GR L 38649; (March, 1979) (Digest)
G.R. No. L-38649 March 26, 1979
FACILITIES MANAGEMENT CORPORATION, J. S. DREYER, and J. V. CATUIRA, petitioners, vs. LEONARDO DE LA ROSA AND THE HONORABLE COURT OF INDUSTRIAL RELATIONS, respondents.
FACTS
Private respondent Leonardo de la Rosa filed a complaint with the Court of Industrial Relations (CIR) against petitioners Facilities Management Corporation (FMC), a foreign corporation, and its officers. De la Rosa sought payment for overtime and night shift differentials for work performed on Wake Island, alleging his employment contract was executed and renewed in Manila. Petitioners moved to dismiss the case for lack of jurisdiction, arguing that FMC and one officer were domiciled in Wake Island, beyond Philippine territorial jurisdiction, and that the corporation was not doing business in the Philippines.
The CIR denied the motion to dismiss and subsequently ruled in favor of de la Rosa, ordering payment of the claimed premiums. The CIR anchored its jurisdiction on the finding that the employment contract was perfected in Manila, making any dispute arising therefrom subject to Philippine venue. Petitioners sought review, reiterating the jurisdictional challenge and contending that the mere act of recruiting workers abroad does not constitute doing business in the Philippines to subject FMC to its jurisdiction.
ISSUE
The principal issue is whether the CIR validly acquired jurisdiction over a non-resident foreign corporation and its officers in a claim for overtime and shift differentials arising from employment abroad.
RULING
The Supreme Court denied the petition, affirming the CIR’s jurisdiction. The legal logic is twofold. First, jurisdiction over the parties was properly acquired. The employment contract was executed and renewed in Manila, establishing a significant connecting factor. Under Philippine law, a contract perfected in the Philippines subjects the parties to the jurisdiction of its courts for disputes arising from that contract. The place of contract execution, not merely the place of work performance, is a valid basis for assuming jurisdiction.
Second, the Court rejected the argument that FMC was not doing business in the Philippines. The act of recruiting Filipino workers through a local agency constitutes “doing business” as it involves a series of commercial acts pursuing the corporation’s purpose. The Court cited precedent stating that “doing business” implies a continuity of commercial dealings. By systematically hiring workers from the Philippines, FMC engaged in such continuous activity, thereby submitting itself to Philippine legal processes. Consequently, the CIR correctly exercised jurisdiction, and its decision ordering payment of the owed compensation was upheld. The petition was denied with costs.