Median Container Corp. v. Metropolitan Bank
REITERATIONFacts
The Antecedents: Respondent Metropolitan Bank and Trust Company (Metrobank) filed a complaint for sum of money against petitioner Median Container Corporation (MCC) and spouses Carlos T. Ley and Fely C. Ley for failure to settle an outstanding loan balance of over P5,000,000. Summonses were issued to MCC at its Quezon City address and to the spouses Ley at their San Juan address. Procedural History: The process server's return indicated that summons was served on MCC on August 7, 2003, by one Danilo Ong, identified as "General Manager." However, MCC claimed Ong was a former employee who resigned in July 2002. Summons was initially not served on the spouses Ley, but was later served via alias summons. MCC filed a motion to dismiss, alleging defective service of summons and defective verification and certificate against non-forum shopping. The spouses Ley also filed a motion to dismiss on similar grounds. The Regional Trial Court (RTC) denied MCC's motion and found the spouses Ley's motion premature. MCC elevated the RTC's denial of its motion to dismiss to the Court of Appeals (CA) via a petition for certiorari, arguing grave abuse of discretion due to defective verification and certification. The CA dismissed MCC's petition, holding that Atty. Mendoza had proper authority when he signed the verification and certification. The CA also passed upon the issue of improper service of summons, finding it a basic jurisdictional issue, and distinguished the case from E.B. Villarosa & Partner Co., Ltd. v. Benito, stating that the process server intended to serve on the correct party. The Petition: MCC filed a Petition for Review on Certiorari with the Supreme Court, raising issues on the dismissal for failure to comply with Rule 7, Section 5 of the Rules of Civil Procedure regarding verification and certification, the validity of service of summons based on the process server's intention versus actual compliance with Rule 14, Section 11, and whether actual receipt or valid service vests the trial court with jurisdiction.
Issue(s)
Whether the trial court should have dismissed the complaint for failure to comply with Rule 7, Section 5 of the 1997 Rules of Civil Procedure regarding the verification and certification against non-forum shopping, as it was allegedly signed by an unauthorized person. Whether the service of summons upon petitioner, a domestic private corporation, was valid under Rule 14, Section 11 of the 1997 Rules of Civil Procedure, considering the process server's intention versus strict compliance. Whether the trial court acquired jurisdiction over the person of the defendant based on actual receipt or valid service of summons in accordance with the rules.
Ruling
The petition is DENIED. Costs against petitioner.
Ratio Decidendi
On the issue of defective verification and certification against non-forum shopping: The Court held that verification is a formal requirement, not jurisdictional, and can be corrected or dispensed with to serve the ends of justice. While failure to comply with the certification against forum shopping is generally cause for dismissal, the Court has relaxed this rule in cases with special circumstances or compelling reasons. In this case, the merits of the petition and the subsequent submission of proof of authority by the signatory were considered mitigating factors. Furthermore, the Court found that the Board Resolution authorizing Atty. Mendoza to sign, though dated after his signing, constituted a ratification of his prior act, curing any defects. On the issue of improper service of summons: The Court affirmed the CA's finding that the service of summons was not improper. While MCC claimed Danilo Ong, who received the summons, was a former employee and not the General Manager, the Court noted the dubious proof of resignation. The process server certified service on the "General Manager" at the correct address, and the person who received it signed for it. The Court distinguished this from E.B. Villarosa & Partner Co., Ltd. v. Benito, emphasizing that the process server's intention to serve on the correct party, coupled with the fact that the summons was received at the correct address by someone who signed for it, and the petitioner's failure to dispute ultimate receipt, rendered the service valid. The Court found that the process server appeared aware of the rules and intended to comply, and the circumstances surrounding the receipt by a former employee were unusual and did not warrant strict application of the rule as interpreted in Villarosa. On the issue of jurisdiction: The Court reiterated that jurisdiction over the person is acquired either by voluntary appearance or by valid service of summons. Based on the findings regarding the validity of the service of summons, the trial court was deemed to have acquired jurisdiction over the person of MCC.
Main Doctrine
The Court reiterated that while the certification against forum shopping is generally mandatory, its relaxation may be justified by special circumstances or compelling reasons, such as the merits of the case or substantial compliance. Furthermore, the Court held that service of summons on a corporation, even if received by a former employee who signed as General Manager, may be considered valid if the process server intended to serve on the correct party, the summons was received at the correct address, and the corporation ultimately received the summons, especially when proof of the employee's resignation is dubious.