Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-11390

March 26, 1918

EL BANCO ESPAOL-FILIPINO, plaintiff-appellant,

vs.
VICENTE PALANCA, administrator of the estate of Engracio Palanca Tanquinyeng, defendant-appellant.
Aitken and DeSelms for appellant.
Hartigan and Welch for appellee.
STREET, J.:
This action was instituted upon March 31, 1908, by "El Banco Espanol-Filipino" to foreclose a mortgage upon
various parcels of real property situated in the city of Manila. The mortgage in question is dated June 16, 1906,
and was executed by the original defendant herein, Engracio Palanca Tanquinyeng y Limquingco, as security for
a debt owing by him to the bank. Upon March 31, 1906, the debt amounted to P218,294.10 and was drawing
interest at the rate of 8 per centum per annum, payable at the end of each quarter. It appears that the parties to
this mortgage at that time estimated the value of the property in question at P292,558, which was about P75,000
in excess of the indebtedness. After the execution of this instrument by the mortgagor, he returned to China
which appears to have been his native country; and he there died, upon January 29, 1810, without again
returning to the Philippine Islands.
As the defendant was a nonresident at the time of the institution of the present action, it was necessary for the
plaintiff in the foreclosure proceeding to give notice to the defendant by publication pursuant to section 399 of the
Code of Civil Procedure. An order for publication was accordingly obtained from the court, and publication was
made in due form in a newspaper of the city of Manila. At the same time that the order of the court should
deposit in the post office in a stamped envelope a copy of the summons and complaint directed to the defendant
at his last place of residence, to wit, the city of Amoy, in the Empire of China. This order was made pursuant to
the following provision contained in section 399 of the Code of Civil Procedure:
In case of publication, where the residence of a nonresident or absent defendant is known, the judge
must direct a copy of the summons and complaint to be forthwith deposited by the clerk in the postoffice, postage prepaid, directed to the person to be served, at his place of residence
Whether the clerk complied with this order does not affirmatively appear. There is, however, among the papers
pertaining to this case, an affidavit, dated April 4, 1908, signed by Bernardo Chan y Garcia, an employee of the
attorneys of the bank, showing that upon that date he had deposited in the Manila post-office a registered letter,
addressed to Engracio Palanca Tanquinyeng, at Manila, containing copies of the complaint, the plaintiff's
affidavit, the summons, and the order of the court directing publication as aforesaid. It appears from the
postmaster's receipt that Bernardo probably used an envelope obtained from the clerk's office, as the receipt
purports to show that the letter emanated from the office.
The cause proceeded in usual course in the Court of First Instance; and the defendant not having appeared,
judgment was, upon July 2, 1908, taken against him by default. Upon July 3, 1908, a decision was rendered in
favor of the plaintiff. In this decision it was recited that publication had been properly made in a periodical, but
nothing was said about this notice having been given mail. The court, upon this occasion, found that the
indebtedness of the defendant amounted to P249,355. 32, with interest from March 31, 1908. Accordingly it was
ordered that the defendant should, on or before July 6, 1908, deliver said amount to the clerk of the court to be
applied to the satisfaction of the judgment, and it was declared that in case of the failure of the defendant to
satisfy the judgment within such period, the mortgage property located in the city of Manila should be exposed to

public sale. The payment contemplated in said order was never made; and upon July 8, 1908, the court ordered
the sale of the property. The sale took place upon July 30, 1908, and the property was bought in by the bank for
the sum of P110,200. Upon August 7, 1908, this sale was confirmed by the court.
About seven years after the confirmation of this sale, or to the precise, upon June 25, 1915, a motion was made
in this cause by Vicente Palanca, as administrator of the estate of the original defendant, Engracio Palanca
Tanquinyeng y Limquingco, wherein the applicant requested the court to set aside the order of default of July 2,
1908, and the judgment rendered upon July 3, 1908, and to vacate all the proceedings subsequent thereto. The
basis of this application, as set forth in the motion itself, was that the order of default and the judgment rendered
thereon were void because the court had never acquired jurisdiction over the defendant or over the subject of
the action.
At the hearing in the court below the application to vacate the judgment was denied, and from this action of the
court Vicente Planca, as administrator of the estate of the original defendant, has appealed. No other feature of
the case is here under consideration than such as related to the action of the court upon said motion.
The case presents several questions of importance, which will be discussed in what appears to be the sequence
of most convenient development. In the first part of this opinion we shall, for the purpose of argument, assume
that the clerk of the Court of First Instance did not obey the order of the court in the matter of mailing the papers
which he was directed to send to the defendant in Amoy; and in this connection we shall consider, first, whether
the court acquired the necessary jurisdiction to enable it to proceed with the foreclosure of the mortgage and,
secondly, whether those proceedings were conducted in such manner as to constitute due process of law.
The word "jurisdiction," as applied to the faculty of exercising judicial power, is used in several different, though
related, senses since it may have reference (1) to the authority of the court to entertain a particular kind of action
or to administer a particular kind of relief, or it may refer to the power of the court over the parties, or (2) over the
property which is the subject to the litigation.
The sovereign authority which organizes a court determines the nature and extent of its powers in general and
thus fixes its competency or jurisdiction with reference to the actions which it may entertain and the relief it may
grant.
Jurisdiction over the person is acquired by the voluntary appearance of a party in court and his submission to its
authority, or it is acquired by the coercive power of legal process exerted over the person.
Jurisdiction over the property which is the subject of the litigation may result either from a seizure of the property
under legal process, whereby it is brought into the actual custody of the law, or it may result from the institution
of legal proceedings wherein, under special provisions of law, the power of the court over the property is
recognized and made effective. In the latter case the property, though at all times within the potential power of
the court, may never be taken into actual custody at all. An illustration of the jurisdiction acquired by actual
seizure is found in attachment proceedings, where the property is seized at the beginning of the action, or some
subsequent stage of its progress, and held to abide the final event of the litigation. An illustration of what we term
potential jurisdiction over the res, is found in the proceeding to register the title of land under our system for the
registration of land. Here the court, without taking actual physical control over the property assumes, at the
instance of some person claiming to be owner, to exercise a jurisdiction in rem over the property and to
adjudicate the title in favor of the petitioner against all the world.
In the terminology of American law the action to foreclose a mortgage is said to be a proceeding quasi in rem, by
which is expressed the idea that while it is not strictly speaking an action in rem yet it partakes of that nature and
is substantially such. The expression "action in rem" is, in its narrow application, used only with reference to
certain proceedings in courts of admiralty wherein the property alone is treated as responsible for the claim or
obligation upon which the proceedings are based. The action quasi rem differs from the true action in rem in the
circumstance that in the former an individual is named as defendant, and the purpose of the proceeding is to
subject his interest therein to the obligation or lien burdening the property. All proceedings having for their sole
object the sale or other disposition of the property of the defendant, whether by attachment, foreclosure, or other
form of remedy, are in a general way thus designated. The judgment entered in these proceedings is conclusive
only between the parties.

In speaking of the proceeding to foreclose a mortgage the author of a well known treaties, has said:
Though nominally against person, such suits are to vindicate liens; they proceed upon seizure; they treat
property as primarily indebted; and, with the qualification above-mentioned, they are substantially
property actions. In the civil law, they are styled hypothecary actions, and their sole object is the
enforcement of the lien against the res; in the common law, they would be different in chancery did not
treat the conditional conveyance as a mere hypothecation, and the creditor's right ass an equitable lien;
so, in both, the suit is real action so far as it is against property, and seeks the judicial recognition of a
property debt, and an order for the sale of the res. (Waples, Proceedings In Rem. sec. 607.)
It is true that in proceedings of this character, if the defendant for whom publication is made appears, the action
becomes as to him a personal action and is conducted as such. This, however, does not affect the proposition
that where the defendant fails to appear the action is quasi in rem; and it should therefore be considered with
reference to the principles governing actions in rem.
There is an instructive analogy between the foreclosure proceeding and an action of attachment, concerning
which the Supreme Court of the United States has used the following language:
If the defendant appears, the cause becomes mainly a suit in personam, with the added incident, that
the property attached remains liable, under the control of the court, to answer to any demand which may
be established against the defendant by the final judgment of the court. But, if there is no appearance of
the defendant, and no service of process on him, the case becomes, in its essential nature, a
proceeding in rem, the only effect of which is to subject the property attached to the payment of the
defendant which the court may find to be due to the plaintiff. (Cooper vs. Reynolds, 10 Wall., 308.)
In an ordinary attachment proceeding, if the defendant is not personally served, the preliminary seizure is to, be
considered necessary in order to confer jurisdiction upon the court. In this case the lien on the property is
acquired by the seizure; and the purpose of the proceedings is to subject the property to that lien. If a lien
already exists, whether created by mortgage, contract, or statute, the preliminary seizure is not necessary; and
the court proceeds to enforce such lien in the manner provided by law precisely as though the property had been
seized upon attachment. (Roller vs. Holly, 176 U. S., 398, 405; 44 L. ed., 520.) It results that the mere
circumstance that in an attachment the property may be seized at the inception of the proceedings, while in the
foreclosure suit it is not taken into legal custody until the time comes for the sale, does not materially affect the
fundamental principle involved in both cases, which is that the court is here exercising a jurisdiction over the
property in a proceeding directed essentially in rem.
Passing now to a consideration of the jurisdiction of the Court of First Instance in a mortgage foreclosure, it is
evident that the court derives its authority to entertain the action primarily from the statutes organizing the court.
The jurisdiction of the court, in this most general sense, over the cause of action is obvious and requires no
comment. Jurisdiction over the person of the defendant, if acquired at all in such an action, is obtained by the
voluntary submission of the defendant or by the personal service of process upon him within the territory where
the process is valid. If, however, the defendant is a nonresident and, remaining beyond the range of the personal
process of the court, refuses to come in voluntarily, the court never acquires jurisdiction over the person at all.
Here the property itself is in fact the sole thing which is impleaded and is the responsible object which is the
subject of the exercise of judicial power. It follows that the jurisdiction of the court in such case is based
exclusively on the power which, under the law, it possesses over the property; and any discussion relative to the
jurisdiction of the court over the person of the defendant is entirely apart from the case. The jurisdiction of the
court over the property, considered as the exclusive object of such action, is evidently based upon the following
conditions and considerations, namely: (1) that the property is located within the district; (2) that the purpose of
the litigation is to subject the property by sale to an obligation fixed upon it by the mortgage; and (3) that the
court at a proper stage of the proceedings takes the property into custody, if necessary, and expose it to sale for
the purpose of satisfying the mortgage debt. An obvious corollary is that no other relief can be granted in this
proceeding than such as can be enforced against the property.
We may then, from what has been stated, formulated the following proposition relative to the foreclosure
proceeding against the property of a nonresident mortgagor who fails to come in and submit himself personally
to the jurisdiction of the court: (I) That the jurisdiction of the court is derived from the power which it possesses

over the property; (II) that jurisdiction over the person is not acquired and is nonessential; (III) that the relief
granted by the court must be limited to such as can be enforced against the property itself.
It is important that the bearing of these propositions be clearly apprehended, for there are many expressions in
the American reports from which it might be inferred that the court acquires personal jurisdiction over the person
of the defendant by publication and notice; but such is not the case. In truth the proposition that jurisdiction over
the person of a nonresident cannot be acquired by publication and notice was never clearly understood even in
the American courts until after the decision had been rendered by the Supreme Court of the United States in the
leading case of Pennoyer vs. Neff (95 U. S. 714; 24 L. ed., 565). In the light of that decision, and of other
decisions which have subsequently been rendered in that and other courts, the proposition that jurisdiction over
the person cannot be thus acquired by publication and notice is no longer open to question; and it is now fully
established that a personal judgment upon constructive or substituted service against a nonresident who does
not appear is wholly invalid. This doctrine applies to all kinds of constructive or substituted process, including
service by publication and personal service outside of the jurisdiction in which the judgment is rendered; and the
only exception seems to be found in the case where the nonresident defendant has expressly or impliedly
consented to the mode of service. (Note to Raher vs. Raher, 35 L. R. A. [N. S. ], 292; see also 50 L .R. A., 585;
35 L. R. A. [N. S.], 312
The idea upon which the decision in Pennoyer vs. Neff (supra) proceeds is that the process from the tribunals of
one State cannot run into other States or countries and that due process of law requires that the defendant shall
be brought under the power of the court by service of process within the State, or by his voluntary appearance,
in order to authorize the court to pass upon the question of his personal liability. The doctrine established by the
Supreme Court of the United States on this point, being based upon the constitutional conception of due process
of law, is binding upon the courts of the Philippine Islands. Involved in this decision is the principle that in
proceedings in rem or quasi in rem against a nonresident who is not served personally within the state, and who
does not appear, the relief must be confined to the res, and the court cannot lawfully render a personal judgment
against him. (Dewey vs. Des Moines, 173 U. S., 193; 43 L. ed., 665; Heidritter vs. Elizabeth Oil Cloth Co., 112 U.
S., 294; 28 L. ed., 729.) Therefore in an action to foreclose a mortgage against a nonresident, upon whom
service has been effected exclusively by publication, no personal judgment for the deficiency can be entered.
(Latta vs. Tutton, 122 Cal., 279; Blumberg vs. Birch, 99 Cal., 416.)
It is suggested in the brief of the appellant that the judgment entered in the court below offends against the
principle just stated and that this judgment is void because the court in fact entered a personal judgment against
the absent debtor for the full amount of the indebtedness secured by the mortgage. We do not so interpret the
judgment.
In a foreclosure proceeding against a nonresident owner it is necessary for the court, as in all cases of
foreclosure, to ascertain the amount due, as prescribed in section 256 of the Code of Civil Procedure, and to
make an order requiring the defendant to pay the money into court. This step is a necessary precursor of the
order of sale. In the present case the judgment which was entered contains the following words:
Because it is declared that the said defendant Engracio Palanca Tanquinyeng y Limquingco, is indebted
in the amount of P249,355.32, plus the interest, to the 'Banco Espanol-Filipino' . . . therefore said
appellant is ordered to deliver the above amount etc., etc.
This is not the language of a personal judgment. Instead it is clearly intended merely as a compliance with the
requirement that the amount due shall be ascertained and that the evidence of this it may be observed that
according to the Code of Civil Procedure a personal judgment against the debtor for the deficiency is not to be
rendered until after the property has been sold and the proceeds applied to the mortgage debt. (sec. 260).
The conclusion upon this phase of the case is that whatever may be the effect in other respects of the failure of
the clerk of the Court of First Instance to mail the proper papers to the defendant in Amoy, China, such
irregularity could in no wise impair or defeat the jurisdiction of the court, for in our opinion that jurisdiction rest
upon a basis much more secure than would be supplied by any form of notice that could be given to a resident of
a foreign country.

Before leaving this branch of the case, we wish to observe that we are fully aware that many reported cases can
be cited in which it is assumed that the question of the sufficiency of publication or notice in a case of this kind is
a question affecting the jurisdiction of the court, and the court is sometimes said to acquire jurisdiction by virtue
of the publication. This phraseology was undoubtedly originally adopted by the court because of the analogy
between service by the publication and personal service of process upon the defendant; and, as has already
been suggested, prior to the decision of Pennoyer vs. Neff (supra) the difference between the legal effects of the
two forms of service was obscure. It is accordingly not surprising that the modes of expression which had
already been molded into legal tradition before that case was decided have been brought down to the present
day. But it is clear that the legal principle here involved is not effected by the peculiar language in which the
courts have expounded their ideas.
We now proceed to a discussion of the question whether the supposed irregularity in the proceedings was of
such gravity as to amount to a denial of that "due process of law" which was secured by the Act of Congress in
force in these Islands at the time this mortgage was foreclosed. (Act of July 1, 1902, sec. 5.) In dealing with
questions involving the application of the constitutional provisions relating to due process of law the Supreme
Court of the United States has refrained from attempting to define with precision the meaning of that expression,
the reason being that the idea expressed therein is applicable under so many diverse conditions as to make any
attempt ay precise definition hazardous and unprofitable. As applied to a judicial proceeding, however, it may be
laid down with certainty that the requirement of due process is satisfied if the following conditions are present,
namely; (1) There must be a court or tribunal clothed with judicial power to hear and determine the matter before
it; (2) jurisdiction must be lawfully acquired over the person of the defendant or over the property which is the
subject of the proceeding; (3) the defendant must be given an opportunity to be heard; and (4) judgment must be
rendered upon lawful hearing.
Passing at once to the requisite that the defendant shall have an opportunity to be heard, we observe that in a
foreclosure case some notification of the proceedings to the nonresident owner, prescribing the time within which
appearance must be made, is everywhere recognized as essential. To answer this necessity the statutes
generally provide for publication, and usually in addition thereto, for the mailing of notice to the defendant, if his
residence is known. Though commonly called constructive, or substituted service of process in any true sense. It
is merely a means provided by law whereby the owner may be admonished that his property is the subject of
judicial proceedings and that it is incumbent upon him to take such steps as he sees fit to protect it. In speaking
of notice of this character a distinguish master of constitutional law has used the following language:
. . . if the owners are named in the proceedings, and personal notice is provided for, it is rather from
tenderness to their interests, and in order to make sure that the opportunity for a hearing shall not be lost
to them, than from any necessity that the case shall assume that form. (Cooley on Taxation [2d. ed.],
527, quoted in Leigh vs. Green, 193 U. S., 79, 80.)
It will be observed that this mode of notification does not involve any absolute assurance that the absent owner
shall thereby receive actual notice. The periodical containing the publication may never in fact come to his
hands, and the chances that he should discover the notice may often be very slight. Even where notice is sent
by mail the probability of his receiving it, though much increased, is dependent upon the correctness of the
address to which it is forwarded as well as upon the regularity and security of the mail service. It will be noted,
furthermore, that the provision of our law relative to the mailing of notice does not absolutely require the mailing
of notice unconditionally and in every event, but only in the case where the defendant's residence is known. In
the light of all these facts, it is evident that actual notice to the defendant in cases of this kind is not, under the
law, to be considered absolutely necessary.
The idea upon which the law proceeds in recognizing the efficacy of a means of notification which may fall short
of actual notice is apparently this: Property is always assumed to be in the possession of its owner, in person or
by agent; and he may be safely held, under certain conditions, to be affected with knowledge that proceedings
have been instituted for its condemnation and sale.
It is the duty of the owner of real estate, who is a nonresident, to take measures that in some way he
shall be represented when his property is called into requisition, and if he fails to do this, and fails to get
notice by the ordinary publications which have usually been required in such cases, it is his misfortune,
and he must abide the consequences. (6 R. C. L., sec. 445 [p. 450]).

It has been well said by an American court:

If property of a nonresident cannot be reached by legal process upon the constructive notice, then our
statutes were passed in vain, and are mere empty legislative declarations, without either force, or
meaning; for if the person is not within the jurisdiction of the court, no personal judgment can be
rendered, and if the judgment cannot operate upon the property, then no effective judgment at all can be
rendered, so that the result would be that the courts would be powerless to assist a citizen against a
nonresident. Such a result would be a deplorable one. (Quarl vs. Abbett, 102 Ind., 233; 52 Am. Rep.,
662, 667.)
It is, of course universally recognized that the statutory provisions relative to publication or other form of notice
against a nonresident owner should be complied with; and in respect to the publication of notice in the
newspaper it may be stated that strict compliance with the requirements of the law has been held to be essential.
In Guaranty Trust etc. Co. vs. Green Cove etc., Railroad Co. (139 U. S., 137, 138), it was held that where
newspaper publication was made for 19 weeks, when the statute required 20, the publication was insufficient.
With respect to the provisions of our own statute, relative to the sending of notice by mail, the requirement is that
the judge shall direct that the notice be deposited in the mail by the clerk of the court, and it is not in terms
declared that the notice must be deposited in the mail. We consider this to be of some significance; and it seems
to us that, having due regard to the principles upon which the giving of such notice is required, the absent owner
of the mortgaged property must, so far as the due process of law is concerned, take the risk incident to the
possible failure of the clerk to perform his duty, somewhat as he takes the risk that the mail clerk or the mail
carrier might possibly lose or destroy the parcel or envelope containing the notice before it should reach its
destination and be delivered to him. This idea seems to be strengthened by the consideration that placing upon
the clerk the duty of sending notice by mail, the performance of that act is put effectually beyond the control of
the plaintiff in the litigation. At any rate it is obvious that so much of section 399 of the Code of Civil Procedure as
relates to the sending of notice by mail was complied with when the court made the order. The question as to
what may be the consequences of the failure of the record to show the proof of compliance with that requirement
will be discussed by us further on.
The observations which have just been made lead to the conclusion that the failure of the clerk to mail the
notice, if in fact he did so fail in his duty, is not such an irregularity, as amounts to a denial of due process of law;
and hence in our opinion that irregularity, if proved, would not avoid the judgment in this case. Notice was given
by publication in a newspaper and this is the only form of notice which the law unconditionally requires. This in
our opinion is all that was absolutely necessary to sustain the proceedings.
It will be observed that in considering the effect of this irregularity, it makes a difference whether it be viewed as
a question involving jurisdiction or as a question involving due process of law. In the matter of jurisdiction there
can be no distinction between the much and the little. The court either has jurisdiction or it has not; and if the
requirement as to the mailing of notice should be considered as a step antecedent to the acquiring of jurisdiction,
there could be no escape from the conclusion that the failure to take that step was fatal to the validity of the
judgment. In the application of the idea of due process of law, on the other hand, it is clearly unnecessary to be
so rigorous. The jurisdiction being once established, all that due process of law thereafter requires is an
opportunity for the defendant to be heard; and as publication was duly made in the newspaper, it would seem
highly unreasonable to hold that failure to mail the notice was fatal. We think that in applying the requirement of
due process of law, it is permissible to reflect upon the purposes of the provision which is supposed to have
been violated and the principle underlying the exercise of judicial power in these proceedings. Judge in the light
of these conceptions, we think that the provision of Act of Congress declaring that no person shall be deprived of
his property without due process of law has not been infringed.
In the progress of this discussion we have stated the two conclusions; (1) that the failure of the clerk to send the
notice to the defendant by mail did not destroy the jurisdiction of the court and (2) that such irregularity did not
infringe the requirement of due process of law. As a consequence of these conclusions the irregularity in
question is in some measure shorn of its potency. It is still necessary, however, to consider its effect considered
as a simple irregularity of procedure; and it would be idle to pretend that even in this aspect the irregularity is not
grave enough. From this point of view, however, it is obvious that any motion to vacate the judgment on the
ground of the irregularity in question must fail unless it shows that the defendant was prejudiced by that

irregularity. The least, therefore, that can be required of the proponent of such a motion is to show that he had a
good defense against the action to foreclose the mortgage. Nothing of the kind is, however, shown either in the
motion or in the affidavit which accompanies the motion.
An application to open or vacate a judgment because of an irregularity or defect in the proceedings is usually
required to be supported by an affidavit showing the grounds on which the relief is sought, and in addition to this
showing also a meritorious defense to the action. It is held that a general statement that a party has a good
defense to the action is insufficient. The necessary facts must be averred. Of course if a judgment is void upon
its face a showing of the existence of a meritorious defense is not necessary. (10 R. C. L., 718.)
The lapse of time is also a circumstance deeply affecting this aspect of the case. In this connection we quote the
following passage from the encyclopedic treatise now in course of publication:
Where, however, the judgment is not void on its face, and may therefore be enforced if permitted to
stand on the record, courts in many instances refuse to exercise their quasi equitable powers to vacate a
judgement after the lapse of the term ay which it was entered, except in clear cases, to promote the
ends of justice, and where it appears that the party making the application is himself without fault and
has acted in good faith and with ordinary diligence. Laches on the part of the applicant, if unexplained, is
deemed sufficient ground for refusing the relief to which he might otherwise be entitled. Something is
due to the finality of judgments, and acquiescence or unnecessary delay is fatal to motions of this
character, since courts are always reluctant to interfere with judgments, and especially where they have
been executed or satisfied. The moving party has the burden of showing diligence, and unless it is
shown affirmatively the court will not ordinarily exercise its discretion in his favor. (15 R. C. L., 694, 695.)
It is stated in the affidavit that the defendant, Engracio Palanca Tanquinyeng y Limquingco, died January 29,
1910. The mortgage under which the property was sold was executed far back in 1906; and the proceedings in
the foreclosure were closed by the order of court confirming the sale dated August 7, 1908. It passes the rational
bounds of human credulity to suppose that a man who had placed a mortgage upon property worth nearly
P300,000 and had then gone away from the scene of his life activities to end his days in the city of Amoy, China,
should have long remained in ignorance of the fact that the mortgage had been foreclosed and the property sold,
even supposing that he had no knowledge of those proceedings while they were being conducted. It is more in
keeping with the ordinary course of things that he should have acquired information as to what was transpiring in
his affairs at Manila; and upon the basis of this rational assumption we are authorized, in the absence of proof to
the contrary, to presume that he did have, or soon acquired, information as to the sale of his property.
The Code of Civil Procedure, indeed, expressly declares that there is a presumption that things have happened
according to the ordinary habits of life (sec. 334 [26]); and we cannot conceive of a situation more appropriate
than this for applying the presumption thus defined by the lawgiver. In support of this presumption, as applied to
the present case, it is permissible to consider the probability that the defendant may have received actual notice
of these proceedings from the unofficial notice addressed to him in Manila which was mailed by an employee of
the bank's attorneys. Adopting almost the exact words used by the Supreme Court of the United States in
Grannis vs. Ordeans (234 U. S., 385; 58 L. ed., 1363), we may say that in view of the well-known skill of postal
officials and employees in making proper delivery of letters defectively addressed, we think the presumption is
clear and strong that this notice reached the defendant, there being no proof that it was ever returned by the
postal officials as undelivered. And if it was delivered in Manila, instead of being forwarded to Amoy, China, there
is a probability that the recipient was a person sufficiently interested in his affairs to send it or communicate its
contents to him.
Of course if the jurisdiction of the court or the sufficiency of the process of law depended upon the mailing of the
notice by the clerk, the reflections in which we are now indulging would be idle and frivolous; but the
considerations mentioned are introduced in order to show the propriety of applying to this situation the legal
presumption to which allusion has been made. Upon that presumption, supported by the circumstances of this
case, ,we do not hesitate to found the conclusion that the defendant voluntarily abandoned all thought of saving
his property from the obligation which he had placed upon it; that knowledge of the proceedings should be
imputed to him; and that he acquiesced in the consequences of those proceedings after they had been
accomplished. Under these circumstances it is clear that the merit of this motion is, as we have already stated,
adversely affected in a high degree by the delay in asking for relief. Nor is it an adequate reply to say that the

proponent of this motion is an administrator who only qualified a few months before this motion was made. No
disability on the part of the defendant himself existed from the time when the foreclosure was effected until his
death; and we believe that the delay in the appointment of the administrator and institution of this action is a
circumstance which is imputable to the parties in interest whoever they may have been. Of course if the minor
heirs had instituted an action in their own right to recover the property, it would have been different.
It is, however, argued that the defendant has suffered prejudice by reason of the fact that the bank became the
purchaser of the property at the foreclosure sale for a price greatly below that which had been agreed upon in
the mortgage as the upset price of the property. In this connection, it appears that in article nine of the mortgage
which was the subject of this foreclosure, as amended by the notarial document of July 19, 1906, the parties to
this mortgage made a stipulation to the effect that the value therein placed upon the mortgaged properties
should serve as a basis of sale in case the debt should remain unpaid and the bank should proceed to a
foreclosure. The upset price stated in that stipulation for all the parcels involved in this foreclosure was
P286,000. It is said in behalf of the appellant that when the bank bought in the property for the sum of P110,200
it violated that stipulation.
It has been held by this court that a clause in a mortgage providing for a tipo, or upset price, does not prevent a
foreclosure, nor affect the validity of a sale made in the foreclosure proceedings. (Yangco vs. Cruz Herrera and
Wy Piaco, 11 Phil. Rep., 402; Banco-Espaol Filipino vs. Donaldson, Sim and Co., 5 Phil. Rep., 418.) In both the
cases here cited the property was purchased at the foreclosure sale, not by the creditor or mortgagee, but by a
third party. Whether the same rule should be applied in a case where the mortgagee himself becomes the
purchaser has apparently not been decided by this court in any reported decision, and this question need not
here be considered, since it is evident that if any liability was incurred by the bank by purchasing for a price
below that fixed in the stipulation, its liability was a personal liability derived from the contract of mortgage; and
as we have already demonstrated such a liability could not be the subject of adjudication in an action where the
court had no jurisdiction over the person of the defendant. If the plaintiff bank became liable to account for the
difference between the upset price and the price at which in bought in the property, that liability remains
unaffected by the disposition which the court made of this case; and the fact that the bank may have violated
such an obligation can in no wise affect the validity of the judgment entered in the Court of First Instance.
In connection with the entire failure of the motion to show either a meritorious defense to the action or that the
defendant had suffered any prejudice of which the law can take notice, we may be permitted to add that in our
opinion a motion of this kind, which proposes to unsettle judicial proceedings long ago closed, can not be
considered with favor, unless based upon grounds which appeal to the conscience of the court. Public policy
requires that judicial proceedings be upheld. The maximum here applicable is non quieta movere. As was once
said by Judge Brewer, afterwards a member of the Supreme Court of the United States:
Public policy requires that judicial proceedings be upheld, and that titles obtained in those proceedings
be safe from the ruthless hand of collateral attack. If technical defects are adjudged potent to destroy
such titles, a judicial sale will never realize that value of the property, for no prudent man will risk his
money in bidding for and buying that title which he has reason to fear may years thereafter be swept
away through some occult and not readily discoverable defect. (Martin vs. Pond, 30 Fed., 15.)
In the case where that language was used an attempt was made to annul certain foreclosure proceedings on the
ground that the affidavit upon which the order of publication was based erroneously stated that the State of
Kansas, when he was in fact residing in another State. It was held that this mistake did not affect the validity of
the proceedings.
In the preceding discussion we have assumed that the clerk failed to send the notice by post as required by the
order of the court. We now proceed to consider whether this is a proper assumption; and the proposition which
we propose to establish is that there is a legal presumption that the clerk performed his duty as the ministerial
officer of the court, which presumption is not overcome by any other facts appearing in the cause.
In subsection 14 of section 334 of the Code of Civil Procedure it is declared that there is a presumption "that
official duty has been regularly performed;" and in subsection 18 it is declared that there is a presumption "that
the ordinary course of business has been followed." These presumptions are of course in no sense novelties, as
they express ideas which have always been recognized. Omnia presumuntur rite et solemniter esse acta donec

probetur in contrarium. There is therefore clearly a legal presumption that the clerk performed his duty about
mailing this notice; and we think that strong considerations of policy require that this presumption should be
allowed to operate with full force under the circumstances of this case. A party to an action has no control over
the clerk of the court; and has no right to meddle unduly with the business of the clerk in the performance of his
duties. Having no control over this officer, the litigant must depend upon the court to see that the duties imposed
on the clerk are performed.
Other considerations no less potent contribute to strengthen the conclusion just stated. There is no principle of
law better settled than that after jurisdiction has once been required, every act of a court of general jurisdiction
shall be presumed to have been rightly done. This rule is applied to every judgment or decree rendered in the
various stages of the proceedings from their initiation to their completion (Voorhees vs. United States Bank, 10
Pet., 314; 35 U. S., 449); and if the record is silent with respect to any fact which must have been established
before the court could have rightly acted, it will be presumed that such fact was properly brought to its
knowledge. (The Lessee of Grignon vs. Astor, 2 How., 319; 11 L. ed., 283.)
In making the order of sale [of the real state of a decedent] the court are presumed to have adjudged
every question necessary to justify such order or decree, viz: The death of the owners; that the
petitioners were his administrators; that the personal estate was insufficient to pay the debts of the
deceased; that the private acts of Assembly, as to the manner of sale, were within the constitutional
power of the Legislature, and that all the provisions of the law as to notices which are directory to the
administrators have been complied with. . . . The court is not bound to enter upon the record the
evidence on which any fact was decided. (Florentine vs. Barton, 2 Wall., 210; 17 L. ed., 785.) Especially
does all this apply after long lapse of time.
Applegate vs. Lexington and Carter County Mining Co. (117 U. S., 255) contains an instructive discussion in a
case analogous to that which is now before us. It there appeared that in order to foreclose a mortgage in the
State of Kentucky against a nonresident debtor it was necessary that publication should be made in a
newspaper for a specified period of time, also be posted at the front door of the court house and be published on
some Sunday, immediately after divine service, in such church as the court should direct. In a certain action
judgment had been entered against a nonresident, after publication in pursuance of these provisions. Many
years later the validity of the proceedings was called in question in another action. It was proved from the files of
an ancient periodical that publication had been made in its columns as required by law; but no proof was offered
to show the publication of the order at the church, or the posting of it at the front door of the court-house. It was
insisted by one of the parties that the judgment of the court was void for lack of jurisdiction. But the Supreme
Court of the United States said:
The court which made the decree . . . was a court of general jurisdiction. Therefore every presumption
not inconsistent with the record is to be indulged in favor of its jurisdiction. . . . It is to be presumed that
the court before making its decree took care of to see that its order for constructive service, on which its
right to make the decree depended, had been obeyed.
It is true that in this case the former judgment was the subject of collateral , or indirect attack, while in the case at
bar the motion to vacate the judgment is direct proceeding for relief against it. The same general presumption,
however, is indulged in favor of the judgment of a court of general jurisdiction, whether it is the subject of direct
or indirect attack the only difference being that in case of indirect attack the judgment is conclusively presumed
to be valid unless the record affirmatively shows it to be void, while in case of direct attack the presumption in
favor of its validity may in certain cases be overcome by proof extrinsic to the record.
The presumption that the clerk performed his duty and that the court made its decree with the knowledge that
the requirements of law had been complied with appear to be amply sufficient to support the conclusion that the
notice was sent by the clerk as required by the order. It is true that there ought to be found among the papers on
file in this cause an affidavit, as required by section 400 of the Code of Civil Procedure, showing that the order
was in fact so sent by the clerk; and no such affidavit appears. The record is therefore silent where it ought to
speak. But the very purpose of the law in recognizing these presumptions is to enable the court to sustain a prior
judgment in the face of such an omission. If we were to hold that the judgment in this case is void because the
proper affidavit is not present in the file of papers which we call the record, the result would be that in the future
every title in the Islands resting upon a judgment like that now before us would depend, for its continued security,

upon the presence of such affidavit among the papers and would be liable at any moment to be destroyed by the
disappearance of that piece of paper. We think that no court, with a proper regard for the security of judicial
proceedings and for the interests which have by law been confided to the courts, would incline to favor such a
conclusion. In our opinion the proper course in a case of this kind is to hold that the legal presumption that the
clerk performed his duty still maintains notwithstanding the absence from the record of the proper proof of that
fact.
In this connection it is important to bear in mind that under the practice prevailing in the Philippine Islands the
word "record" is used in a loose and broad sense, as indicating the collective mass of papers which contain the
history of all the successive steps taken in a case and which are finally deposited in the archives of the clerk's
office as a memorial of the litigation. It is a matter of general information that no judgment roll, or book of final
record, is commonly kept in our courts for the purpose of recording the pleadings and principal proceedings in
actions which have been terminated; and in particular, no such record is kept in the Court of First Instance of the
city of Manila. There is, indeed, a section of the Code of Civil Procedure which directs that such a book of final
record shall be kept; but this provision has, as a matter of common knowledge, been generally ignored. The
result is that in the present case we do not have the assistance of the recitals of such a record to enable us to
pass upon the validity of this judgment and as already stated the question must be determined by examining the
papers contained in the entire file.
But it is insisted by counsel for this motion that the affidavit of Bernardo Chan y Garcia showing that upon April 4,
1908, he sent a notification through the mail addressed to the defendant at Manila, Philippine Islands, should be
accepted as affirmative proof that the clerk of the court failed in his duty and that, instead of himself sending the
requisite notice through the mail, he relied upon Bernardo to send it for him. We do not think that this is by any
means a necessary inference. Of course if it had affirmatively appeared that the clerk himself had attempted to
comply with this order and had directed the notification to Manila when he should have directed it to Amoy, this
would be conclusive that he had failed to comply with the exact terms of the order; but such is not this case. That
the clerk of the attorneys for the plaintiff erroneously sent a notification to the defendant at a mistaken address
affords in our opinion very slight basis for supposing that the clerk may not have sent notice to the right address.
There is undoubtedly good authority to support the position that when the record states the evidence or makes
an averment with reference to a jurisdictional fact, it will not be presumed that there was other or different
evidence respecting the fact, or that the fact was otherwise than stated. If, to give an illustration, it appears from
the return of the officer that the summons was served at a particular place or in a particular manner, it will not be
presumed that service was also made at another place or in a different manner; or if it appears that service was
made upon a person other than the defendant, it will not be presumed, in the silence of the record, that it was
made upon the defendant also (Galpin vs. Page, 18 Wall., 350, 366; Settlemier vs. Sullivan, 97 U. S., 444, 449).
While we believe that these propositions are entirely correct as applied to the case where the person making the
return is the officer who is by law required to make the return, we do not think that it is properly applicable where,
as in the present case, the affidavit was made by a person who, so far as the provisions of law are concerned,
was a mere intermeddler.
The last question of importance which we propose to consider is whether a motion in the cause is admissible as
a proceeding to obtain relief in such a case as this. If the motion prevails the judgment of July 2, 1908, and all
subsequent proceedings will be set aside, and the litigation will be renewed, proceeding again from the date
mentioned as if the progress of the action had not been interrupted. The proponent of the motion does not ask
the favor of being permitted to interpose a defense. His purpose is merely to annul the effective judgment of the
court, to the end that the litigation may again resume its regular course.
There is only one section of the Code of Civil Procedure which expressly recognizes the authority of a Court of
First Instance to set aside a final judgment and permit a renewal of the litigation in the same cause. This is as
follows:
SEC. 113. Upon such terms as may be just the court may relieve a party or legal representative from the
judgment, order, or other proceeding taken against him through his mistake, inadvertence, surprise, or
excusable neglect; Provided, That application thereof be made within a reasonable time, but in no case
exceeding six months after such judgment, order, or proceeding was taken.

An additional remedy by petition to the Supreme Court is supplied by section 513 of the same Code. The first
paragraph of this section, in so far as pertinent to this discussion, provides as follows:
When a judgment is rendered by a Court of First Instance upon default, and a party thereto is unjustly
deprived of a hearing by fraud, accident, mistake or excusable negligence, and the Court of First
Instance which rendered the judgment has finally adjourned so that no adequate remedy exists in that
court, the party so deprived of a hearing may present his petition to the Supreme Court within sixty days
after he first learns of the rendition of such judgment, and not thereafter, setting forth the facts and
praying to have judgment set aside. . . .
It is evident that the proceeding contemplated in this section is intended to supplement the remedy provided by
section 113; and we believe the conclusion irresistible that there is no other means recognized by law whereby a
defeated party can, by a proceeding in the same cause, procure a judgment to be set aside, with a view to the
renewal of the litigation.
The Code of Civil Procedure purports to be a complete system of practice in civil causes, and it contains
provisions describing with much fullness the various steps to be taken in the conduct of such proceedings. To
this end it defines with precision the method of beginning, conducting, and concluding the civil action of whatever
species; and by section 795 of the same Code it is declared that the procedure in all civil action shall be in
accordance with the provisions of this Code. We are therefore of the opinion that the remedies prescribed in
sections 113 and 513 are exclusive of all others, so far as relates to the opening and continuation of a litigation
which has been once concluded.
The motion in the present case does not conform to the requirements of either of these provisions; and the
consequence is that in our opinion the action of the Court of First Instance in dismissing the motion was proper.
If the question were admittedly one relating merely to an irregularity of procedure, we cannot suppose that this
proceeding would have taken the form of a motion in the cause, since it is clear that, if based on such an error,
the came to late for relief in the Court of First Instance. But as we have already seen, the motion attacks the
judgment of the court as void for want of jurisdiction over the defendant. The idea underlying the motion
therefore is that inasmuch as the judgment is a nullity it can be attacked in any way and at any time. If the
judgment were in fact void upon its face, that is, if it were shown to be a nullity by virtue of its own recitals, there
might possibly be something in this. Where a judgment or judicial order is void in this sense it may be said to be
a lawless thing, which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it
exhibits its head.
But the judgment in question is not void in any such sense. It is entirely regular in form, and the alleged defect is
one which is not apparent upon its face. It follows that even if the judgment could be shown to be void for want of
jurisdiction, or for lack of due process of law, the party aggrieved thereby is bound to resort to some appropriate
proceeding to obtain relief. Under accepted principles of law and practice, long recognized in American courts, a
proper remedy in such case, after the time for appeal or review has passed, is for the aggrieved party to bring an
action to enjoin the judgment, if not already carried into effect; or if the property has already been disposed of he
may institute suit to recover it. In every situation of this character an appropriate remedy is at hand; and if
property has been taken without due process, the law concedes due process to recover it. We accordingly old
that, assuming the judgment to have been void as alleged by the proponent of this motion, the proper remedy
was by an original proceeding and not by motion in the cause. As we have already seen our Code of Civil
Procedure defines the conditions under which relief against a judgment may be productive of conclusion for this
court to recognize such a proceeding as proper under conditions different from those defined by law. Upon the
point of procedure here involved, we refer to the case of People vs. Harrison (84 Cal., 607) wherein it was held
that a motion will not lie to vacate a judgment after the lapse of the time limited by statute if the judgment is not
void on its face; and in all cases, after the lapse of the time limited by statute if the judgment is not void on its
face; and all cases, after the lapse of such time, when an attempt is made to vacate the judgment by a
proceeding in court for that purpose an action regularly brought is preferable, and should be required. It will be
noted taken verbatim from the California Code (sec. 473).
The conclusions stated in this opinion indicate that the judgment appealed from is without error, and the same is
accordingly affirmed, with costs. So ordered.

Arellano, C.J., Torres, Carson, and Avancea, JJ., concur.

Separate Opinions
MALCOLM, J., dissenting:
I dissent. It will not make me long to state my reasons. An immutable attribute the fundamental idea of due
process of law is that no man shall be condemned in his person or property without notice and an opportunity of
being heard in his defense. Protection of the parties demands a strict and an exact compliance with this
constitutional provision in our organic law and of the statutory provisions in amplification. Literally hundreds of
precedents could be cited in support of these axiomatic principles. Where as in the instant case the defendant
received no notice and had no opportunity to be heard, certainly we cannot say that there is due process of law.
Resultantly, "A judgment which is void upon its face, and which requires only an inspection of the judgment roll to
demonstrate its want of vitality is a dead limb upon the judicial tree, which should be lopped off, if the power so
to do exists. It can bear no fruit to the plaintiff, but is a constant menace to the defendant." (Mills vs. Dickons, 6
Rich [S. C.], 487.)

FIRST DIVISION
[G.R. No. 131482. July 3, 2002]
REGALADO P. SAMARTINO, petitioner, vs. LEONOR B. RAON, AGUSTIN G. CRISOSTOMO, THE
MUNICIPAL TRIAL COURT OF NOVELETA, CAVITE, HON. MANUEL A. MAYO, REGIONAL TRIAL COURT,
BRANCH 16, CAVITE CITY, HON. ROLANDO D. DIAZ, REGIONAL TRIAL COURT, BRANCH 17, CAVITE
CITY, SHERIFF DANILO G. LAPUZ, CAVITE CITY and THE HON. COURT OF APPEALS, respondents.
DECISION
YNARES-SANTIAGO, J.:
Respondents Leonor Bernardo-Raon and Agustin G. Crisostomo are the surviving sister and spouse,
respectively, of the late Filomena Bernardo-Crisostomo, who passed away on May 17, 1994. Among the
properties left by the deceased was her one-half share in a parcel of land in Noveleta, Cavite, registered under
Transfer Certificate of Title No. T- 131898 in the name of co-owners Lido Beach Corporation and Filomena
Bernardo.
On January 25, 1996, respondents instituted against petitioner Regalado P. Samartino a complaint for ejectment,
docketed as Civil Case No. 744 of the Municipal Trial Court of Noveleta, Cavite. i[1] They alleged that during the
lifetime of Filomena Bernardo, she leased her share in the property to petitioner for a period of five years
counted from 1986; that the said lease expired and was not extended thereafter; and that petitioner refused to
vacate the property despite demands therefor.
Summons was served on Roberto Samartino, brother of petitioner.ii[2] At the time of service of summons at
petitioners house, he was not at home as he was then confined at the National Bureau of Investigation
Treatment and Rehabilitation Center (NBI-TRC), Tagaytay City since January 19, 1996, where he was
undergoing treatment and rehabilitation for drug dependency. Thus, on February 2, 1996, a liaison officer of the
NBI-TRC appeared before the trial court with a certification that petitioner will be unable to comply with the
directive to answer the complaint within the reglementary period, inasmuch as it will take six months for him to
complete the rehabilitation program and before he can be recommended for discharge by the Rehabilitation
Committee.iii[3]
The trial court, despite the written certification from NBI-TRC, granted respondents motion to declare petitioner in
default and ordered them to present evidence ex-parte. On March 21, 1996, the trial court rendered judgment in
favor of respondents as follows:
FROM THE FOREGOING CONSIDERATIONS, judgment is hereby rendered in favor of the plaintiffs and against
the defendant ordering the latter and other person/s claiming rights under him:
1.To vacate immediately the land in question after the finality of the decision.
2.

For the defendant to pay the plaintiffs the sum of P5,000.00 monthly from January, 1992 up to
the time he surrenders the premises considered as damages for the use of the subject land.

3.

For the defendant to pay the plaintiffs P 10,000.00 as and for attorneys fees with an additional
P800.00 as appearance fees.

4.

To pay the plaintiffs P 100.00 as filing fee.

SO ORDERED.iv[4]

After learning of the adverse decision against him, petitioners counsel filed with the Regional Trial Court of
Cavite City, Branch 16, a motion to set aside judgment. The motion was treated as an appeal and docketed as
Civil Case No. N-6281. On July 18, 1996, the RTC affirmed the decision of the MTC. v[5]
The aforesaid decision became final. Accordingly, the court of origin issued on September 17, 1996 a writ of
execution.vi[6] Petitioner was given a grace period of one month within which to vacate the premises. His real
property situated in Noveleta, Cavite, covered by Transfer Certificate of Title No. T-283572, was levied and sold
at public auction to respondents in full satisfaction of the monetary award. vii[7]
On November 25, 1996, petitioner filed with the Regional Trial Court of Cavite City, a petition for relief from
judgment, docketed as Civil Case No. N-6393.viii[8] In support thereof, petitioner submitted an affidavit of merit, ix
[9] alleging in fine that the parcel of land from which he was being evicted had been sold to him by Filomena
Bernardo-Crisostomo, as evidenced by the Deed of Absolute Sale dated December 13, 1988. x[10]
The following day, November 26, 1996, the RTC issued an Order dismissing the petition for relief from
judgment.xi[11] Petitioners Motion for Reconsideration was denied on December 12, 1996. A second Motion for
Reconsideration was likewise denied on January 14, 1997. xii[12] On the same day, a writ of demolition was
issued commanding the sheriff to remove the building and improvements made by petitioner on the subject
premises and to deliver the possession thereof to respondents. xiii[13]
Petitioner thus filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 432O2. xiv[14]
On August 29, 1997, the Court of Appeals dismissed the petition. xv[15] Petitioners Motion for Reconsideration
was denied on November 14, 1997.xvi[16] Hence this petition for review.
The petition is impressed with merit.
In actions in personam, summons on the defendant must be served by handing a copy thereof to the defendant
in person, or, if he refuses to receive it, by tendering it to him. If efforts to serve the summons personally to
defendant is impossible, service may be effected by leaving copies of the summons at the defendants dwelling
house or residence with some person of suitable age and discretion residing therein, or by leaving the copies at
the defendants office or regular place of business with some competent person in charge thereof. Otherwise
stated, service of summons upon the defendant shall be by personal service first and only when the defendant
cannot be promptly served in person will substituted service be availed of. xvii[17]Rule 14 of the 1997 Rules of
Civil Procedure clearly provides:
Sec. 6. Service in person on defendant. - Whenever practicable, the summons shall be served by handing a
copy thereof to the defendant in person, or, if he refuses to receive and sign for it, by tendering it to him.
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
defendants residence with some person of suitable age and discretion then residing therein, or (b) by leaving the
copies at defendants office or regular place of business with some competent person in charge thereof.
We have long held that the impossibility of personal service justifying availment of substituted service should be
explained in the proof of service; why efforts exerted towards personal service failed. The pertinent facts and
circumstances attendant to the service of summons must be stated in the proof of service or Officers Return;
otherwise, the substituted service cannot be upheld. It is only under exceptional terms that the circumstances
warranting substituted service of summons may be proved by evidence aliunde. It bears stressing that since
service of summons, especially for actions in personam, is essential for the acquisition of jurisdiction over the
person of the defendant, the resort to a substituted service must be duly justified. Failure to do so would
invalidate all subsequent proceedings on jurisdictional grounds. xviii[18]In this connection, Supreme Court
Administrative Circular No. 59 was issued on November 19, 1989 to stress the importance of strict compliance
with the requisites for a valid substituted service, to wit:
Delays in court proceedings have been caused by faulty and erroneous implementation of Section 8, Rule 14,
Rules of Court on Substituted Service of Summons.

The Trial Judges of all lower courts, as well as the Clerks of Court in their capacity as Ex-Officio Sheriffs together
with the Deputy Sheriffs are reminded of the provision of Section 8, Rule 14, Rules of Court on substituted
service as follows:
xxx

xxx

xxx

The manner of effecting substituted service as prescribed in Venturanza vs. Court of Appeals, 156 SCRA 305,
must be strictly complied with, thus:
The substituted service should be availed only when the defendant cannot be served promptly in person.
Impossibility of prompt service should be shown by stating the efforts made to find the defendant personally and
the failure of such efforts. The statement should be made in the proof of service. This is necessary because
substituted service is in derogation of the usual method of service.
Substituted service is a method extraordinary in character, and hence may be used only as prescribed in the
circumstances authorized by statute. Thus, the statutory requirements of substituted service must be followed
strictly, faithfully and any substituted service other than authorized by the statute is considered ineffective.
For immediate compliance.
In the case at bar, the sheriffs Return of Summons simply states:
This is to certify that on this date: 26th day of January I have caused the service of summons, together with the
attached complaint and its annexes issued in the above entitled case upon defendant REGALADO SAMARTINO
thru ROBERTO SAMARTINO, Brother of the defendant acknowledge receipt of said court processes by affixing
his signature at the lower left portion of the original summons hereto attached.
WHEREFORE, the attached original summons is hereby respectfully returned to the court of origin duly served
for information and record purposes.
Noveleta, Cavite, February 9, 1996.xix[19]Clearly, the above return failed to show the reason why personal
service could not be made. It failed to state that prompt and personal service on the defendant was rendered
impossible. It was not shown that efforts were made to find the defendant personally and that said efforts failed;
hence the resort to substituted service. As stated above, these requirements are indispensable because
substituted service is in derogation of the usual method of service. It is an extraordinary method since it seeks to
bind the defendant to the consequences of a suit even though notice of such action is served not upon him but
upon another whom law could only presume would notify him of the pending proceedings. For this reason, failure
to faithfully, strictly, and fully comply with the requirements of substituted service renders said service
ineffective.xx[20]Furthermore, nowhere in the return of summons or in the records of this case is it shown that
petitioners brother, on whom substituted service of summons was effected, was a person of suitable age and
discretion residing at petitioners residence.
There being no valid substituted service of summons, the trial court did not acquire jurisdiction over the person of
petitioner. It should be emphasized that the service of summons is not only required to give the court jurisdiction
over the person of the defendant, but also to afford the latter an opportunity to be heard on the claim made
against him. Thus, compliance with the rules regarding the service of summons is as much an issue of due
process as of jurisdiction. The essence of due process is to be found in the reasonable opportunity to be heard
and submit any evidence one may have in support of his defense. It is elementary that before a person can be
deprived of his property, he should first be informed of the claim against him and the theory on which such claim
is premised.xxi[21]By reason of the ineffective service of summons, petitioner was not duly apprised of the action
against him. Consequently, he was prevented from answering the claims against him. He was not given a
chance to be heard on his defenses. What made matters worse was that the trial court had actual knowledge
that petitioner was then indisposed and unable to file his answer to the complaint, as he was then confined at the
NBI-TRC. The trial courts failure to give petitioner a reasonable opportunity to file his answer violated his right to
due process. Perforce, the judgment rendered against petitioner is nugatory and without effect.

The trial court should not have been too rash in declaring petitioner in default, considering it had actual notice of
valid reasons that prevented him from answering. Well-settled is the rule that courts should be liberal in setting
aside orders of default for default judgments are frowned upon, unless in cases where it clearly appears that the
reopening of the case is intended for delay. The issuance of orders of default should be the exception rather than
the rule, to be allowed only in clear cases of obstinate refusal by the defendant to comply with the orders of the
trial court.xxii[22]Suits should as much as possible be decided on the merits and not on technicalities. In this
regard, we have often admonished courts to be liberal in setting aside orders of default as default judgments are
frowned upon and not looked upon with favor for they may amount to a positive and considerable injustice to the
defendant and the possibility of such serious consequences necessitates a careful examination of the grounds
upon which the defendant asks that it be set aside. Since rules of procedure are mere tools designed to facilitate
the attainment of justice, it is well recognized that this Court is empowered to suspend its operation, or except a
particular case from its operation, when the rigid application thereof tends to frustrate rather than promote the
ends of justice. We are not unmindful of the fact that during the pendency of the instant petition, the trial court
has rendered judgment against petitioners. However, being the court of last resort, we deem it in the best
interest that liberality and relaxation of the Rules be extended to petitioners by setting aside the order of default
issued by the trial court and the consequent default judgment; otherwise, great injustice would result if petitioners
are not afforded an opportunity to prove their claims. xxiii[23]In addition, the Regional Trial Court committed
reversible error in dismissing the petition for relief from judgment for having been filed out of time. According to
the Regional Trial Court, the petition for relief, filed on November 25, 1996, was late because petitioner had
actual knowledge of the judgment in the ejectment case since March 1996. The period within which to file a
petition for relief should have been reckoned from the date petitioner learned of the judgment of the Regional
Trial Court. It should not have been counted from the date of the Municipal Trial Courts decision because,
precisely, petitioner appealed the same. It was the Regional Trial Courts decision that became final and, hence,
was the proper subject of the petition for relief from judgment. It is axiomatic that a petition for relief is only
available against a final and executory judgment. xxiv[24]Section 3, Rule 38, of the 1997 Rules of Civil Procedure
provides that a verified petition for relief must be filed within sixty (60) days after the petitioner learns of the
judgment, final order, or other proceeding to be set aside and not more than six (6) months after such judgment
or final order has been entered or such proceeding has been taken. It must be accompanied with affidavits
showing the fraud, accident, mistake, or excusable negligence relied upon, and the facts constituting petitioners
good and substantial cause of action or defense. xxv[25]It is not clear from the records of the case at bar when
petitioner learned of the decision of the Regional Trial Court affirming the judgment of the Municipal Trial Court.
What appears is that the said decision became final only on August 15, 1996, and must have been entered
sometime thereafter. Hence, the petition for relief filed on November 25, 1996 was well within the six-month
period prescribed by the Rules.
Finally, the records show that petitioner raised a meritorious defense in his affidavit of merit. He alleged therein
that the property from which he was being ejected had been sold to him by its registered owner. Ownership is a
valid defense in unlawful detainer cases. While possession is the main issue in ejectment, it is also one of the
essential attributes of ownership. It follows that an owner of real property is entitled to possession of the same.
Petitioner can, therefore, properly plead his right of possession to defeat that of respondents. Indeed, an owner
who cannot exercise the seven "juses or attributes of ownership - the right to possess, to use and enjoy, to
abuse or consume, to accessories, to dispose or alienate, to recover or vindicate and to the fruits - is a crippled
owner.xxvi[26]All told, the Municipal Trial Court of Noveleta and the Regional Trial Court of Cavite City did not
have jurisdiction over the person of petitioner. Hence, all proceedings had as regards petitioner were null and
void. Necessarily, the enforcement of the writ of execution as well as the sale at public auction of petitioners real
property to satisfy the void judgment must also be declared of no legal effect.
There is a real need to resolve the issue of ownership over the premises in order to determine who, as between
petitioner and respondents, has a better right to possess the property in dispute. This can only be done in the
proper proceeding before the trial court wherein petitioner will be afforded every right to present evidence in his
behalf.
WHEREFORE, in view of the foregoing, the petition is GRANTED. The decision of the Court of Appeals in CAG.R. SP No. 43202 is REVERSED and SET ASIDE. This case is REMANDED to the Municipal Trial Court of
Noveleta, Cavite, which is directed to continue proceedings in Civil Case No. 744 by affording petitioner
Regalado P. Samartino a chance to file his answer and present evidence in his defense, and thereafter to hear
and decide the case. The Writ of Execution dated September 17, 1996, the Writ of Demolition dated January 14,

1997, and the certificate of sale over Transfer Certificate of Title No. T-283572, as well as all acts and deeds
incidental to the judgment in Civil Case No. 744, are declared NULL AND VOID.
SO ORDERED.

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THIRD DIVISION
[G.R. No. 111397. August 12, 2002]
HON. ALFREDO LIM and RAFAELITO GARAYBLAS, petitioners, vs. THE COURT OF APPEALS, HON.
WILFREDO REYES and BISTRO PIGALLE, INC., respondents.
DECISION
CARPIO, J.:
The Case

Before us is a petition for review on certiorari[1] of the Decision of the Court of Appeals dated March 25, 1993,[2]
and its Resolution dated July 13, 1993[3] which denied petitioners motion for reconsideration. The assailed
Decision sustained the orders dated December 29, 1992, January 20, 1993 and March 2, 1993,[4] issued by
Branch 36 of the Regional Trial Court of Manila. The trial courts orders enjoined petitioner Alfredo Lim (Lim for
brevity), then Mayor of Manila, from investigating, impeding or closing down the business operations of the New
Bangkok Club and the Exotic Garden Restaurant owned by respondent Bistro Pigalle Inc. (Bistro for brevity).
The Antecedent Facts
On December 7, 1992 Bistro filed before the trial court a petition[5] for mandamus and prohibition, with prayer for
temporary restraining order or writ of preliminary injunction, against Lim in his capacity as Mayor of the City of
Manila. Bistro filed the case because policemen under Lims instructions inspected and investigated Bistros
license as well as the work permits and health certificates of its staff. This caused the stoppage of work in Bistros
night club and restaurant operations.[6] Lim also refused to accept Bistros application for a business license, as
well as the work permit applications of Bistros staff, for the year 1993.[7]
In its petition, Bistro argued that Lims refusal to issue the business license and work permits violated the doctrine
laid down this Court in De la Cruz vs. Paras,[8] to wit:
Municipal corporations cannot prohibit the operation of nightclubs. They may be regulated, but not prevented
from carrying on their business.
Acting on Bistros application for injunctive relief, the trial court issued the first assailed temporary restraining
order on December 29, 1992, the dispositive portion of which reads:
WHEREFORE, respondent and/or his agents and representatives are ordered to refrain from inspecting or
otherwise interfering in the operation of the establishments of petitioner (Bistro Pigalle, Inc.).[9]
At the hearing, the parties submitted their evidence in support of their respective positions. On January 20, 1993,
the trial court granted Bistros application for a writ of prohibitory preliminary injunction. The dispositive portion of
the trial courts order declared:
WHEREFORE, in view of all the foregoing, Petitioners application for a writ of prohibitory preliminary injunction is
granted, and Respondent, and any/all persons acting under his authority, are and (sic) ordered to cease and
desist from inspecting, investigating and otherwise closing or impeding the business operations of Petitioner
Corporations establishments while the petition here is pending resolution on the merits.
Considering that the Respondent is a government official and this injunction relates to his official duties, the
posting of an injunction bond by the Petitioners is not required.
On the other hand, Petitioners application for a writ of mandatory injunction is hereby denied, for to grant the
same would amount to granting the writ of mandamus prayed for. The Court reserves resolution thereof until the
parties shall have been heard on the merits.[10]
However, despite the trial courts order, Lim still issued a closure order on Bistros operations effective January
23, 1993, even sending policemen to carry out his closure order.
On January 25, 1993, Bistro filed an Urgent Motion for Contempt against Lim and the policemen who stopped
Bistros operations on January 23, 1993. At the hearing of the motion for contempt on January 29, 1993, Bistro
withdrew its motion on condition that Lim would respect the courts injunction.
However, on February 12, 13, 15, 26 and 27, and on March 1 and 2, 1993, Lim, acting through his agents and
policemen, again disrupted Bistros business operations.

Meanwhile, on February 17, 1993, Lim filed a motion to dissolve the injunctive order of January 20, 1993 and to
dismiss the case. Lim insisted that the power of a mayor to inspect and investigate commercial establishments
and their staff is implicit in the statutory power of the city mayor to issue, suspend or revoke business permits
and licenses. This statutory power is expressly provided for in Section 11 (l), Article II of the Revised Charter of
the City of Manila and in Section 455, paragraph 3 (iv) of the Local Government Code of 1991.
The trial court denied Lims motion to dissolve the injunction and to dismiss the case in an order dated March 2,
1993, the dispositive portion of which stated:
WHEREFORE, premises considered, the Court hereby orders:
(1) The denial of respondents motion to dissolve the writ of preliminary prohibitory injunction or the dismissal of
the instant case;
(2) Petitioner-corporation is authorized to remove the wooden cross-bars or any other impediments which were
placed at its establishments, namely, New Bangkok Club and Exotic Garden Restaurant on February 12, 1993
and February 15, 1993, respectively, and thereafter said establishments are allowed to resume their operations;
(3) All the other petitioners are allowed to continue working in the aforenamed establishments of petitionercorporation if they have not yet reported; and
(4) The hearing on the contempt proceedings is deferred to give sufficient time to respondent to elevate the
matters assailed herein to the Supreme Court.[11]
On March 10, 1993, Lim filed with the Court of Appeals a petition for certiorari, prohibition and mandamus
against Bistro and Judge Wilfredo Reyes. Lim claimed that the trial judge committed grave abuse of discretion
amounting to lack of jurisdiction in issuing the writ of prohibitory preliminary injunction.
On March 25, 1993, the Court of Appeals rendered the assailed decision.[12] In a resolution dated July 13, 1993,
the Court of Appeals denied Lims motion for reconsideration.[13]
On July 1, 1993, Manila City Ordinance No. 7783[14] took effect. On the same day, Lim ordered the Western
Police District Command to permanently close down the operations of Bistro, which order the police
implemented at once.[15]
The Ruling of the Court of Appeals
In denying Lims petition, the Court of Appeals held that the trial court did not commit grave abuse of discretion
since it issued the writ after hearing on the basis of the evidence adduced.
The Court of Appeals reasoned thus:
x x x. A writ of preliminary injunction may issue if the act sought to be enjoined will cause irreparable injury to the
movant or destroy the status quo before a full hearing can be had on the merits of the case.
A writ of preliminary injunction, as an ancillary or preventive remedy, may only be resorted to by a litigant to
protect or preserve his rights or interests and for no other purpose during the pendency of the principal action. It
is primarily intended to maintain the status quo between the parties existing prior to the filing of the case.
In the case at bar, We find that the respondent Judge did not act improvidently in issuing the assailed orders
granting the writ of preliminary injunction in order to maintain the status quo, while the petition is pending
resolution on the merits. The private respondent correctly points out that the questioned writ was regularly issued
after several hearings, in which the parties were allowed to adduce evidence, and argue their respective

positions.
The issuance of a writ of preliminary injunction is within the limits of the sound exercise of discretion of the court
and the appellate court will not interfere, except, in a clear case of abuse thereof. x x x.
WHEREFORE, the petition is DENIED DUE COURSE and is accordingly DISMISSED.[16]
Hence, this petition.
The Issues
In their Memorandum, petitioners raise the following issues:
1. DID RESPONDENT JUDGE COMMIT GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION IN ISSUING HIS SAID ASSAILED ORDERS OF DECEMBER 29, 1992,
JANUARY 20, 1993 AND MARCH 2, 1993?
2. DID RESPONDENT COURT OF APPEALS COMMIT REVERSIBLE ERRORS IN RENDERING ITS
ASSAILED DECISION OF MARCH 25, 1993 AND ITS ASSAILED RESOLUTION OF JULY 13, 1993?
3. DID SAID CIVIL CASE NO. 92-63712 AND SAID CA-G.R. SP NO. 30381 BECOME MOOT AND ACADEMIC
WHEN THE NEW BANGKOK CLUB AND THE EXOTIC GARDEN RESTAURANT OF PRIVATE RESPONDENT
WERE CLOSED ON JULY 1, 1993 PURSUANT TO ORDINANCE NO. 7783?
The Ruling of the Court
The petition is without merit.
Considering that the constitutionality of Ordinance No. 7783 was not raised before the trial court or the Court of
Appeals, and this issue is still under litigation in another case,[17] the Court will deal only with the first two issues
raised by petitioner.
Validity of the Preliminary Injunction
Bistros cause of action in the mandamus and prohibition proceedings before the trial court is the violation of its
property right under its license to operate. The violation consists of the work disruption in Bistros operations
caused by Lim and his subordinates as well as Lims refusal to issue a business license to Bistro and work
permits to its staff for the year 1993. The primary relief prayed for by Bistro is the issuance of writs of mandatory
and prohibitory injunction. The mandatory injunction seeks to compel Lim to accept Bistros 1993 business
license application and to issue Bistros business license. Also, the mandatory injunction seeks to compel Lim to
accept the applications of Bistros staff for work permits. The writ of prohibitory injunction seeks to enjoin Lim
from interfering, impeding or otherwise closing down Bistros operations.
The trial court granted only the prohibitory injunction. This enjoined Lim from interfering, impeding or otherwise
closing down Bistros operations pending resolution of whether Lim can validly refuse to issue Bistros business
license and its staffs work permits for the year 1993.
Lim contends that the Court of Appeals erred in upholding the prohibitory injunction. Lim relies primarily on his
power, as Mayor of the City of Manila, to grant and refuse municipal licenses and business permits as expressly
provided for in the Local Government Code and the Revised Charter of the City of Manila. Lim argues that the
powers granted by these laws implicitly include the power to inspect, investigate and close down Bistros
operations for violation of the conditions of its licenses and permits.

On the other hand, Bistro asserts that the legal provisions relied upon by Lim do not apply to the instant case.
Bistro maintains that the Local Government Code and the Revised Charter of the City of Manila do not expressly
or impliedly grant Lim any power to prohibit the operation of night clubs. Lim failed to specify any violation by
Bistro of the conditions of its licenses and permits. In refusing to accept Bistros business license application for
the year 1993, Bistro claims that Lim denied Bistro due process of law.
The Court of Appeals held that the trial court did not commit grave abuse of discretion in issuing the prohibitory
preliminary injunction.
We uphold the findings of the Court of Appeals.
The authority of mayors to issue business licenses and permits is beyond question. The law expressly provides
for such authority. Section 11 (l), Article II of the Revised Charter of the City of Manila, reads:
Sec. 11. General duties and powers of the mayor. The general duties and powers of the mayor shall be:
x x x.
(l) To grant and refuse municipal licenses or permits of all classes and to revoke the same for violation
of the conditions upon which they were granted, or if acts prohibited by law or municipal ordinances are
being committed under the protection of such licenses or in the premises in which the business for which the
same have been granted is carried on, or for any other reason of general interest. (Emphasis supplied)
On the other hand, Section 455 (3) (iv) of the Local Government Code provides:
Sec. 455. Chief Executive, Powers, Duties and Compensation: xxx.
(b) For efficient, effective and economical governance the purpose of which is the general welfare of the City and
its inhabitants pursuant to Section 16 of this Code, the City Mayor shall:
(3) x x x.
(iv) Issue licenses and permits and suspend or revoke the same for any violation of the condition upon
which said licenses or permits had been issued, pursuant to law or ordinance. (Emphasis supplied)
From the language of the two laws, it is clear that the power of the mayor to issue business licenses and permits
necessarily includes the corollary power to suspend, revoke or even refuse to issue the same. However, the
power to suspend or revoke these licenses and permits is expressly premised on the violation of the conditions
of these permits and licenses. The laws specifically refer to the violation of the condition(s) on which the licenses
and permits were issued. Similarly, the power to refuse to issue such licenses and permits is premised on noncompliance with the prerequisites for the issuance of such licenses and permits. The mayor must observe due
process in exercising these powers, which means that the mayor must give the applicant or licensee notice and
opportunity to be heard.
True, the mayor has the power to inspect and investigate private commercial establishments for any violation of
the conditions of their licenses and permits. However, the mayor has no power to order a police raid on these
establishments in the guise of inspecting or investigating these commercial establishments. Lim acted beyond
his authority when he directed policemen to raid the New Bangkok Club and the Exotic Garden Restaurant. Such
act of Lim violated Ordinance No. 7716[18] which expressly prohibits police raids and inspections, to wit:
Section 1.No member of the Western Police District shall conduct inspection of food and other business
establishments for the purpose of enforcing sanitary rules and regulations, inspecting licenses and permits,
and/or enforcing internal revenue and customs laws and regulations. This responsibility should be properly

exercised by Local Government Authorities and other concerned agencies. (Emphasis supplied)
These local government officials include the City Health Officer or his representative, pursuant to the Revised
City Ordinances of the City of Manila,[19] and the City Treasurer pursuant to Section 470 of the Local
Government Code.[20]
Lim has no authority to close down Bistros business or any business establishment in Manila without due
process of law. Lim cannot take refuge under the Revised Charter of the City of Manila and the Local
Government Code. There is no provision in these laws expressly or impliedly granting the mayor authority to
close down private commercial establishments without notice and hearing, and even if there is, such provision
would be void. The due process clause of the Constitution requires that Lim should have given Bistro an
opportunity to rebut the allegations that it violated the conditions of its licenses and permits.
The regulatory powers granted to municipal corporations must always be exercised in accordance with law, with
utmost observance of the rights of the people to due process and equal protection of the law.[21] Such power
cannot be exercised whimsically, arbitrarily or despotically. In the instant case, we find that Lims exercise of this
power violated Bistros property rights that are protected under the due process clause of the Constitution.
Lim did not charge Bistro with any specific violation of the conditions of its business license or permits. Still, Lim
closed down Bistros operations even before the expiration of its business license on December 31, 1992. Lim
also refused to accept Bistros license application for 1993, in effect denying the application without examining
whether it complies with legal prerequisites.
Lims zeal in his campaign against prostitution is commendable. The presumption is that he acted in good faith
and was motivated by his concern for his constituents when he implemented his campaign against prostitution in
the Ermita-Malate area. However, there is no excusing Lim for arbitrarily closing down, without due process of
law, the business operations of Bistro. For this reason, the trial court properly restrained the acts of Lim.
Consequently, the Court of Appeals did not err in upholding the trial courts orders. The sole objective of a writ of
preliminary injunction is to preserve the status quo until the merits of the case can be heard fully. It is generally
availed of to prevent actual or threatened acts, until the merits of the case can be disposed of.[22] In the instant
case, the issuance of the writ of prohibitory preliminary injunction did not dispose of the main case for
mandamus. The trial court issued the injunction in view of the disruptions and stoppage in Bistros operations as
a consequence of Lims closure orders. The injunction was intended to maintain the status quo while the petition
has not been resolved on the merits.
WHEREFORE, the petition is denied for lack of merit. The assailed Decision of the Court of Appeals in CA-G.R.
SP NO. 30381 is AFFIRMED in toto.
SO ORDERED.

Puno, (Chairman), and Panganiban, JJ., concur.

Sandoval-Gutierrez, J., on leave.

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Republic of the Philippines
SUPREME COURT
ManilaTHIRD DIVISION
G.R. No. 93891

March 11, 1991

POLLUTION ADJUDICATION BOARD, petitioner

vs.
COURT OF APPEALS and SOLAR TEXTILE FINISHING CORPORATION, respondents.
Oscar A. Pascua and Charemon Clio L. Borre for petitioner.
Leonardo A. Aurelio for respondent Solar Textile Finishing Corp.

RESOLUTION

FELICIANO,
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