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    In Re PNB V Us District Court

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    Xtina Molina
    The act of state doctrine prevents US courts from invalidating or ignoring the official acts of foreign governments that occur within their own territories. The Ninth Circuit Court of Appeals held that the act of state doctrine applied to invalidate orders issued by a US district court in Hawaii against the Philippine National Bank. The district court had invalidated a judgment by the Philippine Supreme Court forfeiting assets to the Philippine government. However, the Philippine judgment qualified as an official act of state even though some of the assets were located abroad. Therefore, the Ninth Circuit issued a writ of mandamus directing the district court to dismiss its orders and refrain from interfering in the matter further.

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    In Re PNB V Us District Court

    Uploaded by

    Xtina Molina
    271 views3 pages
    The act of state doctrine prevents US courts from invalidating or ignoring the official acts of foreign governments that occur within their own territories. The Ninth Circuit Court of Appeals held that the act of state doctrine applied to invalidate orders issued by a US district court in Hawaii against the Philippine National Bank. The district court had invalidated a judgment by the Philippine Supreme Court forfeiting assets to the Philippine government. However, the Philippine judgment qualified as an official act of state even though some of the assets were located abroad. Therefore, the Ninth Circuit issued a writ of mandamus directing the district court to dismiss its orders and refrain from interfering in the matter further.

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    conflict of laws

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    In Re Pnb v Us District Court

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    The act of state doctrine prevents US courts from invalidating or ignoring the official acts of foreign governments that occur within their own territories. The Ninth Circuit Court of Appeals held that the act of state doctrine applied to invalidate orders issued by a US district court in Hawaii against the Philippine National Bank. The district court had invalidated a judgment by the Philippine Supreme Court forfeiting assets to the Philippine government. However, the Philippine judgment qualified as an official act of state even though some of the assets were located abroad. Therefore, the Ninth Circuit issued a writ of mandamus directing the district court to dismiss its orders and refrain from interfering in the matter further.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    271 views3 pages

    In Re PNB V Us District Court

    Uploaded by

    Xtina Molina
    The act of state doctrine prevents US courts from invalidating or ignoring the official acts of foreign governments that occur within their own territories. The Ninth Circuit Court of Appeals held that the act of state doctrine applied to invalidate orders issued by a US district court in Hawaii against the Philippine National Bank. The district court had invalidated a judgment by the Philippine Supreme Court forfeiting assets to the Philippine government. However, the Philippine judgment qualified as an official act of state even though some of the assets were located abroad. Therefore, the Ninth Circuit issued a writ of mandamus directing the district court to dismiss its orders and refrain from interfering in the matter further.

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    © All Rights Reserved
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    ACT OF STATE DOCTRINE

    United States Court of Appeals, Ninth Circuit.


    IN RE: PHILIPPINE NATIONAL BANK, Philippine National Bank, Petitioner, v. United States
    District Court for the District of Hawaii, Respondent, Maximo Hilao;  Estate of Ferdinand Marcos;
     Imelda R. Marcos;  Ferdinand R. Marcos, Jr., Real Parties in Interest.

    No. 04-71843.
    Decided: February 04, 2005

    FACTS. In an earlier case (Credit Suisse case), the US Court of Appeals dealt with the attempt of
    a class of plaintiffs to reach assets of the Marcos estate located in Swiss banks. The Swiss assets
    had been frozen by the Swiss government at the request of the Republic of the Philippines, which
    was seeking to recover them. The class plaintiffs obtained an injunction from the US district court
    requiring the Swiss banks to hold the assets for the benefit of the class plaintiffs.

    Thereafter, the Swiss government released the funds frozen in Switzerland for transfer to the
    Philippine National Bank in escrow pending a determination of proper disposal by a competent
    court in the Philippines. The Philippine National Bank deposited the funds in Singapore. The
    Philippine Supreme Court subsequently held that the assets were forfeited to the Republic of the
    Philippines.

    The US district court ruled that the Philippine Supreme Court had violated “due process by any
    standard” and that its judgment was entitled to no deference. The district court then issued an
    Order to Show Cause against the Philippine Bank requiring the Bank to show why it should not
    be held in contempt for violating the court's injunction against transfer of assets by the estate.

    The Bank then filed the present petition for mandamus in this court (US CA), seeking to restrain
    the district court from enforcing its Order to Show Cause. The Bank asserts that it has transferred
    nearly all of the funds in issue to the Republic pursuant to the judgment of the Philippine courts.
    More important, the Bank contends that the entire proceeding against the Bank for its transfer
    of funds violated the act of state doctrine.

    ISSUE. Whether the act of state doctrine applies to invalidate the orders issued by the Hawaii
    District Court. (Yes)

    HELD. We conclude that the district court's orders violated the act of state doctrine, and we
    accordingly issue the writ.

    The act of state doctrine. Every sovereign state is bound to respect the independence of every
    other sovereign state, and the courts of one country will not sit in judgment on the acts of the
    government of another, done within its own territory. Redress of grievances by reason of
    such acts must be obtained through the means open to be availed of by sovereign powers as
    between themselves.
    The act of state doctrine originally was deemed to arise from international law, but more
    recently has been viewed as a function of our constitutional separation of powers. So viewed,
    the doctrine reflects “ ‘the strong sense of the Judicial Branch that its engagement in the task
    of passing on the validity of foreign acts of state may hinder’ the conduct of foreign affairs.”

    The district court's orders in issue violated this principle. In order to obtain assets from the
    Philippine Bank, or to hold the Bank in contempt for the transfer of those assets to the Republic,
    the district court necessarily (and expressly) held invalid the forfeiture judgment of the Philippine
    Supreme Court.

    Although the act of state doctrine is normally inapplicable to court judgments arising from private
    litigation, there is no inflexible rule preventing a judgment sought by a foreign government from
    qualifying as an act of state. “A judgment of a court may be an act of state.” There is no question
    that the judgment of the Philippine Supreme Court gave effect to the public interest of the
    Philippine government. The forfeiture action was not a mere dispute between private parties;  it
    was an action initiated by the Philippine government pursuant to its “statutory mandate to
    recover property allegedly stolen from the treasury.”  The subject matter of the forfeiture action
    thus qualifies for treatment as an act of state.

    Generally, the act of state doctrine applies to official acts of foreign sovereigns “performed
    within [their] own territory.” The act of the Philippine Supreme Court was not wholly external,
    however. Its judgment, which the district court declared invalid, was issued in the Philippines and
    much of its force upon the Philippine Bank arose from the fact that the Bank is a Philippine
    corporation. Even when an act of a foreign state affects property outside of its territory, “the
    considerations underlying the act of state doctrine may still be present.” Because the
    Republic's “interest in the enforcement of its laws does not end at its borders.” The fact that
    the escrow funds were deposited in Singapore does not preclude the application of the act of
    state doctrine. The underlying governmental interest of the Republic supports treatment of the
    judgment as an act of state.

    The Philippine forfeiture judgment is an act of state. The Swiss government did not repudiate its
    freeze order, and the Swiss banks did not transfer the funds in the ordinary course of business.
    They delivered the funds into escrow with the approval of the Swiss courts in order to permit the
    very adjudication of the Philippine courts that the district court considered invalid. To permit the
    district court to frustrate the procedure chosen by the Swiss and Philippine governments to
    adjudicate the entitlement of the Republic to these assets would largely nullify the effect of our
    decision in Credit Suisse.

    WRIT OF MANDAMUS ISSUED directing dismissal of the US district court's order, and ordering
    the district court to refrain from taking any further action or any other case involving any or all
    of the class plaintiffs and any assets of the Estate of Ferdinand E. Marcos held or claimed to be
    held by the Banks.

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