Carson Realty & Management Corporation vs. Red Robin Security Agency and Monina C. Santos

A corporation voluntarily submits to the jurisdiction of a court when it files a motion seeking affirmative relief, such as an extension of time to file a responsive pleading, without expressly limiting its appearance to challenge the court's jurisdiction over its person; such voluntary appearance renders subsequent questions regarding the validity of service of summons academic, and the corporation may be properly declared in default for failure to file an answer within the time granted.

Carson Realty & Management Corporation operates a real estate and management business with offices at Unit 601 Prestige Tower Condominium, Ortigas Center, Pasig City. Monina C. Santos initiated a civil action for sum of money and damages against Carson in the Regional Trial Court of Quezon City. The dispute centered on Carson's alleged liability for monetary claims, with Carson initially resisting the court's jurisdiction through challenges to the manner of service of summons.

• The Original Action: Santos filed a Complaint for Sum of Money and Damages against Carson in the RTC Quezon City, Branch 216 on March 23, 2007.
• Initial Service and Appearance: Process Server Jechonias F. Pajila, Jr. served the Summons dated April 11, 2007 upon Carson at its Ortigas office through Precilla S. Serrano, identified as "corporate secretary" but later revealed to be a staff assistant. Atty. Tomas Z. Roxas, Jr., Carson's counsel, filed an Appearance and Motion dated April 25, 2007 acknowledging receipt of the summons and praying for a fifteen-day extension from April 27, 2007 to file a responsive pleading. The RTC granted this extension on May 3, 2007.
• Challenge to Jurisdiction: Instead of filing an answer, Carson filed a Motion to Dismiss alleging that the summons was not served on any officer authorized under Section 11, Rule 14 of the Rules of Court. Santos countered that Carson had voluntarily submitted to jurisdiction by seeking an extension of time.
• Alias Summons Proceedings: The RTC denied the Motion to Dismiss and directed the issuance of an alias summons dated September 24, 2007. Process Server Pajila attempted to serve this upon the President and General Manager but found them absent. He was advised by a secretary to bring the summons to Atty. Roxas's law office, where service was refused. He then attempted substituted service with Mr. JR Taganila, who also refused to acknowledge receipt.
• Second Alias Summons and Substituted Service: The RTC issued another alias summons dated September 9, 2008. Process Server Pajila made four attempts on October 2, 16, 27, and 28, 2008 to personally serve the President/General Manager, but found them unavailable each time. On October 28, 2008, he resorted to substituted service by leaving the summons with Ms. Lorie Fernandez, a receptionist, who refused to acknowledge receipt. Fernandez later filed a Manifestation returning the summons, claiming lack of authority.
• Default and Post-Default Proceedings: Santos filed a Motion to Declare Defendant in Default. The RTC granted this on June 29, 2009 and allowed ex-parte presentation of evidence. Carson filed an Urgent Motion to Set Aside Order of Default on August 27, 2009, which the RTC denied on December 4, 2009. Carson's Motion for Reconsideration was denied on November 22, 2010. Carson subsequently filed a Petition for Certiorari with the Court of Appeals questioning the orders declaring it in default.

• Invalid Service of Summons: Carson argued that the RTC never acquired jurisdiction over its person because the summons was not properly served upon its president, general manager, corporate secretary, treasurer, or in-house counsel as required by Section 11, Rule 14 of the Rules of Court. The service upon Serrano (a staff assistant, not corporate secretary) and subsequently upon Fernandez (a receptionist) was invalid.
• Improper Substituted Service: Carson maintained that substituted service is not permitted against a corporation and that the process server's return failed to comply with the strict requirements for substituted service enunciated in Manotoc v. Court of Appeals, particularly regarding the impossibility of personal service and the authority of the person served.
• Invalid Default Order: Carson contended that the declaration of default was improper because the trial court lacked jurisdiction over its person due to defective service.

• Voluntary Submission to Jurisdiction: Santos countered that Carson voluntarily submitted to the RTC's jurisdiction when Atty. Roxas filed the Appearance and Motion dated April 25, 2007 acknowledging receipt of the summons and seeking an extension of time to file a responsive pleading. By seeking affirmative relief without expressly limiting the appearance to challenge jurisdiction, Carson waived any defect in the initial service.
• Valid Substituted Service: Santos argued that the substituted service upon Fernandez was valid, as she was a competent person in charge of the office, and the process server's return demonstrated substantial compliance with the requirements of Manotoc given Carson's deliberate avoidance of service.
• Propriety of Default: Santos maintained that Carson was properly declared in default for failure to file an answer within the extended period granted by the court.

• Jurisdiction over the Person: Whether the RTC acquired jurisdiction over Carson Realty & Management Corporation.
• Validity of Default: Whether Carson was properly declared in default.

• Jurisdiction through Voluntary Appearance: The RTC acquired jurisdiction over Carson through its voluntary appearance. By filing the Appearance and Motion dated April 25, 2007 seeking an extension of time to file a responsive pleading without expressly limiting its appearance to challenge jurisdiction, Carson submitted itself to the court's authority. A party who seeks affirmative relief is deemed to have submitted to the jurisdiction of the court, and the filing of a motion for additional time to file an answer constitutes voluntary submission.
• Alternative Basis of Substituted Service: Even assuming arguendo that no voluntary appearance was made, jurisdiction was validly acquired through substituted service of the September 9, 2008 alias summons. The process server's return dated October 28, 2008 established substantial compliance with the requirements for substituted service under Manotoc v. Court of Appeals: (a) impossibility of prompt personal service was demonstrated by four separate attempts on different dates to serve the President/General Manager; (b) the return detailed the specific efforts made; and (c) service was made upon Fernandez, an employee at Carson's office. The Court applied the doctrine of substantial compliance, noting that strict adherence to procedural rules is not required where the defendant deliberately avoids service.
• Proper Declaration of Default: Carson was properly declared in default under Section 3, Rule 9 of the Rules of Court for failure to file an answer within the time allowed despite its voluntary submission to the court's jurisdiction. The erroneous basis cited by the RTC (substituted service rather than voluntary appearance) does not invalidate the default order where a lawful ground exists.

• Voluntary Appearance as Submission to Jurisdiction: A defendant's voluntary appearance in an action is equivalent to service of summons under Section 20, Rule 14 of the Rules of Court. Filing a motion for extension of time to file an answer, being a request for affirmative relief, constitutes voluntary submission to the court's jurisdiction unless the appearance is expressly limited to challenge jurisdiction.
• Requirements for Valid Substituted Service (Manotoc Standards): Before substituted service of summons may be resorted to, the following must be established: (a) impossibility of prompt personal service within a reasonable time (generally one month), demonstrated by at least three attempts on at least two different dates; (b) specific details in the return of summons describing the efforts made to locate the defendant and the reasons for failure; and (c) service upon a person of suitable age and discretion (if at residence) or a competent person in charge (if at office), who must have sufficient knowledge to understand the obligation and importance of the summons.
• Doctrine of Substantial Compliance: While statutory requirements for substituted service must generally be followed strictly, an overly strict application is not warranted where the defendant actively attempts to frustrate proper service through deception or evasion. The spirit of procedural rules, not their letter, governs in instances where strict adherence would frustrate justice.
• Effect of Erroneous Basis in Default Order: A default order is not rendered invalid merely because the trial court cited an erroneous basis (such as invalid substituted service) if a lawful ground for the default actually exists (such as voluntary submission to jurisdiction followed by failure to answer).

• "It is the spirit of the procedural rules, not their letter, that governs." — Cited in support of the doctrine that substantial compliance with procedural requirements is sufficient where strict adherence would frustrate justice.
• "Sheriffs are not expected to be sleuths, and cannot be faulted where the defendants themselves engage in deception to thwart the orderly administration of justice." — Articulating the rationale for relaxing strict requirements when defendants deliberately avoid service.
• "A party who seeks an affirmative relief is deemed to have submitted to the jurisdiction of the court." — Establishing the principle that motions seeking affirmative relief constitute voluntary submission.
• "Seeking an affirmative relief is inconsistent with the position that no voluntary appearance had been made, and to ask for such relief, without the proper objection, necessitates submission to the Court's jurisdiction." — Explaining the incompatibility between requesting affirmative relief and simultaneously challenging jurisdiction.

• Manotoc v. Court of Appeals, G.R. No. 130974, August 16, 2006 — Established the strict requirements for substituted service of summons; followed but applied with substantial compliance given Carson's evasion tactics.
• Philippine Commercial International Bank v. Spouses Dy, G.R. No. 171137, June 5, 2009 — Cited for the principle that seeking affirmative relief constitutes voluntary submission to jurisdiction.
• Atiko Trans, Inc. and Cheng Lie Navigation Co., Ltd. v. Prudential Guarantee and Assurance, Inc., G.R. No. 167545, August 17, 2011 — Controlling precedent upholding a default order despite invalid service of summons where jurisdiction was acquired through voluntary submission.
• Sagana v. Francisco, G.R. No. 161952, October 2, 2009 — Cited for the doctrine that substantial compliance with substituted service requirements is sufficient where the defendant deliberately avoids service.

• Section 11, Rule 14, Rules of Court — Mandates service upon corporations to be made on the president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel.
• Section 20, Rule 14, Rules of Court — Provides that a defendant's voluntary appearance in the action shall be equivalent to service of summons.
• Section 3, Rule 9, Rules of Court — Governs the declaration of default and the remedies available to a party declared in default.

Lucas P. Bersamin, Bienvenido L. Reyes, Francis H. Jardeleza, and Alfredo Benjamin S. Caguioa (designated as Fifth Member per Special Order No. 2417 dated January 4, 2017).

None.