In January 2000, Efren Alcañeses died in a plane accident in Ivory Coast. He was survived by his widow, Esther Alcañeses.
In July 2000, Esther executed an affidavit of self-adjudication where she declared that she is the sole heir of Efren. She was able to consolidate unto herself two parcels of land and two vehicles which were previously part of her conjugal property with Efren.
In November 2000, Esther sought judicial appointment as the representative of Efren’s estate for purposes of seeking indemnification from Kenya Air which owned the plane that Efren boarded when he died. Esther then filed a claim for damages but Kenya Air chose to settle out-of-court for $430,000.00 to which Esther agreed.
In 2002, the siblings of Efren filed a partition case for purposes of partitioning the money received by Esther from Kenya Air and to annul the affidavit of self-adjudication executed by Esther.
The trial court ruled in favor of the siblings of Efren. The case was elevated to the Court of Appeals. The Court of Appeals partially affirmed the RTC. The CA ruled that the indemnification from Kenya Air is not part of Efren’s estate. As to the estate, 3/4 belongs to Esther while 1/4 belongs to the siblings of Efren. As to the $430k, each of them are entitled to 1/10 share. The basis of the CA was the Civil Code provision on indemnification.
ISSUE: Whether or not the ruling of the Court of Appeals as to the $430k is correct.
HELD: No. The CA is correct in ruling that the indemnification from Kenya Air does not form part of Efren’s estate. However, in determining as to who is entitled to the indemnification, the CA was mistaken in using the provisions of the Civil Code.
In ruling that the specific Kenyan Law (Fatal Accidents Act of Kenya) on indemnification is the governing law and not the Civil Code nor the national law of Efren, the Supreme Court made use of the Most Significant Relationship Principle. Under this principle, the following test factors are to be considered:
(1) The nationality of a person, his [or her] domicile, his [or her] residence , his [or her] place of sojourn, or his [or her] origin;
(2) the seat of a legal or juridical person, such as a corporation;
(3) the situs of a thing, that is, the place where a thing is, or is deemed to be situated. In particular, the lex situs is decisive when real rights are involved;
(4) the place ·where an act has been done, the locus actus, such as the place where a contract has been made, a marriage celebrated, a will signed or a tort committed. The lex loci actus is particularly important in contracts and torts;
(5) the place where an act is intended to come into effect, e.g., the place of performance of contractual duties, or the place where a power of attorney is to be exercised;
(6) the intention of the contracting parties as to the law that should govern their agreement, the lex loci intentionis,·
(7) the place where judicial or administrative proceedings are instituted or done. The lex fori -the law of the forum is particularly important because, as we have seen earlier, matters of ‘procedure’ not going to the substance of the claim involved are governed by it; and because the lex fori applies whenever the content of the otherwise applicable foreign law is excluded from application in a given case for the reason that it falls under one of the exceptions to the applications of foreign law, and
(8) the flag of a ship, which in many cases is decisive of practically all legal relationships of the ship and of its master or owner as such. It also covers contractual relationships particularly contracts of affreightment.
Pursuant to these guidelines and upon scrutiny of the records, this SC held that the following “points of contact” are material: (1) the parties’ nationality; (2) Kenya Air’s principal place of business; (3) the place where the tort was committed; and (4) the intention of the contracting parties as to the law that should govern their agreement.
Kenya’s Fatal Accident Act provides that the beneficiaries of an indemnification under their law are the spouse, descendant, or ascendant. Hence, in this case, only Esther is entitled to the indemnification. The siblings are not.
SIDE ISSUE: The Philippines is a signatory of the Warsaw Convention which governs international air carriage, and “seeks to accommodate or balance the interests of passengers seeking recovery for personal injuries and the interests of air carriers seeking to limit potential liability.” It enumerates the most convenient fora where claims between an airline and its passengers may be litigated. Is the Warsaw Convention applicable in this case?
No. The action does not involve an international carrier’s liability. Here, the siblings of Efren did not implead Kenya Air to seek damages from it. Neither did they question its indemnity award to Esther. In imploring this Court to direct Esther to deliver to them a portion of the settlement, the siblings anchor their cause of action on Philippine law.
