Continuation: Choice of Law in Property…

5. SITUS OF CERTAIN PROPERTIES
1. SITUS OF PERSONAL PROPERTY FOR TAX PURPOSES
-CAN'T apply mobilia sequuntur personam (had its origins in considerations of general convenience and public policy)
-STATE has right to tax property w/n its jurisdiction
-can't be applied if it would result in inescapable and patent injustice
ASIATIC PETROLEUM V. CO QUICO (1940)
(note: this is not a tax case so I don't know why ma'am placed it in this part)
Short summary: Co Quico was an agent of Asiatic Petroleum who defaulted in payment of the proceeds of his sale for the latter company. Company filed suit to recover amount, attached his bank deposits w/ Mercantile Bank of China. Court held that said attachment and execution from the property, even w/o having jurisdiction over Co Quico who was in China at that time, is valid.
Facts:
-Co Quico is an agent of Asiatic Petroleum for whom he should sell the latter's products and make a proper accounting
-Co Quico was in default of P2,123 and left for China
-Asiatic Petroleum filed COMPLAINT TO RECOVER ALLEGED UNREMITTED SUM, PRAYED FOR PRELIMINARY INJUNCTION OVER CO'S PROPERTIES (IN RP - THE DEPOSITS IN MERCANTILE BANK OF CHINA)
-summons by publication was made
-no appearance from Co Quico, declared in default
TC: Judgment in default: for Asiatic Petroleum
1. Co Quico should pay AP
2. Writ of execution, allowed levy on his deposits with Mercantile Bank
-WOE unsatisfied: deposits were transferred to Co's son
-Co's counsel made special appearance (solely to contest the validity of the proceedings - no jurisdiction over the person of the defendant)
TC: for CO
1. Earlier proceedings NULL AND VOID
2. Action was in personam - so needs jurisdiction over the person of the defendant and summons by publication improper
WON THE COURT HAD EXERCISED VALID JURISDICTION OVER THE PROCEEDINGS? YES
-All property w/n a state is subject to the jurisdiction of its courts, and they have the right to:
•  adjudicate title thereto
• Enforce liens thereupon
• Subject it to the payment of the debts of its owners
…whether residents or not
-modern tendency is to make NO DISTINCTION BETWEEN MOBILITY AND IMMOBILITY OF PROPERTY established by the time honored principles of lex rei sitae and mobilia personam sequuntur
-the court did not find it necessary to determine WON the action is in rem or quasi in rem because the situs of the res is clear (the res is in the Philippines)
-HERE: though Co Quico was in China when action instituted against him, his property were found and located in RP and was w/n jurisdiction of the courts so pede!
Review:
quasi in rem: (De Midgeley v. Ferandos: A quasi in rem action is an action between parties where the direct object is to reach and dispose of property owned by them or some interest therein. Jurisdiction was acquired because it was a quasi in rem action, where jurisdiction over the person is not required and where the service of summons is required only for the purpose of complying with the requirement of due process.
In rem: where the direct object is to reach and dispose of property owned by them. (i.e. testamentary proceeding which is an action in rem par excellance)
2. SITUS OF MONEY
LEON V. MANUFACTURERS LIEF INSURANCE CO.
F: (not really clear, too sloppy to even look at the original case so I just invented)
-Leon probably wanted to recover money from an instrument endorsed in an annuity in Canada
-sued the local branch or agency of Manufacturers Life Insurance in RP to recover
H: Since the money to be recovered was from an instrument endorsed in an annuity in Canada under a contract executed in that country, CANADA WAS THE SITUS OF THE MONEY
-the local branch impleaded delivered to the annuitant the checks made out and issued from the home office in CANADA, but no showing that the funds (the money) was indeed transferred from CANADA to the home branch
*cha: Only Checks were in the local branch, not money. Probably, the pleading prayed that money, not checks were to be levied on or something. Boo… this case is labo
3. SITUS OF DEBTS
-still UNSETTLED in RP
-suggested that the law w/c governs the contract from which the debt arises should govern the transfer of the debt
2 kinds of movable property:
1. Choses in possession: all kinds of TANGIBLE PHYSICAL OBJECTS
2. Choses in action: INTANGIBLE objects
1. Mere rights of action: debt arising from a loan
2. Rights represented by a document: capable of delivery, susceptible to negotiation as a separate legal entity
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HARRIS V. BALK
Short summary: Harris owed Balk $180 (in North Carolina), who owed more than $300 to Epstein (in Maryland). When Harris was in Maryland, Epstein served a writ of attachment to the debt of Harris to Balk. Back in North Carolina, Balk wanted to collect from Harris. The court held that payment of Harris to Epstein absolved him from any liability to Balk.
Facts:
-Harris (D1) owed Balk (C1,D1)$180 (North Carolina)
-Balk (C1D1) owed Epstein (C2) more than $300 (Maryland)
-Harris, while TEMPORARILY STAYING IN MARYLAND to buy merchandise, was served by Epstein w/ a writ attaching the debt which Harris owed to Balk
-Balk (C1D1) was given a process as regards the said attachment
MARYLAND COURT: Harris consented to the entry against him, paid for $180 (so paid his debt to Balk to Balk's creditor, Epstein)
-when Harris went back to North Carolina, Balk sued Harris for the recovery of the $180 (which he already paid to Balk's creditor)
Defense: used the Maryland judgment
-Maryland judgment is a valid judgment, entitled to full faith and credit
NORTH CAROLINA COURT: for Balk
-Maryland had no jurisdiction to garnish the debt Harris owed Balk
-WHY: Harris had only TEMPORARY stay in Maryland + situs of debt was in North Carolina
WON SITUS OF DEBT AND CHARACTER OF STAY IMPORTANT IN ATTACHMENT? NO
Ratio:  The obligation of the debtor to pay his debt clings to and accompanies him wherever he goes
-If the garnishee be found in the State, and process be personally served upon him therein, the court acquires jurisdiction over him, and can garnish the debt due from him to the debtor of the plaintiff and condemn it, provided that the garnishee could himself be sued by his creditor in that State
-Power over the person of the garnishee confers jurisdiction on the courts of the State where the writ issues. If, while temporarily there, his creditor might sue him there and recover the debt, then he is liable to process of garnishment, no matter where the situs of the debt was originally
-Possession cannot be taken of a debt or of the obligation to pay it as tangible property might be taken possession of
-HERE: Balk could have sued Harris while in Maryland to recover his debt
+ Maryland laws allow the principal creditor to recover from the debtor of his principal debtor (by garnishment) - so Harris had no defense and had to pay Epstein in Maryland
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CRITIQUE TO THE CASE:
2 premises which led to the conclusion in the case:
1. Debt though intangible, is subject to seizure like tangible property
2. The debt is LOCATED where the debtor is - can be sued wherever he is
-BUT THIS MAKES THE CREDITOR HELPLESS TO FIX THE PERSONAL PRESENCE OF THE DEBTOR AT ONE PLACE OR ANOTHER
…Unjust to submit the creditor's claim to the accident of the debtor's presence in one state or another
4. SITUS OF CORPORATE SHARES OF STOCKS
Corporation Code: SEC 63
…shares of stock issued by the corp are PERSONAL PROPETY
…may be transferred by DELIVERY OF THE CERTIICATE OR CERTIFICATES INDORSED BY THE OWNER OR HIS ATTORNEY IN FACT or other persons legally authorized to make the transfer
VALID TRANSFER
-valid between parties ONLY: not yet recorded
-when valid to everyone: recorded in the books of the corporation
…shows the names of the parties  to the transaction
…date of transfer
...number of certificate or certificates
…number of shares transferred
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CIR V. ANGLO CALIFORNIA NATIONAL BANK
Short summary: CIR wanted to collect "deficiency" income and capital gains tax from Calamba Sugar Estate Inc for the sale of capital stock of Pampanga Sugar Mills. Court held that since the sales of shares (which are located in RP) was in California, and since the shares are considered intangible personal properties whose place of sale is considered the place or source of the capital gain, the income derived from that sale is not within the Philippines, thus, not taxable by CIR.
Facts:
-Calamba Sugar Estate Inc (CSEI) is a foreign corporation (really?) organized and existing under the laws of State of California duly licensed to do business in RP, and has continuously filed ITR in RP
-CIR gave CSEI an assessment for deficiency income taxes based on:
1. Capital gains derived from sale of shares of capital stock of Pampanga Sugar Mills to Pasumil Planters, Inc
2. PN executed by Pampanga Sugar Mills
Defense (protest):
• sale took place in California
• Payment was made in California
• CSEI was already dissolved in accordance w/ law
-protest by CSEI denied by CIR; appealed to CTA
-CTA: absolved CSEI because the income was derived from abroad, thus not subject to income tax here
WON THE CIR COULD IMPOSE INCOME TAX ON SALES OF SHARES OF STOCK (LOCATED IN RP) WHICH WAS CONSUMMATED ELSEWHERE? NO
1. Shares of stock are considered intangible personal properties (in the earlier discussion, it is thus choses of action which are rights represented by a document, capable of delivery, susceptible to negotiation as a separate legal entity)
2. SEC24, NIRC: can only impose income tax on foreign corporations for income derived from sources w/n RP + capital gains for sale of personal properties
3. SEC 37(e): the source of the capital gain is the place of sale
4. HERE: the place of sale is in California: title to the shares of stock passed from the vendor to the vendee in California
5. On argument of CIR that the situs of the shares of stock which is the subject of the sale is in RP, thus, the capital gains is derived in RP: no income tax imposed on the shares themselves!
-the subject of the proceedings is the income derived by the sale of the shares of stock, NOT the income derived from the shares itself!
6. On SECTION 35, CORPO LAW (lack of recording of the transfer in the corpo's books makes the transaction nonbinding upon other parties): does not invalidate the transfer between the paries
Disposition: for CSEI, affirm CTA
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6. PATENTS, TRADEMARKS, TRADE NAME, COPYRIGHT
Paris Convention of 1893 (Union Convention for the Protection of Industrial Property)
-RP became a party to it on September 1965
-protects TRADE NAME in all countries of the Union w/o obligation of registration, WON it forms part of the trade name
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WESTERN EQUIPMENT AND SUPPLY CO V. REYES (1925)
Short Summary: A foreign corporation wanted to enjoin a domestic corporation who intends to use the foreign corp's name in RP, and would engage in the same business as the foreign corp, from using its name. Court held that even if the corporation is not doing business and is not licensed in the Philippines, it could still protect the use of its trade name.
Facts:
-a foreign corporation organized under laws of Nevada was issued a provisional license by Director of Bureau of Commerce and Industry
-it then started importing and selling in RP electrical and telephone apparatus and supplies manufactured by Western Electric Co (WEC international), a foreign corpo, never licensed nor engaged in  business in RP; they had been in the business for the past 50 years and have acquired high trade reputation
-Herman et. Al filed Articles of Incorporation as a Philippine corp w/ name  Western Electric Company (WEC)+ they are also engaged in manufacturing of electrical and telephone apparatus and supplies.
-WEC international filed for Temp Injunction to stop issuance of certificate of incorp for WEC
Defense: WEC is a foreign corp not licensed, nor is doing business, in RP so has no legal capacity to sue
WON WEC HAS LEGAL CAPACITY TO SUE TO PROTECT ITS REPUTATION EVEN IF ITS NOT REGISTERED NOR DOING BUSINESS IN RP? YES
-the right to use the company's corporate and trade name is a property right which may be asseted against the whole world
-HANOVER STAR MILLING V. ALLEN AND WHEELER CORP: trademark acknowledges no territorial boundaries of municipalities or states or nations, but extends to every market where the trader's goods have become known and identified by the use of the mark
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RA 8293: INTELLECTUAL PROPERTY CODE OF 1998
-established the Intellectual Property Ofice
-does not allow corps to register as their trade names those which are
1. Well known internationally and in the RP, WON registered in RP (already used as a mark by some other person)
2. Used for identical or similar goods or services
-allows a corporation w/c may not be engaged in business or is not registered in RP to still file suit (civil or administrative) to protect its trade name (note: only owners of registered marks in RP can recover damages for trademark infringement)
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PHILIPS EXPORT BV V. CA
Short summary: Foreign Company (Philips Export BV) and corporations allowed to use its name (Philips Electrical Lamps and Philips Industrial Develoment Corp) wanted the cancellation of the Certificate of Registration of Standard PHILIPS Corp., a domestic corporation which allegedly wanted to ride on the popularity and name of the foreign corp to sell its products (which, although alleged to just be engaged in chain rollers, belts, bearings, cutting saw, may actually sell the same products as that of the complainant). Court held that trade name being important, it should be protected against the whole world in the same manner as a acorp. may protects its tangible property against trespass or conversion.
Digest from Corpo:
PHILIP EXPORT BV (PEBV), PHILIPS ELECTRICAL LAMPS (PHILIPS ELECTRICAL) AND PHILIPS INDUSTRIAL DEVELOPMENT INC (PHILIPS INDUSTRIAL) VS. CA, SEC AND STANDARD PHILIPS CORP (STANDARD PHILIPS)
FACTS:
PEBV:
-foreign corporation organized under laws of Netherlands
-though not engaged in business in RP, is the registered owner of TM Philips and PHILIPS SHIELD EMBLEM under the Cert. of Registration issued by the Philippine Patents Office
-incorporated 1922 pa!
PHILIPS ELECTRICAL & PHILIPS INDUSTRIAL:
-authorized users of TM PHILIPS AND PHILIPS SHIELD EMBLEM
-incorporated 1956 pa!
STANDARD PHILIPS:
-issued Cert of Registration on May 1982
PEBV, PHILIPS ELECTRICAL AND PHILIPS INDUSTRIAL filed a complaint for cancellation of the word Philips from STANDARD PHILIPS' corporate name before SEC
COA: (1) prior registration with Bureau of Patents by PEBV; (2) prior registration of PHILIPS ELECTRICAL and PHILIPS INDUSTRIAL with SEC.
-Standard Philips refused to amend its Articles of incorporation
So PEBV, Philips Electrical and Philips Industrial (Petitioners na from hereon) filed a petition for issuance of writ of PI before SEC
COA: Standard Philips' use of PHILIPS amount to infringement and clear violation of Petitioners' exclusive right to use the same, considering engaged in same business
ANSWER:
(1) PEBV had no capacity to sue;
(2) no similarity if considered in entirety;
(3) its products (chain rollers, belts, bearings, cutting saw) are different from petitioners' (electrical products)
SEC: for Standard Philips (did not issue injunction); subsequently dismissed the petition itself for lack of merit: Sec 18 applicable only when corporate names in question are identical  - here no confusing similarity at Standard Philps contain at least 2 words different…
-MR denied
SEC en banc (on appeal):  affirmed dismissal of appeal
CA: Reverse case (where it was held that when the other corporation's name constitutes a dominant part of the complainant's corporate names, the former cannot be allowed to use it) not for-square (di ba all fours?) with the present case because not involved in same business; unrelated and non-competing businesses - MR Denied
RULING: For Petitioners
ON corporate name = property
-a corporation's right to use its corporate and trade name is a property right, a right in rem, which it may assert and protect against the world in the same manner as it may protect its tangible property, real or personal, against trespass or conversion. It is regarded, to a certain extent, as a property right and one which cannot be impaired or defeated by subsequent appropriation by another corporation in the same field
-A name is peculiarly important as necessary to the very existence of a corporation. Its name is one of its attributes, an element of its existence, and essential to its identity. The general rule as to corporations is that each corporation must have a name by which it is to sue and be sued and do all legal acts. The name of a corporation in this respect designates the corporation in the same manner as the name of an individual designates the person; and the right to use its corporate name is as much a part of the corporate franchise as any other privilege granted.
-A corporation acquires its name by choice and need not select a name identical with or similar to one already appropriated by a senior corporation while an individual's name is thrust upon him. A corporation can no more use a corporate name in violation of the rights of others than an individual can use his name legally acquired so as to mislead the public and injure another.
ON CORPO CODE: SECTION 18
"No corporate name may be allowed by the Securities and Exchange Commission if the proposed name is identical or deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law or is patently deceptive, confusing or contrary to existing law. Where a change in a corporate name is approved, the commission shall issue an amended certificate of incorporation under the amended name."
*two requisites:
(1) that the complainant corporation acquired a prior right over the use of such corporate name; and
(2) the proposed name is either:
(a) identical; or
(b) deceptively or confusingly similar to that of any existing corporation or to any other name already protected by law; or
(c) patently deceptive, confusing or contrary to existing law.
WHICH CORPORATION HAS RIGHT TO USE THE NAME: Priority of Adoption
-so PEBV (issued Cert of Registration 1922) Philips Electrical and Philips industrial (1956) adopted the name "PHILIPS" first vs. Standard Philips (only in 1982, or 26 years after)
HOW TO DETERMINE WON THERE'S CONFUSING SIMILARITY IN CORPORATE NAMES: whether the similarity is such as to mislead a person, using ordinary care and discrimination. In so doing, the Court must look to the record as well as the names themselves
---HERE, Phips is indeed the dominant word in all the companies!
ON PROOF OF CONFUSION OR DECEPTION:
-Director of Patents, in denying Standard Philips' application for registration of the trademark, ruled that PEBV imports to the RP included equipments, machines and other parts falling under same category wherein the products of Standard Phips fall.
-primary purposes of Standard Philips, as indicated in its articles of incorporation, included the buying, selling…of electrical wiring devices, electrical component parts, and/or complement of…electrical supplies…which is also included among the primary purposes of petitioner Philips electrical; SO SAME LINE OF BUSINESS! Making it appear that Standard Philips' intention was to  ride on the popularity and established goodwill of said petitioner's business throughout the world
ON THE ARGUMENT THAT 2 WORDS WERE DIFFERENT:
-What is lost sight of, however, is that PHILIPS is a trademark or trade name which was registered as far back as 1922. Petitioners, therefore, have the exclusive right to its use which must be free from any infringement by similarity. A corporation has an exclusive right to the use of its name, which may be protected by injunction upon a principle similar to that upon which persons are protected in the use of trademarks and tradenames (18 C.J.S. 574). Such principle proceeds upon the theory that it is a fraud on the corporation which has acquired a right to that name and perhaps carried on its business thereunder, that another should attempt to use the same name, or the same name with a slight variation in such a way as to induce persons to deal with it in the belief that they are dealing with the corporation which has given a reputation to the name. Notably, too, Private Respondent's name actually contains only a single word, that is, "STANDARD", different from that of Petitioners inasmuch as the inclusion of the term "Corporation" or "Corp." merely serves the Purpose of distinguishing the corporation from partnerships and other business organizations.
ON ARGUMENT THAT OTHER COMPANIES ALSO USES "PHILIPS": So? The fact that there are other companies engaged in other lines of business using the word "PHILIPS" as part of their corporate names is no defense and does not warrant the use by Private Respondent of such word which constitutes an essential feature of Petitioners' corporate name previously adopted and registered and-having acquired the status of a well-known mark in the Philippines and internationally as well
*As a general rule, parties organizing a corporation must choose a name at their peril; and the use of a name similar to one adopted by another corporation, whether a business or a nonbusiness or non-profit organization if misleading and likely to injure it in the exercise in its corporate functions, regardless of intent, may be prevented by the corporation having the prior right, by a suit for injunction against the new corporation to prevent the use of the name
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EMERALD GARMENT MANUFACTURING CORPORATION V. COURT OF APPEALS (1995)
Short summary (IPL Case by Prof. Amador!): In this case, his client used STYLISTIC MR. LEE. LEE international wanted the cancellation of the said trademark, alleging that it closely resembled its own trademark (from sir's kwento: "Stylistic Mr." was just a small marking at the side, then the "Lee" was similar to the "Lee" TM by the foreign corp). Court held that since the international corp failed to prove prior actual use of 2 months before they had their TM registered in RP + using the Holistic approach in testing the TM, Stylistic Mr. Lee could still be used by the domestic corp. The case summary in Ma'am's book focuses though on the Prior Actual Use requirement (which is misleading because under the IPC, it's not required anymore), saying that even if the Paris Convention provides for the protection of TMs by foreign corporation even if it's not registered in RP, it doesn't  mean that the said foreign law is superior to our own laws. The incorporation principle in Consti merely makes the Paris Convention equal in standing to our own laws.
Facts:
-HD Lee. Co. Inc is a foreign corporation organized under Delaware laws. It has filed an application for registration of its TM with the BPTTT. It allegedly first reached RP in the 1960s through local sales by the Post Exchanges of the US Military Bases in RP
-Emerald Garment Manufacturing on the other hand is a domestic corporation has been using the trademark "Stylistic Mr. Lee" since 1975 on skirts, jeans, blouses, etc. The said trademark was registered, and a Certification for this was issued in 1980.
-In 1981, HD Lee filed for Petition for Cancellation of the Trademark with BPTTT:
1. Sec 37, RA 166 (old Intellectual Property Law)
2. Art VIII, Paris Convention
*"Stylistic Mr. Lee" so closely resembled its own TM, "Lee", as previously registered and used in RP + not abandoned
*the said TM causes confusion, mistake and deception on part of purchasing public as to the origin of the goods
-Defense: TM entirely and unmistakably different from that of HD Lee
DIRECTOR OF PATENTS: cancelled TM of Emerald Garment Manufacturing
1. Prior registration
2. Prior use of the registration before Emerald was able to acquire a TM registration of "Stylistic Mr. Lee"
CA: affirm
WON PRIOR COMMERCIAL USE WAS SUFFICIENTLY PROVED BY HD LEE BEFORE FILING OF APPLICATION FOR REGISTRATION? NO
1. ON ARGUMENT THAT THE MARKS CLOSELY RESEMBLED EACH OTHER: using the Holistic approach, the dissimilarities between the 2 marks become conspicuous, noticeable, and substantial enough to matter
2. ON PRIOR ACTUAL COMMERCIAL USE OF 2 MONTHS: was not sufficiently proven by HD Lee
-Sec2, Philippine Trademark Law (RA 166): prior use for 2m + comity = registration of TM even of corporations domiciled in any foreign country
-Sec2A: who could acquire exclusive use over a TM and how acquire it: the applicant should
1. Lawfully produce or deal in merchandise of any kind
2. Engage in lawful business
3. Render any lawful service in  business or service
-PARIS CONVENTION vs. RA 166 (Philip Morris v. CA): Actual use requirement in the RP must subordinate an international agreement inasmuch as apparent clash is being decided by a municipal tribunal
…[though] international law has been made part of the law of the land (through incorporation clause), it does not mean  that it is superior to municipal law; incorporation clause merely makes it equal in standing to domestic laws
3. A foreign corporation may have the capacity to sue for infringement irrespective of lace of business activity in RP BUT question of WON they have an exclusive right to use such would depend on the actual use of their TM in RP
4. ON ARGUMENT THAT HD LEE IS A SENIOR REGISTRANT: registration alone will not suffice, when there's lacking in proof of prior actual use before said registration was issued