Case Digest (G.R. No. 195549) Core Legal Reasoning Model
Facts:
This case involves Vlason Enterprises Corporation (VEC) as petitioner and the Court of Appeals (CA) and Duraproof Services, represented by its General Manager Cesar Urbino Sr., as respondents. The case, decided on July 6, 1999, arose from complex admiralty and civil litigation involving a vessel, M/V Star Ace, owned by Omega Sea Transport Company, and incidents related to the vessel’s seizure by the Bureau of Customs due to suspicions of smuggling. Duraproof Services, claiming a salvor’s lien, filed a petition for certiorari, prohibition, and mandamus with the Regional Trial Court (RTC) Manila Branch 8 against the Commissioner of Customs and District Collector, among others, including Vlason Enterprises.
Duraproof filed multiple amended petitions and subpoenas. Vlason Enterprises contended it was never validly impleaded or served summons and, therefore, the RTC did not acquire jurisdiction over it. The trial court rendered a default judgment against Vlason Enterprises ordering
Case Digest (G.R. No. 195549) Expanded Legal Reasoning Model
Facts:
- Background of the case
- Poro Point Shipping Services, acting as the local agent of Omega Sea Transport Company (a Panamanian company), requested approval to unload cargo of the vessel M/V Star Ace at the Philippine Ports Authority (PPA) compound in San Fernando, La Union, due to engine trouble. Approval was given by the Bureau of Customs.
- Customs personnel seized the vessel and its cargo on suspicion of smuggling and hijacking, pursuant to the Tariff and Customs Code. A hearing was notified to the consignee and shipper abroad.
- During the seizure proceedings, typhoons hit La Union causing the vessel to run aground and be abandoned. Frank Cadacio, the authorized representative, entered a salvage agreement with Duraproof Services (private respondent) for securing and repairing the vessel, agreeing to a $1 million consideration plus 50% of the cargo after expenses and taxes.
- The District Collector of Customs lifted the seizure on July 16, 1989, finding no fraud; however, the Customs Commissioner declined to issue clearance and instead forfeited the vessel and cargo, ordering their sale in favor of the government.
- Civil Case No. 89-51451 before the Regional Trial Court (RTC)
- Duraproof Services filed a Petition for Certiorari, Prohibition, and Mandamus seeking to enforce its preferred salvor’s lien and assailing the Customs Commissioner and District Collectors’ actions, including impleading PPA and Med Line Philippines as respondents.
- The petition was amended to include more parties, including Vlason Enterprises Corporation (petitioner) represented by Vicente Angliongto, among others. Summons were served on various respondents; service on petitioner was through its president's secretary, Betty Bebero.
- Summons by publication was allowed on foreign defendants who had no representatives in the country.
- Private respondent repeatedly moved to have several defendants declared in default, including petitioner, but the trial court did not act on these motions initially, denying a general default declaration.
- After several motions and amendments, the trial court declared some defendants in default (notably not petitioner at that stage), allowed private respondent to present evidence ex parte against defaulting defendants, and eventually held petitioner liable for damages amounting to P3 million, despite objections raised by petitioner about jurisdiction and service of summons.
- A compromise was reached between private respondent and some defendants (including Omega and Singkong Trading), reducing amounts adjudged by 20%.
- Motion for execution was granted; writ of execution issued; sheriff was deputized to levy and sell the vessel and cargo.
- Post-judgment challenges and Court of Appeals involvement
- Petitioner filed motion for reconsideration claiming lack of jurisdiction, defective service of summons, non-inclusion in complaint, and absence of default declaration; trial court initially denied but later reversed its decision and set aside the default judgment against petitioner.
- Sheriff conducted an auction sale despite a trial court order to stop execution proceedings.
- Private respondent filed a petition for certiorari before the Court of Appeals (CA) to nullify the trial court’s cease and desist orders; CA issued a Temporary Restraining Order (TRO) preserving the status quo.
- CA issued a decision granting private respondent’s petition and nullifying various trial court orders that recalled the writ of execution and quashed levy and sale.
- CA ruled the trial court had jurisdiction over the salvor's claim and that the decision was final and executory as to all respondents, including petitioner.
- Petitioner filed motions for reconsideration and clarification before CA, arguing the judgment was not final and executory against it and that it was never validly summoned or declared in default. CA denied these motions.
- Petitioner filed the present petition for review on certiorari questioning the CA rulings.
Issues:
- Has the February 18, 1991 RTC Decision become final and executory as to petitioner?
- Did the trial court acquire jurisdiction over petitioner?
- Was the RTC default judgment binding and validly rendered against petitioner?
- Was the award of damages against petitioner procedurally proper?
- Was private respondent entitled to issue a writ of execution against petitioner’s properties?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)