Villa Rey Transit, Inc. v. Far East Motor Corporation
REITERATIONFacts
1. The Antecedents: Respondent Far East Motor Corporation initiated a lawsuit against petitioner Villa Rey Transit, Inc., seeking various sums of money. The core of the dispute appears to stem from transactions involving promissory notes signed by petitioner's Assistant General Manager for Operations, Atty. Virgilio A. Reyes, in his former capacity as President. 2. Procedural History: The case began in the Court of First Instance of Manila, where respondent filed suit. After the sheriff's return indicated service on Atty. Reyes, who allegedly refused to sign, the petitioner was declared in default. Despite a subsequent motion to extend time to answer being denied, and a default judgment being rendered, the petitioner filed a motion to quash service of summons, lift the default order, and set aside the judgment. This motion was initially denied, but later reconsidered and granted by the trial court, which quashed the summons and set aside the judgment. Respondent's motion for reconsideration of this order was denied. The respondent then filed a petition for certiorari, mandamus, and prohibition with the Supreme Court, which was certified to the Court of Appeals. The Court of Appeals sustained the respondent's petition, ordering the lower court to issue a writ of execution on the default judgment. 3. The Petition: The present petition for certiorari seeks to overturn the Court of Appeals' decision. The central argument revolves around the validity of the service of summons on Atty. Virgilio A. Reyes, petitioner's Assistant General Manager for Operations, at a sub-station. Petitioner contends this service was improper and that the court therefore lacked jurisdiction. The petition also touches upon the timeliness of appeals and the nature of motions filed, particularly a motion for reconsideration which the appellate court deemed pro forma and thus not suspending the appeal period.
Issue(s)
Whether the service of summons upon Atty. Virgilio A. Reyes, Assistant General Manager for Operations, constituted valid service of process on petitioner corporation. Whether the lower court correctly declared petitioner in default and rendered judgment ex-parte. Whether petitioner's subsequent motions suspended the reglementary period to appeal. Whether the judgment by default had become final and executory.
Ruling
The decision of the Court of Appeals is affirmed. Execution shall issue on the lower court's judgment by default.
Ratio Decidendi
On the validity of service of summons: The Court held that service of summons upon Atty. Virgilio A. Reyes, Assistant General Manager for Operations, was valid. Section 13, Rule 14 of the Revised Rules of Court enumerates officers on whom service may be made, including the manager or agent. The Court found that as Assistant General Manager for Operations, Atty. Reyes was not a lesser officer but was in charge of the main bulk of the petitioner's business, making him sufficiently integrated with the corporation to ensure he would realize his responsibilities. Furthermore, the Court noted that petitioner itself admitted Atty. Reyes customarily received summons at the same sub-station, contradicting its claim that he was not a proper person to receive it. The refusal to sign the return, coupled with the suggestion to serve the President, did not invalidate the service, as tender of the summons was sufficient to confer jurisdiction. On the order of default and ex-parte judgment: The Court found the order of default proper, as petitioner failed to file an answer within the reglementary period, even after its motion for extension was denied. Consequently, the subsequent hearing on the merits ex-parte and the resulting judgment by default were also deemed proper. On the suspension of the appeal period: The Court ruled that petitioner's Motion to Quash Service of Summons, Lift Order of Default, and Set Aside Judgment, filed on November 6, 1968, suspended the appeal period. However, the subsequent Motion for Reconsideration dated December 5, 1968, was considered pro forma because it did not present new arguments against the merits of the ex-parte judgment. Therefore, this latter motion did not suspend the running of the remaining appeal period. On the finality of the judgment: The Court determined that the 30-day appeal period commenced on October 25, 1968 (receipt of the decision). The filing of the motion on November 6, 1968, suspended this period. Upon receipt of the denial of this motion on November 21, 1968, the remaining 18 days of the appeal period began to run. The appeal period expired on December 9, 1968. Since no appeal was filed by that date, the judgment became final and executory. Consequently, the lower court lost jurisdiction to hear the motion for reconsideration filed on December 5, 1968.
Main Doctrine
Service of summons upon an Assistant General Manager for Operations of a corporation, who is also a former President and General Manager, is valid service of process as such officer is integrated with the corporation's business and can be expected to realize responsibilities and act accordingly. A motion for reconsideration that raises no new arguments against the merits of an ex-parte judgment is pro forma and does not suspend the running of the period to appeal.