Mangila vs CA (Remedial Law)

Anita MANGILA V. CA and Loreta Guina

G.R. No. 125027 | AUGUST 12, 2002

FACTS:

Anita Mangila is an exporter of seafoods and doing business under the name of Seafoods Products. Private respondent Loreta Guina is the President and General Manager of Air Swift International, a single registered proprietorship engaged in the freight forwarding business.

In January 1988, Mangila contracted the freight forwarding services of Guina for shipment of petitioner’s products, such as crabs, prawns and assorted fishes, to Guam (USA) where petitioner maintains an outlet. Mangila agreed to pay cash on delivery. Guina’s invoice stipulates a charge of 18 percent interest per annum on all overdue accounts, and in case of suit, stipulates attorney’s fees equivalent to 25 percent of the amount due plus costs of suit.

On the first shipment, Mangila requested for 7 days within which to pay private Guina. However, for the next three shipments, March 17, 24 and 31, 1988, petitioner failed to pay private respondent shipping charges amounting to P109, 376.95.

Despite several demands, Mangila never paid. Thus, on June 10, 1988, Guina filed before the RTC Pasay City an action for collection of sum of money.

The Sheriff’s Return showed that summons was not served on Mangila. A woman found at Mangila’s house informed the sheriff that petitioner transferred her residence to Guagua, Pampanga. The sheriff found out further that petitioner had left the Philippines for Guam.

Thus, on September 1988, construing petitioner’s departure from the Philippines as done with intent to defraud her creditors, Ginua filed a Motion for Preliminary Attachment, which the court subsequently granted. A Writ of Preliminary Attachment was thereafter issued.

Through the assistance of the sheriff of RTC Pampanga, the Notice of Levy with the Order, Affidavit and Bond was served on Mangila’s household help in San Fernando, Pampanga on October 1988.

 On November 1988, Mangila filed an Urgent Motion to Discharge Attachment without submitting herself to the jurisdiction of the trial court. She pointed out that up to then, she had not been served a copy of the Complaint and the summons. Hence, petitioner claimed the court had not acquired jurisdiction over her person.

After the hearing on the motion, RTC granted the same on January 13, 1989 upon filing of petitioner’s counter-bond. The trial court, however, did not rule on the question of jurisdiction and on the validity of the writ of preliminary attachment.

Thereafter, Guina applied for an alias summons and on January 26, 1989 summons was finally served on petitioner.

On February 1989, Mangila moved for the dismissal of the case on the ground of improper venue, claiming that as stipulated in the invoice of Guina’s freight services, the venue in case a complaint is filed would be in Makati and not Pasay. For her part, Guina explained that although “Makati” appears as the stipulated venue, the same was merely an inadvertence by the printing press whose general manager executed an affidavit admitting such inadvertence. Moreover, Guina claimed that Mangila knew that private respondent was holding office in Pasay City and not in Makati.

The RTC ave credence to Guina’s Opposition, denied the Motion to Dismiss, and gave petitioner 5 days to file her Answer. Petitioner filed an MR but this too was denied. Thus she filed her Answer on June 1989, maintaining her contention that the venue was improperly laid.

The case was set for pre-trial. Meanwhile, Guina filed a Motion to Sell Attached Properties but the trial court denied the motion.

On motion of Mangila, the RTC reset the pre-trial but Mangila failed to appear on the rescheduled date. Without declaring Mangila to be in default, the court allowed Guina to present evidence ex parte.

Mangila filed an MR of the order terminating the pre-trial, and argued that there was no order decalring him in default and that his attorney was only late but not absent during the rescheduled pre-trial.

Nevertheless, the RTC ruled in favor of Guina and ordered petitioner to pay respondent P109,376.95 plus 18 percent interest per annum, 25 percent attorney’s fees and costs of suit. Mangila appealed to the CA while Guina filed a Motion for Execution Pending Appeal but the trial court denied the same.

The CA affirmed the RTC decision. The Court of Appeals upheld the validity of the issuance of the writ of attachment and sustained the filing of the action in the RTC of Pasay. The Court of Appeals also affirmed the declaration of default on petitioner and concluded that the trial court did not commit any reversible error.

ISSUES: 

WON the CA erred in affirming the validity of the issuance of the writ of Preliminary Attachment

WON the venue was improperly laid

HELD: 

1) Yes, because there was no proper service of summons, order, and the writ of attachment.

*Improper Issuance and Service of Writ of Attachment. In Davao Light & Power Co., Inc. v. Court of Appeals, this Court clarified the actual time when jurisdiction should be had:

“It goes without saying that whatever be the acts done by the Court prior to the acquisition of jurisdiction over the person of defendant – issuance of summons, order of attachment and writ of attachment – these do not and cannot bind and affect the defendant until and unless jurisdiction over his person is eventually obtained by the court, either by service on him of summons or other coercive process or his voluntary submission to the court’s authority. Hence, when the sheriff or other proper officer commences implementation of the writ of attachment, it is essential that he serve on the defendant not only a copy of the applicant’s affidavit and attachment bond, and of the order of attachment, as explicitly required by Section 5 of Rule 57, but also the summons addressed to said defendant as well as a copy of the complaint xxx.”

Furthermore, we have held that the grant of the provisional remedy of attachment involves three stages: first, the court issues the order granting the application; second, the writ of attachment issues pursuant to the order granting the writ; and third, the writ is implemented. For the initial two stages, it is not necessary that jurisdiction over the person of the defendant be first obtained. However, once the implementation of the writ commences, the court must have acquired jurisdiction over the defendant for without such jurisdiction, the court has no power and authority to act in any manner against the defendant. Any order issuing from the Court will not bind the defendant.

2) Yes.

*Improper Venue. The Rules of Court provide that parties to an action may agree in writing on the venue on which an action should be brought. However, a mere stipulation on the venue of an action is not enough to preclude parties from bringing a case in other venues. The parties must be able to show that such stipulation is exclusive. Thus, absent words that show the parties’ intention to restrict the filing of a suit in a particular place, courts will allow the filing of a case in any venue, as long as jurisdictional requirements are followed. Venue stipulations in a contract, while considered valid and enforceable, do not as a rule supersede the general rule set forth in Rule 4 of the Revised Rules of Court. In the absence of qualifying or restrictive words, they should be considered merely as an agreement on additional forum, not as limiting venue to the specified place.

In the instant case, the stipulation does not limit the venue exclusively to Makati. There are no qualifying or restrictive words in the invoice that would evince the intention of the parties that Makati is the “only or exclusive” venue where the action could be instituted. We therefore agree with private respondent that Makati is not the only venue where this could be filed.

The case was dismissed without prejudice.

*digest of the ruling taken from http://www.scribd.com/doc/110773918/BSL-CASE-DOCTRINES-IN-CIVIL-PROCEDURE-BRONDIAL