G.R. No. 156759 - Macasaet vs. Co, Jr.

Case Summary (G.R. No. 156759)

Factual Background

On June 6, 2000, the daily tabloid Abante Tonite published an article alleged to be libelous. On July 3, 2000, Francisco R. Co, Jr. filed Civil Case No. 00-97907 against Abante Tonite; its Publisher Allen A. Macasaet; Managing Director Nicolas V. Quijano; Circulation Manager Isaias Albano; Editors Janet Bay, Jesus R. Galang, and Randy Hagos; and Columnist/Reporter Lily Reyes, claiming damages for libel. The complaint was raffled to Branch 51 of the RTC, which issued summons to be served at the business address given as Monica Publishing Corporation, Rooms 301-305, 3rd Floor, BF Condominium Building, Solana Street corner A. Soriano Street, Intramuros, Manila.

Sheriff's Attempts at Service

On the morning of September 18, 2000, RTC Sheriff Raul Medina proceeded to the stated address to effect personal service of the summons on each defendant but found the defendants out of the office and unavailable. He returned that afternoon for a second attempt and was again informed that petitioners were still out. The sheriff then resorted to substituted service and explained his actions in a sheriffs return dated September 22, 2000, certifying that summonses and copies of the complaint were served upon Ms. Lu-Ann Quijano, wife and secretary, and upon Rene Esleta, Editorial Assistant, who signed to acknowledge receipt, and stating that personal service was ineffectual because the defendants were habitually out and unavailable.

Motion to Dismiss and Trial Court Proceedings

On October 3, 2000, petitioners filed a motion to dismiss through counsel appearing specially, contending lack of jurisdiction over their persons because substituted service was invalid under Section 6 and Section 7, Rule 14, Rules of Court, and moving to drop Abante Tonite as not being a natural or juridical person. At the hearing Sheriff Medina testified to the two attempts at personal service and to the information he received from office personnel that the defendants were habitually absent or roving to gather news, thus prompting substituted service.

RTC Order Denying Motion to Dismiss

On March 12, 2001, the RTC denied the motion to dismiss and directed petitioners to file answers within the remaining period. The RTC found from the sheriffs return that efforts at personal service had been made on several occasions and proved ineffectual, and it held that substituted service was validly applied because summonses could not be served within a reasonable time on the persons of the defendants. The RTC treated those who received the papers at the office as competent persons of sufficient age and discretion within Section 7, Rule 14, Rules of Court.

RTC Denial of Reconsideration and Characterization of Abante Tonite

Petitioners moved for reconsideration, asserting immediate resort to substituted service and that Abante Tonite was not a person capable of being sued. On June 29, 2001, the RTC denied reconsideration, reiterating that the sheriff did attempt personal service twice and that the nature of petitioners' work justified substituted service. The RTC further held that Abante Tonite, as a widely circulated daily tabloid that represented itself to the public and derived profit therefrom, could be treated under the doctrine of corporation by estoppel and that its non-registration with the Securities and Exchange Commission did not necessarily prevent it from being sued.

Petition to the Court of Appeals

Petitioners sought relief by filing a petition for certiorari, prohibition, and mandamus in the Court of Appeals to nullify the RTC orders dated March 12, 2001 and June 29, 2001. The Court of Appeals, by decision promulgated March 8, 2002, dismissed the petition and affirmed the RTC orders, and it denied the motion for reconsideration by resolution promulgated January 13, 2003.

Court of Appeals' Reasoning

The Court of Appeals found no grave abuse of discretion by the respondent judge. It relied on the sheriffs return stating that efforts at personal service were made but were ineffectual, and it upheld the trial court's finding of substantial compliance with the rules allowing substituted service. The CA also rejected petitioners' contention that Abante Tonite could not be sued, applying the doctrine of corporation by estoppel where an unincorporated association represents itself as a corporate entity and a third party relies in good faith on that representation.

Issues Presented to the Supreme Court

Petitioners framed two principal issues: whether the Court of Appeals erred in holding that the trial court acquired jurisdiction over them by virtue of the substituted service, and whether the CA erred in sustaining the inclusion of Abante Tonite as a party in the case.

Supreme Court Disposition

The Supreme Court, applying the applicable constitutional and procedural law, affirmed the Court of Appeals decision. The Court held that the petition for review lacked merit and ordered petitioners to pay the costs of suit. The Supreme Court thus left intact the RTC orders denying the motion to dismiss and the CA judgment affirming those orders.

Jurisdictional Principles and Legal Standards Applied

The Court reiterated that jurisdiction in personam is indispensable in an action in personam, and that the service of summons serves to vest such jurisdiction and to secure the defendant's opportunity to be heard. The Court set out the distinction between proceedings in personam, in rem, and quasi in rem, citing controlling authorities, and explained that extraterritorial service in actions in rem or quasi in rem serves due process but is not a means of acquiring personal jurisdiction. Under Section 6 and Section 7, Rule 14, Rules of Court, personal service is the rule and substituted service is extraordinary and permissible only when personal service cannot be effected within a reasonable time. The Court emphasized that the statutory requirements for substituted service must be strictly followed, but that the necessity of substituted service must appear from the sheriffs return unless the defendant waives the requirement.

Application of Law to the Present Facts

The Court found that Sheriff Medina twice attempted personal service on petitioners at their office on September 18, 2000 and reasonably concluded, after the second attempt and upon information given by office personnel, that further attempts would be futile within a reasonable time. The Court held that the circumstances justified substituted service and that the serving officer was not required to pursue personal service by all means and at all times. The Court observed that petitioners had in any event manifested a voluntary appearance by filing several pleadings in the RTC, including an an

Case Syllabus (G.R. No. 156759)

Parties and Posture

Allen A. Macasaet, Nicolas V. Quijano, Jr., Isaias Albano, Lily Reyes, Janet Bay, Jesus R. Galang, and Randy Hagos, Petitioners were named defendants in a libel action.
Francisco R. Co, Jr., Respondent was the plaintiff who filed the libel complaint.
Abante Tonite and Monica Publishing Corporation were named in the complaint as the publisher and business address respectively.
The libel action was docketed as Civil Case No. 00-97907 and raffled to Branch 51 of the Regional Trial Court, Manila.
The petition to the Supreme Court assailed the Court of Appeals' affirmation of the RTC orders denying petitioners' motion to dismiss and denying reconsideration.

Key Facts

Francisco R. Co, Jr. filed the libel complaint on July 3, 2000 arising from an article published in the June 6, 2000 issue of Abante Tonite.
The RTC issued summonses directed to the business address at Monica Publishing Corporation, Rooms 301-305 3rd Floor, BF Condominium Building, Solana corner A. Soriano Streets, Intramuros, Manila.
Sheriff Raul Medina attempted personal service in the morning and again in the afternoon of September 18, 2000 but found the defendants absent on both occasions.
The sheriff executed a sheriffs return dated September 22, 2000 stating that substituted service was effected through Lu-Ann Quijano and Rene Esleta because the defendants were reported to be "always out" and "roving" to gather news.
Petitioners subsequently filed pleadings in the RTC, including an answer with compulsory counterclaim ad cautelam and a pre-trial brief ad cautelam, and availed themselves of discovery procedures.

Procedural History

Petitioners filed a motion to dismiss on October 3, 2000 alleging lack of personal jurisdiction due to invalid substituted service and asserting that Abante Tonite could not be sued as it was neither a natural nor juridical person.
The RTC, Branch 51, denied the motion to dismiss on March 12, 2001 and denied reconsideration on June 29, 2001.
Petitioners filed a petition for certiorari, prohibition, and mandamus in the Court of Appeals.
The Court of Appeals dismissed the petition and affirmed the RTC orders on March 8, 2002, and denied reconsideration on January 13, 2003.
The Supreme Court promulgated its decision on June 05, 2013 affirming the Court of Appeals' decision and ordering petitioners to pay the costs of suit.

Issues Presented

Whether the Court of Appeals erred in holding that the trial court acquired jurisdiction over the person of petitioners through substituted service.
Whether the Court of Appeals erred in sustaining the inclusion of Abante Tonite as a defendant in th