Summit Trading v Avendano

Facts: The case is about summons intended for defendant Summit Trading and
Development Corporation. Segunda Pilipinia and Edgardo Mindo in 1973 acquired under
Land Authority Admin. Order No. 4 two lots located at San Pedro Laguna. They contain
the annotation that should Pilipinia and Mindo sell the same, they have the right to
redeem the lots within five years from the date of sale. Pilipinia and Mindo sold the two
lots for P16000 and P12000 to Gavino Ortega. They however retained possession of the
ricelands and became tenants. At the instance of Ortega, the annotation was cancelled by
Judge Avendano bec. The lots would be turned into commercial, industrial or residential
lots (they presently are still ricelands). In a letter, Ortega advised Ernesto (attorney of
Pilipinia and Mindo) that he would have the right of first refusal in case the lots were
sold. Ortega resold the lots at P11000 and P16000 to Summit thru its president, Balaguer.
Pilipinia and Mindo within the five year period filed complaint against Ortega and
Summit for the redemption or repurchase of the lots. They deposited P10,000 with Royal
Savings.

Ortega was duly summoned. He failed to answer and was declared in default, and so
was Summit Trading. Judge Avendano gave Pilipinia and Mindo 15 days from notice to
redeem the lots for P16,000 and P12,000 and ordered Summit to execute the deeds of
sale and surrender the Torrens titles. If Summit failed to do this, then the task passed on
to the clerk of court. Register of deeds was ordered to issue new titles to Pilipinia and
Mindo.

The default judgment was rendered on the assumption that Summit was duly summoned
through Saquilayan who was the secretary of Summit. She received summons on Aug
28, 1981. A copy of the judgment was also served on her on November 13, 1981.
Actually she received the summons as secretary of Balaguer the president. Nineteen days
after she received a copy of the decision, Summit filed for motion for reconsideration on
the ground that TC did not acquire jurisdiction bec. Summons was not served in
accordance with the ROC.

Issue: Was summons duly served to Summit?

SC: Yes. It is true, Saquilayan was not among those persons mentioned in Sec. 13, ROC
as to who may receive summons:

Sec. 13-Service upon private domestic corporation or partnership-If the defendant is a

corporation organized under the laws of the Philippines or a partnership duly registered,
service may be made on the president, manager, secretary, cashier, agent or any of its
directors. Being under the control of Summit, she has not explained what she had done
with the summons and complaint. The assumption is she delivered it to her boss, the
president of Summons. Summit’s motion for reconsideration was denied.
Summit was correct in saying that there was no strict compliance with the rules. Also,
generally, service of summons to a secretary is not proper. Under the facts, however,
Saquilayan may be considered an “agent” within the meaning of Sec. 13. Summons was
therefore properly served on Summit and it’s negligence in not answering the complaint
was inexcusable.