G.R. No. 125027 ; August 12, 2002
ANITA MANGILA, petitioner, vs. COURT OF APPEALS and LORETA GUINA, respondents.

FACTS

Petitioner Anita Mangila, an exporter doing business as Seafoods Products, contracted the freight forwarding services of private respondent Loreta Guina, President of Air Swift International, for shipments to Guam in January 1988. Petitioner agreed to pay cash on delivery, with the invoice stipulating 18% interest per annum on overdue accounts and 25% attorney’s fees plus costs in case of suit. Petitioner failed to pay for three shipments in March 1988, totaling P109,376.95. Despite demands, petitioner did not pay, prompting private respondent to file a collection case on June 10, 1988. Summons could not be served initially as petitioner had transferred residence and left for Guam. On September 13, 1988, private respondent filed a Motion for Preliminary Attachment, which the trial court granted. The writ was implemented on October 28, 1988, with service on petitioner’s household help in Pampanga. Petitioner filed an Urgent Motion to Discharge Attachment on November 7, 1988, without submitting to the court’s jurisdiction, arguing she had not been served the Complaint and summons. The motion was granted upon filing of a counter-bond on January 13, 1989. Summons was finally served on petitioner on January 26, 1989. Petitioner filed a Motion to Dismiss on the ground of improper venue, citing a stipulation in the invoice that the agreed venue was Makati. The trial court denied the motion, finding the stipulation was an inadvertence by the printer and that petitioner knew private respondent’s office was in Pasay City. Petitioner filed her Answer on June 16, 1989. During the pre-trial on August 24, 1989, petitioner’s counsel arrived late. The trial court terminated the pre-trial and allowed private respondent to present evidence ex-parte. Petitioner’s motions for reconsideration were denied. The trial court rendered a decision against petitioner, which the Court of Appeals affirmed.
ISSUES:
1. Whether the writ of attachment was improperly issued and served.
2. Whether there was a valid declaration of default.
3. Whether there was improper venue.
4. Whether the Court of Appeals erred in declaring petitioner obliged to pay P109,376.95 plus attorney’s fees.

RULING

1. On the writ of attachment: The Supreme Court ruled that the writ of attachment was improperly implemented. Citing Davao Light & Power Co., Inc. v. Court of Appeals, the Court held that for the implementation of a writ of attachment to be valid, the court must have acquired jurisdiction over the defendant. Jurisdiction over the person is acquired either by service of summons or voluntary appearance. At the time the writ was implemented on October 28, 1988, summons had not been served on petitioner. Therefore, the trial court had not acquired jurisdiction over her person, making the service of the writ void. The Court distinguished between the issuance of the writ (which can be before service of summons) and its implementation (which requires prior jurisdiction over the defendant).
2. On the declaration of default: The Supreme Court ruled that there was no valid declaration of default. The Order of August 24, 1989 only terminated the pre-trial and allowed ex-parte presentation of evidence; it did not declare petitioner in default. A party can only be declared in default for failure to file an Answer, not for failure to appear at pre-trial. Since petitioner had filed her Answer, she could not be declared in default. Her counsel’s tardiness at pre-trial was not a ground for default. The trial court should have proceeded under Rule 18, Section 5, which allows the court to allow the plaintiff to present evidence ex-parte only if the defendant fails to appear at the pre-trial, but this does not constitute a default judgment.
3. On the venue: The Supreme Court ruled that venue was improperly laid. The invoice stipulated that the agreed venue for litigation was Makati. Under Rule 4, Section 4(b) of the Rules of Court, such a written agreement on exclusive venue is binding. The Court rejected the claim of inadvertence by the printing press, noting that the stipulation was clear and the affidavit from the printer’s general manager was self-serving. The agreement was valid and enforceable, and the case should have been filed in Makati, not Pasay City.
4. On the obligation to pay: Given the rulings on the improper venue and the invalid implementation of the attachment, the Supreme Court found it unnecessary to rule on the substantive merits of the obligation. The case was remanded to the trial court for further proceedings consistent with the ruling on venue.
The Supreme Court granted the petition, reversed the Decision of the Court of Appeals, and remanded the case to the trial court for proper proceedings.