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Erlinda Velayo-Fong vs Spouses Raymond and Maria Hedy Velayo

G.R. No. 155488 December 6, 2006


FACTS:
Spouses Raymond and Maria hedy Velayo filed a complaint for collection of sum of
money against Velayo-Fong. In the complaint, spouses Velayo alleged that VelayoFong was a resident of Hanolulu, Hawaii,USA. Since Velayo-Fong was a non-resident
and not found in the Philippines, Spouses Velayo prayed for a writ to attach VelayoFongs properties found in the Philippines.
However, before the application for the writ can be acted upon by the RTC, spouses
Velayo filed an Urgent Motion praying that the summons be served to Velayo-Fong
at her Two Condominium Suites.One at Roxas Boulevard, Pasay City and another, at
Burgos Street, Towers Condominium, Makati. Subsequently, the RTC granted the
said motion.
Then, the Process server indicated on his Officers Return that after several failed
attempts to serve the copy of summons and complaints issued at the given address
of Velayo-Fong, Finally, the Process server was able to serve personally the
summons together with the copy of the complaint upon Velayo-Fong, not at her two
addresses but at the lobby of a hotel, right in the presence of a lobby counter
personnel but Velayo-Fong refused to sign in the receipt thereof.
Later, the RTC in its Order declared Velayo-Fong in default for failure to file an
answer. Velayo-Fong upon knowing the order of the RTC, filed a Motion to set Aside
Order of Default claiming that she was prevented from filing a responsive pleading
and defending herself against respondents, complaint because of fraud, accident or
mistake; that contrary to the Officers; return, no summons was served upon her;
that she was has valid and meritorious defenses to refute respondents material
allegation.
The RTC denied the Motion and CA affirmed RTCs order.
Now, Velayo-Fong questioned the propriety and validity of the service of summons
made upon her as she did not remember that a man hurled some papers at her
while she was entering the elevator and not knowing what the papers were all
about, she threw back the papers to the man she has a valid and meritorious
defense to refute the material allegations of respondents; complain.
She also argued that the summons should have been served through extraterritorial
service since she is a non-resident.

ISSUES:
Whether or not service of summon may be effective on a non-resident.

RULING:
NO. Under Sec.17, Rule 14 when the defendant is a non-resident and he is
not found in the country summons may be served extraterritorially. This kind
of service of summons applies only where the actions is in rem because in in
rem and quasi in rem actions, jurisdiction over the person of the defendant is
not a prerequisites to confer jurisdiction on the court provided that the court
acquires jurisdiction over the res.
Where the action is in personam and when the defendant is a non-resident,
personal service of summons within the states is essential to the acquisition
of jurisdiction over the person. This cannot be done, however, if the
defendant is not physically presents in the country, and thus the court
cannot acquire jurisdiction over the person and therefore cannot validly try
and decide the case against him.
In the present case, spouses Velayos cause of action and their prayer that
actual and moral damages, plus attorneys fees, be awarded in their favour
affect the parties alone, not the whole world. Any judgement therein is
binding only upon the parties properly impleaded, thus, it is an action in
personam. As such personal service of summons upon the defendants is
essential in order for the court to acquire jurisdiction over their person.