Service of summons

Joe Pallugna

SEVERAL legal issues have arisen in the past on how service of summons are effected upon defendant corporations.

This is the case involving a plaintiff bank who sued a corporation and several private persons. The court sheriff served summons upon the corporate secretary  of the corporation who did not sign receipt but instead instructed her administrative assistant to sign receipt of the summons.

The sheriff tried to locate the other individual defendants but could not find them in the building designated as the corporate office address. Thus, the sheriff left copies of the summons at the corporate office or regular place of business and had one summons received and signed by the Supply Custodian of the corporation. The sheriff then deemed it as substituted service. The lawyer of the individual defendants entered his appearance in court to file a motion to dismiss arguing that the court did not acquire jurisdiction over the private individual defendants as summons was not properly served on them.

Will the motion to dismiss be granted?

The Supreme Court, in the recent case of Nena Ang, et al., versus Chinatrust Bank, et al., (G.R. No. 200693, April 18, 2016), clearly outlined the rule: “In civil cases, jurisdiction over a party is acquired either through his voluntary appearance in court or upon a valid service of summons. When a party was not validly served summons and did not voluntarily submit to the court’s jurisdiction, the court cannot validly grant relief against him.

In an action strictly in personam, summons shall be served personally on the defendant whenever practicable. Personal service is made by personally handing a copy of the summons to the defendant or by tendering it to him if he refuses to receive and sign for it.

While personal service is the preferred method of serving summons, the Rules of Court are also mindful that this is sometimes impracticable or even impossible. Thus, Rule 14 also allows the sheriff to resort to substituted service instead:

‘Sec. 7. Substituted Service – If, for justifiable causes, the defendant cannot be served within a reasonable time as provided in the preceding section, service may be effected (a) by leaving copies of the summons at the defendant’s residence with some person of suitable age and discretion then residing therein, or (b) by leaving copies at the defendant’s office or regular place of business with some competent person in charge thereof.’

“If substituted service is made at the defendant’s office or regular place of business, the sheriff must leave a copy of the summons with a ‘competent person in charge thereof’. This refers to the person managing the office or the manger.

“Even assuming that Chinatrust were able to establish the impossibility of personal service, the substituted service through Charlotte Magpayo was invalid. A ‘competent person in charge’ refers to one managing the office or the business, such as the president, manager, or the officer-in-charge. The rule presupposes the existence of a relation of confidence between such person and the defendant.

“Charlotte Magpayo is the Property Custodian at Nation Petroleum. Her position denotes limited liability to office equipment, inventory, and supplies. Chinatrust did not submit any evidence that Magpayo’s job description includes management of National Petroleum’s Makati office. We do not see how she can be considered as the competent person in charge of the defendant’s business or office and the respondents failed to prove otherwise.

“The statutory requirements of substituted service must be followed strictly, faithfully and fully, and any substituted service other than that authorized by statute is considered ineffective.”

The High Tribunal then declared that the substituted service upon the property custodian is not a valid service of summons upon the defendants.

So the next time summons need to be served and substituted service is chosen to be the mode of service, the plaintiff and the sheriff must ensure that strict compliance with the Rules of Court should be observed.

(Joe Pallugna is a lawyer based in Cagayan de Oro. E-mail: ajpallugna@gmail.com)