediator, Mr. Mills.
Consequently, the Omnibus Order dated December 14, 2006, which directed the implementation of the Writ of Execution, is likewise void. Ordinarily, courts have the ministerial duty to grant the execution of a final judgment.230 The prevailing party may immediately move for execution of the judgment, and the issuance of the writ follows as a matter of course.
A writ of execution may be stayed or quashed when "facts and circumstances transpire" after judgment has been rendered that would make "execution impossible or unjust." the Compromise Agreement did not impose solidary liability on the parties' subsidiaries, affiliates, controlled, and related entities, successors, and assigns but merely allowed them to benefit from its effects. Thus, respondent Judge Omelio gravely abused his discretion in holding that the petitioners' subsidiaries and affiliates were solidarily liable under the Compromise Agreement. Furthermore, there is no reason for respondent court to pierce the veil of corporate fiction. There is hardly any evidence to shew that petitioners abused their separate juridical identity to evade their obligation under the Compromise Agreement.
Hence Judge Omelio committed grave abuse of discretion.
FALLO
WHEREFORE, the Petition for Certiorari is GRANTED. The assailed orders and writs are ANNULLED and SET ASIDE for having been issued with grave abuse of discretion
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