Case Summary (G.R. No. 89651)
Filing of Civil Case and Motion to Dismiss
Kitamura filed for specific performance and damages in the RTC of Lipa City on June 1, 2000. Nippon moved to dismiss for lack of jurisdiction, invoking lex loci celebrationis and lex contractus—contending the ICA was perfected in Tokyo between Japanese nationals and should be adjudicated by Japanese courts. RTC denied the motion on June 29, 2000, applying the law of the place of performance (lex loci solutionis).
First and Second Rule 65 Petitions in the CA
Petitioners filed a Rule 65 certiorari petition (CA-G.R. SP No. 60205) to assail the RTC order but it was dismissed without prejudice due to procedural deficiencies in verification, certification against forum shopping, and statement of material dates. Within the reglementary period, they filed a corrected second petition (CA-G.R. SP No. 60827). On April 18, 2001, the CA ruled on the merits, finding no grave abuse of discretion by the RTC and applying lex loci solutionis. A motion for reconsideration was denied on July 25, 2001.
Supreme Court’s Scope and Procedural Objections
The petition for review on certiorari under Rule 45 raised jurisdictional issues and alleged improper invocation of conflict-of-laws principles. Respondent argued that the finality of the first CA dismissal barred further petitions. The Court held dismissals without prejudice do not bar refiling and found no fatal omission in certification of non-forum shopping. However, the Court identified a fatal defect in Hasegawa’s authorization to verify and certify on behalf of Nippon, issued only by the company’s president and not the board, requiring corporate approval under Philippine law. Accordingly, the petition was denied on procedural grounds.
Jurisdiction vs. Choice of Law Distinction
The Court clarified that three phases in conflict resolution are jurisdiction, choice of law, and recognition/enforcement. Only the jurisdictional phase was before the courts. Subject matter jurisdiction is conferred by law and determined by the complaint’s allegations. The movants did not dispute RTC’s statutory competence to hear a non-pecuniary claim for specific performance and damages.
Inapplicability of Lex Loci Celebrationis and Similar Doctrines
Petitioners’ reliance on lex loci celebrationis (law of the contract’s making), lex contractus (law of execution or performance), and the most significant relationship rule pertains to choice of law and not subject matter jurisdiction. The Court held these principles govern which substantive law appli
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Facts
- On March 30, 1999, Nippon Engineering Consultants Co., Ltd. (“Nippon”), a Japanese consultancy firm, entered into an Independent Contractor Agreement (ICA) with Minoru Kitamura, a Japanese national permanently residing in the Philippines.
- The ICA, executed wholly in Japan by Japanese nationals, provided for a one-year term of professional services from April 1, 1999 to March 31, 2000.
- Nippon assigned Kitamura as project manager of the Southern Tagalog Access Road (STAR) Project under its consultancy contract with the Philippine Government.
- When the STAR Project neared completion, the Department of Public Works and Highways engaged Nippon for the detailed engineering and supervision of the Bongabon-Baler Road Improvement (BBRI) Project, naming Kitamura as project manager in Appendix 3.1.
- On February 28, 2000, Kazuhiro Hasegawa, Nippon’s International Division general manager, informed Kitamura that his ICA would expire on March 31, 2000 and would not be renewed automatically.
- Kitamura, fearing unemployment, through counsel requested negotiations and reassignment to the BBRI Project, which Nippon refused, maintaining that the fixed-term ICA had expired.
Procedural History
- June 1, 2000: Kitamura filed Civil Case No. 00-0264 in the Regional Trial Court (RTC) of Lipa City for specific performance and damages.
- Petitioners moved to dismiss for lack of jurisdiction, invoking lex loci celebrationis and lex contractus and arguing that Japanese courts alone could resolve the ICA dispute.
- June 29, 2000: RTC denied the motion, applying lex loci solutionis under Insular Government v. Frank.
- Petitioners’ motion for reconsideration was likewise denied by the RTC.
- August 14, 2000: First certiorari petition under Rule 65 filed in the Court of Appeals (CA) as CA-G.R. SP No. 60205; dismissed on August 23, 2000 for defective material-dates statement and insufficient verification and certification.
- September 19, 2000: Second certiorari petition filed as CA-G.R. SP No. 60827, this time with correct dates and proper verification/certification.
- April 18, 2001: CA rendered its decision finding no grave abuse of discretion in the RTC’s denial