Case Digest (G.R. No. 121576-78)
Facts:
In Banco do Brasil v. Court of Appeals, petitioner Banco do Brasil, a nonresident foreign corporation, assailed the July 19, 1993 Decision and August 15, 1995 Resolution of the Court of Appeals reinstating the February 18, 1991 Regional Trial Court (RTC) of Manila ruling that held Banco do Brasil liable to private respondent Cesar S. Urbino, Sr. for $300,000 in damages. The dispute arose from the salvage of the M/V Star Ace, a vessel under local agency by Poro Point Shipping Services for Omega Sea Transport Company, which suffered engine trouble and was stored at the Philippine Ports Authority in La Union. Customs seized the vessel on suspicion of smuggling, then lifted the seizure only for the Commissioner of Customs to forfeit it and its cargo. Private respondent Duraproof Services, the salvor, filed a petition for certiorari, prohibition, and mandamus before the RTC to enforce his lien, impleading scores of respondents including Banco do Brasil. After multiple amendments, defCase Digest (G.R. No. 121576-78)
Facts:
- Background of the Dispute
- Poro Point Shipping Services, as local agent for Omega Sea Transport Co. (Panama), sought approval to unload and store cargo of M/V Star Ace at PPA San Fernando, La Union, after engine trouble.
- Bureau of Customs approved; upon docking (Jan 7, 1989), customs suspected hijacking and smuggling, seized vessel and cargo under Tariff & Customs Code.
- Cargo seizure proceedings ensued; vessel grounded and abandoned after typhoons; Frank Cadacio (authorized agent) entered salvage agreement (June 8, 1989) with Duraproof Services for $1 million plus 50% of cargo net of expenses.
- Trial-Court Proceedings
- District Collector Quiray lifted seizure (July 1989); Customs Commissioner Mison later forfeited vessel and cargo (Nov 1989) and ordered sale for government benefit.
- Duraproof Services filed certiorari/prohibition/mandamus (RTC Manila, Branch 8) to enforce salvor’s lien and annul forfeiture, impleading PPA, Med Line Phils., Vlason Enterprises, Singkong Trading, Banco do Brasil, Dusit Int’l, Thai-Nan and others.
- Summons by personal service and publication; motion to declare defaults; motions to dismiss for litis pendentia and lack of jurisdiction granted as to some respondents; others declared in default.
- Evidence presented ex parte against defaulting parties; Urbino testified; Rada (relief captain) executed Memorandum of Agreement (Dec 29, 1990) to assign vessel if Omega gave no instructions.
- RTC Decision (Feb 18, 1991) found respondents (including Banco do Brasil) liable: injunction against transfer of vessel; damages, salvaging and preservation fees; $300,000 in damages from Banco do Brasil; costs and attorneys’ fees.
- Subsequent compromise agreements reduced awards by 20%; Duraproof moved for execution; writ issued; sheriffs levied and sold the vessel; Bureau of Customs sought recall; trial court ordered cease of execution for some respondents.
- Banco do Brasil filed special appearance and motion to vacate/jurisdictional objection (Apr 10, 1991); RTC set aside decision as to it (May 20, 1991); motion for reconsideration denied (June 21, 1991).
- Appellate Proceedings
- Duraproof filed three certiorari petitions in the Court of Appeals to nullify various RTC and tax‐court orders affecting execution, returns and custody of the vessel and cargo.
- CA Decision (July 19, 1993) granted petitions, set aside contested orders, and reinstated the RTC Decision in its entirety (including Banco do Brasil’s liability).
- Motions for reconsideration by Urbino, Vlason and Banco do Brasil denied by CA Resolution (Aug 15, 1995).
- Petition Before the Supreme Court
- Banco do Brasil questioned CA’s ruling that the suit was in rem, permitting service by publication, and argued that personal jurisdiction was never acquired for an in personam claim.
- It also contended the RTC Decision was not yet final and executory as to it, having filed its motion within the appeal period.
Issues:
- Whether service of summons by publication on Banco do Brasil, a non-resident foreign corporation, validly conferred personal jurisdiction when the action included a claim for $300,000 in damages (in personam).
- Whether the RTC Decision dated February 18, 1991 had become final and executory as to Banco do Brasil, precluding any jurisdictional challenge.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)