Talsan Enterprises, Inc. v. Baliwag Transit, Inc.
REITERATIONFacts
1. The Antecedents: On March 4, 1992, a passenger bus owned by Baliwag Transit, Inc., driven by Angeles Ramos, collided with a Kia Ceres Van owned by Francisco P. San Diego and driven by Alfredo Santiago. This incident led to a civil complaint for damages filed by Talsan Enterprises, Inc., Francisco P. San Diego, Victor Ramoga, and Bonifacio Talplacido against Baliwag Transit, Inc. and Angeles Ramos. 2. Procedural History: The Regional Trial Court (RTC) of Makati City declared the respondents in default on September 11, 1992, after summons was served on their cashier, Ms. Baby Cansino, who refused to sign the original summons. The RTC subsequently rendered a decision in favor of the petitioners. The respondents appealed this decision to the Court of Appeals (CA), arguing that the service of summons was improper and that the RTC had not acquired jurisdiction over them. The CA annulled the default order and the judgment, remanding the case to the RTC for further proceedings, finding the service of summons insufficient. 3. The Petition: The petitioners seek a review on certiorari of the CA's decision and resolution. They raise two main issues: (1) whether there was a valid service of summons upon the respondents, and (2) whether the appeal taken by the respondents to the CA, instead of a motion for new trial, was the proper remedy. The petitioners argue that the service of summons on Ms. Cansino was proper under the rules for corporations, and that the CA erred in annulling the default judgment.
Issue(s)
Whether or not there was a valid service of summons upon respondents Angeles Ramos and Baliwag Transit, Inc. Whether or not the appeal taken by the private respondents instead of a motion for new trial is the proper remedy.
Ruling
The Supreme Court ruled that the petition is partly meritorious. The service of summons upon respondent Angeles Ramos was improper, rendering the judgment against him void. However, the service of summons upon respondent Baliwag Transit, Inc. through its cashier, Ms. Baby Cansino, was proper, and thus the trial court validly acquired jurisdiction over the corporation. The appeal taken by the respondents was also deemed proper. The case was remanded to the Regional Trial Court for further proceedings.
Ratio Decidendi
On the issue of valid service of summons upon respondents: The Court held that the service of summons upon respondent Angeles Ramos, the bus driver, was improper. In actions in personam, personal service is required first. Substituted service can only be availed of if personal service is impossible. The sheriff's hasty resort to substituted service without attempting personal service on Ramos violated the rule, thus the trial court did not acquire jurisdiction over his person, rendering the judgment against him nugatory. Regarding respondent Baliwag Transit, Inc., the Court found the service of summons proper. Under Section 13 of Rule 14, service may be made on the corporation's cashier. Ms. Cansino's affidavit claiming she was merely a cash receiving clerk was considered self-serving and could not overcome the prima facie evidence of the Sheriff's Return, which certified her as the cashier. The presumption of regularity in the performance of official duty by the sheriff was not overcome. Even if she were not the cashier, service upon her was still proper as she was an agent of the company authorized to receive court processes, being an officer with vital and sensitive functions. The Court reiterated the rationale that service must be on a representative so integrated with the corporation as to ensure they realize their responsibilities. Furthermore, the actual receipt of summons by Ms. Cansino constituted substantial compliance, as the respondents did not deny actual receipt. Service at the bus terminal in Caloocan City, rather than the main office, was also deemed valid as the rule does not impose such a requirement. On the issue of the propriety of the appeal: The Court affirmed that the appeal taken by the private respondents was proper. A defendant declared in default has several remedies, including appealing the judgment rendered against them as contrary to the evidence or law, even if no motion to set aside the default was presented. Since the respondents filed a motion for reconsideration which was pending when the decision was rendered, they could appeal the judgment pursuant to Section 2(3), Rule 41 of the Rules of Court. A default judgment is considered an adjudication on the merits and is therefore appealable.
Main Doctrine
Service of summons upon a cashier of a corporation is considered proper and vests the court with jurisdiction over the corporation, even if the summons was served at a branch office and not the principal office. However, a judgment against a driver who was not properly served summons is void.