THIRTEENTH DIVISION
[CA-G.R. CV No. 56561. September 17, 2001.]
UNITED COCONUT PLANTERS BANK, plaintiff-appellee, vs. Spouses ADORCITO and TERESITA TUAZON, and JOHN DOE, defendants-appellants.
D E C I S I O N
DACUDAO, J p:
Appeal from the Decision 1 of the Regional Trial Court of Pasay City, Branch 231, in Civil Case No. 96-1205, the dispositive portion whereof reads, to wit —
"It appearing from the testimony of the witness and the evidence admitted that plaintiff mortgagee, UCPB is entitled to the possession of the mortgaged vehicle, but its return can no longer be affected, wherefore, judgment is hereby rendered in favor of the plaintiff and against defendants ordering the latter to pay the following sum of:
"1. TWO HUNDRED SEVENTY FOUR THOUSAND SIX HUNDRED FORTY FIVE PESOS AND THIRTY ONE CENTAVOS (P274,645.31) plus penalty thereon at the rate of 4% per month from March 1997, until fully paid;
"2. The sum of TEN THOUSAND PESOS (P10,000.00) as attorneys fees;
"3. Cost of suit.
"SO ORDERED.
"Pasay City, February 28, 1997.
"CESAR Z. YLAGAN
"Judge."
Upon the 13th of September 1996 plaintiff United Coconut Planters Bank (or UCPB) filed a complaint for replevin and damages. Thereunder plaintiff averred in substance: that defendants spouses Adorcito Tuazon and Teresita Tuazon are residents of No. 20 Natib Street, Cubao, Quezon City and/or No. 61 Yale Street, Cubao, Quezon City where they may be served with summons and judicial processes; that on 27 October 1995 defendants Tuazon spouses executed and delivered to plaintiff a promissory note in the sum of P259,020.00, payable in 36 monthly installments of P7,195.00, beginning 11 December 1995 until fully paid; that, to secure the payment of the loan, defendants Tuazon spouses executed in favor of plaintiff a chattel mortgage over a motor vehicle, more particularly described, as follows — "Make: Nissan Sentra, 4 door-sedan, Model: 1992, Engine No.: GA16-114523B, Serial No.: BEAB13-A51807, and Plate No. TCG-581"; that defendants Tuazon spouses defaulted in paying the installments beginning 11 January 1996; that, for that reason, plaintiff demanded from defendants Tuazon spouses payment of the whole balance, which amounted to P246,173.27, plus accrued interests thereon, as well as penalty charges and other incidental expenses, or, alternatively, to deliver to plaintiff the mortgaged vehicle so that plaintiff could have it foreclosed; that defendants Tuazon spouses failed and refused to heed the demand; that, consequently, plaintiff was constrained to institute the present action; that, under the contract documents, plaintiff is entitled to attorney's fees of P61,543.3 and liquidated damages also in the sum of P61,543.31, which sums do not yet include expenses that would be incurred for the manual delivery of the mortgaged vehicle.
Plaintiff likewise asked for the manual delivery of the subject motor vehicle, and in support thereof averred: that as mortgagee of the subject vehicle, it is entitled to the possession of the mortgaged vehicle, together with all its accessories and equipment; that defendants Tuazon spouses are wrongfully detaining the motor vehicle for the purpose of defeating plaintiff's mortgage lien thereover; that the motor vehicle has not been taken for any tax assessment, or fine pursuant to law, or seized under an execution or attachment against the property of the plaintiff, or if so seized, the same is exempt from such seizure; that the actual value of the motor vehicle is P246,173.27; and that plaintiff is ready and willing to file a good, sufficient and solvent bond in an amount double the actual value of the motor vehicle, or in the sum of P492,346.54.
Finding plaintiff's replevin bond to be sufficient in form and substance, the Trial Court granted the application for manual delivery of the mortgaged vehicle and issued a writ of seizure. The Trial Court also caused the service of summons, together with a copy of the complaint, upon defendants Tuazon spouses.
On 14 November 1996, because defendants Tuazon spouses were out of the country, the summons was served on Avelina Manas, said to be an aunt of defendants Tuazon spouses. 2 But, the writ of seizure could not be implemented, as the subject vehicle could not be found or located. 3
Defendants Tuazon spouses had fifteen (15) days from 14 November 1996, or until 29 November 1996, within which to file an answer or responsive pleading to the complaint. But November 29, 1996 came and went, and defendants spouses filed no answer. Consequently, upon plaintiff's motion, the Trial Court, on 14 February 1997, issued an order 4 declaring defendants in default: the Trial Court set the ex parte presentation of plaintiff's evidence before the Acting Branch Clerk of Court on 19 February 1997.
At the ex parte hearing, George Sales, Legal Assistant of plaintiff UCPB, gave the following testimony: that he was present when defendants Tuazon spouses executed the promissory note, 5 dated 27 October 1995, and the chattel mortgage, 6 dated 24 November 1995, in favor of plaintiff UCPB; that, for a time, defendants Tuazon spouses paid their monthly dues, but that on 29 February 1996, they defaulted, and this default persisted in the succeeding months thereafter; that he was sent by plaintiff UCPB to serve a demand letter to defendants Tuazon spouses, which letter the latter received; that, despite demand, defendants Tuazon spouses still failed and refused to pay their obligation; that in view thereof, plaintiff UCPB was constrained to institute the present action; that the total obligation of defendants Tuazon spouses amounted to P345,766.95, 7 this sum being based on the Statement of Account, 8 issued by plaintiff UCPB; that he accompanied the Sheriff but they were not able to find/locate the mortgaged vehicle; and that he does not know the whereabouts of the motor vehicle and believes that it is still with the defendants.
Given these facts, the Court a quo gave judgment decretally disposing of the controversy in the manner elsewhere quoted.
On the 18th of August 1997 defendants Tuazon spouses filed an omnibus motion, 9 thereunder alleging: that they never received the summons and the complaint; that the same were never handed over/delivered to them by their aunt Avelina Manas; that they came to know of the present action only when they were served with a copy of the decision; that they have no intention of absconding with the mortgaged vehicle nor of turning their back on their obligation with plaintiff; and that they have legal and valid defenses, amongst which is that, they have already made substantial payments of their accounts to plaintiff; and that some of the other payments made by them were collected by an agent of plaintiff.
On the 5th of September 1997, the omnibus motion elicited an opposition from plaintiff UCPB. And, on the 10th of September 1997, the Trial Court issued an order 10 denying the omnibus motion for lack of merit.
Against the foregoing judgment, defendants Tuazon spouses, now appellants, have instituted the present appeal, and in support thereof, now contend that:
1. The lower court erred in declaring the defendants-appellants in default.
2. The lower court erred in not according appellants their full day in court.
3. The lower court erred in not finding that appellants had already made substantial payments on their account with appellee UCPB.
4. The lower court erred in not finding and crediting the payments made by appellants with plaintiff UCPB's agent.
5. The lower court erred in failing to find that the complaint was filed prematurely.
6. The lower court erred in not allowing appellants to present their evidence.
7. The lower court erred in holding appellants liable under their promissory note.
The basic issue is whether or not the service of summons on Avelina Manas was a valid service upon appellants, such that the Trial Court properly declared them in default when they failed to file an answer; and that the Trial Court, thus, properly rendered judgment by default against them.
We find merit in the appeal.
Service of summons upon the defendant is the means by which the court acquires jurisdiction over his person. In the absence of a valid waiver thereof, trial and judgment in the case without such service are null. This process is solely for the benefit of the defendant. Its purpose is not only 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. 11
Under section 7 (now section 6) of Rule 14 of the Rules of Court, summons must be served to the defendant in person. If this mode of service cannot be effected within a reasonable time, however, substituted service may be resorted to under section 8 (now section 7) of the same Rule, to wit —
"Section 8. Substituted service. — If 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 defendant's dwelling house or residence with some person of suitable age and discretion then residing therein, or (b) by leaving the copies at defendant's office or regular place of business with some competent person in charge thereof." 12
In the case at bench, plaintiff UCPB, now appellee, gave two addresses whereat appellants-spouses may be served with summons. 13 But appellants cannot legally be held to have had two dwelling houses, or residences, at the same time, vis-a-vis the service of summons. For, the terms "dwelling house" or "residence" refer to the place where defendant is habitually present, and from which when he departs, he intends to return. It has also been held to be equivalent to the term "permanent abode," and to the word "home," in the sense of a house to which one, whenever absent, intends to return. 14
We hold that the substituted service in this case was not validly made/effected, given the fact that the Sheriff's Return, dated 14 November 1996, 15 does not show that the service was made in the dwelling house, or residence, of the appellants, as required by the Rules. Thusly:
"RETURN
"RESPECTFULLY returned to this Honorable Court the summons/es issued in this case with the following information:
xxx xxx xxx
"THAT Substituted Service was made on the following after diligent efforts to locate them personally proved futile for reasons stated opposite their names:
"1. SPS. ADORCITO & TERESITA TUAZON DULY SERVED thru one AVELINA P. MANAS (AUNTIE), a person of sufficient age and discretion residing thereat for reason that defendants/ were out of the country at the time the undersigned served the Summons.
xxx xxx xxx
"Pasay City, METRO MANILA, NOVEMBER 14, 1996.
"(Sgd.)
"Lawrence B. Uy
"Sheriff IV"
Since the substituted service of summons in this case was either patently flawed, or, at the very least ineffective, it stands to reason that the Trial Court did not acquire jurisdiction over the persons of the appellants. The order of default and the judgment by default are, therefore, void, or voidable, at the very least.
Parenthetically, appellants did not waive the Trial Court's lack of jurisdiction over their persons. Indeed, so much is clear from their omnibus motion, whereunder appellants insisted that they never received the summons, for the reason that their aunt allegedly did not hand over/deliver the same to them. Notably, too, in their appeal brief, appellants raised anew the issue of validity of the substituted service of summons on their aunt, who, appellants claimed, resides or lives, in a separate house. In both instances, appellants, in effect, if not infact, questioned the lack of jurisdiction of the Trial Court over their persons. In the higher interest of substantial justice, we are prepared to accord credence to their insistent claim, and to give them a second chance.
WHEREFORE, the judgment appealed from, must be, as it hereby is, VACATED and SET ASIDE, and the case ordered REMANDED to the court of origin for further proceedings, which shall include the valid service of summons on defendants spouses.
Without costs.
SO ORDERED.
Callejo, Sr. and Del Castillo, JJ., concur.
Footnotes
1 Penned by Judge Cesar Z. Ylagan.
2 As per Sheriff's Return dated 14 November 1996; Record, p. 32.
3 As per Sheriff's Return dated 29 November 1996.
4 Record, p. 35.
5 Exhibit A; Record, p. 9.
6 Exhibit B; Record, p. 10.
7 Inclusive of attorney's fees of P69,153.39 and litigation expenses of P1,118.25.
8 Exhibit D; Record, p, 37.
9 Record, p. 61.
10 Record, p. 69.
11 Keister v. Navarro, 77 SCRA 209, at p. 214.
12 Emphasis supplied.
13 The addresses are as follows: (1) No. 20 Natib Street, Cubao, Quezon City, and (2) No. 61 Yale Street, which is also in Cubao, Quezon City.
14 Arevalo v. Quilatan, 116 SCRA 700, at p. 709.
15 Record, p. 32.