PARAMOUNT INSURANCE CORP., G.R. No. 175109
Petitioner,
Present:
Ynares-Santiago, J. (Chairperson),
- versus - Austria-Martinez,
Chico-Nazario,
Nachura, and
Reyes, JJ.
A.C. ORDOÑEZ CORPORATION
and FRANKLIN SUSPINE, Promulgated:
Respondents.
x
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YNARES-SANTIAGO, J.:
This petition for review on certiorari seeks to annul and
set aside the July 17, 2006 Decision[1]
of the Court of Appeals in CA-G.R. SP No. 93073, which reversed and set aside
the September 21, 2005 Decision of the Regional Trial Court of Makati City,
Branch 58[2]
and reinstated the August 25, 2000 and September 26, 2000 Orders of the Metropolitan
Trial Court of Makati City, Branch 66,[3]
which admitted respondent’s Answer and set the case for pre-trial, as well as
its October 12, 2006 Resolution[4]
denying the Motion for Reconsideration.
Petitioner Paramount Insurance
Corp. is the subrogee of Maximo Mata, the registered owner of a Honda City sedan
involved in a vehicular accident with a truck mixer owned by respondent corporation
and driven by respondent Franklin A. Suspine on
On
On May 19, 2000, petitioner filed a Motion to Declare
Defendants in Default; however, on June 28, 2000, respondent corporation filed
an Omnibus Motion (And Opposition to Plaintiff’s Motion to Declare Defendant in
Default) alleging that summons was improperly served upon it because it was
made to a secretarial staff who was unfamiliar with court processes; and that
the summons was received by Mr. Armando C. Ordoñez, President and General
Manager of respondent corporation only on June 24, 2000. Respondent corporation asked for an extension
of 15 days within which to file an Answer.
Pending resolution of its first motion to declare
respondents in default, petitioner filed on
On
On
When this case was called for the hearing of Motion, the
Court’s attention was brought to the Answer filed by the defendant.
WHEREFORE, in order to afford the defendants a day in
Court, defendant’s answer is admitted and the pre-trial is set for
SO ORDERED.
Petitioner moved for
reconsideration but it was denied. Thus,
it filed a petition for certiorari and mandamus with prayer for preliminary injunction
and temporary restraining order before the
On
WHEREFORE, premises considered, the petition for certiorari
and mandamus is hereby GRANTED. The Orders of public respondent dated
The case is hereby remanded to the court a quo to act on
petitioner’s (plaintiff’s) “Second motion to declare defendants in Default”
dated
SO ORDERED.
Respondent corporation moved
for reconsideration but it was denied; hence, it appealed to the Court of
Appeals which rendered the assailed Decision dated
By and large, We find no abuse of discretion committed by
the first level court in the contested orders.
IN VIEW OF ALL THE FOREGOING, the instant appeal is hereby GRANTED, the challenged RTC
Decision dated
SO ORDERED.
Petitioner’s motion for
reconsideration was denied. Hence, the
instant petition raising the following issues:
I.
WHETHER
THERE WAS VALID SERVICE OF SUMMONS ON DEFENDANT AC ORDONEZ CONSTRUCTION
CORPORATION.
II.
WHETHER
A PARTY WITHOUT CORPORATE EXISTENCE MAY FILE AN APPEAL.
III.
WHETHER
THIS COURT ERRED IN NOT CALLING THE PARTIES INTO MEDIATION.
IV.
WHETHER
THERE WAS FRAUD COMMITTED BY THE PETITIONER IN ITS PLEADINGS.
The petition lacks merit.
Section 11, Rule 14 of the Rules of Court provides:
SEC. 11. Service
upon domestic private juridical entity. – When the defendant is a corporation,
partnership or association organized under the laws of the Philippines with a
juridical personality, service may be made on the president, managing partner,
general manager, corporate secretary, treasurer, or in-house counsel.
Section 11, Rule 14 sets
out an exclusive enumeration of the officers who can receive summons on behalf
of a corporation. Service of summons to
someone other than the corporation’s president, managing partner, general
manager, corporate secretary, treasurer, and in-house counsel, is not valid.
The designation of
persons or officers who are authorized to receive summons for a domestic
corporation or partnership is limited and more clearly specified in the new
rule. The phrase ‘agent, or any of its
directors’ has been conspicuously deleted.[8] Moreover, the argument of substantial
compliance is no longer compelling. We
have ruled that the new rule, as opposed to Section 13, Rule 14 of the 1964
Rules of Court, is restricted, limited and exclusive, following the rule in
statutory construction that expressio
unios est exclusio alterius. Had the
Rules of Court Revision Committee intended to liberalize the rule on service of
summons, it could have done so in clear and concise language. Absent a manifest intent to liberalize the rule,
strict compliance with Section 11, Rule 14 of the 1997 Rules of Civil Procedure
is required.[9]
Thus, the service of
summons to respondent corporation’s Receiving Section through Samuel D.
Marcoleta is defective and not binding to said corporation.
Moreover, petitioner was served
with a copy of the Sheriff’s Return which states:
3. MANNER OF
SERVICE: DULY SERVED thru SAMUEL D.
MARCOLETA (receiving section-A.C. Ordonez Construction Corp.,) and who was
authorized by A. C. Ordonez Construction Corp., management to receive such
court processes.
On its face, the return shows
that the summons was received by an employee who is not among the responsible
officers enumerated by law. Such being
invalid, petitioner should have sought the issuance and proper service of new
summons instead of moving for a declaration of default.
Consequently, the motions for declaration of default filed
on
Thus, there was no grave abuse of discretion when the Metropolitan
Trial Court admitted respondent corporation’s Answer. Although it was filed beyond the extension period
requested by respondent corporation, however, Sec. 11, Rule 11 grants
discretion to the trial court to allow an answer or other pleading to be filed
after the reglementary period, upon motion and on such terms as may be just. An answer should be admitted where it had
been filed before the defendant was declared in default and no prejudice is
caused to plaintiff. The hornbook rule
is that default judgments are generally disfavored.[10]
There is likewise no merit in petitioner’s claim that respondent
corporation lacks legal personality to file an appeal. Although the cancellation of a corporation’s
certificate of registration puts an end to its juridical personality, Sec. 122
of the Corporation Code, however provides that a corporation whose corporate
existence is terminated in any manner continues to be a body corporate for
three years after its dissolution for purposes of prosecuting and defending
suits by and against it and to enable it to settle and close its affairs.[11]
Moreover, the rights of a corporation, which
is dissolved pending litigation, are accorded protection by law pursuant to
Sec. 145 of the Corporation Code, to wit:
Section 145. Amendment
or repeal. No right or remedy in favor of or against any corporation, its
stockholders, members, directors, trustees, or officers, nor any liability
incurred by any such corporation, stockholders, members, directors, trustees,
or officers, shall be removed or
impaired either by the subsequent dissolution of said corporation or by any
subsequent amendment or repeal of this Code or of any part thereof. (Emphasis ours)
Dissolution or even the
expiration of the three-year liquidation period should not be a bar to a corporation’s
enforcement of its rights as a corporation.[12]
Finally, the decision to
refer a case to mediation involves judicial discretion. Although Sec. 9 B, Rule 141 of the Rules of
Court, as amended by A. M. No. 04-2-04-SC, requires the payment of P1,000.00 as
mediation fee upon the filing of a
mediatable case, petition, special civil action, comment/answer to the petition
or action, and the appellee’s brief, the final decision to refer a case to
mediation still belongs to the ponente,
subject to the concurrence of the other members of the division.
As clarified by A. M. No.
II. SELECTION
OF CASES
Division Clerks of Court, with the assistance of the
Philippine Mediation Center (PMC), shall identify the pending cases to be referred to mediation for the approval either
of the Ponente for completion of
records, or, the Ponente for
decision. Henceforth, the petitioner or appellant shall specify – by writing
or by stamping on the right side of the caption of the initial pleading (under
the case number) that the case is mediatable.
Any party who is
interested to have the appealed case mediated may also submit a written
request in any form to the Court of Appeals. If the case is eligible for mediation, the
Ponente, with the concurrence of the other members of the Division, shall refer
the case to the PMC. (Emphasis ours)
Thus, for cases pending
at the time the said guidelines were issued, the Division Clerks of Court, with
the assistance of the Philippine Mediation Center, shall identify the cases to
be referred to mediation. Thereafter, the
petitioner or appellant shall specify, by writing or by stamping on the right
side of the caption of the initial pleading (under the case number), that the
case is mediatable. Further, any party
who is interested to have the appealed case mediated may also submit a “written
request in any form to the Court of Appeals.”
In the instant case, petitioner failed to write or stamp the notation “mediatable”
on its Memorandum of Appeal. Moreover,
it failed to submit any written request for mediation.
WHEREFORE, the
petition is DENIED. The assailed Decision of the Court of Appeals
dated July 17, 2006 reinstating the August 25, 2000 and September 26, 2000 Orders
of the Metropolitan Trial Court of Makati City, Branch 66 which admitted
respondent corporation’s Answer and set the case for pre-trial, as well as the
Resolution dated October 12, 2006 denying the motion for reconsideration, are
SO ORDERED.
CONSUELO
YNARES-SANTIAGO
Associate Justice
WE CONCUR:
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
MINITA V. CHICO-NAZARIO ANTONIO EDUARDO B. NACHURA
Associate
Justice Associate Justice
RUBEN T. REYES
Associate Justice
ATTESTATION
I
attest that the conclusions in the above decision were reached in consultation
before the case was assigned to the writer of the opinion of the Court’s
Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
CERTIFICATION
Pursuant
to Section 13, Article VIII of the Constitution and the Division Chairperson’s
Attestation, it is hereby certified that the conclusions in the above Decision
were reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
REYNATO
S. PUNO
Chief Justice
[1] Rollo, pp. 15-25;
penned by Associate Justice Conrado M. Vasquez, Jr. and concurred in by
Associate Justices Mariano C. Del Castillo and Vicente S.E. Veloso.
[2]
[3]
Penned by Judge Rommel O. Baybay.
[4] Rollo, pp.
34-35.
[5] Records, Process Server’s Return dated
[6]
[7] Rollo, pp. 36-39.
[8] Villarosa v. Benito, 370 Phil. 921, 929
(1999).
[9] Mason v. Court of
Appeals, 459 Phil. 689, 698 (2003).
[10] Delos Santos v. Carpio, G.R. No.
153696, September 11, 2006, 501 SCRA 390, 403.
[11] Pepsi-Cola
Products Philippines, Inc. v. Court of Appeals, G.R. No. 145855, November
24, 2004, 443 SCRA 580, 594.
[12] Knecht v.
United Cigarette Corporation, 433 Phil. 380, 395 (2002).