G.R. No. 175109; August 6, 2008
Paramount Insurance Corp., petitioner, vs. A.C. Ordoñez Corporation and Franklin Suspine, respondents.

FACTS

Petitioner Paramount Insurance Corp., as subrogee, filed a complaint for damages against respondents A.C. Ordoñez Corporation and its driver, Franklin Suspine, arising from a vehicular accident. Summons was served on the corporation on April 3, 2000, received by Samuel D. Marcoleta of its Receiving Section. Petitioner moved to declare respondents in default for failure to file an answer. Respondent corporation opposed, arguing improper service of summons, claiming it was served on a secretarial staff unfamiliar with legal processes, and that its president only received it on June 24, 2000. It filed an Omnibus Motion seeking a 15-day extension to answer, and later a Motion to Admit Answer with its attached Answer.
The Metropolitan Trial Court (MeTC) admitted the Answer and set the case for pre-trial. Petitioner challenged this via a petition for certiorari before the Regional Trial Court (RTC), arguing the MeTC gravely abused its discretion. The RTC granted the petition, set aside the MeTC orders, and remanded the case to act on the motion to declare default. The Court of Appeals (CA) reversed the RTC, reinstating the MeTC orders. Petitioner elevated the case to the Supreme Court.

ISSUE

The core issue is whether the MeTC committed grave abuse of discretion in admitting the respondent corporation’s Answer despite petitioner’s claim of invalid service of summons and procedural defects in the corporation’s pleadings.

RULING

The Supreme Court denied the petition and affirmed the CA decision. The Court held there was no grave abuse of discretion by the MeTC. On the pivotal question of summons, the Court ruled service was invalid. Under Section 11, Rule 14 of the Rules of Court, service upon a domestic private juridical entity must be made exclusively on its president, managing partner, general manager, corporate secretary, treasurer, or in-house counsel. Service to the corporation’s “Receiving Section” or a secretarial staff member, as in this case, does not constitute valid service. This rule is strict and exclusive.
However, the respondent corporation’s subsequent voluntary appearance through the filing of its Omnibus Motion and Motion to Admit Answer cured the defect in service. By seeking affirmative relief from the court, the corporation voluntarily submitted to its jurisdiction. The MeTC, in the interest of justice and to afford parties a full hearing on the merits, acted within its discretion in admitting the belated Answer. Courts have the prerogative to relax procedural rules to prevent a miscarriage of justice, especially where a party demonstrates a willingness to participate in the proceedings. The MeTC’s orders were thus reinstated.