G.R. No. 146553. November 27, 2002.
BANK OF THE PHILIPPINE ISLANDS, petitioner, vs. Spouses WILLIE and JULIE L. EVANGELISTA and LTS PHILIPPINES CORPORATION, respondents.

FACTS

Petitioner Bank of the Philippine Islands (BPI) filed a collection suit against respondents Spouses Willie and Julie L. Evangelista and LTS Philippines Corporation before the Regional Trial Court (RTC) of Makati. The spouses executed a continuing suretyship for LTS’s loans and a real estate mortgage to secure their own and LTS’s obligations. After respondents defaulted, BPI extrajudicially foreclosed the mortgaged property. The auction proceeds were insufficient to cover the total obligation, leaving a deficiency. BPI filed a case to collect this deficiency.
Summonses were issued. The process server’s return stated that for the spouses, summons was served “thru Ms. Carmen Paanto, a person of suitable age and discretion, living therein.” For LTS, the return stated it was served “thru Ms. Cabrera, a person of suitable age and discretion, working therein.” Respondents filed a Motion to Dismiss, arguing improper service of summons, lack of cause of action, and non-compliance with a condition precedent. The RTC denied the motion, upholding the presumption of regularity in the performance of the process server’s duty. The Court of Appeals granted respondents’ Petition for Certiorari, annulled the RTC’s orders, and directed the dismissal of the case without prejudice, ruling that the RTC did not acquire jurisdiction over respondents due to defective service of summons. The CA found the return violated Sections 7 and 11 of Rule 14 of the Rules of Court as it failed to state any reason for resorting to substituted service and was served on persons not authorized to receive summons for the corporation.

ISSUE

Whether the trial court acquired jurisdiction over the persons of the respondents through the service of summons.

RULING

The Supreme Court PARTLY GRANTED the petition and MODIFIED the Court of Appeals’ Decision. The Court held that the RTC did not acquire jurisdiction over respondents because the service of summons was defective on its face. The returns failed to comply with Sections 7 and 11 of Rule 14. For substituted service (as to the spouses), the return did not indicate the impossibility of prompt personal service and the details of the attempts made. For service upon a corporation (LTS), the return did not show that service was made upon its president, general manager, corporate secretary, treasurer, or in-house counsel. The presumption of regularity in the performance of official duty does not apply where the return is patently defective.
However, the Supreme Court ruled that a patent defect in the return does not necessarily constitute conclusive proof that the actual service was improperly made. The trial court should immediately ascertain whether the defect is real. If, after hearing, the service is found improper, the court should cause the service of new summons. Thus, the case was REMANDED to the RTC to determine whether there was actually a valid service of summons. If found improper, new summons should be issued and served. The dismissal ordered by the CA was set aside.