Ang v. Chinatrust
REITERATIONFacts
The Antecedents: Respondent Chinatrust (Philippines) Banking Corporation filed a money claim with an application for a writ of preliminary attachment against Nation Petroleum Corporation and several individuals, including the petitioners, for US $458,614.84. The complaint was lodged with the Regional Trial Court (RTC) of Makati City. Summonses were issued for both the corporation and the individual defendants, with addresses provided for their office at RCBC Plaza, Makati City. The RTC subsequently granted the application for a writ of attachment. Procedural History: Summonses were purportedly served on October 30, 2006. The Officer's Return indicated that service was made on Ricky Ang personally, and substituted service was effected on Ms. Charlotte Magpayo, an administrative assistant, for the other defendants, including Nation Petroleum Corporation. The defendants entered a Special Appearance and filed a Motion to Dismiss, arguing lack of jurisdiction due to invalid service of summons. The RTC denied this motion. The defendants then filed a petition for certiorari with the Court of Appeals (CA), which affirmed the RTC's order but dismissed the suit against Nation Petroleum Corporation. The petitioners, the individual defendants, then filed the present petition for review on certiorari with the Supreme Court. The Petition: The petitioners argue that the Officer's Return failed to establish the impossibility of personal service, that Charlotte Magpayo was not a competent person in charge of their business, and that the failure to comply with the strict requirements of substituted service renders the service of summons void. The respondent, The Asian Debt Fund, Ltd. (ADF), countered that the impossibility of personal service and diligent efforts are factual matters, and that circumstances supported the impossibility of service and Magpayo's competence. ADF also maintained that Ricky Ang was personally served summons. The Supreme Court found the petition partly meritorious, ruling that personal service was not sufficiently established as impossible and that a property custodian is not a competent person in charge for substituted service, thus dismissing the case against most petitioners for lack of jurisdiction, but upholding the service on Ricky Ang.
Issue(s)
Whether the RTC acquired jurisdiction over the persons of the petitioners Mario Ang, Nena C. Ang, Renato C. Ang, Pauline Ang, Guillermo Sy, Alison Ang-Sy, Nelson C. Ang, and Melinda C. Ang due to alleged invalid substituted service of summons. Whether Ricky C. Ang was validly served summons.
Ruling
The Supreme Court partly granted the petition. It modified the Court of Appeals' decision by dismissing the complaint against Mario Ang, Nena C. Ang, Renato C. Ang, Pauline Ang, Guillermo Sy, Alison Ang-Sy, Nelson C. Ang, and Melinda C. Ang for lack of jurisdiction over their persons, without prejudice to its refiling. The Court affirmed the lower courts' ruling that Ricky C. Ang was validly served summons and directed the RTC to proceed with the case against him.
Ratio Decidendi
On the issue of jurisdiction over Mario Ang, Nena C. Ang, Renato C. Ang, Pauline Ang, Guillermo Sy, Alison Ang-Sy, Nelson Ang, and Melinda Ang: The Court ruled that the RTC failed to acquire jurisdiction over these petitioners due to the invalid substituted service of summons. The Officer's Return did not establish the impossibility of prompt personal service, as it only showed two attempts on the same date at the defendants' office and no attempts at their homes. The claim of "diligent efforts" to locate the defendants outside their office was a general statement lacking specific details. Furthermore, Charlotte Magpayo, a Property Custodian, was not a "competent person in charge" of the defendants' business or office, as her role was limited to office equipment, inventory, and supplies, and there was no evidence she managed the office. The Court emphasized that substituted service is in derogation of the usual method and requires strict compliance with its statutory requirements, which were not met in this case. On the issue of service of summons on Ricky C. Ang: The Court sustained the lower courts' conclusion that Ricky C. Ang was personally served summons. The Officer's Return indicated that Ricky Ang personally received a copy of the summons and complaint, even though he refused to sign the original copy. This refusal, coupled with the tender of the documents, constitutes valid personal service under Rule 14, Section 6 of the Rules of Court. The Court stressed that while personal service is preferred, tendering the summons to a defendant who refuses to receive and sign for it is sufficient.
Main Doctrine
Substituted service of summons requires strict compliance with statutory requirements, including establishing the impossibility of prompt personal service and serving the summons upon a competent person in charge of the defendant's office or regular place of business. Failure to comply with these requirements renders the service of summons void, and the court fails to acquire jurisdiction over the person of the defendant.