Gonzales vs. State Properties Corporation

Under Section 4(c), Rule 58 of the 1997 Rules of Civil Procedure, a case with an application for a writ of preliminary injunction or TRO may be raffled without notice to and presence of adverse parties whose whereabouts are unknown and who cannot be served summons despite diligent efforts, because the required prior or contemporaneous service of summons—and the notice of raffle and presence—may be dispensed with in those instances.

Gonzalo R. Gonzales is one of the heirs of the late Benito Gonzales. State Properties Corporation claims ownership of the property covered by Transfer Certificate of Title No. S-17992, including its improvements. The legal backdrop is Section 4(c), Rule 58 of the 1997 Rules of Civil Procedure—formerly reflected in Administrative Circular No. 20-95—which governs the notice and presence requirements before a case with an application for injunctive relief is raffled in a multiple-sala court.

State Properties Corporation filed a verified complaint for Recovery of Property based on ownership on March 23, 1999 with the RTC of Las Piñas against Gonzalo R. Gonzales and his brothers and sisters, all heirs of the late Benito Gonzales. The complaint, accompanied by an application for a temporary restraining order and/or preliminary injunction, prayed that after trial the court confirm State Properties' right to take and enjoy possession of the property covered by Transfer Certificate of Title No. S-17992, together with all improvements, to the exclusion of the heirs of Benito Gonzales, including Gonzalo. The case was raffled to Branch 253 of the RTC of Las Piñas, and summons was duly served on Gonzalo.

On April 15, 1998, Gonzalo filed an Omnibus Motion praying, among others, that another raffle be held because the other defendants did not receive any notice of raffle as required by Administrative Circular No. 20-95. To expedite the disposition of its application for injunctive relief, State Properties filed a manifestation expressing that it interposed no objection to the Omnibus Motion. Gonzalo then filed his Answer.

Meanwhile, State Properties filed a Motion for Service of Summons by Publication on all the defendants except Gonzalo, for the reason that their residences could not be ascertained despite diligent inquiry. The RTC granted the motion at the hearing on May 21, 1999. Subsequently, State Properties received a Notice of Raffle from the Office of the Clerk of Court of the RTC of Las Piñas enjoining it to attend the raffle of the case before the sala of the RTC on July 30, 1999 at 1:00 p.m.

On July 30, 1999, counsel for Gonzalo and counsel for State Properties appeared, but Gonzalo's counsel opposed the holding of the raffle on the ground that the other defendants were not duly notified of the raffle, again invoking Administrative Circular No. 20-95. The RTC granted the opposition and issued an Order stating that no raffle would be conducted and advising the affected parties to determine the meaning of Administrative Circular No. 20-95, paragraph (1), when there are other parties whose addresses are not alleged in the complaint or whose addresses are unknown. State Properties filed a Motion for Reconsideration, to which Gonzalo filed an opposition.

On August 30, 1999, the RTC issued the assailed Order reconsidering its July 30, 1999 Order and setting the case for regular raffle on September 8, 1999. Gonzalo then questioned the August 30, 1999 Order before the CA, which dismissed his petition and affirmed the RTC.

• Notice and Presence Before Raffle: Petitioner argued that under Section 4(c), Rule 58, a case may be raffled only after notice to and in the presence of the adverse party, and that these requisites are mandatory.
• Service of Summons and Section 5, Rule 58: Petitioner maintained that the exception allowing service of summons to be dispensed with should not be isolated from Section 5, Rule 58, which provides that no writ of preliminary injunction shall be granted without hearing and prior notice to the adverse party.
• Raffle Before Service by Publication: Petitioner argued that the CA gravely abused its discretion in holding that where the parties are unknown, the case must be raffled first before the court can act on a motion for leave to serve summons by publication.
• Dismissal and Review: Petitioner contended that the CA gravely abused its discretion in dismissing the petition and that there were special and important reasons to warrant review.

• Unknown Whereabouts: Respondent pointed out that the requirement of notice of raffle to a party whose whereabouts are unknown does not apply because the case must first be raffled before the court can act on a motion for leave to serve summons by publication.

• Notice Requirement Prior to Raffle: Whether a case with an application for a writ of preliminary injunction or TRO may be raffled without notice to and presence of adverse parties whose whereabouts are unknown and who cannot be served summons despite diligent efforts.
• Raffle Before Service by Publication: Whether the case must first be raffled before the court can act on a motion for leave to serve summons by publication on defendants with unknown addresses.
• Grave Abuse of Discretion: Whether the CA gravely abused its discretion in dismissing the petition and affirming the RTC order.

• Notice Requirement Prior to Raffle: Yes. Under Section 4(c), Rule 58, the notice and presence requirements are dispensed with where summons could not be served personally or by substituted service despite diligent efforts; the notice of raffle and presence of the adverse party must likewise be dispensed with.
• Raffle Before Service by Publication: Yes. The notice requirement does not apply to a party whose whereabouts are unknown because the case must first be raffled before the court can act on the motion for leave to serve summons by publication.
• Grave Abuse of Discretion: No. The CA's dismissal and affirmance are consistent with Section 4(c), Rule 58; the petition has no merit.

• Notice Requirement Prior to Raffle: Section 4(c), Rule 58 requires that, when an application for a writ of preliminary injunction or TRO is included in a complaint or initiatory pleading filed in a multiple-sala court, the case shall be raffled only after notice to and in the presence of the adverse party or the person to be enjoined. The notice must be preceded, or contemporaneously accompanied, by service of summons, together with a copy of the complaint or initiatory pleading, the applicant's affidavit, and the bond. The second paragraph of the same provision, however, expressly allows the required prior or contemporaneous service of summons to be dispensed with in three instances: (a) when the summons cannot be served personally or by substituted service despite diligent efforts, (b) when the adverse party is a resident of the Philippines temporarily absent therefrom, or (c) when such party is a nonresident. In those cases, the notice of raffle and the presence of the adverse party must also be dispensed with. The SC found that State Properties had shown that the whereabouts of the other defendants were unknown and that summons could not be served personally or by substituted service. Hence, State Properties could not be required to serve summons prior to or contemporaneous with the notice of raffle, and the raffle could proceed even without notice to and presence of those adverse parties. This did not violate Section 5, Rule 58, which bars a preliminary injunction without hearing and prior notice, because the rule on raffle expressly carries its own exceptions.
• Raffle Before Service by Publication: The SC rejected Gonzalo's reading that the raffle must await notice to all defendants even when their whereabouts are unknown. Respondent pointed out that the requirement of notice of raffle to a party whose whereabouts are unknown does not apply because the case must first be raffled before the court can act on a motion for leave to serve summons by publication. Under Gonzalo's interpretation, defendants could, by simply concealing their whereabouts and preventing the holding of a raffle, bar a trial court from acting on a case or from allowing service of summons by publication. The SC held that such an interpretation would result in absurdity and should not be countenanced.
• Grave Abuse of Discretion: The CA's dismissal rested on the correct reading of Section 4(c), Rule 58, so it did not gravely abuse its discretion. The SC also stressed that Gonzalo himself had been given notice prior to the raffle and therefore had no ground to object. He had no standing to complain on behalf of the other parties because he did not claim to represent them. In any event, the other defendants were later located and served summons; the case was subsequently raffled on December 8, 1999, and a pretrial was conducted on May 9, 2000. None of the other defendants complained of any impropriety in the raffle, and their silence demonstrated the lack of merit in Gonzalo's contention.

• Raffle Notice and Presence under Section 4(c), Rule 58 — In a multiple-sala court, a case with an application for a writ of preliminary injunction or TRO is raffled only after (a) notice to and (b) presence of the adverse party or the person to be enjoined. The notice must be preceded, or contemporaneously accompanied, by service of summons, together with a copy of the complaint or initiatory pleading, the applicant's affidavit, and the bond. The SC applied this general rule but recognized the statutory exceptions.
• Exceptions to Prior or Contemporaneous Summons — The required prior or contemporaneous service of summons may be dispensed with when (a) the summons cannot be served personally or by substituted service despite diligent efforts, (b) the adverse party is a resident of the Philippines temporarily absent therefrom, or (c) the adverse party is a nonresident. In those instances, the notice of raffle and the presence of the adverse party must also be dispensed with. The SC applied the first exception because the other defendants' whereabouts were unknown.
• No Absurd Interpretation — A procedural rule should not be read to allow defendants, by concealing their whereabouts, to prevent the holding of a raffle and bar the trial court from acting on a case or from allowing service of summons by publication. The SC rejected Gonzalo's contrary reading as absurd.
• Standing to Challenge Raffle Notice — A party who was himself given notice of the raffle has no ground to object, and he has no standing to complain on behalf of other parties whom he does not claim to represent. The SC applied this to Gonzalo.
• Issuance vs. Enforcement of Provisional Writ — A writ of attachment may be issued ex parte before the court acquires jurisdiction over the defendant, but its enforcement is valid only after jurisdiction over the person is acquired. The SC used this distinction to explain why Section 4(c), Rule 58 requires that notice of raffle be preceded or contemporaneously accompanied by summons.

• "The second paragraph clearly states, though, that the required prior or contemporaneous service of summons may be dispensed with in the following instances: (a) when the summons cannot be served personally or by substituted service despite diligent efforts, (b) when the adverse party is a resident of the Philippines temporarily absent therefrom, or (c) when such party is a nonresident." — The SC enumerates the exceptions to the prior or contemporaneous service of summons under Section 4(c), Rule 58.
• "In such event, the notice of raffle and the presence of the adverse party must also be dispensed with." — The SC states the consequence of the exceptions: the raffle may proceed without notice to and presence of the adverse party.
• "Under the interpretation of petitioner, however, defendants, by the simple expedient of concealing their whereabouts and thereby preventing the holding of a raffle, can bar a trial court from acting on a case or from allowing a service of summons by publication. Clearly, such interpretation would result in absurdity and should not be countenanced." — The SC rejects Gonzalo's reading of the rule because it would allow defendants to defeat the raffle and service by publication by concealing their whereabouts.
• "Petitioner has no ground to object, since he himself had been given notice prior to the holding of the raffle. Furthermore, he has no standing to complain on behalf of the other parties, because he does not claim to represent them." — The SC rules that Gonzalo cannot challenge the raffle notice when he was notified and did not represent the other defendants.

• Davao Light & Power Co., Inc. vs. Court of Appeals, 204 SCRA 343, 357, November 29, 1991 — Relied on for the rule that a writ of attachment may issue ex parte, but levy on property under it cannot be validly effected unless preceded or contemporaneously accompanied by service of summons and the required documents; cited in connection with the Rule 58 notice requirement.
• H.B. Zachry vs. CA, 232 SCRA 329, 342-343, May 10, 1994 — Relied on for the distinction between issuance and enforcement of a writ: the trial court may issue the writ before acquiring jurisdiction over the defendant, but enforcement can only be validly done after jurisdiction is acquired.
• Oñate vs. Abrogar, 241 SCRA 659, February 23, 1995 — Cited with H.B. Zachry on the same distinction between issuance and enforcement of a writ.
• Cosico vs. NLRC, 272 SCRA 582, May 23, 1997; Camacho vs. CA, 287 SCRA 611, March 19, 1998; Matuguina Integrated Wood Products vs. CA, 263 SCRA 490, October 24, 1996 — Cited to support the SC's rejection of an interpretation that would result in absurdity.
• Commissioner of Immigration vs. Reyes, 12 SCRA 728, 732, December 28, 1964 — Cited for the purpose of notice of raffle in ordinary suits: to afford the parties a chance to be heard in the assignment of their cases.

• Section 4(c), Rule 58, 1997 Rules of Civil Procedure — Requires that a case with an application for a writ of preliminary injunction or TRO, if filed in a multiple-sala court, be raffled only after notice to and in the presence of the adverse party or person to be enjoined; the notice must be preceded or contemporaneously accompanied by service of summons, complaint or initiatory pleading, applicant's affidavit, and bond. It also provides the exceptions where prior or contemporaneous service of summons may be dispensed with.
• Section 5, Rule 58, 1997 Rules of Civil Procedure — Prohibits the grant of a preliminary injunction without hearing and prior notice to the party or person sought to be enjoined, while allowing an ex parte TRO in cases of great or irreparable injury under the stated periods. The SC held that allowing the raffle to proceed in this case was not inconsistent with this section.
• Section 14, Rule 14 — Allows service of summons by publication, by leave of court, where the defendant is designated as an unknown owner or the like, or whenever his whereabouts are unknown and cannot be ascertained by diligent inquiry. The SC cited it in connection with the motion for service of summons by publication on the other defendants.
• Administrative Circular No. 20-95, paragraph 1 — Required that a complaint or initiatory pleading with an application for TRO or writ of preliminary injunction be raffled only after notice to the adverse party and in the presence of such party or counsel. The SC noted that it was incorporated into Section 4(c), Rule 58 of the 1997 Rules of Civil Procedure.