G.R. No. 155488 ; December 6, 2006
ERLINDA R. VELAYO-FONG, petitioner, vs. SPOUSES RAYMOND and MARIA HEDY VELAYO, respondents.

FACTS

Respondents, spouses Raymond and Maria Hedy Velayo, filed a complaint for sum of money and damages against petitioner Erlinda R. Velayo-Fong and others. Petitioner was a non-resident, residing in Hawaii, USA. The RTC granted respondents’ motion to serve summons at two addresses in Pasay and Makati. The process server’s return stated that after failed attempts at those addresses, he personally served summons upon petitioner at the lobby of the Intercontinental Hotel in Makati on September 23, 1993, but she refused to sign. Petitioner failed to answer, and the RTC declared her in default, later rendering a judgment against her.
Petitioner filed a motion to set aside the order of default, alleging she was never served with summons. She argued she was a non-resident and was only temporarily in the Philippines, thus requiring extraterritorial service under the rules. The RTC denied her motion, upholding the presumption of regularity in the process server’s return. The Court of Appeals affirmed the RTC, ruling the appeal raised only questions of law outside its jurisdiction and that the trial court acquired jurisdiction through personal service.

ISSUE

Whether the Court of Appeals erred in dismissing the appeal and in ruling that the trial court validly acquired jurisdiction over the person of the petitioner through the contested service of summons.

RULING

The Supreme Court granted the petition. The Court held that the CA erred in dismissing the appeal for raising pure questions of law. The determination of whether summons was validly served involves a question of fact, as it requires an examination of the circumstances of service. The core issue was the validity of the substituted service.
On the merits, the Court ruled the service was invalid. Petitioner was a non-resident defendant temporarily sojourning in the Philippines. For the court to acquire jurisdiction over her, either personal service within the Philippines or extraterritorial service under Rule 14, Section 16 was required. The process server’s return indicated personal service was attempted and effected. However, the service at a hotel lobby did not comply with the rules for substituted service. Substituted service is allowed only if the defendant cannot be served personally within a reasonable time, and service must be made at the defendant’s residence, office, or regular place of business to a person of suitable age and discretion residing or working therein. Service at a transient hotel lobby to a counter personnel does not satisfy these requirements. Consequently, the trial court did not acquire jurisdiction over petitioner, rendering the default judgment void. The presumption of regularity in the performance of official duty was overcome by the clear invalidity of the service method employed.