Porac Trucking, Inc. v. The Honorable Court of Appeals
REITERATIONFacts
The Antecedents: A complaint for damages was filed by Emerenciana Guevarra against Porac Trucking, Inc. (PORAC TRUCKING) and its driver, Albert Mercado, arising from a collision between Guevarra's mini Isuzu cargo truck and a truck owned by PORAC TRUCKING. Summons was personally served on Albert Mercado, but a certain Hermie Lansangan refused to receive the summons for PORAC TRUCKING, resulting in an unsigned Sheriff's return. Procedural History: The Regional Trial Court (RTC) declared PORAC TRUCKING in default. Subsequently, Atty. Rodolfo Macalin filed a motion for leave to file an answer beyond the reglementary period, which the RTC treated as a voluntary submission to its jurisdiction. The RTC rendered a decision in favor of Guevarra. A motion for execution was filed and granted. PORAC TRUCKING, through its in-house counsel, filed a Petition for Relief from Judgment, which was dismissed. The RTC's decision was affirmed by the Court of Appeals (CA). The Petition: PORAC TRUCKING filed a petition for review, arguing that the summons was improperly served and that the unauthorized appearance of Atty. Macalino did not cure the defect. They also contended that Guevarra had waived her claims by executing an "Affidavit of Desistance" or "Release of Claim" after receiving payment from her insurer, who in turn received payment from PORAC TRUCKING's insurer.
Issue(s)
Whether or not the summons was properly served on the petitioner to confer jurisdiction on the trial court. Whether the unauthorized appearance of Atty. Rodolfo Macalino, counsel for PORAC TRUCKING's insurer, constituted a voluntary submission to the jurisdiction of the court by PORAC TRUCKING. Whether the "Affidavit of Desistance" or "Release of Claim" executed by Guevarra constituted a waiver of her claims against PORAC TRUCKING.
Ruling
The petition is GRANTED. The decision of the respondent Court of Appeals is SET ASIDE. The case is REMANDED to the trial court for proper proceedings.
Ratio Decidendi
On the issue of proper service of summons: The Court held that the service of summons on Hermie Lansangan, who refused to acknowledge receipt and whose capacity to bind the corporation was never established, did not constitute proper service under Section 13 of Rule 14 of the Revised Rules of Court. Lansangan was not an authorized representative of PORAC TRUCKING, and his only connection was as a middleman for specific delivery contracts. The requisites for substantial compliance, such as actual receipt of the summons by the defendant corporation through the person served, were not met in this case. Therefore, the trial court did not acquire jurisdiction over PORAC TRUCKING due to defective service of summons, violating the corporation's right to due process. On the issue of unauthorized appearance: The Court found that Atty. Rodolfo Macalino was the lawyer for Rico General Insurance Corporation, the insurer of PORAC TRUCKING, and not for PORAC TRUCKING itself. His appearance was based on instructions from the manager of Rico General Insurance, who had not informed PORAC TRUCKING of this arrangement. The Court emphasized that the lawyer of an insurance company does not ipso facto become the lawyer for the insured in all subsequent litigations. Consequently, Atty. Macalino's appearance, lacking a client-lawyer relationship with PORAC TRUCKING, did not constitute a voluntary submission to the court's jurisdiction by the petitioner. On the issue of the "Affidavit of Desistance" or "Release of Claim": While the Court did not rule on the merits of the release of claim due to the private respondent's failure to comment, it noted that this document must be presented in evidence and litigated upon by the parties. The Court acknowledged that Guevarra had received P19,579.80 from her insurer, which was paid by PORAC TRUCKING's insurer, with the stated purpose of barring further claims. However, the validity and extent of this waiver were left for determination by the trial court.
Main Doctrine
A corporation's right to due process is violated if summons is not properly served on its authorized representative, and an unauthorized appearance by the insurer's counsel does not confer jurisdiction on the court.