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PERKIN ELMER SINGAPORE PTE LTD., petitioner, vs.

DAKILA TRADING
CORPORATION, respondent.||| (Perkin Elmer Singapore Pte Ltd. v. Dakila Trading Corp. , G.R.
No. 172242, [August 14, 2007], 556 PHIL 822-852)

Doctrine: Rule 14, Section 15 on Extraterritorial service of summons when allowed:


(1) when the action affects thepersonal status of the plaintiff;
(2) when the action relates to, or the subject of which is property, within the Philippines,in which
the defendant claims a lien or an interest, actual or contingent;
(3) when the relief demanded in such actionconsists, wholly or in part, in excluding the
defendant from any interest in property located in the Philippines; and
(4)when the defendant non-residents property has been attached within the Philippines.

In these instances, service of summons may be effected by


(a) personal service out of the country, with leave of court;
(b) publication, also with leaveof court; or
(c) any other manner the court may deem sufficient.

Facts: Perkin Elmer Asia entered into a distribution agreement with Dakila, a domestic corp.
Under the agreement,Dakila was appointed its sole distributor in the Phils and thus, shall
receive commissions for its sales from Perkin Asia.Dakila was supposed to order the products
either from Perkin Asia or from Perkin Elmer Instruments Philippines (PEIP),an affiliate of Perkin
Asia, 99% of the shares of which is owned by Perkin Asia.However, Perkin Asia unilaterally
terminated the agreement with Dakila. So Dakila sued both Perkin Asia and PEIP

Dakila filed a Complaint for Collection of Money (an In Personam suit) with a prayer for a Writ
of Attachment (for theproperties of PEIP since 99% is owned by Perkin Asia anyway). The Alias
Summons was, however, served uponPerkinelmer Asia, a Singapore based sole proprietorship
owned by Perkin Asia but was allegedly, a separate and distinctentity from it.So in response to
Dakilas collection suit, PEIP filed a Motion to Dismiss for lack of cause of action. Perkinelmer
Asiainformed the court of the wrongful service of summons upon it. Dakila then filed an
amended complaint saying thatPerkin Asia is now Perkinelmer, it became a sole proprietorship
and changed its name but its the same people/interest so they should still be accountable for
their obligations. Perkin Asia, herein petitioner and the proper party, on the otherhand, filed a
Motion to Dismiss on the ground that the RTC failed to acquire jurisdiction over its person.

RTC denied petitioners

Motion to Dismiss stating that since the action is one for damages, it relates to Perkin Asias
property and since Dakila alleged in its complaint that Perkin Asia owns shares in PEIP, the
extraterritorial service of summons was sufficient to acquire jurisdiction ( RTC relied on Sec. 15
of Rule 14 - (2) when the action relates to, or thesubject of which is property, within the
Philippines, in which the defendant claims a lien or an interest, actual orcontingent). CA affirmed
the RTC ruling.Issue: WON the service was summons was defective/won jurisdiction was validly
acquired

Held: No, SC reversed CA (and RTC).Extraterritorial service of summons applies only in in rem
and quasi in rem cases, where only jurisdiction over the res isrequired and such extraterritorial
service of summons is done not for the purpose of acquiring jurisdiction over theperson of the
defendant, but to inform the defendant that there is a suit involving his property (due process).
On the other hand, when the defendant or respondent does not reside and is not found in the
Philippines, and the actioninvolved is in personam, Philippine courts cannot try any case against
him because of the impossibility of acquiring jurisdiction over his person unless he voluntarily
appears in court. The present case is an action in personam because it deals with Perkin Asias
personal liability to Dakila because of its unilateral termination of the distribution agreement.
Hence, there should have been personal service of summons.

Dakilas allegation that Perkin Asia had properties in the Philippines did not convert the case
into an action quasi in rem as to make the extraterritorial service valid. The RTC was incorrect in
relying upon Sec. 15 of Rule 14 mere allegations of personal property does not make the action
as one that relates to or the subject of which is, property within the Philippines.

It is incorrect for the RTC to have ruled that the allegations made by the respondent in its
Amended Complaint, which is primarily for collection of a sum of money and damages, that the
petitioner owns shares of stock within the Philippines to which the petitioner claims interest, or
an actual or contingent lien, would make the case fall under one of the aforesaid instances
wherein extraterritorial service of summons under Section 15, Rule 14 of the 1997 Revised
Rules of Civil Procedure, would be valid. The RTC in arriving at such conclusions relied on the
second instance, mentioned under Section 15, Rule 14 of the 1997 Revised Rules of Civil
Procedure (i.e., when the action relates to, or the subject of which is property, within the
Philippines, in which the defendant claims a lien or interest, actual or contingent), where
extraterritorial service of summons can be properly made. However, the aforesaid second
instance has no application in the case before this Court. Primarily, the Amended Complaint
filed by the respondent against the petitioner was for the collection of sum of money and
damages. The said case was neither related nor connected to any property of the petitioner to
which it claims a lien or interest. The action for collection of a sum of money and damages was
purely based on the personal liability of the petitioner towards the respondent. The petitioner is
correct in saying that "mere allegations of personal property within the Philippines does not
necessarily make the action as one that relates to or the subject of which is, property within the
Philippines as to warrant the extraterritorial service of summons. For the action to be considered
one that relates to, or the subject of which, is the property within the Philippines, the main
subject matter of the action must be the property itself of the petitioner in the Philippines." By
analogy, an action involving title to or possession of real or personal property such as the
foreclosure of real estate or chattel mortgage where the mortgagor does not reside or is not
found in the Philippines can be considered as an action which relates to, or the subject of
which is, property within the Philippines, in which the defendant claims a lien or interest, actual
or contingent; and in such instance, judgment will be limited to the res.|||