Case Summary (G.R. No. 204753)
Petitioner and Respondents
Petitioner: UCPB
Respondents: Spouses Alison Ang-Sy and Guillermo Sy; Renato Ang; Nena Ang; Ricky Ang; Derick Chester Sy; Nation Granary, Inc.; Nation Petroleum Gas, Inc.
Key Dates
• November 27, 2006 – Complaint filed and prayer for ex parte preliminary attachment granted.
• December 4–5, 2006 – Service of process and levy/garnishment effected.
• June 8, 2007 – RTC denied defendants’ Motion to Dismiss, granted suspension for NGI and NPGI.
• February 10, 2012 – CA reversed the RTC, voiding the proceedings for lack of jurisdiction.
• December 7, 2012 – CA denied UCPB’s Motion for Reconsideration.
• March 27, 2019 – Supreme Court rendered final decision.
Applicable Law
• 1987 Constitution – Judicial power and due process.
• Rules of Court, Rule 14 – Service of summons on individuals (Sec. 6), substituted service (Sec. 7), and service on juridical entities (Sec. 11, exclusive list).
• Rules of Court, Rule 14, Sec. 20 – Effect of voluntary appearance.
• Rule 45 – Petition for Review on Certiorari.
• Rule 65 – Special appearance to question jurisdiction.
Filing and Grant of Preliminary Attachment
UCPB sought recovery of P824,390,158.21 plus interest and damages, P1,000,000 attorney’s fees, and costs of suit, based on unpaid import and trust‐receipt lines totaling US$18,800,400.00. The RTC issued a writ of preliminary attachment on November 30, 2006, and summonses were served on December 4, 2006; a Toyota Land Cruiser was levied the same day and stocks and assets were garnished on December 5.
Motion to Dismiss for Lack of Jurisdiction
Defendants moved to dismiss for lack of personal and corporate jurisdiction, contending that: (1) no personal service on the spouses; substituted service was improperly attempted without prior personal service; and (2) corporate summons was delivered to an unauthorized custodian rather than to an officer enumerated in Rule 14, Sec. 11. They prayed for dismissal, discharge of attachment, and suspension due to a stay order. The RTC denied the motion on June 8, 2007, except that it suspended proceedings against NGI and NPGI.
Special Appearance and CA Proceedings
Respondents filed a Rule 65 petition before the CA, alleging grave abuse of discretion in the RTC’s order denying the Motion to Dismiss. The CA granted the petition, holding that the RTC acquired no jurisdiction over the persons of either the individual or corporate defendants because of defective service of summons, rendering all proceedings void. UCPB’s motion for reconsideration was denied.
Issue Before the Supreme Court
Whether the RTC acquired jurisdiction over the persons of the parties despite defective service of summons, either by cure through voluntary submission or waiver, or by failure of the corporations to contest jurisdiction.
Jurisdiction and Service Requirements
Jurisdiction over defendants must be acquired by: (a) valid service of summons under Rule 14, or (b) voluntary appearance. Personal service requires handing a copy to the defendant in person. Substituted service is permitted only after several failed attempts at personal service, leaving copies with a person of suitable age and discretion at the residence or business. Corporate service is valid only when made on designated officers: president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel. Defective service renders proceedings void.
Defective Service on Individual Respondents
The Sheriff’s Report showed only a single‐day attempt at personal service and failed to identify a suitable person of age and discretion for substituted service. The return lacked specifics on understanding and delivery of summons, violating the “ironclad” requirement for detailed returns.
Defective Service on Corporate Respondents
Summons were served on an OIC Property Supply Custodian, who is not among the exclusive list of corporate officers under Rule 14, Sec. 1
...continue readingCase Syllabus (G.R. No. 204753)
Parties
- Petitioner: United Coconut Planters Bank (UCPB)
- Respondents: Spouses Alison Ang-Sy and Guillermo Sy; Renato Ang; Nena Ang; Ricky Ang; Derick Chester A. Sy (collectively “Sps. Sy, et al.”)
- Other defendants in the complaint: Nation Granary, Inc. (NGI) and Nation Petroleum Gas, Inc. (NPGI)
Nature of the Complaint
- Civil action for sum of money and/or damages, with prayer for ex parte issuance of a writ of preliminary attachment
- Based on credit accommodations granted by UCPB to NGI:
• Import Letter of Credit/Trust Receipt in the amount of US$15,000,000.00
• Case-to-case Letter of Credit/Trust Receipt in the amount of US$3,800,400.00 - Surety Agreements executed by NPGI and Sps. Sy, et al., securing the credit accommodations
- Prayer for:
- Payment of ₱824,390,158.21 plus interest, penalty, and other charges from 15 November 2006 until fully paid
- ₱1,000,000.00 as attorney’s fees and litigation expenses
- Costs of suit
Facts and Antecedent Proceedings
- 27 November 2006: Complaint filed with RTC of Makati City, Branch 146 (Civil Case No. 06-1014)
- Allegation of unpaid demands for payment by NGI and sureties
- 30 November 2006: RTC granted ex parte writ of preliminary attachment
- 4 December 2006: Service of summons and copy of attachment order; levy on Toyota Land Cruiser (plate XRK-783)
- 5 December 2006: Garnishment of respondents’ interests in stocks and other assets in NGI and NPGI
Motion to Dismiss and RTC Order
- 18 December 2006: Sps. Sy, et al. filed a Motion to Dismiss with Manifestation, alleging:
• Defective service of summons on corporations (served on employee Charlotte Magpayo, OIC Property Supply Custodian, not an authorized corporate officer)
• Lack of personal service on spouses and other individual respondents before resorting to substituted service
• Prayer for dismissal of complaint, discharge of attachment writ, and suspension of proceedings due to existing stay order - UCPB opposed, arguing valid service or, at least, substantial compliance, and that respondents submitted to jurisdiction by seeking alternat