Lex loci celebrationis (Article 17, Civil Code)

The forms and solemnities of contracts, wills, and other public instruments shall be governed by the laws of the country in which they are executed.

When the acts referred to are executed before the diplomatic or consular officials of the Republic of the Philippines in a foreign country, the solemnities established by the Philippine laws shall be observed in their execution.

Prohibitive laws concerning persons, their acts or property, and those which have for their object public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country. (Article 17, Civil Code of the Philippines)

Paras explains that the first paragraph of the Article lays down the rule of lex loci celebrationis insofar as extrinsic validity (forms and solemnities) is concerned. Thus, a contract entered into by a Filipino in China will be governed by Chinese law insofar as form and solemnities of the contract are concerned. Thus also, if a power of attorney is executed in Texas, Texan laws and not the Philippine Civil Code should determine its formal validity. (Citing Germann and Co. v. Donaldson, Sim and Co., 1 Phil. 63)

Albano explains that, while matters pertaining to the due execution of contracts are regulated according to the law of the place of their execution, on the other hand, matters connected with the performance of contracts are regulated by the law in force at the place of performance. This is called "lex loci solutionis." Remedies, such as the bringing of suit, admissibility of evidence, and the statute of limitations, depend upon the law of the place where the action is brought. (Gov’t. of Phil. vs. Frank, 13 Phil. 236).

Lex loci solutionis (Latin: "law of the place of performance"), in conflict of laws, is the law applied in the place of an event. If a case comes before a court and all the main features of the case are local, the court will then apply the lex fori, the prevailing municipal law, to decide the case.

The second paragraph speaks of the extension of Philippine formal laws to acts executed before diplomatic or consular officials of the Republic of the Philippines in a foreign country. It is as if such acts were made in the Philippine Islands and, therefore, solemnities under our laws will govern.

The last paragraph talks about the effect of foreign laws, foreign decisions, treaties, etc. on Philippine prohibitive laws concerning persons, their acts or property. For example, in the case of Querubin v. Querubin, G.R. No. L-3693, July 29, 1950, a US court allowed a mother living with a man other than her husband to exercise authority over her child with the lawful husband. It was held by our Supreme Court that such a decision cannot be enforced in the Philippines. The rule is the same today except that in case of separation of his parents, no child under 7 years of age shall be separated from his mother, unless the court finds compelling reasons to do so. Even the commission of adultery, according to the Code Commission, is not a compelling reason. (Paras, 2008)

In simpler terms, what the last paragraph of Article 17 is saying is that Philippine public policy laws and rules cannot be rendered useless by foreign statutes or decisions, even treaties.Moreover, foreign law should not be applied when its application would work undeniable injustice to the citizens or residents of the forum. To give justice is the most important function of law; hence, a law, or judgment or contract that is obviously unjust negates the fundamental principles of Conflict of Laws. (G.R. No. 193707, December 10, 2014)

In the case of Del Socorro v. Van Wilsem (G.R. No. 193707, December 10, 2014), the Supreme Court said: "The public policy sought to be protected in the instant case is the principle imbedded in our jurisdiction proscribing the splitting up of a single cause of action. Section 4, Rule 2 of the 1997 Rules of Civil Procedure is pertinent — If two or more suits are instituted on the basis of the same cause of action, the filing of one or a judgment upon the merits in any one is available as a ground for the dismissal of the others."

Another example of a public policy that cannot be ignored is the constitutional protection to labor. According to the Supreme Court, whether employed locally or overseas, all Filipino workers enjoy the protective mantle of Philippine labor and social legislation, contract stipulations to the contrary notwithstanding. This pronouncement is in keeping with the basic public policy of the State to afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed, and regulate the relations between workers and employers. (Becmen Service v. Cuaresma, G.R. Nos. 182978-79, April 07, 2009)