Interlink Movie Houses, Inc. vs. Court of Appeals

Service of summons on a domestic private juridical entity must be made exclusively upon the persons enumerated in Section 11, Rule 14 of the Rules of Court — the president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel — and service upon any other person, such as a corporate officer's secretary, is void and does not vest the court with jurisdiction over the entity.

Interlink Movie Houses, Inc., represented by its president Edmer Y. Lim, is the lessor of premises occupied by Expressions Stationery Shop, Inc., a domestic corporation whose president is Josephine Lim Bon Huan. The dispute arose from Expressions' alleged failure to pay rentals under their lease contract, prompting Interlink to file a collection suit for a sum of money and damages — an action in personam — before the RTC of Pasig City. Because jurisdiction over the defendants in such an action depends on valid service of summons, the manner and sufficiency of that service became the central legal question.

On July 22, 2008, Interlink Movie Houses, Inc., represented by its president Edmer Y. Lim, filed before the RTC of Pasig City, Branch 167, a complaint for sum of money and damages against Expressions Stationery Shop, Inc. and its president, Josephine Lim Bon Huan. The action sought recovery of unpaid rentals and damages for alleged breach of a lease contract. On September 24, 2008, Sheriff Benedict R. Muriel served the summons and a copy of the complaint at the office of the defendant company's president through a certain Jonalyn Liwanan, who undertook to forward the documents to her superior. Interlink thereafter moved to declare respondents in default on January 5, 2009, but respondents entered a special appearance through Atty. Generosa Jacinto on January 6, 2009, alleging that the service was defective and that the RTC had not acquired jurisdiction over them.

By Order dated March 2, 2009, the RTC agreed that the first service did not comply with Section 11, Rule 14 of the Rules of Court and ordered the issuance and service of alias summonses. On May 11, 2009, Sheriff Muriel attempted the second service: he served the summons on Expressions at the office of its president, Bon Huan, through Amee Ochotorina, who introduced herself as one of Bon Huan's secretaries and assured the sheriff that the summons would be brought to Bon Huan's attention. Interlink again moved to declare respondents in default on June 25, 2009. Respondents re-entered a special appearance on July 10, 2009, contending that the second service remained defective because Ochotorina was not connected with the office of the president and was not among the officers enumerated in Section 11, Rule 14.

Notwithstanding this objection, the RTC granted the motion to declare defendants in default by Order dated February 10, 2010, finding sufficient compliance with the rules because the summons was received by the assistant or secretary of the president, and reasoning that corporate officers are usually busy and summons are typically received only by their assistants or secretaries. The RTC denied respondents' omnibus motion to recall that order by Order dated August 9, 2010, and Interlink proceeded with ex parte presentation of evidence. On September 15, 2010, the RTC rendered judgment in favor of Interlink, ordering respondents jointly and severally to pay PhP600,000.00 for unpaid use of premises, PhP242,676.00 for rentals from June to July 2008, PhP300,000.00 as actual damages, and costs, all with 12% interest per annum from the filing of the complaint until full payment. Respondents filed a petition for certiorari under Rule 65 before the CA, which annulled the RTC decision on May 17, 2012 for lack of jurisdiction over their persons. Interlink's motion for reconsideration was denied on September 6, 2012, giving rise to the present petition.

• Validity of Service of Summons: Petitioner argued that the second service of summons was valid because it was received by the secretary of the president of Expressions, and that corporate officers are usually busy such that summons are ordinarily received only by their assistants or secretaries.
• Voluntary Appearance: Petitioner contended that respondents' filing of an omnibus motion to recall the order of default — an affirmative relief — constituted voluntary submission to the jurisdiction of the RTC, thereby curing any defect in the service of summons.

• Defective Service of Summons: Respondents maintained that the second service of summons was defective because Ochotorina did not work for nor was connected with the office of the president of Expressions, and was neither its president, managing partner, general manager, corporate secretary, treasurer, nor in-house counsel.
• Special Appearance: Respondents argued that they filed their omnibus motion on special appearance and expressly objected to the RTC's jurisdiction over their persons on the ground of invalid service of summons, such that they did not voluntarily submit to the court's authority.

• Validity of Service of Summons on a Domestic Corporation: Whether the appellate court erred when it ruled that the trial court did not acquire jurisdiction over the persons of the respondents by reason of the second service of summons being made through Ochotorina, a secretary of Bon Huan, rather than through one of the officers enumerated in Section 11, Rule 14 of the Rules of Court.
• Voluntary Appearance: Whether respondents' filing of an omnibus motion seeking affirmative relief constituted voluntary submission to the jurisdiction of the trial court, notwithstanding their special appearance and express objection to jurisdiction.

• Validity of Service of Summons on a Domestic Corporation: No. The service of summons upon Ochotorina, a secretary of Bon Huan, was void because she was not among the officers enumerated in Section 11, Rule 14 of the Rules of Court, and the enumeration is exclusive. Substituted service was likewise unavailable, the sheriff having made only one attempt at personal service without establishing impossibility.
• Voluntary Appearance: No. Respondents' omnibus motion was filed on special appearance with an express and unequivocal objection to the RTC's jurisdiction over their persons, which under the doctrine of conditional appearance does not constitute voluntary submission to the court's authority.

• Validity of Service of Summons on a Domestic Corporation: In actions in personam, such as collection for a sum of money and damages, jurisdiction over the person of the defendant is acquired through personal or substituted service of summons. For a domestic private juridical entity, Section 11, Rule 14 of the Rules of Court provides that service may be made on the president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel. The Court held that this enumeration is exclusive, citing Cathay Metal Corporation vs. Laguna West Multi-Purpose Cooperative, Inc. and Green Star Express, Inc. vs. Nissin-Universal Robina Corporation. Service upon persons other than those enumerated is invalid. Ochotorina was merely one of Bon Huan's secretaries and was not among the listed officers; the service was therefore void. Even assuming arguendo that the service could be treated as substituted service upon Bon Huan as president, the same was still ineffective. Substituted service is allowed only if personal service is impossible, which requires at least three attempts, preferably on at least two different dates, within a reasonable period of one month, with the sheriff citing reasons for failure. Sheriff Muriel attempted personal service only once on May 11, 2009, and failed to state why personal service was ineffectual beyond noting that Bon Huan was attending to business matters. The impossibility of prompt personal service was not established, rendering substituted service improper.

• Voluntary Appearance: As a general rule, a party who seeks affirmative relief is deemed to have submitted to the court's jurisdiction. Filing motions to admit answer, for additional time, for reconsideration of a default judgment, and to lift an order of default typically constitute voluntary submission. This rule is tempered, however, by the concept of conditional or special appearance: a party who makes a special appearance to challenge the court's jurisdiction over his person is not considered to have submitted to its authority. Drawing on Philippine Commercial International Bank vs. Spouses Dy, the Court held that a special appearance requires the defendant to explicitly and unequivocally pose objections to the court's jurisdiction over his person. The respondents' omnibus motion expressly stated it was filed on special appearance and explicitly objected to the RTC's jurisdiction on the ground of invalid service of summons. Measured against the Philippine Commercial International Bank standard, respondents never recognized or acquiesced to the RTC's jurisdiction. A party making a special appearance challenging jurisdiction based on invalid service of summons is not deemed to have submitted to the court's jurisdiction.

• Exclusive Enumeration Rule for Service of Summons on Domestic Corporations — The list of officers upon whom service of summons may be made under Section 11, Rule 14 of the Rules of Court — president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel — is exclusive. Service upon any person not so enumerated, including a secretary or assistant of a corporate officer, is void and does not vest the court with jurisdiction over the corporation. The Court applied this by holding that service upon Ochotorina, Bon Huan's secretary, was invalid.

• Requirements for Substituted Service of Summons — Before resorting to substituted service, the sheriff must establish the impossibility of prompt personal service through at least three attempts, preferably on at least two different dates, within a reasonable period of one month, and must cite reasons why such efforts were unsuccessful. The Court found that Sheriff Muriel's single attempt on one date, without explanation of why personal service failed, was insufficient.

• Conditional or Special Appearance Doctrine — A party who makes a special appearance to challenge the court's jurisdiction over his person, expressly and unequivocally objecting on the ground of invalid service of summons, is not deemed to have voluntarily submitted to the court's jurisdiction, even if the motion seeks affirmative relief. The Court applied this by holding that respondents' omnibus motion, filed on special appearance with an express jurisdictional objection, did not constitute voluntary appearance.

• "Service on a domestic private juridical entity must, therefore, be made only on the person expressly listed in Section 11, Rule 14 of the Rules of Court. If the service of summons is made upon persons other than those officers enumerated in Section 11, the same is invalid." — This passage articulates the ratio decidendi on the exclusivity of the Section 11 enumeration, the central holding of the case.

• "a special appearance operates as an exception to the general rule on voluntary appearance. Such special appearance, however, requires that the defendant must explicitly and unequivocally pose objections to the jurisdiction of the court over his person; otherwise, such failure would constitute voluntary submission to the jurisdiction of the court." — This passage, drawn from Philippine Commercial International Bank vs. Spouses Dy and adopted by the Court, defines the controlling standard for distinguishing special appearance from voluntary submission.

• "A party who makes a special appearance in court challenging the jurisdiction of said court based on the ground of invalid service of summons is not deemed to have submitted itself to the jurisdiction of the court." — This formulation states the Court's conclusion on the voluntary-appearance issue, synthesizing the conditional appearance doctrine with the facts.

• Manotoc vs. Court of Appeals, 530 Phil. 454 (2006) — Cited for the rule that before resorting to substituted service, the sheriff must establish the impossibility of prompt personal service through at least three attempts on at least two different dates within a reasonable period, and must cite reasons for failure. Followed and applied to find Sheriff Muriel's single attempt insufficient.
• Philippine Commercial International Bank vs. Spouses Dy, 606 Phil. 615 (2009) — Cited for the standard that a special appearance requires explicit and unequivocal objection to the court's jurisdiction over the person, failing which the filing of pleadings seeking affirmative relief constitutes voluntary submission. Followed and applied to hold that respondents' special appearance with express objection did not amount to voluntary appearance.
• Cathay Metal Corporation vs. Laguna West Multi-Purpose Cooperative, Inc., 738 Phil. 37 (2014) — Cited for the proposition that the enumeration of officers in Section 11, Rule 14 is exclusive. Followed.
• Green Star Express, Inc. vs. Nissin-Universal Robina Corporation, 763 Phil. 27 (2015) — Cited for the rule that service on a domestic private juridical entity must be made only on the persons expressly listed in Section 11, Rule 14. Followed.
• Paramount Insurance Corp. vs. A.C. Ordonez Corporation and Franklin Suspine, 583 Phil. 321 (2008) — Cited for the rule that service upon persons other than those enumerated in Section 11 is invalid. Followed.

• Section 11, Rule 14, Rules of Court — Governs service of summons upon domestic private juridical entities, authorizing service upon the president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel. Applied as the controlling provision; the Court held the enumeration is exclusive and service upon a corporate officer's secretary is void.
• Section 7, Rule 14, Rules of Court — Governs substituted service of summons, allowing it only when personal service is not possible within a reasonable time, by leaving copies at the defendant's residence with a person of suitable age and discretion or at the office with a competent person in charge. Applied to hold that substituted service was unavailable because the sheriff failed to establish the impossibility of personal service.
• Section 6, Rule 14, Rules of Court — Defines personal service of summons as handing a copy to the defendant in person or tendering it if he refuses. Cited as the preferred mode of service in actions in personam.

Presbitero J. Velasco, Jr. (Chairperson), Lucas P. Bersamin, Marvic M.V.F. Leonen, and Alexander G. Gesmundo concurred.