Case Digest (A.M. No. P-04-1867)
Facts:
In Northwest Orient Airlines, Inc. v. Court of Appeals and C.F. Sharp & Company, Inc., the petitioner, Northwest Orient Airlines, Inc. (NORTHWEST), a Minnesota corporation, entered into an International Passenger Sales Agency Agreement on May 9, 1974 with the private respondent, C.F. Sharp & Company, Inc. (SHARP), a Philippine corporation operating through its Japan branches. After SHARP failed to remit proceeds from ticket sales, NORTHWEST sued in the 36th Civil Department of the Tokyo District Court on March 25, 1980. A writ of summons issued April 11, 1980 was unsuccessfully tendered twice at SHARP’s Yokohama branch—once because the authorized recipient, Mr. Dinozo, was in Manila and again because he disclaimed authority. On July 11, 1980, the Tokyo court requested the Supreme Court of Japan to serve the summons via diplomatic channels on SHARP’s Manila office. Deputy Sheriff Rolando Balingit effected service on August 28, 1980. SHARP did not appear, and on January 29, 1981 tCase Digest (A.M. No. P-04-1867)
Facts:
- Contract and Initial Proceedings in Japan
- On May 9, 1974, Northwest Orient Airlines, Inc. (NORTHWEST) and C.F. Sharp & Company, Inc. (SHARP) through its Japan branch executed an International Passenger Sales Agency Agreement authorizing SHARP to sell air‐transportation tickets for NORTHWEST.
- When SHARP failed to remit ticket sale proceeds, NORTHWEST on March 25, 1980 sued SHARP in the 36th Civil Department, Tokyo District Court, seeking collection of unremitted proceeds and damages.
- Service of Summons and Japanese Judgment
- On April 11, 1980 the Tokyo court issued a writ of summons for SHARP at its Yokohama office; two attempts at personal service failed (Mr. Dinozo was absent or refused).
- On July 11, 1980 the Tokyo court requested the Supreme Court of Japan to serve summons through diplomatic channels on SHARP’s Manila head office; on August 28, 1980 Deputy Sheriff Rolando Balingit served the summons in Manila.
- SHARP did not appear; on January 29, 1981 the Tokyo court rendered judgment ordering SHARP to pay ¥83,158,195 plus 6% per annum interest from August 28, 1980. SHARP received the judgment on March 24, 1981 and did not appeal.
- Enforcement Proceedings in the Philippines
- On May 20, 1983 NORTHWEST filed Civil Case No. 83-17637 before RTC Branch 54, Manila to enforce the Japanese judgment.
- On July 16, 1983 SHARP answered, claiming the Japanese judgment was null and void for lack of jurisdiction, lack of proper notice, collusion/fraud, and mistake of law or fact.
- After trial, SHARP moved for judgment on a demurrer to evidence (April 21, 1989), arguing want of jurisdiction and violation of due process; RTC granted the demurrer and dismissed the complaint on June 21, 1989.
- RTC denied reconsideration on October 16, 1989; NORTHWEST appealed to the Court of Appeals.
- On November 10, 1993 the Court of Appeals affirmed the dismissal, holding extraterritorial service in Manila conferred no jurisdiction on the Japanese court.
Issues:
- Whether a Japanese court acquires valid in-personam jurisdiction over a Philippine corporation doing business in Japan by serving summons via diplomatic channels at its Manila office after failed in-Japan attempts.
- Whether extraterritorial service of process was valid under Japanese procedural law, and if not proven otherwise, whether the presumption of regularity applies.
- How Philippine rules on service (Rule 14, Sec. 14) and the processual presumption apply to foreign corporations doing business in the Philippines.
- Whether SHARP’s status as a corporation with Japanese branches renders it a “resident” of Japan for jurisdictional purposes.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)