SAMARTINO VS.

RAON
Facts:

1. 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 in the name of
co-owners Lido Beach Corporation and Filomena Bernardo.
2. 2. In 1996, respondents instituted a complaint for ejectment against petitioner
Regalado P. Samartino a complaint for ejectment alleging that during the lifetime of
Filomena, she leased her share 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.
3. Summons was served on Roberto Samartino, brother of petitioner. At the time of
service, he was not at home as he was then confined at the NBI rehab center 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.]
4. The trial court, despite the written certification from NBI-TRC, declared petitioner
in default and ordered them to present evidence ex-parte. On March 21, 1996, the
trial court rendered judgment in favor of respondents. Counsel of respondent filed a
motion to set aside judgement at the RTC, RTC affirmed lower court decision. This
decision became final, the property was sold in an auction to the respondents,
Petitioner filed petition for relief from judgement alleging 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.
Petition was dismissed by RTC. Petitioner filed petition for certiorari before CA
which was also dismissed, including his MR, hence this petition for review.
Issue: Whether or not the court (MTC & RTC) acquired jurisdiction over the
person of the petitioner

NO. The summon was ineffective. There being no valid substituted service of
summons, the trial court did not acquire jurisdiction over the person of petitioner.
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.

1. 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.
2. 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.
3. 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

4. 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.

JG Summit Holdings Inc. vs. CA

G.R. No. 124293, November 20, 2000

FACTS:

The National Investment and Development Corporation (NIDC), a government corporation, entered into a
Joint Venture Agreement (JVA) with Kawasaki Heavy Industries, Ltd. for the construction, operation and
management of the Subic National Shipyard, Inc., later became the Philippine Shipyard and Engineering
Corporation (PHILSECO). Under the JVA, NIDC and Kawasaki would maintain a shareholding proportion
of 60%-40% and that the parties have the right of first refusal in case of a sale.

Through a series of transfers, NIDCs rights, title and interest in PHILSECO eventually went to the
National Government. In the interest of national economy, it was decided that PHILSECO should be
privatized by selling 87.67% of its total outstanding capital stock to private entities. After negotiations, it
was agreed that Kawasakis right of first refusal under the JVA be exchanged for the right to top by five
percent the highest bid for said shares. Kawasaki that Philyards Holdings, Inc. (PHI), in which it was a
stockholder, would exercise this right in its stead.

During bidding, Kawasaki/PHI Consortium is the losing bidder. Even so, because of the right to top by 5%
percent the highest bid, it was able to top JG Summits bid. JG Summit protested, contending that
PHILSECO, as a shipyard is a public utility and, hence, must observe the 60%-40% Filipino-foreign
capitalization. By buying 87.67% of PHILSECOs capital stock at bidding, Kawasaki/PHI in effect now
owns more than 40% of the stock.

ISSUE:

* Whether or not PHILSECO is a public utility

* Whether or not Kawasaki/PHI can purchase beyond 40% of PHILSECOs stocks

HELD:

In arguing that PHILSECO, as a shipyard, was a public utility, JG Summit relied on sec. 13, CA No. 146.
On the other hand, Kawasaki/PHI argued that PD No. 666 explicitly stated that a shipyard was not a
public utility. But the SC stated that sec. 1 of PD No. 666 was expressly repealed by sec. 20, BP Blg.
391 and when BP Blg. 391 was subsequently repealed by EO 226, the latter law did not revive sec. 1 of
PD No. 666. Therefore, the law that states that a shipyard is a public utility still stands.

A shipyard such as PHILSECO being a public utility as provided by law is therefore required to comply
with the 60%-40% capitalization under the Constitution. Likewise, the JVA between NIDC and Kawasaki
manifests an intention of the parties to abide by this constitutional mandate. Thus, under the JVA, should
the NIDC opt to sell its shares of stock to a third party, Kawasaki could only exercise its right of first
refusal to the extent that its total shares of stock would not exceed 40% of the entire shares of stock. The
NIDC, on the other hand, may purchase even beyond 60% of the total shares. As a government
corporation and necessarily a 100% Filipino-owned corporation, there is nothing to prevent its purchase
of stocks even beyond 60% of the capitalization as the Constitution clearly limits only foreign
capitalization.

Kawasaki was bound by its contractual obligation under the JVA that limits its right of first refusal to 40%
of the total capitalization of PHILSECO. Thus, Kawasaki cannot purchase beyond 40% of the
capitalization of the joint venture on account of both constitutional and contractual proscriptions.