UNIVERSITY OF SANTO TOMAS CIVPROCIAR, JULIE ANNE PRINCESS A 2DASSIGNMENT 5.1 CASE COMPILATION

MICROSOFT CORPORATION VS. BEST DEAL COMPUTER CENTER CORPORATIONMicrosoft Corporation filed a complaint against Best Deal Computer Center Corporation, et. al. It alleged that defendants without authority or license copied, reproduced, distributed, installed and/or loaded software programs owned by Microsoft into computer units sold by them to their customers in violation of its intellectual property rights. It prayed for the issuance of a writ of preliminary injunction to restrain and enjoin defendants from illegally reproducing, selling and distributing unlicensed software programs. It also applied for the issuance of an ex parte order for the seizure and impounding of relevant evidence that can be or may be found at defendants business premises. The RTC of Las Pias denied Microsofts application for an ex-parte order but set petitioners prayer for the issuance of TRO. Microsofts motion for reconsideration was also denied. Microsoft then brought the matter directly to the Supreme Court supposedly because of the importance of the issue involved and that it had no appeal or any plain, speedy and adequate remedy in the ordinary course of law. It also argued that it would be useless to first seek recourse thereat as the party aggrieved by the appellate courts ruling would nonetheless elevate the matter to this Court. By then, Microsoft surmised, the level of intellectual piracy would have worsened. Likewise, petitioner presumes that direct resort to this Court is justified as the petition involves a pure question of law.Issue: 1. WHETHER OR NOT the extraordinary writ of certiorari lie. WHETHER OR NOT Microsoft violated the principle of hierarchy of courts.Held:1st issueNo. The extraordinary writ of certiorari will not lie. For certiorari to lie, it must be shown that the tribunal, board or officer exercising judicial functions acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction, and that there is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law for the purpose of amending or nullifying the proceeding. A special civil action for certiorari will prosper only if grave abuse of discretion is manifested. For an abuse to be grave the power must be exercised in an arbitrary or despotic manner by reason of passion or personal hostility. The abuse of discretion must be so patent and gross as to amount to an evasion of a positive duty, or a virtual refusal to perform the duty enjoined or act in contemplation of law. There is grave abuse of discretion when respondent acts in a capricious or whimsical manner in the exercise of its judgment as to be equivalent to lack of jurisdiction which was never shown by Microsoft in its petition. There being no hint of grave abuse of discretion that can be attributed to the lower court, hence, it could be safely held that the assailed orders were rendered in the proper exercise of its jurisdiction.Significantly, even assuming that the orders were erroneous, such error would merely be deemed as an error of judgment that cannot be remedied by certiorari. As long as the respondent acted with jurisdiction, any error committed by him or it in the exercise thereof will amount to nothing more than an error of judgment which may be reviewed or corrected only by appeal. The distinction is clear: A petition for certiorari seeks to correct errors of jurisdiction while a petition for review seeks to correct errors of judgment committed by the court. Errors of judgment include errors of procedure or mistakes in the courts findings. Certiorari under Rule 65 is a remedy designed for the correction of errors of jurisdiction and not errors of judgment. Microsofts rights can be more appropriately addressed in the appeal.2nd issueYes. Microsofts direct resort to the Supreme Court in the guise of speedy justice was in utter disregard of the hierarchy of courts. The Court said that it found no exceptional or compelling reason not to observe the hierarchy of courts. The Court reiterated its ruling in a catena of cases that the Courts original jurisdiction to issue writs of certiorari is not exclusive. It is shared with Regional Trial Courts and with the Court of Appeals. The concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of courts. A direct invocation of the Supreme Courts original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. It is a policy that is necessary to prevent inordinate demands upon the Courts time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further over-crowding of the Courts docket.

MANOTOC VS CA

Agapita Trajano (Agapita) filed for the recognition and/or enforcement of foreign judgment rendered by the United States District Court of Honolulu, Hawaii, United States of America for wrongful death of deceased Archimedes Trajano committed by military intelligence officials of the Philippines allegedly under the command and direction of Imelda R. Marcos-Manotoc (Imee). Based on the complaint, the trial court issued summons addressed to petitioner at Alexandra Condominium Corporation or Alexa Homes, E-2 Room 104, at No. 29 Meralco Avenue, Pasig City. The summons and a copy of the complaint were allegedly served upon Macky de la Cruz (Macky), an alleged caretaker of Imees condominium unit. However, Macky refused to sign the receipt for the summons. When Imee failed to file her answer, the trial court declared her in default. Imee by special appearance of counsel filed a motion to dismiss on the ground of lack of jurisdiction of the trial court over her person due to invalid service of summons, i.e., the procedure prescribed by the Rules on personal and substituted service of summons was ignored. The RTC rejected the motion to dismiss and the plea for reconsideration. The CA affirmed the ruling of the RTC.

Issue: WHETHER OR NOT there was a valid service of summons.

Held:The Court ruled in the negative. If the substituted service will be done at defendants office or regular place of business, then it should be served on a competent person in charge of the place. Thus, the person on whom the substituted service will be made must be the one managing the office or business of defendant, such as the president or manager; and such individual must have sufficient knowledge to understand the obligation of the defendant in the summons, its importance, and the prejudicial effects arising from inaction on the summons. There is a serious nonconformity from the requirement that the summons must be left with a "person of suitable age and discretion" residing in defendants house or residence. Thus, there are two (2) requirements under the Rules: (1) recipient must be a person of suitable age and discretion; and (2) recipient must reside in the house or residence of defendant. Both requirements were not met. In this case, the Sheriffs Return lacks information as to residence, age, and discretion of Macky, aside from the sheriffs general assertion that Macky is the "resident caretaker" of petitioner as pointed out by a certain Lyn Jacinto, alleged receptionist and telephone operator of Alexandra Homes. It is doubtful if Macky is residing with petitioner Manotoc in the condominium unit considering that a married woman of her stature in society would unlikely hire a male caretaker to reside in her dwelling. With the Imees allegation that Macky is not her employee, servant, or representative, it is necessary to have additional information in the Return of Summons. Besides, Mackys refusal to sign the Receipt for the summons is a strong indication that he did not have the necessary "relation of confidence" with petitioner. The person must have the "relation of confidence" to the defendant, ensuring that the latter would receive or at least be notified of the receipt of the summons. To protect petitioners right to due process by being accorded proper notice of a case against her, the substituted service of summons must be shown to clearly comply with the rules. The sheriff should therefore determine Mackys relationship with the defendant, and whether he comprehends the significance of the receipt of the summons and his duty to immediately deliver it to the defendant or at least notify the defendant of said receipt of summons.Agapita failed to demonstrate that there was strict compliance with the requirements of the Rule. Due to non-compliance with the prerequisites for valid substituted service, the proceedings held before the trial court perforce was annulled.

PANTALEON VS. ASUNCIONPantaleon instituted an action against Asuncion for recovery of a sum of money. Summons was issued but was returned since according to reliable information, Asuncion is residing inB-24 Tala Estate, Caloocan, Rizal. Hence, alias summons was issued. However, such summons was returned unserved since the Sheriff found out that Asuncion was no longer residing in that address and diligent effort served no purpose. Upon Pantaleons motion, the court declared that Asuncion shall be summoned by publication. Having failed to appear, the court declared him in default and rendered a decision against him. It was only 46 days after rendition of the decision that Asuncion learned of the complaint as well as of the adverse decision. Aggrieved, Asuncion filed a petition for relief alleging that he had not been summoned or notified of the hearing; no copy of the summons and publication were sent since he had not received any; and his nonappearance is excusable it being due to the mistake of the authorities.Issue: W the summons was served and thus conferred jurisdiction upon the lower court.Held:The summons was not served. Rue 7, Sec. 21 is applicable but such was not complied.Section 21 is unqualified. It prescribes the proof of service by publication, regardless of whether the defendant is a resident of the Philippines or not. Section 16 must be read in relation to section 21, which complements it. Then, too, there is no reason why copy of the summons and of the order for its publication should be mailed to non-resident defendants, but not to resident defendants.Considering that strict compliance with the terms of the statute is necessary to confer jurisdiction through service by publication the conclusion is inescapable that the lower court had no authority whatsoever to issue the order declaring Asuncion in default and to render decision against Asuncion, and that both are null and void ad initio.It is also constitutionally required that in action strictlyin personam, like the one at bar, personal service of summons, within the forum, is essential to the acquisition of jurisdiction over the person of the defendant, who does not voluntarily submit himself to the authority of the court.

DEL MAR V. PAGCORPAGCOR requested for legal advice from the Secretary of Justice as to whether or not it is authorized by its Charter to operate and manage jai-alai frontons (courts) in the country.The Secretary of Justice opined that the authority of PAGCOR to operate and maintain games of chance or gambling extends to jai-alai which is a form of sport or game played for bets and that the Charter of PAGCOR amounts to a legislative franchise for the purpose.Petitioner Raoul B. Del Mar initially filed a Petition for Prohibition (GR 138298) to prevent PAGCOR from managing and/or operating the jai-alai or Basque pelota games, by itself of in agreement with Belle Corporation, on the ground that the controverted act is patently illegal and devoid of any basis either from the Constitution or PAGCORs own Charter.PAGCOR later entered into an agreement with Belle Jai Alai Corporation, wherein Belle will make available to PAGCOR the required facilities, as well as provide the needed funding for jai-alai operations with no financial outlay from PAGCOR, while PAGCOR handles the actual management and operation of jai-alai.Petitioner Del Mar filed a Supplemental Petition for Certiorari questioning the validity of the agreement on the ground that PAGCOR is without jurisdiction, legislative franchise, authority or power to enter into such Agreement for the opening, establishment, operation, control and management of jai-alai games.Petitioners Federico S. Sandoval II and Michael T. Defensor filed a Petition for Injunction (GR 138982) to enjoin PAGCOR from operating or managing said jai-alai games. In this case, a Petition in Intervention was filed by Juan Miguel Zubiri alleging that the operatin by PAGCOR of jai-alai is illegal because it is not included in the scope of PAGCORs franchise which covers only games of chance.Procedural Issue: Does the Court have jurisdiction to take original cognizance of a petition for injunction because it is not one of those actions specifically mentioned in Sec. 1, Rule 57?Substantive Issue: Does PAGCOR have the authorization to manage or otherwise operate jai-alai games?Ruling on Procedural Issue:YES. It is axiomatic that what determines the nature of an action and hence, the jurisdiction of the court, are the allegations of the pleading and the character of the relief sought.A cursory perusal of the petition in GR 138982 will show that it is actually one for Prohibition.Even assuming arguendo, that it is an action for injunction, this Court has the discretionary power to take cognizance of the petition at bar if compelling reasons, or the nature and importance of the issues raised, warrant the immediate exercise of its jurisdiction.Rules of procedure are but tools designed to facilitate the attainment of justice such that when its rigid applications tends to frustrate rather than promote substantial justice, this Court has the duty to suspend their operation.Ruling on Substantive Issue:NO. A historical study of the creation, growth and development of PAGCOR will really show that it was never given a legislative franchise to operate jai-alai.Section 1 of PD 1067-B provides the nature and term of PAGCORs franchise to maintain gambling casinos (not a franchise to operate jai-alai);Section 2 of the same decree spells out of the scope of the PAGCOR franchise to maintain gambling casinos (not a franchise to operate jai-alai);PD 1399, amending PD 1067-A and PD 1067-B did not have any amendments that changed the nature and scope of the PAGCOR franchise to maintain gambling casinos.EO No. 169, issued by President Corazon Aquino, revoked the franchise of the Philippines Jai-Alai and Amusement Corporation controlled by the Romualdezes to operate jai-alai in Manila. PAGCORs franchise to operate gambling casinos was not revoked; but neither was it given a franchise to operate jai-alai.It is abundantly clear from the aforequoted laws, executive orders and decrees that the legislative practice is that a franchise to operate jai-alai is granted solely for that purpose and the terms and conditions of the grant are unequivocably defined by the grantor. Such express grant and its conditionalities protective of the public interest are evidently wanting in PD 1869, the present Charter of PAGCOR.In fine, PD 1869 does not have the standard marks of a law granting a franchise to operate jai-alai as those found under PD 810 or EO 135. PD 1869 deals with details pertinent alone to the operation of gambling casinos.The short point is that PD 1869 does not have the usual provisions with regards to jai-alai.Legislative franchise to operate jai-alai is imbued with public interest and involves an exercise of police power. The familiar rule is that laws which grant the right to exercise a part of the police power of the state are to be construed strictly and any doubt must be resolved against the grant.A statute which legalizes a gambling activity or business should be strictly construed and every reasonable doubt must be resolved to limit the powers and rights claimed under its authority.In addition, PAGCORs franchise was not granted by a real Congress where the passage of the law requires a more rigorous process; it was enacted in the exercise of the legislative power of President Marcos. It is self-evident that there is a need to be extra cautious in treating this alleged grant of a franchise as a grant by the legislature, as a grant by the representatives of our people, for plainly it is not.

CRUZ VS SECRETARY OF ENVIRONMENT AND NATURAL RESOURCES Petitioners, as taxpayers and citizens brought this suit for prohibition and mandamus assailing the constitutionality of RA 8371, otherwise known as the IPRA Law, together with its implementing rules. The respondents, through the Solicitor General, filed its comment with the view that said law is partly unconstitutional, on the ground that it grants ownership over natural resources to indigenous people and prays that the petition be granted in part.The National Commission on Indigenous People (NCIP), the agency created under the IPRA law defended its constitutionality and pray that the petition be dismissed.A group of intervenors also filed their respective comments defending the constitutionality of the IPRA law. The votes were equally divided 7 to 7 and the necessary majority was not obtained even after the re-deliberation. Accordingly, pursuant to Rule 56, Sec 7 of the Rules of Civil Procedure , the petition is dismissed.Issue: WHETHER OR NOT the petitioners validly invoked the jurisdiction of the Supreme Court. WHETHER OR NOT the petitioners have the standing to file the suit as citizens and taxpayers.Held:(Separate Opinion of Justice Vitug) For 1st issue 1st IssueA cardinal requirement, is that one who invokes the Courts adjudication must have a personal and substantial interest in the dispute;indeed, the developing trend would require alogical nexusbetween the status asserted and the claim sought to be adjudicated in order to ensure that one is the proper and appropriate party to invoke judicial power.The rule requires a party to aptly show a personal stake in the outcome of the case or an injury to himself that can be redressed by a favorable decision so as to warrant his invocation of the Courts jurisdiction and to render legally feasible the exercise of the Courts remedial powers in his behalf. If it were otherwise, the exercise of that power can easily become too unwieldy by its sheer magnitude and scope to a point that may, in no small measure, adversely affect its intended essentiality, stability and consequentiality.Nevertheless, where a most compelling reason exists, such as when the matter is of transcendental importance and paramount interest to the nation,the Court must take the liberal approach that recognizes the legal standing of nontraditional plaintiffs, such as citizens and taxpayers, to raise constitutional issues that affect them.

(Separate Opinion of Justice Kapunan) For 2nd issue 2rd Issue:Petitioners,as citizens,possess the "public right" to ensure that the national patrimony is not alienated and diminished in violation of the Constitution. Since the government, as the guardian of the national patrimony, holds it for the benefit of all Filipinos without distinction as to ethnicity, it follows that a citizen has sufficient interest to maintain a suit to ensure that any grant of concessions covering the national economy and patrimony strictly complies with constitutional requirements. Thus, the preservation of the integrity and inviolability of the national patrimony is a proper subject of a citizens suit.

In addition, petitioners,as taxpayers,possess the right to restrain officials from wasting public funds through the enforcement of an unconstitutional statute.It is well-settled that a taxpayer has the right to enjoin public officials from wasting public funds through the implementation of an unconstitutional statute,49and by necessity, he may assail the validity of a statute appropriating public funds.50The taxpayer has paid his taxes and contributed to the public coffers and, thus, may inquire into the manner by which the proceeds of his taxes are spent. The expenditure by an official of the State for the purpose of administering an invalid law constitutes a misapplication of such funds.

MAGDALENA ESTATE, INC. VS RENE NIETO AND HELEN GARCIA Defendants bought from plaintiff a parcel of land (New Manila Subdivision, QC). By a special arrangement with the plaintiff, respondents were able to transfer the title to their names without paying the full amount. Defendants maid partial payments and the balance (12,000) was secured by a promissory note. The respondents agreed to pay plaintiff the balance in monthly installments in not less than 500 per month.

The defendants paid only 100 in 2 installments. Plaintiff, thru its counsel, sent a letter of demand which was received by the defendants. Despite receipt of letter, defendants did not comply and even failed to make a reply.

There was an ex-parte reception of evidence because the defendants had been declared in default, plaintiff having complied with the court's order allowing service of summons and copy of the complaint upon the defendants-appellants through publication of the same in a newspaper of general circulation (Daily Mirror), pursuant to Section 16, Rule 14 of the Rules of Court.

Plaintiff claims that summons could not be served personally upon the defendants because they concealed themselves to avoid service upon them; and, that when the sheriff went to the Jai-Alai Corporation of the Philippines at Cebu City where defendant-appellant Rene Nieto holds office, as manager, he could not be found thereat but, when the decision was served at the same address, the defendants were able to receive it.

Issue: WHETHER OR NOT the lower court erred in allowing service of summons by publication. YesHeld:It is true that in Fontanilla vs. Dominguez, it was held that service of summons by publication is proper in all actions without distinction, provided the defendant is residing in the Philippines but his Identity is unknown or his address cannot be ascertained. However, in a later case, Pantaleon vs. Asuncion, the Court, ruled that "it is a well-settled principle of Constitutional Law that, in an action strictly in personam, like the one at bar,personalservice of summons,withinthe forum, is essential to the acquisition of jurisdiction divert the person of the defendant, who does not voluntarily submit himself to the authority of the court.In other words, summons by publication cannot consistently with the due process clause in the Bill of Rightsconfer upon the court jurisdiction over said defendant." And, quoting A C.J.S., as follows: "Due process of law requires personal service to support a personal judgment, and, when the proceeding is strictly in personam brought to determine the personal rights and obligations of the parties, personal service within the state or a voluntary appearance in the case is essential to the acquisition of jurisdiction so as to constitute compliance with the constitutional requirement of due process. ... Although a state legislature has more control over the form of service on its own residents than non-residents, it has been held that in actions in personam ... service by publication on resident defendants, who are personally within the state and can be found therein is not "due process of law", and a statute allowing it is unconstitutional."In the case of Citizens'Surety and Insurance Company, Inc. vs. Melencio-Herrera: ... the Court could not validly acquire jurisdiction on a non-appearing defendant, absent apersonalservice of summons withinthe forum... The proper recourse for a creditor in the same situation as petitioner is to locate properties, real or personal, of the resident defendant debtor with unknown address and cause them to be attached under Rule 57, Section 1 (f), in which case, the attachment converts the action into a proceeding in rem orquasi in remand the summons by publication may then accordingly be deemed valid and effective."

CONSOLIDATED PLYWOOD INDUSTRIES, INC. (CPII) VS HON. AUGUSTO BREVA AND MINDANAO HEMP EXPORT CORPORATION (MHEC)CPII and MHEC are registered co-owners of a parcel of land measuring 5, 263 sq. m., with a warehouse and office building standing thereon. It was CPII who occupied the property, using the warehouse to store its products and the nearby building to quarter its personnel. It also employed guards to secure the premises. In 1984, it made repairs and improvements on the property which, together with the guard fees, allegedly amounted to P239,837.21. CPII sought to recover from MHEC one half of the aforementioned amount as co-owner of the same property. When extrajudicial demands produced no results, it filed suit for collection against MHEC in the RTC.Summons was issued to MHEC whose address was stated in the complaint to be at 413 Jaboneros St., Binondo, Manila. The same went unserved because MHEC was no longer doing business at said address and nobody around the place knew the present whereabouts of said defendant. The service of summons having already been attempted and failed, CPII moved for, and the RTC ordered, service of summons by publication which was effected in the newspaper, Philippine Daily Inquirer, on May 15 and June 1, 1987. No answer being filed within the 60 period after last publication prescribed in the alias summons, MHEC was declared in default and CPII thereafter presented its evidence ex parte. The RTC dismissed the complaint for lack of merit. Thus, CPII sought immediate recourse to the SC.

ISSUE: Whether or not the service of summons by publication was sufficient to enable the court to acquire jurisdiction over the person of the defendantHeld: No While from the foregoing it may appear that resolution of the appeal is a simple and straightforward matter of applying law and precedent to the facts established by the evidence, such a result is precluded by the circumstance that due to a failure to effect proper service of summons on MHEC, the Trial Court never acquired jurisdiction over the person of said defendant and therefore could not lawfully render valid judgment thereon.Petitioner's suit is for the collection of a sum of money, hence, a personal action, as distinguished from a real action. It is, too, an action strictly in personam, as to which, in a line of cases starting with Pantaleon vs. Asuncion, the Court has laid down and consistently hewed to the rule that xxx personal service of summons within the forum, is essential to the acquisition of jurisdiction over the person of the defendant, who does not voluntarily submit himself to the authority of the court. In other words, summons by publication cannot consistently with the due process clause in the Bill of Rights confer upon the Court jurisdiction over said defendant," and that "xxx (t)he proper recourse for a creditor in the same situation as petitioner is to locate properties, real or personal, of the resident defendant debtor with unknown address and cause them to be attached under Rule 57, section 1(f) in which case, the attachment converts the action into a proceeding in rem or quasi in rem and the summons by publication may then accordingly be deemed valid and effective.Accordingly, service of summons by publication here not having been preceded by attachment of property of MHEC, it did not confer on the Trial Court jurisdiction over the person of said defendant, and it is on this score that petitioner's action must be, as it is hereby, DISMISSED.

ASIAVEST LIMITED VS CA AND ANTONIO HERAS Asiavest filed a complaint against Heras to enforce a Hong Kong Court Judgment which ordered the latter to pay the following amounts: a) USD1,810,265.40 or its equivalent in Hong Kong currency; b) interest on the sum of USD 1,500 at 9.875% per annum; c) HK$905 at fixed cost in the action and; d) at least USD80,000 representing attorneys fees, litigation expenses and cost, with interest thereon from the date of the judgment until fully paid. Heras moved for dismissal of the complaint on the ground that the Hong Kong Judgment was void for lack of jurisdiction for want of notice. The RTC rendered judgment in favor of Asiavest. It held that the Hong Kong court judgment should be recognized and given effect in this jurisdiction for failure of HERAS to overcome the legal presumption in favor of the foreign judgment. On appeal, the CA reversed the trial court. It held that under Hong Kong law, the substituted service of summons upon Heras effected in the Philippines would be valid if it was done in accordance with Philippine laws, and since the summons was not personally served on Heras, the same was rendered void for an action in personam requires personal service in order to be valid. Thus, Asiavest sought relief from the SC.ISSUEs: a) Whether or not the Hong Kong Judgment can be validly enforced in this jurisdiction b) Whether or not the Hong Kong Supreme Court validly acquired jurisdiction over Heras (this involves the issue on whether the service of summons on Heras was defective under Philippine law)Held: 1st issueYes. At the outset it is important to note that a foreign judgment is presumed to be valid and binding in the country from which it comes, until the contrary is shown. Considering that both Asiavest and Heras admitted to the existence and authenticity of the judgment, the same confirmed the validity and enforceability of the judgment in this jurisdiction. However, the judgment may be repelled by evidence of want of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of law or fact. In this case, the judgment is being assailed for having been rendered without validly acquiring jurisdiction over the person of Heras.It is settled that matters of remedy and procedure such as those relating to the service of process upon the defendant are governed by the lex fori or the law of the forum, in this case, the law of Hong Kong. However, there being no proof on the existence of a specific Hong Kong law pertaining to service of summons either in actions in rem or in personam, the presumption of identity or similarity or the so-called processual presumption shall come into play. It will thus be presumed that the Hong Kong law on the matter is similar to the Philippine law. In view of this, issue on jurisdiction shall now be discussed.2nd issueNo. Since the judgment sought to be enforced is a money judgment, the action is deemed in personam which is an action against a person on the basis of his personal liability. In an action in personam, jurisdiction over the person of the defendant is necessary for the court to validly try and decide the case. Jurisdiction over the person of a resident defendant who does not voluntarily appear in court can be acquired by personal service of summons as provided under Section 7, Rule 14 of the Rules of Court. If he cannot be personally served with summons within a reasonable time, substituted service may be made in accordance with Section 8 of said Rule. If he is temporarily out of the country, any of the following modes of service may be resorted to: (1) substituted service set forth in Section 8; (2) personal service outside the country, with leave of court; (3) service by publication, also with leave of court; or (4) any other manner the court may deem sufficient.However, in an action in personam wherein the defendant is a non-resident who does not voluntarily submit himself to the authority of the court, personal service of summons within the state is essential to the acquisition of jurisdiction over her person. This method of service is possible if such defendant is physically present in the country. If he is not found therein, the court cannot acquire jurisdiction over his person and therefore cannot validly try and decide the case against him.In the case at bar, the action filed in Hong Kong against HERAS was in personam, since it was based on his personal guarantee of the obligation of the principal debtor.Accordingly, since HERAS was not a resident of Hong Kong and the action against him was, indisputably, one in personam, summons should have been personally served on him in Hong Kong. The extraterritorial service in the Philippines was therefore invalid and did not confer on the Hong Kong court jurisdiction over his person. It follows that the Hong Kong court judgment cannot be given force and effect here in the Philippines for having been rendered without jurisdiction.

LUZON DEVELOPMENT BANK V. ASSOCIATION OF LUZON DEVELOPMENT BANK EMPLOYEES

LDB and ALDBE had a dispute whether or not LDB has violated their CBA and MOA on promotion.They agreed to submit their dispute on voluntary arbitration. Atty. Garcia, as voluntary arbitrator, received the position papers of ALDBE but LDB failed to submit its position papers.Without LDBs position papers, Atty. Garcia rendered a decision holding that LDB violated their CBA and MOA on promotion.Issue: WHETHER OR NOT a petition for certiorari before the Supreme Court is the proper remedy for the decision of the voluntary arbitrator.

Held: The jurisdiction conferred by law on a voluntary arbitrator or a panel of such arbitrators is quite limited compared to the original jurisdiction of the labor arbiter and the appellate jurisdiction of the NLRC for that matter.RA 6715 provides that "the award or decision of the Voluntary Arbitrator shall be final and executory after 10 calendar days from receipt of the copy of the award or decision by the parties,while the "decision, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within 10 calendar days from receipt of such decisions, awards, or orders.Hence, while there is an express mode of appeal from the decision of a labor arbiter, RA 6715 is silent with respect to an appeal from the decision of a voluntary arbitrator.A voluntary arbitrator or the panel of voluntary arbitrators may not strictly be considered as a quasi-judicial agency, board or commission; still both he and the panel are comprehended within the concept of a "quasi-judicial instrumentality."The word "instrumentality," with respect to a state, contemplates an authority to which the state delegates governmental power for the performance of a state function.The voluntary arbitrator no less performs a state function pursuant to a governmental power delegated to him under the provisions therefore in the Labor Code and he falls, therefore, within the contemplation of the term "instrumentality" in the Sec. 9 of B.P. 129.Thus, the decision or award of the voluntary arbitrator or panel of arbitrators should likewise be appealable to the Court of Appeals just like those of the quasi-judicial agencies, boards and commissions.Republic Act No. 876, also known as the Arbitration Law, arbitration is deemed a special proceeding of which the court specified in the contract or submission, or if none be specified, the Regional Trial Court for the province or city in which one of the parties resides or is doing business, or in which the arbitration is held, shall have jurisdiction. A party to the controversy may, at any time within one (1) month after an award is made, apply to the court having jurisdiction for an order confirming the award and the court must grant such order unless the award is vacated, modified or corrected.In effect, the award or decision of the voluntary arbitrator with that of the regional trial court. Consequently, in a petition forcertiorarifrom that award or decision, the Court of Appeals must be deemed to have concurrent jurisdiction with the Supreme Court.Wherefore, the Court resolved to REFER this case to the Court of Appeals.

MARGARITA ROMUALDEZ-LICAROSVS ABELARDO B. LICAROS

Abelardo Licaros and Margarita Romualdez-Licaros were lawfully married on December 15, 1968.Out of this marital union were born Maria Concepcion and Abelardo, Jr.Ironically, marital differences, squabbles and irreconcilable conflicts transpired between the spouses, such that sometime in 1979, they agreed to separate from bed and board. In 1982, Margarita left for the United States and there, to settle down with her two (2) children.Abelardo commenced Civil Case No. 91-1757, for the declaration of nullity of his marriage with Margarita, based on psychological incapacity under the New Family Code.As Margarita was then residing at 96 Mulberry Lane, Atherton, California, U.S.A., Abelardo initially moved that summons be served through the International Express Courier Service.The courta quodenied the motion.Instead, it ordered that summons be served by publication in a newspaper of general circulation once a week for three (3) consecutive weeks, at the same time furnishing respondent a copy of the order, as well as the corresponding summons and a copy of the petition at the given address in the United States through the Department of Foreign Affairs, all at the expense of Abelardo.Respondent was given sixty (60) days after publication to file a responsive pleading. On November 8, 1991, the Decisionwas handeddown in Civil Case No.91-1757 declaring the marriage between Abelardo and Margarita null and void.Almost nine (9) years later, on April 28, 2000, the petition at bench was commenced when Margarita received a letter dated November 18, 1991 from a certain Atty. Angelo Q. Valencia informing her that she no longer has the right to use the family nameLicarosinasmuch as her marriage to Abelardo had already been judicially dissolved by the Regional Trial Court of Makati on November 8, 1991. Petitioner filed an instant petition regarding the validity of the declaration of nullity of marriage based on the absence of a summon that should be served upon her. CA rejected the petition.ISSUE: WHETHER OR NOT Margarita was validly served with summons in the case for declaration of nullity of her marriage with AbelardoHELD: Yes, Margarita was validly served with summons.Margarita insists that the trial court never acquired jurisdiction over her person in the petition for declaration of nullity of marriage since she was never validly served with summons. Neither did she appear in court to submit voluntarily to its jurisdiction.On the other hand, Abelardo argues that jurisdiction over the person of a non-resident defendant in an actionin remorquasi in remis not necessary.The trial and appellate courts made a clear factual finding that there was proper summons by publication effected through the Department of Foreign Affairs as directed by the trial court.Thus, the trial court acquired jurisdiction to render the decision declaring the marriage a nullity.Summons is a writ by which the defendant is notified of the action brought against him.Service of such writ is the means by which the court acquires jurisdiction over his person.As a rule, when the defendant does not reside and is not found in the Philippines, Philippine courts cannot try any case against him because of the impossibility of acquiring jurisdiction over his person unless he voluntarily appears in court.But when the case is one of actionsin remorquasi in remenumerated in Section 15, Rule 14 of the Rules of Court, Philippine courtshave jurisdictiontohear and decide the case.In such instances, Philippine courts have jurisdiction over theres,and jurisdiction over the person of the non-resident defendant is not essential. Actionsin personamand actionsin remorquasi in remdiffer in that actionsin personamare directed against specific persons and seek personal judgments.On the other hand, actionsin remorquasi in remare directed against the thing or property or status of a person and seek judgments with respect thereto as against the whole world. At the time Abelardo filed the petition for nullity of the marriage in 1991, Margarita was residing in the United States.She left the Philippines in 1982 together with her two children.The trial court considered Margarita a non-resident defendant who is not found in the Philippines.Since the petition affects the personal status of the plaintiff, the trial court authorized extraterritorial service of summons under Section 15, Rule 14 of the Rules of Court.The term personal status includes family relations, particularly the relations between husband and wife. Under Section 15 of Rule 14, a defendant who is a non-resident and is not found in the country may be served with summons by extraterritorial service in four instances: (1)when the action affects the personal status of theplaintiff; (2) when the action relates to, or the subject of which is property within the Philippines, in which the defendant has or claims a lien or interest, actual or contingent; (3) when the relief demanded consists, wholly or in part, in excluding the defendant from any interest in property located in the Philippines; or (4) when the property of the defendant has been attached within the Philippines.In these instances, extraterritorial service of summons may be effected underanyof three modes: (1) by personal service out of the country, with leave of court; (2) by publication and sending a copy of the summons and order of the court by registered mail to the defendants last known address, also with leave of court; or (3)by any other means the judge may consider sufficient.Applying the foregoing rule, the trial court required extraterritorial service of summons to be effected on Margarita in the following manner: x x x, service of Summons by way of publication in a newspaper of general circulation once a week for three (3) consecutive weeks,at the same time, furnishing respondent copy of this Order as well as the corresponding Summons and copy of the petition at her given address at No. 96 Mulberry Lane, Atherton, California, U.S.A.,thru the Department of Foreign Affairs, all at the expense of petitioner. (Emphasis ours)The trial courts prescribed mode of extraterritorial service does not fall under the first or second mode specified in Section 15 of Rule 14, but under the third mode.This refers to any other means that the judge may consider sufficient.

The Process Servers Return of 15 July 1991 shows that the summons addressed to Margarita together with the complaint and its annexes were sent by mail to the Department of Foreign Affairs with acknowledgment of receipt.The Process Servers certificate of service of summons isprima facieevidence of the facts as set out in the certificate.Before proceeding to declare the marriage between Margarita and Abelardo null and void, the trial court stated in its Decision dated 8 November 1991 thatcompliance with the jurisdictional requirements hav(e)(sic)been duly established.We hold that delivery to the Department of Foreign Affairs was sufficient compliance with the rule.After all, this is exactly what the trial court required and considered as sufficient to effect service of summons under the third mode of extraterritorial service pursuant to Section 15 of Rule 14.

WHEREFORE, the Decision of the Court of Appeals in CA-G.R. SP No. 58487 dismissing the petition to annul judgment is AFFIRMED.

ANITA C. BUCE VS CA, SPS. BERNARDO C. TIONGCO AND ARACELI TIONGCO, SPS. DIONISIO TIONGCO AND LUCILA TIONGCO, AND JOSE M. TIONGCO

Buce leased a 56-square meter parcel of land in Manila. The lease contract was for a period of fifteen years, "subject to renewal for another ten (10) years, under the same terms and conditions." Petitioner then constructed a building and paid the required monthly rental of P200. Private respondents, through their administrator Jose Tiongco, later demanded a gradual increase in the rental until it reached P400 in 1985. For July and August 1991, petitioner paid private respondents P1,000 as monthly rental.On 6 December 1991, private respondents counsel wrote petitioner informing her of the increase in the rent pursuant to the provisions of the Rent Control Law.Petitioner, however, did not pay the increased amount. Respondents refused to accept such insufficient payment.On 9 August 1993, petitioner filed with the Regional Trial Court of Manila a complaint for specific performance with prayer for consignation. She prayed that private respondents be ordered to accept the rentals in accordance with the lease contract and to respect the lease of fifteen years, which was renewable for another ten years, at the rate of P200 a month.In their Answer, Under Republic Act No. 877, as amended, rental payments should already be P1,576.58 per month; hence, they were justified in refusing the checks for P400 that petitioner tendered. Moreover, the phrase in the lease contract authorizing renewal for another ten years does not mean automatic renewal; rather, it contemplates a mutual agreement between the parties.During the pendency of the controversy, counsel for private respondents wrote petitioner reminding her that the contract expired on 1 June 1994.RTC declared the lease contract automatically renewed for ten years and considered as evidence thereof (a) the stipulations in the contract giving the lessee the right to construct buildings and improvements and (b) the filing by petitioner of the complaint almost one year before the expiration of the initial term of fifteen years.On appeal, the Court of Appeals reversed the decision of the RTC, and ordered petitioner to immediately vacate the leased premises on the ground that the contract expired on 1 June 1994 without being renewed and to pay the rental arrearages at the rate of P1,000 monthly.The Court of Appeals denied petitioners motion for reconsideration. Hence this petition.Petitioner contends that by ordering her to vacate the premises, the Appellate Court went beyond the bounds of its authority because the case she filed before the RTC was for "Specific Performance" not unlawful detainer. The power to order the lessee to vacate the leased premises is lodged in another forum. Additionally, private respondents did not pray for the ejectment of petitioners from the leased premises in their Answer with Counterclaim; well-settled is the rule that a court cannot award relief not prayed for in the complaint or compulsory counterclaim.

ISSUE: WHETHER OR NOT the Court of Appeals erred in ordering the petitioner to vacate the premises which is a relief not prayed for in the complaint or compulsory counterclaim.

HELD: YES, the Court of Appeals went beyond the bounds of its authority, when after interpreting the questioned provision of the lease contract in favor of the private respondents it proceeded to order petitioner to vacate the subject premises.After the lease terminated on 1 June 1994 without any agreement for renewal being reached, petitioner became subject to ejectment from the premises. It must be noted, however, that private respondents did not include in their Answer with Counterclaim a prayer for the restoration of possession of the leased premises. Neither did they file with the proper Metropolitan Trial Court an unlawful detainer suit against petitioner after the expiration of the lease contact. Moreover, the issues agreed upon by the parties to be resolved during the pre-trial were the correct interpretation of the contract and the validity of private respondents refusal to accept petitioners payment of P400 as monthly rental.They later limited the issue to the first, i.e., the correct interpretation of the contract. The issue of possession of the leased premises was not among the issues agreed upon by the parties or threshed out before the court a quo. Neither was it raised by private respondents on appeal.Petition granted.

MERCADER VS DBP

The Maderazos and the Mercaders rented the property of Manreals and cultivated the same. The subject lot was mortgaged to DBP without the knowledge of the Mercaders. Manreals defaulted, thus DBP foreclosed the property together with its improvements.The Mercaders thereafter prayed that the DBP respect the improvements they introduced therein and exclude them from the foreclosure. During the pre trial stage, the possibility of a compromise was made. DBP provided options for the Mercaders in purchasing the property. The Mercaders choose the lease purchase option. During the negotiations however, the DBP rejected the extension request of the Mercaders. In short, the compromise was not successful causing the termination of the pre trial stage. The Mercaders thereafter filed a supplemental pleading alleging the validity and the enforcement of the lease purchase option. The trial court ruled in favor of the Mercaders and ordered the DBP to respect the lease contract between the Mercaders and Manreals. On appeal, the CA ruled out the issue on lease purchase option because it was not alleged in the original pleading.Issue: WHETHER OR NOT the Court of Appeals erred in disregarding as material the lease-purchase option on the ground that it was not raised in the pleadings.Held: Yes The CA adverts to the lack of reference to the lease-purchase option in the initiatory pleadings, this can be simply explained by the fact that the trial court only took cognizance thereof when it became an integral component of the pre-trial proceedings. That is why the lease-purchase option was included firstly, in the pre-trial order as one of the issues to be resolved at trial and secondly, in the supplemental pleading subsequently filed by the MERCADERs. As a supplemental pleading, it served to aver supervening facts which were then not ripe for judicial relief when the original pleading was filed. As such, it was meant to supply deficiencies in aid of the original pleading, and not to dispense with the latter. Hence, it was patently erroneous for the Court of Appeals to pronounce that the lease-purchase option was not raised in the pleadings. The DBP was even quite aware and knowledgeable of the supplemental pleading because it filed an opposition thereto.

YUIJUICO V. QUIAMBAO

STRADEC held its annual stockholders meeting in its Pasig City. At the said meeting, the following were elected members of the Board of Directors: Alderito Z. Yujuico, Bonifacio C. Sumbilla, Dolney S. Sumbilla (petitioners herein), Cesar T. Quiambao, Jose M. Magno III and Ma. Christina Ferreros (respondents herein). Petitioners Alderito Yujuico was elected Chairman and President, while Bonifacio Sumbilla was elected Treasurer.Respondents filed with the Regional Trial Court (RTC), San Carlos City, Pangasinan a Complaint against STRADEC. The complaint prays that: (1) the March 1, 2004 election be nullified on the ground of improper venue, pursuant to Section 51 of the Corporation Code; (2) all ensuing transactions conducted by the elected directors be likewise nullified; and (3) a special stockholders meeting be held anew. Subsequently, respondents filed an Amended Complaint dated September 2, 2004 further praying for the issuance of a temporary restraining order (TRO) and/or writ of preliminary injunction to enjoin petitioners from discharging their functions as directors and officers of STRADEC.They filed a Supplemental Complaint praying that the court (1) direct Export Industry Bank, Cezar T. Quiambao and Bonifacio G. Sumbilla to surrender to them the original and reconstituted Stock and Transfer Book and other corporate documents of STRADEC; and (2) nullify the reconstituted Stock and Transfer Book and all transactions of the corporation. Both pleadings were admitted by the trial court.Petitioners filed their Answer with Counterclaim in Civil (SEC) Case No. U-14. They prayed for the dismissal of the complaint on the following grounds, among others: (a) the complaint does not state a cause of action; (b) the action is barred by prescription for it was filed beyond the 15-day prescriptive period provided by Section 2, Rule 6 of the Interim Rules and Procedure Governing Intra-Corporate Controversies under Republic Act (R.A.) No. 8799; (c) respondents prayer that a special stockholders meeting be held in Bayambang, Pangasinan "is premature pending the establishment of a principal office of STRADEC in said municipality;" and (d) respondents waived their right to object to the venue as they attended and participated in the said March 1, 2004 meeting and election without any protestRTC granting respondents application for preliminary injunction and the turn-over by petitioner Bonifacio Sumbilla to the court of the duplicate key of the safety deposit box in Export Industry Bank, Shaw Boulevard, Pasig City where the original Stock and Transfer Book of STRADEC was deposited.Petitioners raise the following issues:Only the SEC, not the RTC, has jurisdiction to order the holding of a special stockholders meeting involving an intra-corporate controversy; Judge Meliton Emuslan had no authority to issue the assailed Order dated November 25, 2004 as Judge Aurelio Ralar, Jr. was already the presiding judge of RTC, Branch 48, Urdaneta City; and Assuming Judge Emuslan had authority to issue the assailed Order; he nonetheless acted with grave abuse of discretion amounting to lack or excess of jurisdiction.

CA rendered the decision dismissing the Petition for Certiorari. It upheld the jurisdiction of the RTC over the controversy and sustained the validity of Judge Emuslans Order of November 25, 2004. Petitioners motion for reconsideration was denied in a Resolution dated June 29, 2005

Issue: WHETHER OR NOT CA erred in ruling that the RTC has the power to call a special stockholders meeting involving an intra-corporate controversy.

Held: SC said, we agree with respondents. First, the appellate court correctly ruled that the power to hear and decide controversies involving intra-corporate disputes, as well as to act on matters incidental and necessary thereto, have been transferred from the SEC to the RTCs designated as Special Commercial Courts. It would be the height of absurdity, they argue, to require the filing of a separate case with the SEC for the sole purpose of asking the said agency to order the holding of a special stockholders meeting where there is already a pending case involving the same matter before the proper court.Upon the enactment of R.A. No. 8799, otherwise known as "The Securities Regulation Code" which took effect on August 8, 2000, the jurisdiction of the SEC over intra-corporate controversies and other cases enumerated in Section 5 of P.D. No. 902-A has been transferred to the courts of general jurisdiction, or the appropriate RTC.Second, Respondents never refuted petitioners assertion. The Court of Appeals, for its part, dismissed petitioners allegation by merely ruling that "this is the first time they are raising this issue which is much too late in the day. In any event, one cannot question the authority of the court when it does not suit him and accepts such authority when it favors him. The ruling suggests that petitioners are barred by laches and/or estoppel from raising that issue. The appellate court likewise denied petitioners motion to set the case for oral arguments.CA should have resolved the issue of whether Judge Emuslan had the authority to issue the assailed Order, a jurisdictional question crucial to the resolution of the petition. It is elementary that a jurisdictional controversy may be raised at any time.THIRD, petitioners further contend that even if Judge Emuslan had the authority to issue the challenged Order, still he issued it with grave abuse of discretion amounting to lack or excess of jurisdiction. They lament that the Order effectively disposed of the merits of the main case [Civil (SEC) Case No. U-14].Unfortunately, despite the significance of this issue, the Court of Appeals totally ignored it by failing to render a ruling thereon. Respondents, for their part, merely aver that Judge Emuslan "only had the best interest of STRADEC in mind" when he issued the questioned Order.We find for petitioners. In Section 1, Rule 1 of the Interim Rules of Procedure Governing Intra-Corporate Controversies under R.A. No. 8799, among the intra-corporate controversies transferred to the special courts are:(3) Controversies in the election or appointment of directors, trustees, officers, or managers of corporation, partnerships or associations;Undoubtedly, therefore, the instant case is an intra-corporate controversy among the stockholders themselves relative to the election of directors or officers of STRADEC, specifically between respondents on one hand and petitioners, on the other. If there is still any doubt that the Special Corporate Court can call for a stockholders meeting, Rule 6 (citing Sections 1 and 2) of the Interim Rules completely puts to rest said issue.Clearly, therefore, said Rule empowers the special corporate courts to decide election cases.As pointed out by petitioners in their answer with counterclaim, under Section 3, Rule 6 of the Interim Rules of Procedure Governing Intra-Corporate Controversies under R.A. No. 8799, an election contest must be "filed within 15 days from the date of the election." It was only on August 16, 2004 that respondents instituted an action questioning the validity of the March 1, 2004 stockholders election, clearly beyond the 15-day prescriptive period. In sum, Judge Emuslan, in granting the writ of preliminary injunction, acted with grave abuse of discretion amounting to lack or excess of jurisdiction.

GOCHAN VS YOUNGFelix Gochan and Sons Realty Corporation was registered with the SEC with Felix Gochan, Sr., et al. as its incorporators.Felix Gochan Sr.'s daughter, Alice, mother of herein respondents, inherited 50 shares of stock in Gochan Realty from the former. Alice died leaving the 50 shares to her husband, John Young, Sr. The Regional Trial Court adjudicated 6/14 of these shares to Alice's children, herein respondents Richard Young, et al. Having earned dividends, these stocks numbered 179.Gochan Realty refused John Sr.'s request to partition the shares of his late wife and issuing new stock certificates in the names of Richard, et al., citing as reason, the right of first refusal granted to the remaining stockholders by the Articles of Incorporation.John, Sr. died, leaving the shares to the Richard, et al.Cecilia Gochan Uy and Miguel Uy filed a complaint with the SEC for issuance of shares of stock to the rightful owners, nullification of shares of stock, reconveyance of property impressed with trust, accounting, removal of officers and directors and damages against respondents. ISSUES:Whether or not the Spouses Uy could properly bring a derivative suit in the name of Gochan Realty to redress wrongs allegedly committed against it for which the directors refused to sueWhether or not the intestate estate of John D. Young Sr. is an indispensable party in the SEC case considering that the individual heirs' shares are still in the decedent stockholder's nameHELD: The case should be remanded to the proper RTC, not to the SEC.Derivative Suit and the Spouses UyAs early as 1911, this Court has recognized the right of a single stockholder to file derivative suits. In its words:"Where corporate directors have committed a breach of trust either by their frauds, ultra vires acts, or negligence, and the corporation is unable or unwilling to institute suit to remedy the wrong, a single stockholder may institute that suit, suing on behalf of himself and other stockholders and for the benefit of the corporation, to bring about a redress of the wrong done directly to the corporation and indirectly to the stockholders."The personal injury suffered by the spouses cannot disqualify them from filing a derivative suit on behalf of the corporation. It merely gives rise to an additional cause of action for damages against the erring directors. This cause of action is also included in the Complaint filed before the SEC.The Spouses Uy have the capacity to file a derivative suit in behalf of and for the benefit of the corporation. The reason is that, as earlier discussed, the allegations of the Complaint make them out as stockholders at the time the questioned transaction occurred, as well as at the time the action was filed and during the pendency of the action.Capacity of the Intestate Estate of JohnD.Young Sr.Based on Section 3 of Rule 3 of the Rules of Court and Section 2 of Rule 87 of the same Rules, whilepermittingan executor or administrator to represent or to bring suits on behalf of the deceased, do notprohibitthe heirs from representing the deceased. These rules are easily applicable to cases in which an administrator has already been appointed. But no rule categorically addresses the situation in which special proceedings for the settlement of an estate have already been instituted, yet no administrator has been appointed. In such instances, the heirs cannot be expected to wait for the appointment of an administrator; then wait further to see if the administrator appointed would care enough to file a suit to protect the rights and the interests of the deceased; and in the meantime do nothing while the rights and the properties of the decedent are violated or dissipated.The Rules are to be interpreted liberally in order to promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding.They cannot be interpreted in such a way as to unnecessarily put undue hardships on litigants. For the protection of the interests of the decedent, this Court has in previous instancesrecognized the heirs as proper representatives of the decedent, even when there is already an administrator appointed by the court. When no administrator has been appointed, as in this case, there is all the more reason to recognize the heirs as the proper representatives of the deceased. Since the Rules do not specifically prohibit them from representing the deceased, and since no administrator had as yet been appointed at the time of the institution of the Complaint with the SEC, this Court seesnothing wrong with the fact that it was the heirs of John D. Young Sr. who represented his estate in the case filed before the SEC.

FORTUNATO GOMEZ AND AURORA GOMEZ VSCOURT OF APPEALS, ADOLFO TROCINO AND MARIANO TROCINO

The defendants, through their counsel Atty. Expedito P. Bugarin, filed their Answer. Defendant Caridad A. Trocino, respondents mother, verified said pleading.After trial on the merits, the RTC rendered its decision on March 1993, with the following disposition.Judgment is hereby rendered in favor of the plaintiffs and against the defendants.The latter are hereby ordered to jointly and severally execute a Deed of Sale in favor of the plaintiffs and to deliver the owners duplicate copies of TCT Nos. 10616 and 31856, covering the properties sold, to the plaintiffs within ten (10) days from the finality of the judgment, after which plaintiffs shall pay in turn to the defendants the balance of P2,000,000.00. Otherwise, the sale is rescinded and revoked and the defendants are directed to return to the plaintiffs the amount of P500,000.00, with interest of 12% per annum computed from December 6, 1989, until the full amount is paid.In addition thereto, defendants are to pay jointly and severally to the plaintiffs, the amount of P50,000.00 as moral damages; P20,000.00 as exemplary damages; P40,000.00 by way of attorneys fees; and P10,000.00 as litigation expenses.Due to the defendants failure to deliver the owners duplicate of TCT Nos. 10616 and 31856, the RTC issued an order on August 29, 1995 declaring said titles null and void, and ordering the Register of Deeds of Cebu City to issue new titles in the name of herein petitioners.CA issued the assailed Decision granting the petition and annulling the decision of the RTC-Cebu (Branch 10). The decretal portion of the decision reads:The decision of the Regional Trial Court of Cebu City, Branch 10, in Civil Case No. CEB-11103 as well as all Orders issued to implement the same are hereby ANNULLED AND SET ASIDE. The Register of Deeds of Cebu City is hereby ENJOINED from cancelling Transfer Certificates of Title Nos. 10616 and 31856. No pronouncement as to costs.ISSUES:Whether or not the court of appeals erred in declaring the need for personal and/or extraterritorial service of summons, despite the nature of the cause of action being one in rem.HELD:Summons is a writ by which the defendant is notified of the action brought against him. Service of such writ is the means by which the court acquires jurisdiction over his person. Any judgment without such service in the absence of a valid waiver is null and void.In actions in personam, summons on the defendant must be served by handing a copy thereof to the defendant in person, or, if he refuses to receive it, by tendering it to him. This is specifically provided in Section 7, Rule 14 of the Rules of Court,which states:SEC. 7. Personal service of summons.-- The summons shall be served by handing a copy thereof to the defendant in person or, if he refuses to receive it, by tendering it to him.In the present case, petitioners cause of action in Civil Case No. CEB-11103 is anchored on the claim that the spouses Jesus and Caridad Trocino reneged on their obligation to convey ownership of the two parcels of land subject of their sale. Thus, petitioners pray in their complaint that the spouses Trocino be ordered to execute the appropriate deed of sale and that the titles be delivered to them (petitioners); or in the alternative, that the sale be revoked and rescinded; and spouses Trocino ordered to return to petitioners their down payment in the amount of P500,000.00 plus interests. The action instituted by petitioners affect the parties alone, not the whole world. Hence, it is an action in personam, i.e., any judgment therein is binding only upon the parties properly impleaded.It must be pointed out that while it was the spouses Jesus and Caridad Trocino who sold the properties to petitioners, their right to proceed against Jesus Trocino when he died was passed on to his heirs, which includes respondents and Caridad Trocino. Such transmission of right occurred by operation of law, more particularly by succession, which is a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance of a person are transmitted.When the process server personally served the summons on Caridad Trocino, the trial court validly acquired jurisdiction over her person alone. Hence, the trial courts decision is valid and binding with regard to her, but only in proportion to Caridad Trocinos share. As aptly stated by the Court of Appeals:This Courts decision is therefore applicable to all the defendant heirs with the exception of defendant Caridad Trocino considering that it was the latter who entered into the alleged sale without the consent of her husband. She is therefore estopped from questioning her own authority to enter into the questioned sale. Moreover, Caridad Trocino was validly served with summons and was accorded due process.The petition for review is DENIED. The decision of the Court of Appeals is AFFIRMED.

BANCO DE BRASIL VS CACesar Urbino, Sr. sued Poro Point Shipping Services for damages the former incurred when one of the latters ship ran aground causing losses to Urbino. Urbino impleaded Banco Do Brasil (BDB), a foreign corporation not engaged in business in the Philippines nor does it have any office here or any agent. BDB was impleaded simply because it has a claim over the sunken ship. BDB however failed to appear multiple times. Eventually, a judgment was rendered and BDB was adjudged to pay $300,000.00 in damages in favor of Urbino for BDB being a nuisance defendant.BDB assailed the said decision as it argued that there was no valid service of summons because the summons was issued to the ambassador of Brazil. Further, the other summons which were made through publication is not applicable to BDB as it alleged that theactionagainst them isin personam.

ISSUE: WHETHER OR NOT the court acquired jurisdiction over Banco Do Brasil and whether or not the summons were properly issued.HELD: The Supreme Court ruled in favor of the petitioner. Although the suit is originally in rem as it was BDBs claim on the sunken ship which was used as the basis for it being impleaded, theactionnevertheless became an in personam one when Urbino asked for damages in the said amount. As such, only a personal service of summons would have vested the court jurisdiction over BDB.The Supreme Court also ruled said that the summons was not properly issued. When the defendant is a non-resident and he is not found in the country, summons may be served extraterritorially in accordance with Rule 14, Section 17 (now section 15) of the Rules of Court. Under this provision, there are only four (4) instances when extraterritorial service of summons is proper, namely: when the action affects the personal status of the plaintiffs; when the action relates to, or the subject of which is property, within the Philippines, in which the defendant claims a lien or interest, actual or contingent; when the relief demanded in such action consists, wholly or in part, in excluding the defendant from any interest in property located in the Philippines; andWhen the defendant non-residents property has been attached within the Philippines." In these instances, service of summons may be effected by (a) personal service out of the country, with leave of court; (b) publication, also with leave of court; or (c) any other manner the court may deem sufficient. Extrajudicial services of summons apply only where the action is in rem. However, where the action is in personam, jurisdiction over the person of the defendant is necessary for the court to validly try and decide the case. When the defendant is a non-resident, personal service of summons within the state is essential to the acquisition of jurisdiction over the person. This cannot be done, however, if the defendant is not physically present in the country, and thus, the court cannot acquire jurisdiction over his person and therefore cannot validly try and decide the case against him. In the present case, the relief demanded went beyond the res by making a claim for damages, thus, converting the respondents action into an action in personam. Bearing in mind the in personam nature of the action, personal or, if not possible, substituted service of summons on petitioner, and not extraterritorial service, is necessary to confer jurisdiction over the person of petitioner and validly hold it liable to private respondent for damages.

PROGRESSIVE DEVELOPMENT CORPORATION VS COURT OF APPEALS

Petitioner leased to private respondent Westin Seafood Market, Inc., a parcel of land with a commercial building thereon located at Araneta Center, Cubao for a period of 9 years and 3 months with a monthly rental of approximatelyP600,000.00.Private respondent failed to pay rentals despite several demands by petitioner.The arrearages amounted toP8,608,284.66.Admittedly, non-payment of rentals constituted breach of their contract; thus, pursuant to the express authority granted petitioner under Secs. 25 and 26 of the lease agreement, petitioner repossessed the leased premises, inventoried the movable properties found within and owned by private respondent and scheduled public auction for the sale of the movables with notice to private respondent.Private respondent filed with the MeTC of Quezon City a complaint against petitioner for forcible entry with damages and a prayer for a temporary restraining order and/or writ of preliminaryinjunction. The court issued a TRO enjoining petitioner from selling private respondents properties at a public auction.Thereafter the parties agreed, among others, on the following:(a) private respondent would deposit with the Philippine Commercial and Industrial Bank in the name of theMeTC the amount ofP8,000,000.00 to guarantee the payment of its back rentals; (b) petitioner would defer the sale of the personal properties of the Westin Seafood Market, Inc., until a final settlement of the case had been arrived at; (c) petitioner shall allow private respondent to retrieve all the perishable goods from inside the leased premises like frozen meat, vegetables and fish, all properly receipted for; (d) petitioner shall allow three (3) maintenance personnel of private respondent to enter the premises at reasonable working hours to maintain the restaurant equipment; and (e) the parties shall negotiate for the restoration of the premises to private respondent, and if no settlement be arrived at on or before January 8, 1993, the hearing on the merits of the case shall proceed and the disposition of the amount deposited representing the rental arrearages shall be left to the discretion of the court.Private respondent did not comply with its undertaking to deposit with the designated bank the amount representing its back rentals.Instead, with the forcible entry case still pending with the MeTC, private respondent instituted another action for damages against petitioner with the RTC of Quezon City.Petitioner filed a motion to dismiss the damage suit on the ground oflitis pendenciaand forum shopping.The RTC issued an order archiving the case pending the outcome of the forcible entry case being heard at the MeTC for the reason that"the damages is principally anchored on whether or not the defendants (petitioner herein) have committed forcible entry." Petitioner moved for reconsideration of the order and reiterated its motion to dismiss the suit for damages.The court issued an order (a) denying petitioner's motion to dismiss, (b) admitting private respondent's amended complaint, and (c) granting private respondent's application for a temporary restraining order against petitioner.Thus, petitioner filed with the CA a special civil action for certiorari on the ground that the MeTC committed grave abuse of discretion inadmitting the amended complaint of private respondent and issuing a restraining order against petitioner; in allowing private respondent to engage in forum shopping; and, taking cognizance of the action for damages despite lack of jurisdiction.CA dismissed the petition due to the failure of petitioner to file a MR of MeTC's order of which, it explained, was a prerequisite to the institution of a petition forcertiorariand prohibition. Hence this petition for review oncertiorari.Issues: WHETHER OR NOT CA erred in(a) finding that petitioner failed to avail of its plain, speedy and adequate remedy of a prior MR with the RTC;(b)ruling that the trial judge did not act with grave abuse of discretion in taking cognizance of the action for damages and injunction despite the pendency of the forcible entry case with the MeTC; and, (c) ruling that private respondent did not commit forum shopping since the causes of action before the RTC and MeTC were not identical with each other.Held: While generally a MR must first be filed before resorting tocertiorariin order to give the lower court an opportunity to correct the errors imputed to itthis rule admits of exceptions.The filing of the MR before availing of the remedy ofcertiorariis notsinequanonwhen the issue raised is one purely of law,orwherethe error is patent or the disputed order is void,or the questions raised oncertiorariare the same as those already squarely presented to and passed upon by the lower court.We now turn to the issue of whether an action for damages filed with the RTC by the lessee against the lessor should be dismissed on the ground of pendency of another action for forcible entry and damages earlier filed by the same lessee against the same lessor before the MeTC.Section 1 of Rule 70 of the Rules of Court provides that any person deprived of the possession of any land or building by force, indimidation, threat, strategy or stealth, or against whom the possession of any land or building is unlawfully withheld, may bring an action in the proper Municipal Trial Court against the person or persons unlawfully withholding or depriving of possession,together with damages and costs.Otherwise expressed, no claim for damages arising out of forcible entry or unlawful detainer may be filed separately and independently of the claim for restoration of possession.It is likewise basic under Sec. 3 of Rule 2 of the Revised Rules of Court, as amended, that a party may not institute more than one suit for a single cause of action.Under Sec. 4 of the same Rule, if two or moresuits are instituted on the basis of the same cause of action, the filing of one or a judgment uponthe merits in any one is available as a ground for the dismissal of the other or others.Since actual andcompensatorydamages were already prayedforinthe forcible entry case before the MeTC, it is obvious that this cannot be relitigated in thedamage suit before the RTC byreason ofres adjudicata.A claim cannot be divided in such a way that a part of the amount of damages may be recovered in one case and the rest, in another.What then is the effect of the dismissal of the other action?Since the rule is that all such rights should be alleged in a single complaint, it goes without sayingthatthosenottherein included cannot be the subject of subsequent complaints for they are barred forever.The records ineluctably show that the complaint lodged by private respondent with the RTC of Quezon City contained no certification of non-forum shopping.When petitioner filed a motion to dismiss the case raising among others the ground of forum shopping it pointed out the absence of the required certification.Theamended complaint, as well as the second and third amended complaints, attempted to rectify the error by invariably stating that there was no other action pending between the parties involving the same causes of action although there was actually a forcible entry case pending before the MTC of Quezon City.By its admission of a pending forcible entry case, it is obvious that private respondent was indulging in forum shopping. This is a compelling reason to dismiss the second case.

ROGELIO MARISCAL VS CA AND BELLA C. CATALAN

Private respondent Bella Catalan filed a complaint against petitioner Rogelio Mariscal before the RTC of Iloilo for the annulment of their marriage on the ground that it was voidab initiofor having been solemnized without a valid marriage license and being bigamous. The case was docketed as Civil Case No. 20983. Previously, Catalan also filed criminal complaints against Mariscal for bigamy and perjury before the Iloilo courts.2 days later, Rogelio filed his own complaint against Bella before the RTC of Digos seeking likewise the annulment of the same marriage on the ground that he was forced to marry her at gunpoint and that they had no valid license. In view of Civil Case No. 20983 which she earlier instituted in the RTC of Iloilo, Bella moved for the dismissal of Civil Case No. 2996 invokinglitis pendencia, citing Civil Case No. 20983 pending before the RTC of Iloilo which involved the same parties and the same cause of action. RTC of Digos denied the MTD as well as the subsequent MR.On appeal, the RTC of Digos was reversed by the CA in its assailed decision thus ---Both actions filed separately in the two courts by petitioner (respondent Bella herein) and respondent Mariscal (Rogelio herein) are for the annulment of marriage contracted by them. Common to the complaints filed in both cases is the ground that no license to contract marriage was obtained by both parties. That the marriage contracted by respondent Rogeliol was bigamous because he had contracted a previous marriage with another woman is another ground alleged by petitioner in her complaint. Certainly the judgment to be rendered in the action first instituted, regardless of which party is successful, will amount tores judicataagainst the second action . .Petitioner's added claim of $32k against respondent Rogelio, her complaint cannot militate against the fact that the causes of action and reliefs in both cases are identical.WHEREFORE, the orders complained of . . are annulled and set aside. Accordingly, respondent Rogelio's complaint in Civil Case No. 2996 is DISMISSED on the ground oflitis pendencia. . . .His MR having been rejected,petitioner Rogelio is now before us submitting that the CA erred in ordering the dismissal of Civil Case No. 2996 notwithstanding that the judgment that may be rendered in either case will not constituteres judicataon the other; for, on the possibility that the RTC of Iloilo dismisses the complaint for annulment, the RTC of Digos can still void the marriage by ruling that Rogelio's consent to the marriage with Bella was vitiated by force, duress, intimidation and threats.ISSUE: WHETHER OR NOT the complaint filed by Rogelio should be dismissed on the ground of litis pendencia.HELD: Negative. The petition is devoid of merit. It is not infrequent that this Court is given the opportunity to discusslitis pendenciaas ground for the dismissal of an action which has become unnecessary and vexatious. InVictronics Computers, Inc. v. RTC-Br. 63, Makati,we said It is a rule that forlitis pendenciato be invoked as ground for the abatement or dismissal of an action, the concurrence of the following requisites is necessary: (a) identity of parties, or at least such as representing the same interest in both actions; (b) identity of rights asserted and relief prayed for, the relief being founded on the same facts; and, (c) the identity in the 2 cases should be such that the judgment that may be rendered in the pending case would, regardless of which party is successful, amount tores judicatain the other.x first 2 requisites are present. The parties involved in Civil Case No. 20983 (RTC-Iloilo) are the very same protagonists in Civil Case No. 2996 (RTC-Digos). The actions in both fora are based on the same set of facts that gave rise to the uniformity of the principal reliefs sought, more particularly, the ultimate dissolution of their marriage.The third requisite is the bone of contention. Rogelio contends that there can be nores judicatabetween the 2 simultaneous civil actions because of the different grounds for the nullification of their marriage. According to him, the judgment in one case will not abate the second because the basis for annulment in the former would not have even been traversed or passed upon in the latter. Petitioner Rogelio does not convince. Inlitis pendenciawhat is essential is the identity and similarity of the issues under consideration. In his effort to have the case resolved in a different venue, petitioner has resorted to nit-picking and in the process has lost track of the real issue besetting the 2 actions which is simply the nullification of a marriage. Interestingly, in his answer submitted in Civil Case No. 20983 (RTC-Iloilo), he prayed WHEREFORE . . . . it is prayed . . . that the above-entitled case be dismissed; and/or, in the alternative, that the alleged marriage contracts be declared void from the beginning for having been performed illegally and under force, violence, intimidation, threats and strategy . . . .By including such prayer in his answer,Rogelio has raised the issue of "force, violence, intimidation, threats and strategy" before the RTC-Iloilo, the very same set forth in the RTC-Digos. Hence, he cannot now deny that the issues as well as arguments raised before the 2 trial courts are identical. Any decision or ruling promulgated in Civil Case No. 20983 by the RTC of Iloilo will necessarily constituteres judicataon Civil Case No. 2996 pending before the RTC of Digos andvice-versa.In addition to specific denials, affirmative and special defenses wherein he questioned the jurisdiction of the RTC of Iloilo over the nature of the action and that there was pending between the same parties for the same cause Civil Case No. 2996 in the RTC of Digos, he also presented a compulsory counterclaim in his answer. Therein he alleged that by reason of the complaint filed by Bella in gross and evident bad faith, malice and harassment, he suffered anxiety, wounded feelings, besmirched reputation, mental torture and sleepless nights thus entitling him to moral damages of P1M exemplary damages of P500K as well as attorney's fees of 35% of the amount of damages and value of the property or money involved but in no case less than P500K plus initial litigation costs of P30K.A counterclaim partakes of the nature of a complaint and/or a cause of action against the plaintiff in a case. To interpose a cause of action in a counterclaim and again invoke it in a complaint against the same person or party would be splitting a cause of action not sanctioned by the Rules.Indeed the Court is puzzled no end why he literally shied away from the RTC of Iloilo where he could have just as well ventilated his affirmative and special defenses and litigated his compulsory counterclaim in that court and thus avoided this duplicity of suits which is the matrix upon whichlitis pendenciais laid.A supervening development further dramatizes the puerile, if not needless, efforts of Rogelio to derail the action pending before the RTC of Iloilo. In her Rejoinder, Bella informed the Court that the RTC of Iloilo rendered judgment in Civil Case No. 20983 nullifying her marriage to Rogelio on the ground that it was bigamous. Bella was awarded P100k as moral damages, P50k as exemplary damages and P50k as attorney's fees. Her claim for reimbursement of US$32k was however rejected as the evidence presented in support thereof was considered hearsay.With this turn of events, any subsequent ruling by the RTC of Digos (were it allowed to proceed) which deviates from the ruling of the RTC of Iloilo, a co-equal and coordinate court, could only lead to absurd, if not chaotic, consequences. Indeed, this case underscores the importance ofres judicataor bar by prior judgment as a stabilizing factor in our judicial system. It forecloses not only matters squarely raised and litigated but all such matters which could have been raised in the litigation but were not.WHEREFORE, the petition is DENIED. The assailed decision of the CA ordering the dismissal of Civil Case No. 2996 pending before the RTC Digos, Davao del Sur, as well as the resolution denying petitioner Rogelios MR, is AFFIRMED.

RUDOLF LIETZ HOLDINGS, INC., VS. THE REGISTRY OF DEEDS OF PARAAQUE CITY,Petitioner corporation was formerly known as Rudolf Lietz, Incorporated. On July 15, 1996, it amended its Articles of Incorporation to change its name to Rudolf Lietz Holdings, Inc. As a consequence of its change of name, petitioner sought the amendment of the transfer certificates of title over real properties owned by the said corporation, all of which were under the old name, Rudolf Lietz, Incorporated. For this purpose, petitioner instituted, on November 20, 1997, a petition for amendment of titles with the Regional Trial Court of Paraaque City,The petition impleaded as respondent the Registry of Deeds of Pasay City, apparently because the titles sought to be amended, all state that they were issued by the Registry of Deeds of Pasay City. Petitioner likewise inadvertently alleged in the body of the petition that the lands covered by the subject titles are located in Pasay City. Subsequently, petitioner learned that the subject titles are in the custody of the Register of Deeds of Paraaque City. Hence, petitioner filed an Ex-Parte Motion to Admit AmendedPetition impleading instead as respondent the Registry of Deeds of Paraaque City, and alleged that its lands are located in Paraaque City.In the meantime, however, the court a quo had dismissed the petition motu proprio on the ground of improper venue, it appearing therein that the respondent is the Registry of Deeds of Pasay City and the properties are located in Pasay City. Petitioner filed with the lower court a Motion for Reconsideration but was denied. On the other hand, in view of the dismissal of the petition, the lower court also denied the Ex-Parte Motion to Admit Amended Petition.The Solicitor General filed his Comment contending that the trial court did not acquire jurisdiction over the res because it appeared from the original petition that the lands are situated in Pasay City; hence,outside the jurisdiction of the Paraaque court. Since it had no jurisdiction over the case, it could not have acted on the motion to admit amended petition.

ISSUE: WHETHER OR NOT the trial court motu proprio dismiss a complaint on the ground of improper venue? HELD: While the ground invoked by the trial court in dismissing the petition below was clearly that of improper venue, the Solicitor General confuses venue with jurisdiction. A distinction between the two must be drawn. Jurisdiction over the subject matter or nature of an action is conferred only by law. It may not be conferred by consent or waiver upon a court which otherwise would have no jurisdiction over the subject matter of an action. On the other hand, the venue of an action as fixed by statute may be changed by the consent of the parties, and an objection on improper venue may be waived by the failure of the defendant to raise it at the proper time. In such an event, the court may still render a valid judgment. Rules as to jurisdiction can never be left to the consent or agreement of the parties. Venue is procedural, not jurisdictional, and hence may be waived.