G.R. No. L-19596            October 30, 1964 In Western Equipment and Supply Co. vs. Reyes, 51 Phil.
In Western Equipment and Supply Co. vs. Reyes, 51 Phil. 116, it was held that a
LAVERN R. DILWEG, plaintiff-appellant, vs. ROBERT O. PHILLIPS,
INOCENTES DINEROS and ISAAC S. ECETA, defendants-appellees.
Direct appeal on pure question of law from an order rendered by the Court of First Instance of
Rizal, Branch II, in its Civil Case No. 4850, dismissing plaintiff's complaint as well as from the
order denying a motion to reconsider said order of dismissal.
The record disclosed that on 7 February 1958 plaintiff Lavern R. Dilweg a nonresident
American, through counsel, instituted the complaint at bar consisting of six causes of action
against defendants. Robert O. Phillips, Inocentes G. Dineros, and Isaac S. Esceta, claiming
civil damages arising out of alleged libelous and defamatory statements uttered and published
in the Philippines by the latter. On 24 February 1958 the first two named defendants
presented a motion to dismiss the complaint. Plaintiff interposed an opposition thereto on 7
March 1958.
On 13 May 1958 the trial court, acting on this motion, denied the same; consequently, on 17
May 1958 the two defendants filed their joint answer with six causes of action as
counterclaims for damages against the plaintiff. On 24 May 1958, plaintiff answered the
defendant's counterclaims.
On 11 June 1958, defendant Isaac S. Eceta, who was represented by a different counsel,
filed his answer adopting in toto as his own the answer as well as the counterclaims of his co-
defendants. On 26 June 1958, plaintiff answered defendant Eceta's counterclaims.
The trial court, in its order dated 17 September 1958, scheduled the hearing of the case for 10
and 11 December, 1958.
On 8 March 1961, in the course of the trial on the merits, defendants Robert O. Phillips and
Inocentes G. Dineros presented a written motion for reconsideration of the order dated 13
May 1958 denying their motion to dismiss the plaintiff's complaint. An opposition thereto was
interposed by plaintiff on 7 April 1961.
On 11 May 1961 the trial court issued an order, which is the subject of the present appeal, the
pertinent portion of which is as follows:
This action is one for damages by reason of alleged libelous statements uttered in
the Philippines by the defendants against the plaintiff. In otherwords, it is an action
based on a tort or act, which under the law of the Philippines, is defined as a
criminal offense. At the time the said libelous statements were uttered, the plaintiff
was in Washington D.C. where he was and has always been a resident. There is no
allegation in the complaint that plaintiff has ever been in the Philippines or has
resided at anytime therein.
The general rule in this jurisdiction is that a court acquires jurisdiction over the
person of the plaintiff by the filing of his complaint. (Manila Railroad Co. vs. Attorney
General, 20 Phil. 523). In King Mau Wu vs. Sycip, 50 O.G. page 5366, April 23,
1954 it was contended that as the plaintiff therein has never been a resident of the
Philippines, the courts of this country have not acquired jurisdiction to take
cognizance of his action based on a contract which was executed in the State of
New York, U.S.A. The Supreme Court held that a non-resident may sue a resident
in the courts of his country for the collection of money arising from a contract
notwithstanding the fact that said contract was executed outside the country.
foreign corporation which has never done any business in the Philippines and which
is unlicensed and unregistered to do business here, may sue in the courts of the
Philippines for the purpose of restraining certain residents and inhabitants of the
Philippines from organizing a corporation in this country bearing the same name as
that of the plaintiff because the action involves the use of a tradename and hence, it
is one in rem.
The instant case is however different because it is a personal action based on an
act defined as a crime under Philippine Law. It is therefore of first impression.
Defendants contend that if a counterclaim is filed against the plaintiff for damages, it
cannot be enforced because the Court has not acquired jurisdiction over his person
as he has never been and is not now present in this country. It may be stated in
addition, that in such a case, if a judgment is rendered against him by this Court
since he has no property in the Philippines, the decision cannot be enforced
because the decision of a court of this country is not enforceable outside of
Philippine jurisdiction.
In some European countries, it is a requirement that before a non-resident alien
may file an action, he must file a bond, the so-called "Judicatum Solvi", in order to
protect the interest of residents from unwarranted actions. There is no law of this
kind in this jurisdiction.
As there are no doctrines in this jurisdiction covering the issue raised by the
defendants, this Court is bound to rely on American doctrines for the reason that
our rules on jurisdiction have been copied and patterned upon American laws and
statutes. The following are some of the doctrines which have some bearing on the
case, aside from those cited by the movants:
A difficulty may sometimes arise, in determining whether a particular law
applies to the citizen of a foreign country, and (is) intended to subject him
to its provision. But if the law applies to him, and embraces his case, it is
unquestionably binding upon him when he is within the jurisdiction of the
United States. (Brown vs. Duchesne, Mass. 19. How., U.S. 183, 194, 51
L. Ed. 595. (Ibid).
While the presence of the res or property within the territorial limits of the
sovereignty under which the court acts may confer jurisdiction in rem on the court,
in personal actions jurisdiction both of the subject matter and of the person or party
whose right are to be affected are essential, and a state court can acquire no
jurisdiction where neither the person nor any property of can be found within the
state. (Emmanuel vs. Ferris 41 S.E. 20, 63 S.C. 104). If a court having jurisdiction
of the subject matter acquires jurisdiction of the person it has the right and power to
hear and determine the particular case; and unless jurisdiction of the subject matter
and of the person exists it is the duty of the court to decline to do more than
ascertain and declare that it has no power to examine or to decide the merits of the
case ... . While a court may have general jurisdiction of the subject matter of a class
of actions, it does not necessarily follow that it may hear and determine a particular
case submitted for its consideration (21 C.J.S. 43-44)
In El Banco Español Filipino v. Palanca, 37 Phil. 921, and Perkins v. Dizon 69 Phil.
189, it has been also held that in order that the court may validly try a case, it must
have jurisdiction over the subject matter and over the persons of the parties.
Jurisdiction over the persons of the parties is acquired by their voluntary
appearance in court and their submission to its authority, or by the coercive power
of legal process exerted over their persons.
 Applying the principles laid down in the above-quoted doctrines and those cited in
the motion for reconsideration of the defendants, the Court has come to the
conclusion that in order that the court may validly try a case, it must have
jurisdiction not only over the persons of the parties and over the subject matter and
that plaintiff must be a resident within the territorial jurisdiction of this Court in order
that jurisdiction over his person can be acquired, otherwise the Court will not be
able to render a valid judgment against him.
IN VIEW OF THE FOREGOING CONSIDERATIONS and of the fact that the
question of jurisdiction, may be raised at any time, the Court hereby grants the
motion for reconsideration; sets aside the former order deriving defendants' motion
to dismiss and hereby dismisses this case, without costs.
SO ORDERED. (Rec. on Appeal, pp. 99-103)
On 28 June 1961, a motion to have the above-quoted order reconsidered was presented by
the plaintiff and an opposition thereto was filed by the defendants on 10 July 1961. Plaintiff, in
return, submitted a reply to said opposition on 22 July 1961. On 7 November 1961, the trial
court, acting on said motion, denied it; hence, the present appeal.
The sole issue posed in the present appeal is whether or not our Philippine courts can
rightfully refuse to assume jurisdiction over a personal action instituted by a nonresident alien
who is not within the territorial jurisdiction of our courts.
In refusing to assume jurisdiction over this case, the court below upheld defendants'
contention that in a personal action it can only acquire jurisdiction over the person of the
plaintiff if he resides within our territorial jurisdiction. We believe and hold that the trial court is
in error in this point. In fact, this Court only recently has upheld the right of non-residents to
maintain personal actions against our residents in Philippine courts Sharruf v. Bubla, G.R. No.
L-17029, September 30, 1964).
In an American case with facts similar to those obtaining in the case at bar, and in which the
same identical issue was raised, the Court of Appeals of New York held:
There is no objection to the maintenance of the action in our courts in the fact that
the plaintiff was an English subject, or that he was a non-resident. As a personal
action, sounding in tort, it was transitory in its nature, following the person of the
defendant. Our courts were open to the plaintiff for redress of any personal injury
suffered by reason of defendant' acts
This position is supported by practically unanimous American authority (3 Am. Jur. 2d, Aliens,
Sec. 43, p. 895; 21 C.J.S. (Courts), sec. 75 pp. 112-113).
It is thus evident that, contrary to the conclusion reached by the court below, it is not
indispensable for a foreigner to establish residence, nor need he be physically present in a
state of which he is not a resident or citizen in order that he may initiate or maintain a
personal action against a resident or citizen of that other state for rights of action arising in, or
for violations of laws committed within, the territorial jurisdiction of that other state. In this
jurisdiction, no general law has come to our knowledge or notice which restricts the right of
non-resident aliens to sue in our courts. It is not disputed that plaintiff's causes of action arose
in, and that the defendants are within, our territorial jurisdiction. It is conceded by both parties
that the law under which the instant case falls is silent on the matter of the right of an alien to
sue in our courts. On the other hand, the particular law evidently availed of by the plaintiff in
filing his complaint is article 33 of the Civil Code of the Philippines, which provides:
In cases of defamation, fraud, and physical injuries, a civil action for damages
entirely separate and distinct from the criminal action may be brought by the injured
party. Such civil action shall proceed independently of the criminal prosecution and
shall require only preponderance of evidence.
The above-quoted provision of law does not make any distinction as to whether the "injured
party", who may maintain an action for damages based on defamation, is a Filipino citizen or
a resident or an alien.
The American decisions cited in the order of 11 May 1961 are not applicable to the case at
bar because there the defendants invoked the issue of lack of jurisdiction over their own
persons and not against the person of the plaintiff.
The fact that there are counterclaims against the non-resident plaintiff does not alter the case.
The Rules of Court provide for remedies against nonresident defendants.
WHEREFORE, the order appealed from is set aside, and the case is ordered remanded to the
court below for further proceedings consonant with this opinion. Costs against respondents
Phillips, Dineros and Eceta.
DIGEST
         On 7 February 1958 plaintiff Lavern R. Dilweg, a nonresident American citizen, through
counsel, instituted the complaint at bar consisting of six causes of action against defendants
Robert O. Phillips, Inocentes G. Dineros, and Isaac S. Eceta, claiming civil damages arising
out of alleged libelous and defamatory statements uttered and published in the Philippines by
the latter. On 24 February 1958 the first two named defendants presented a motion to dismiss
the complaint. Plaintiff interposed an opposition thereto on 7 March 1958.                         
          On 11 May 1961 the trial court issued an order, which is the subject of the present
appeal, the pertinent portion of which is as follows:
         "This action is one for damages by reason of alleged libelous statements uttered in the
Philippines by the defendants against the plaintiff. In other words, it is an action bared on a
tort or act, which under the law of the Philippines, is defined as a criminal offense. At the time
the said libelous statements were uttered, the plaintiff was in Washington, D.C. where, he was
and has always been a resident. There is no allegation in the complaint that plaintiff has ever
been in the Philippines or has resided at anytime therein.
        "The general rule in this jurisdiction is that a court acquires jurisdiction over the person of
the plaintiff by the filing of his complaint. It was contended that as the plaintiff therein has
never been a resident of the Philippines, the courts of this country have not acquired
jurisdiction to take cognizance of his action bared on a contract which was executed in the
State of New York,USA.
         The Court has come to conclusion that in order that it may validly try this case, it must
have jurisdiction not only over the persons of the parties and over the subject matter and the
plaintiff must be a resident within the territorial of this Court in order that jurisdiction over his
person can be acquired, otherwise the Court will not be able to render a valid judgment
against him.
ISSUE:
        Whether or not our Philippine courts can rightfully refuse to assume jurisdiction over a
personal action instituted by a nonresident alien who is not within the territorial jurisdiction of
our courts?
RULING:
         It is thus evident that, contrary to the conclusion reached by the court below, it is not
indispensable for a foreigner to establish a residence, nor need he be physically present in a
state of which he is not a resident or citizen in order that he may initiate or maintain a
personal action against a resident or citizen of that ether state for rights of action arising in, or
for violations of laws committed within, the territorial jurisdiction of that other state. In this
jurisdiction, no general law has come to our knowledge or notice which restricts the right of
nonresident aliens to sue in our courts. It is not disputed that plaintiff's causes of action arose
in, and that the defendants are within, our territorial jurisdiction. It is conceded by both parties
that the law under which the instant case falls is silent on the matter of the right of an Alien to
sue in our courts. On the other hand the particular law evidently availed of by the plaintiff in
filing his complaint is Article 33 of the Civil Code of the Philippines, which provides:
        "In cases of defamation, fraud, and physical injuries, a civil action for damages entirely
separate and distinct from the criminal action may be brought by the injured party. Such civil
action shall proceed independently of the criminal prosecution and shall require only
preponderance of evidence."
          The above-quoted provision of law does not make any distinction as to whether the
"injured party." who may maintain an action for damages based on defamation, is a Filipino
citizen or resident or an alien.
        “Wherefore, the order appealed from is set aside, and the case is ordered remanded to
the court below for further proceeding consonant with this opinion”.
G.R. No. 112573 February 9, 1995
NORTHWEST ORIENT AIRLINES, INC. petitioner, vs.COURT OF
APPEALS and C.F. SHARP & COMPANY INC., respondents.
This petition for review on certiorari seeks to set aside the decision of the Court of Appeals
affirming the dismissal of the petitioner's complaint to enforce the judgment of a Japanese
court. The principal issue here is whether a Japanese court can acquire jurisdiction over a
Philippine corporation doing business in Japan by serving summons through diplomatic
channels on the Philippine corporation at its principal office in Manila after prior attempts to
serve summons in Japan had failed.
Petitioner Northwest Orient Airlines, Inc. (hereinafter NORTHWEST), a corporation organized
under the laws of the State of Minnesota, U.S.A., sought to enforce in Civil Case No. 83-
17637 of the Regional Trial Court (RTC), Branch 54, Manila, a judgment rendered in its favor
by a Japanese court against private respondent C.F. Sharp & Company, Inc., (hereinafter
SHARP), a corporation incorporated under Philippine laws.
1
As found by the Court of Appeals in the challenged decision of 10 November 1993,   the
following are the factual and procedural antecedents of this controversy:
On May 9, 1974, plaintiff Northwest Airlines and defendant C.F. Sharp &
Company, through its Japan branch, entered into an International
Passenger Sales Agency Agreement, whereby the former authorized the
latter to sell its air transportation tickets. Unable to remit the proceeds of
the ticket sales made by defendant on behalf of the plaintiff under the
said agreement, plaintiff on March 25, 1980 sued defendant in Tokyo,
Japan, for collection of the unremitted proceeds of the ticket sales, with
claim for damages.
On April 11, 1980, a writ of summons was issued by the 36th Civil
Department, Tokyo District Court of Japan against defendant at its office
at the Taiheiyo Building, 3rd floor, 132, Yamashita-cho, Naka-ku,
Yokohoma, Kanagawa Prefecture. The attempt to serve the summons
was unsuccessful because the bailiff was advised by a person in the
office that Mr. Dinozo, the person believed to be authorized to receive
court processes was in Manila and would be back on April 24, 1980.
On April 24, 1980, bailiff returned to the defendant's office to serve the
summons. Mr. Dinozo refused to accept the same claiming that he was
no longer an employee of the defendant.
After the two attempts of service were unsuccessful, the judge of the
Tokyo District Court decided to have the complaint and the writs of
summons served at the head office of the defendant in Manila. On July
11, 1980, the Director of the Tokyo District Court requested the Supreme
Court of Japan to serve the summons through diplomatic channels upon
the defendant's head office in Manila.
On August 28, 1980, defendant received from Deputy Sheriff Rolando
Balingit the writ of summons (p. 276, Records). Despite receipt of the
same, defendant failed to appear at the scheduled hearing. Thus, the
Tokyo Court proceeded to hear the plaintiff's complaint and on [January
29, 1981], rendered judgment ordering the defendant to pay the plaintiff
the sum of 83,158,195 Yen and damages for delay at the rate of 6% per
annum from August 28, 1980 up to and until payment is completed (pp.
12-14, Records).
On March 24, 1981, defendant received from Deputy Sheriff Balingit copy
of the judgment. Defendant not having appealed the judgment, the same
became final and executory.
Plaintiff was unable to execute the decision in Japan, hence, on May 20,
1983, a suit for enforcement of the judgment was filed by plaintiff before
the Regional Trial Court of Manila Branch 54. 2
On July 16, 1983, defendant filed its answer averring that the judgment of
the Japanese Court sought to be enforced is null and void and
unenforceable in this jurisdiction having been rendered without due and
proper notice to the defendant and/or with collusion or fraud and/or upon
a clear mistake of law and fact (pp. 41-45, Rec.).
Unable to settle the case amicably, the case was tried on the merits. After
the plaintiff rested its case, defendant on April 21, 1989, filed a Motion for
Judgment on a Demurrer to Evidence based on two grounds: 
(1) the foreign judgment sought to be enforced is null and void for want of
jurisdiction and (2) the said judgment is contrary to Philippine law and
public policy and rendered without due process of law. Plaintiff filed its
opposition after which the court a quo rendered the now assailed
decision dated June 21, 1989 granting the demurrer motion and
dismissing the complaint (Decision, pp. 376-378, Records). In granting
the demurrer motion, the trial court held that:
The foreign judgment in the Japanese Court sought
in this action is null and void for want of jurisdiction
over the person of the defendant considering that
this is an action in personam; the Japanese Court did
not acquire jurisdiction over the person of the
defendant because jurisprudence requires that the
defendant be served with summons in Japan in order
for the Japanese Court to acquire jurisdiction over it,
the process of the Court in Japan sent to the
Philippines which is outside Japanese jurisdiction
cannot confer jurisdiction over the defendant in the
case before the Japanese Court of the case at
 bar. Boudard versus Tait 67 Phil. 170. The plaintiff
contends that the Japanese Court acquired
jurisdiction because the defendant is a resident of
Japan, having four (4) branches doing business
therein and in fact had a permit from the Japanese
government to conduct business in Japan (citing the
exhibits presented by the plaintiff); if this is so then
service of summons should have been made upon
the defendant in Japan in any of these alleged four
branches; as admitted by the plaintiff the service of
the summons issued by the Japanese Court was
made in the Philippines thru a Philippine Sheriff. This
Court agrees that if the defendant in a foreign court
is a resident in the court of that foreign court such
court could acquire jurisdiction over the person of the
defendant but it must be served upon the defendant
in the territorial jurisdiction of the foreign court. Such
is not the case here because the defendant was
served with summons in the Philippines and not in
Japan.
Unable to accept the said decision, plaintiff on July 11, 1989 moved for
reconsideration of the decision, filing at the same time a conditional
Notice of Appeal, asking the court to treat the said notice of appeal "as in
effect after and upon issuance of the court's denial of the motion for
reconsideration."
Defendant opposed the motion for reconsideration to which a Reply
dated August 28, 1989 was filed by the plaintiff.
On October 16, 1989, the lower court disregarded the Motion for
Reconsideration and gave due course to the plaintiff's Notice of Appeal. 3
In its decision, the Court of Appeals sustained the trial court. It agreed with the latter in its
reliance upon Boudard vs.Tait  4 wherein it was held that "the process of the court has no
extraterritorial effect and no jurisdiction is acquired over the person of the defendant by
serving him beyond the boundaries of the state." To support its position, the Court of Appeals
further stated:
In an action strictly in personam, such as the instant case, personal
service of summons within the forum is required for the court to acquire
jurisdiction over the defendant (Magdalena Estate Inc. vs. Nieto, 125
SCRA 230). To confer jurisdiction on the court, personal or substituted
service of summons on the defendant not extraterritorial service is
necessary (Dial Corp vs. Soriano, 161 SCRA 739).
But while plaintiff-appellant concedes that the collection suit filed is an
action in personam, it is its theory that a distinction must be made
between an action in personam against a resident defendant and an
action in personam against a non-resident defendant. Jurisdiction is
acquired over a non-resident defendant only if he is served personally
within the jurisdiction of the court and over a resident defendant if by
personal, substituted or constructive service conformably to statutory
authorization. Plaintiff-appellant argues that since the defendant-appellee
maintains branches in Japan it is considered a resident defendant.
Corollarily, personal, substituted or constructive service of summons
when made in compliance with the procedural rules is sufficient to give
the court jurisdiction to render judgment in personam.
Such an argument does not persuade.
It is a general rule that processes of the court cannot lawfully be served
outside the territorial limits of the jurisdiction of the court from which it
issues (Carter vs. Carter; 41 S.E. 2d 532, 201) and this is regardless of
the residence or citizenship of the party thus served (Iowa-Rahr vs. Rahr,
129 NW 494, 150 Iowa 511, 35 LRC, NS, 292, Am. Case 1912 D680).
There must be actual service within the proper territorial limits on
defendant or someone authorized to accept service for him. Thus, a
defendant, whether a resident or not in the forum where the action is
filed, must be served with summons within that forum.
But even assuming a distinction between a resident defendant and non-
resident defendant were to be adopted, such distinction applies only to
natural persons and not in the corporations. This finds support in the
concept that "a corporation has no home or residence in the sense in
which those terms are applied to natural persons" (Claude Neon Lights
vs. Phil. Advertising Corp., 57 Phil. 607). Thus, as cited by the defendant-
appellee in its brief:
Residence is said to be an attribute of a natural person, and can be
predicated on an artificial being only by more or less imperfect analogy.
Strictly speaking, therefore, a corporation can have no local residence or
habitation. It has been said that a corporation is a mere ideal existence,
subsisting only in contemplation of law — an invisible being which can
have, in fact, no locality and can occupy no space, and therefore cannot
have a dwelling place. (18 Am. Jur. 2d, p. 693 citing Kimmerle v. Topeka,
88 370, 128 p. 367; Wood v. Hartfold F. Ins. Co., 13 Conn 202)
Jurisprudence so holds that the foreign or domestic character of a
corporation is to be determined by the place of its origin where its charter
was granted and not by the location of its business activities (Jennings v.
Idaho Rail Light & P. Co., 26 Idaho 703, 146 p. 101), A corporation is a
"resident" and an inhabitant of the state in which it is incorporated and no
other (36 Am. Jur. 2d, p. 49).
Defendant-appellee is a Philippine Corporation duly organized under the
Philippine laws. Clearly, its residence is the Philippines, the place of its
incorporation, and not Japan. While defendant-appellee maintains
branches in Japan, this will not make it a resident of Japan. A corporation
does not become a resident of another by engaging in business there
even though licensed by that state and in terms given all the rights and
privileges of a domestic corporation (Galveston H. & S.A.R. Co. vs.
Gonzales, 151 US 496, 38 L ed. 248, 4 S Ct. 401).
On this premise, defendant appellee is a non-resident corporation. As
such, court processes must be served upon it at a place within the state
in which the action is brought and not elsewhere (St. Clair vs. Cox, 106
US 350, 27 L ed. 222, 1 S. Ct. 354). 5
It then concluded that the service of summons effected in Manila or beyond the territorial
boundaries of Japan was null and did not confer jurisdiction upon the Tokyo District Court
over the person of SHARP; hence, its decision was void.
Unable to obtain a reconsideration of the decision, NORTHWEST elevated the case to this
Court contending that the respondent court erred in holding that SHARP was not a resident of
Japan and that summons on SHARP could only be validly served within that country.
A foreign judgment is presumed to be valid and binding in the country from which it comes,
until the contrary is shown. It is also proper to presume the regularity of the proceedings and
the giving of due notice therein. 6
Under Section 50, Rule 39 of the Rules of Court, a judgment in an action in personam of a
tribunal of a foreign country having jurisdiction to pronounce the same is presumptive
evidence of a right as between the parties and their successors-in-interest by a subsequent
title. The judgment may, however, be assailed by evidence of want of jurisdiction, want of
notice to the party, collusion, fraud, or clear mistake of law or fact. Also, under Section 3 of
Rule 131, a court, whether of the Philippines or elsewhere, enjoys the presumption that it was
acting in the lawful exercise of jurisdiction and has regularly performed its official duty.
Consequently, the party attacking a foreign judgment has the burden of overcoming the
presumption of its validity. 7Being the party challenging the judgment rendered by the
Japanese court, SHARP had the duty to demonstrate the invalidity of such judgment. In an
attempt to discharge that burden, it contends that the extraterritorial service of summons
effected at its home office in the Philippines was not only ineffectual but also void, and the
Japanese Court did not, therefore acquire jurisdiction over it.
It is settled that matters of remedy and procedure such as those relating to the service of
process upon a defendant are governed by the lex fori or the internal law of the forum. 8 In this
case, it is the procedural law of Japan where the judgment was rendered that determines the
validity of the extraterritorial service of process on SHARP. As to what this law is is a question
of fact, not of law. It may not be taken judicial notice of and must be pleaded and proved like
any other fact. 9Sections 24 and 25, Rule 132 of the Rules of Court provide that it may be
evidenced by an official publication or by a duly attested or authenticated copy thereof. It was
then incumbent upon SHARP to present evidence as to what that Japanese procedural law is
and to show that under it, the assailed extraterritorial service is invalid. It did not. Accordingly,
the presumption of validity and regularity of the service of summons and the decision
thereafter rendered by the Japanese court must stand.
Alternatively in the light of the absence of proof regarding Japanese 
law, the presumption of identity or similarity or the so-called processual presumption 10 may be
invoked. Applying it, the Japanese law on the matter is presumed to be similar with the
Philippine law on service of summons on a private foreign corporation doing business in the
Philippines. Section 14, Rule 14 of the Rules of Court provides that if the defendant is a
foreign corporation doing business in the Philippines, service may be made: (1) on its resident
agent designated in accordance with law for that purpose, or, (2) if there is no such resident
agent, on the government official designated by law to that effect; or (3) on any of its officers
or agents within the Philippines.
If the foreign corporation has designated an agent to receive summons, the designation is
exclusive, and service of summons is without force and gives the court no jurisdiction unless
made upon him. 11
Where the corporation has no such agent, service shall be made on the government official
designated by law, to wit: (a) the Insurance Commissioner in the case of a foreign insurance
company; (b) the Superintendent of Banks, in the case of a foreign banking corporation; and
(c) the Securities and Exchange Commission, in the case of other foreign corporations duly
licensed to do business in the Philippines. Whenever service of process is so made, the
government office or official served shall transmit by mail a copy of the summons or other
legal proccess to the corporation at its home or principal office. The sending of such copy is a
necessary part of the service. 12
SHARP contends that the laws authorizing service of process upon the Securities and
Exchange Commission, the Superintendent of Banks, and the Insurance Commissioner, as
the case may be, presuppose a situation wherein the foreign corporation doing business in
the country no longer has any branches or offices within the Philippines. Such contention is
belied by the pertinent provisions of the said laws. Thus, Section 128 of the Corporation
Code 13 and Section 190 of the Insurance Code 14 clearly contemplate two situations: (1) if the
corporation had left the Philippines or had ceased to transact business therein, and (2) if the
corporation has no designated agent. Section 17 of the General Banking Act 15 does not even
speak a corporation which had ceased to transact business in the Philippines.
Nowhere in its pleadings did SHARP profess to having had a resident agent authorized to
receive court processes in Japan. This silence could only mean, or least create an
impression, that it had none. Hence, service on the designated government official or on any
of SHARP's officers or agents in Japan could be availed of. The respondent, however, insists
that only service of any of its officers or employees in its branches in Japan could be resorted
to. We do not agree. As found by the respondent court, two attempts at service were made at
SHARP's Yokohama branch. Both were unsuccessful. On the first attempt, Mr. Dinozo, who
was believed to be the person authorized to accept court process, was in Manila. On the
second, Mr. Dinozo was present, but to accept the summons because, according to him, he
was no longer an employee of SHARP. While it may be true that service could have been
made upon any of the officers or agents of SHARP at its three other branches in Japan, the
availability of such a recourse would not preclude service upon the proper government official,
as stated above.
As found by the Court of Appeals, it was the Tokyo District Court which ordered that
summons for SHARP be served at its head office in the Philippine's after the two attempts of
service had failed. 16 The Tokyo District Court requested the Supreme Court of Japan to
cause the delivery of the summons and other legal documents to the Philippines. Acting on
that request, the Supreme Court of Japan sent the summons together with the other legal
documents to the Ministry of Foreign Affairs of Japan which, in turn, forwarded the same to
the Japanese Embassy in Manila . Thereafter, the court processes were delivered to the
Ministry (now Department) of Foreign Affairs of the Philippines, then to the Executive Judge of
the Court of First Instance (now Regional Trial Court) of Manila, who forthwith ordered Deputy
Sheriff Rolando Balingit to serve the same on SHARP at its principal office in Manila. This
service is equivalent to service on the proper government official under Section 14, Rule 14 of
the Rules of Court, in relation to Section 128 of the Corporation Code. Hence, SHARP's
contention that such manner of service is not valid under Philippine laws holds no water. 17
In deciding against the petitioner, the respondent court sustained the trial court's reliance
on Boudard vs. Tait  18where this Court held:
The fundamental rule is that jurisdiction in personam over nonresidents,
so as to sustain a money judgment, must be based upon personal
service within the state which renders the judgment.
xxx xxx xxx
The process of a court, has no extraterritorial effect, and no jurisdiction is
acquired over the person of the defendant by serving him beyond the
boundaries of the state. Nor has a judgment of a court of a foreign
country against a resident of this country having no property in such
foreign country based on process served here, any effect here against
either the defendant personally or his property situated here.
Process issuing from the courts of one state or country cannot run into
another, and although a nonresident defendant may have been
personally served with such process in the state or country of his
 domicile, it will not give such jurisdiction as to authorize a personal
judgment against him.
It further availed of the ruling in Magdalena Estate, Inc. vs. Nieto 19 and Dial
Corp. vs. Soriano, 20 as well as the principle laid down by the Iowa Supreme Court in the
1911 case of Raher vs. Raher. 21
The first three cases are, however, inapplicable. Boudard involved the enforcement of a
judgment of the civil division of the Court of First Instance of Hanoi, French Indo-China. The
trial court dismissed the case because the Hanoi court never acquired jurisdiction over the
person of the defendant considering that "[t]he, evidence adduced at the trial conclusively
proves that neither the appellee [the defendant] nor his agent or employees were ever in
Hanoi, French Indo-China; and that the deceased Marie Theodore Jerome Boudard had
never, at any time, been his employee." In Magdalena Estate, what was declared invalid
resulting in the failure of the court to acquire jurisdiction over the person of the defendants in
an action in personam was the service of summons through publication against non-
appearing resident defendants. It was claimed that the latter concealed themselves to avoid
personal service of summons upon them. In Dial, the defendants were foreign corporations
which were not, domiciled and licensed to engage in business in the Philippines and which did
not have officers or agents, places of business, or properties here. On the other hand, in the
instant case, SHARP was doing business in Japan and was maintaining four branches
therein.
Insofar as to the Philippines is concerned, Raher is a thing of the past. In that case, a divided
Supreme Court of Iowa declared that the principle that there can be no jurisdiction in a court
of a territory to render a personal judgment against anyone upon service made outside its
limits was applicable alike to cases of residents and non-residents. The principle was put at
rest by the United States Supreme Court when it ruled in the 1940 case of Milliken
vs. Meyer  22 that domicile in the state is alone sufficient to bring an absent defendant within
the reach of the state's jurisdiction for purposes of a personal judgment by means of
appropriate substituted service or personal service without the state. This principle is
embodied in section 18, Rule 14 of the Rules of Court which allows service of summons on
residents temporarily out of the Philippines to be made out of the country. The rationale for
this rule was explained in Milliken as follows:
[T]he authority of a state over one of its citizens is not terminated by the
mere fact of his absence from the state. The state which accords him
privileges and affords protection to him and his property by virtue of his
domicile may also exact reciprocal duties. "Enjoyment of the privileges of
residence within the state, and the attendant right to invoke the protection
of its laws, are inseparable" from the various incidences of state
citizenship. The responsibilities of that citizenship arise out of the
relationship to the state which domicile creates. That relationship is not
dissolved by mere absence from the state. The attendant duties, like the
rights and privileges incident to domicile, are not dependent on
continuous presence in the state. One such incident of domicile is
amenability to suit within the state even during sojourns without the state,
where the state has provided and employed a reasonable method for
apprising such an absent party of the proceedings against him. 23
The domicile of a corporation belongs to the state where it was incorporated. 24 In a strict
technical sense, such domicile as a corporation may have is single in its essence and a
corporation can have only one domicile which is the state of its creation. 25
Nonetheless, a corporation formed in one-state may, for certain purposes, be regarded a
resident in another state in which it has offices and transacts business. This is the rule in our
jurisdiction and apropos thereto, it may be necessery to quote what we stated in State
Investment House, Inc, vs. Citibank, N.A., 26 to wit:
The issue is whether these Philippine branches or units may be
considered "residents of the Philippine Islands" as that term is used in
Section 20 of the Insolvency Law . . . or residents of the state under the
laws of which they were respectively incorporated. The answer cannot be
found in the Insolvency Law itself, which contains no definition of the
term, resident, or any clear indication of its meaning. There are however
other statutes, albeit of subsequent enactment and effectivity, from which
enlightening notions of the term may be derived.
The National Internal Revenue Code declares that the term "'resident
foreign corporation' applies to a foreign corporation engaged in trade or
business within the Philippines," as distinguished from a "'non-resident
foreign corporation' . . . (which is one) not engaged in trade or bussiness
within the Philippines." [Sec. 20, pars. (h) and (i)].
The Offshore Banking Law, Presidential Decree No. 1034, states "that
branches, subsidiaries, affiliation, extension offices or any other units of
corporation or juridical person organized under the laws of any foreign
country operating in the Philippines shall be considered residents of the
Philippines. [Sec. 1(e)].
The General Banking Act, Republic Act No. 337, places "branches and
agencies in the Philippines of foreign banks . . . (which are) called
Philippine branches," in the same category as "commercial banks,
savings associations, mortgage banks, development banks, rural banks,
stock savings and loan associations" (which have been formed and
organized under Philippine laws), making no distinction between the
former and the latter in so far as the terms "banking institutions" and
"bank" are used in the Act [Sec. 2], declaring on the contrary that in "all
matters not specifically covered by special provisions applicable only to
foreign banks, or their branches and agencies in the Philippines, said
foreign banks or their branches and agencies lawfully doing business in
the Philippines "shall be bound by all laws, rules, and regulations
applicable to domestic banking corporations of the same class, except
such laws, rules and regulations as provided for the creation, formation,
organization, or dissolution of corporations or as fix the relation, liabilities,
responsibilities, or duties of members, stockholders or officers of
corporation. [Sec. 18].
This court itself has already had occasion to hold [Claude Neon Lights,
Fed. Inc. vs. Philippine Advertising Corp., 57 Phil. 607] that a foreign
corporation licitly doing business in the Philippines, which is a defendant
in a civil suit, may not be considered a non-resident within the scope of
the legal provision authorizing attachment against a defendant not
residing in the Philippine Islands; [Sec. 424, in relation to Sec. 412 of Act
No. 190, the Code of Civil Procedure; Sec. 1(f), Rule 59 of the Rules of
1940, Sec. 1(f), Rule 57, Rules of 1964] in other words, a preliminary
attachment may not be applied for and granted solely on the asserted
fact that the defendant is a foreign corporation authorized to do business
in the Philippines — and is consequently and necessarily, "a party who
resides out of the Philippines." Parenthetically, if it may not be considered
as a party not residing in the Philippines, or as a party who resides out of
the country, then, logically, it must be considered a party who does reside
in the Philippines, who is a resident of the country. Be this as it may, this
Court pointed out that:
 . . . Our laws and jurisprudence indicate a purpose to
assimilate foreign corporations, duly licensed to do
business here, to the status of domestic
corporations. (Cf. Section 73, Act No. 1459, and
Marshall Wells Co. vs. Henry W. Elser & Co., 46 Phil.
70, 76; Yu Cong Eng vs. Trinidad, 47 Phil. 385, 411)
We think it would be entirely out of line with this
policy should we make a discrimination against a
foreign corporation, like the petitioner, and subject its
property to the harsh writ of seizure by attachment
when it has complied not only with every requirement
of law made specially of foreign corporations, but in
addition with every requirement of law made of
domestic corporations. . . .
Obviously, the assimilation of foreign corporations authorized to do
business in the Philippines "to the status of domestic corporations,
subsumes their being found and operating as corporations,
hence, residing, in the country.
The same principle is recognized in American law: that the residence of a
corporation, if it can be said to have a residence, is necessarily where it
exercises corporate functions . . .;" that it is considered as dwelling "in the
place where its business is done . . .," as being "located where its
franchises are exercised . . .," and as being "present where it is engaged
in the prosecution of the corporate enterprise;" that a "foreign corporation
licensed to do business in a state is a resident of any country where it
maintains an office or agent for transaction of its usual and customary
business for venue purposes;" and that the "necessary element in its
signification is locality of existence." [Words and Phrases, Permanent
Ed., vol. 37, pp. 394, 412, 493].
In as much as SHARP was admittedly doing business in Japan through its four duly
registered branches at the time the collection suit against it was filed, then in the light of the
processual presumption, SHARP may be deemed a resident of Japan, and, as such, was
amenable to the jurisdiction of the courts therein and may be deemed to have assented to the
said courts' lawful methods of serving process. 27
Accordingly, the extraterritorial service of summons on it by the Japanese Court was valid not
only under the processual presumption but also because of the presumption of regularity of
performance of official duty.
We find NORTHWEST's claim for attorney's fees, litigation expenses, and exemplary
damages to be without merit. We find no evidence that would justify an award for attorney's
fees and litigation expenses under Article 2208 of the Civil Code of the Philippines. Nor is an
award for exemplary damages warranted. Under Article 2234 of the Civil Code, before the
court may consider the question of whether or not exemplary damages should be awarded,
the plaintiff must show that he is entitled to moral, temperate, or compensatory damaged.
There being no such proof presented by NORTHWEST, no exemplary damages may be
adjudged in its favor.
WHEREFORE, the instant petition is partly GRANTED, and the challenged decision is
AFFIRMED insofar as it denied NORTHWEST's claims for attorneys fees, litigation expenses,
and exemplary damages but REVERSED insofar as in sustained the trial court's dismissal of
NORTHWEST's complaint in Civil Case No. 83-17637 of Branch 54 of the Regional Trial
Court of Manila, and another in its stead is hereby rendered ORDERING private respondent
C.F. SHARP L COMPANY, INC. to pay to NORTHWEST the amounts adjudged in the foreign
judgment subject of said case, with interest thereon at the legal rate from the filing of the
complaint therein until the said foreign judgment is fully satisfied. Costs against the private
respondent.
DIGEST
FACTS: Petitioner Northwest Orient Airlines, Inc. (NORTHWEST), a corporation organized
under the laws of the State of Minnesota, U.S.A., sought to enforce in the RTC- Manila, a
judgment rendered in its favor by a Japanese court against private respondent C.F. Sharp &
Company, Inc., (SHARP), a corporation incorporated under Philippine laws.
factual and procedural antecedents of this controversy:
On May 9, 1974, Northwest Airlines and Sharp, through its Japan branch, entered into an
International Passenger Sales Agency Agreement, whereby the former authorized the latter to
sell its air transportation tickets. Unable to remit the proceeds of the ticket sales made by
defendant on behalf of the plaintiff under the said agreement, plaintiff on March 25, 1980 sued
defendant in Tokyo, Japan, for collection of the unremitted proceeds of the ticket sales, with
claim for damages.
On April 11, 1980, a writ of summons was issued by the 36th Civil Department, Tokyo District
Court of Japan against defendant at its office at the Taiheiyo Building, 3rd floor, 132,
Yamashita-cho, Naka-ku, Yokohoma, Kanagawa Prefecture. The attempt to serve the
summons was unsuccessful because the bailiff was advised by a person in the office that Mr.
Dinozo, the person believed to be authorized to receive court processes was in Manila and
would be back on April 24, 1980.
On April 24, 1980, bailiff returned to the defendant’s office to serve the summons. Mr. Dinozo
refused to accept the same claiming that he was no longer an employee of the defendant.
After the two attempts of service were unsuccessful, the judge of the Tokyo District Court
decided to have the complaint and the writs of summons served at the head office of the
defendant in Manila. On July 11, 1980, the Director of the Tokyo District Court requested the
Supreme Court of Japan to serve the summons through diplomatic channels upon the
defendant’s head office in Manila.
On August 28, 1980, defendant received from Deputy Sheriff Rolando Balingit the writ of
summons (p. 276, Records). Despite receipt of the same, defendant failed to appear at the
scheduled hearing. Thus, the Tokyo Court proceeded to hear the plaintiff’s complaint and on
[January 29, 1981], rendered judgment ordering the defendant to pay the plaintiff the sum of
83,158,195 Yen and damages for delay at the rate of 6% per annum from August 28, 1980 up
to and until payment is completed (pp. 12-14, Records).
On March 24, 1981, defendant received from Deputy Sheriff Balingit copy of the judgment.
Defendant not having appealed the judgment, the same became final and executory.
Plaintiff was unable to execute the decision in Japan, hence, on May 20, 1983, a suit for
enforcement of the judgment was filed by plaintiff before the Regional Trial Court of Manila
Branch 54.
Defendant filed its answer averring that the judgment of the Japanese Court: (1) the foreign
judgment sought to be enforced is null and void for want of jurisdiction and (2) the said
judgment is contrary to Philippine law and public policy and rendered without due process of
law.
In its decision, the Court of Appeals sustained the trial court. It agreed with the latter in its
reliance upon Boudard vs. Tait wherein it was held that “the process of the court has no
extraterritorial effect and no jurisdiction is acquired over the person of the defendant by
serving him beyond the boundaries of the state.” To support its position, the Court of Appeals
further stated:
In an action strictly in personam, such as the instant case, personal service of summons
within the forum is required for the court to acquire jurisdiction over the defendant (Magdalena
Estate Inc. vs. Nieto, 125 SCRA 230). To confer jurisdiction on the court, personal or
substituted service of summons on the defendant not extraterritorial service is necessary.
ISSUE: whether a Japanese court can acquire jurisdiction over a Philippine corporation doing
business in Japan by serving summons through diplomatic channels on the Philippine
corporation at its principal office in Manila after prior attempts to serve summons in Japan had
failed.
HELD: YES
A foreign judgment is presumed to be valid and binding in the country from which it comes,
until the contrary is shown. It is also proper to presume the regularity of the proceedings and
the giving of due notice therein. 6
The judgment may, however, be assailed by evidence of want of jurisdiction, want of notice to
the party, collusion, fraud, or clear mistake of law or fact.(See Sec. 50, R 39)
Being the party challenging the judgment rendered by the Japanese court, SHARP had the
duty to demonstrate the invalidity of such judgment.
It is settled that matters of remedy and procedure such as those relating to the service of
process upon a defendant are governed by the lex fori or the internal law of the forum. 8 In
this case, it is the procedural law of Japan where the judgment was rendered that determines
the validity of the extraterritorial service of process on SHARP. As to what this law is is a
question of fact, not of law.
It was then incumbent upon SHARP to present evidence as to what that Japanese procedural
law is and to show that under it, the assailed extraterritorial service is invalid. It did not.
Accordingly, the presumption of validity and regularity of the service of summons and the
decision thereafter rendered by the Japanese court must stand.
Alternatively in the light of the absence of proof regarding Japanese law, the presumption of
identity or similarity or the so-called processual presumption may be invoked. Applying it, the
Japanese law on the matter is presumed to be similar with the Philippine law on service of
summons on a private foreign corporation doing business in the Philippines.
Section 14, Rule 14 of the Rules of Court provides that if the defendant is a foreign
corporation doing business in the Philippines, service may be made: (1) on its resident agent
designated in accordance with law for that purpose, or, (2) if there is no such resident agent,
on the government official designated by law to that effect; or (3) on any of its officers or
agents within the Philippines.
Where the corporation has no such agent, service shall be made on the government official
designated by law, to wit: (a) the Insurance Commissioner in the case of a foreign insurance
company; (b) the Superintendent of Banks, in the case of a foreign banking corporation; and
(c) the Securities and Exchange Commission, in the case of other foreign corporations duly
licensed to do business in the Philippines.
Nowhere in its pleadings did SHARP profess to having had a resident agent authorized to
receive court processes in Japan.
While it may be true that service could have been made upon any of the officers or agents of
SHARP at its three other branches in Japan, the availability of such a recourse would not
preclude service upon the proper government official, as stated above.
As found by the respondent court, two attempts at service were made at SHARP’s Yokohama
branch. Both were unsuccessful.
The Tokyo District Court requested the Supreme Court of Japan to cause the delivery of the
summons and other legal documents to the Philippines. Acting on that request, the Supreme
Court of Japan sent the summons together with the other legal documents to the Ministry of
Foreign Affairs of Japan which, in turn, forwarded the same to the Japanese Embassy in
Manila . Thereafter, the court processes were delivered to the Ministry (now Department) of
Foreign Affairs of the Philippines, then to the Executive Judge of the Court of First Instance
(now Regional Trial Court) of Manila, who forthwith ordered Deputy Sheriff Rolando Balingit to
serve the same on SHARP at its principal office in Manila. This service is equivalent to service
on the proper government official under Section 14, Rule 14 of the Rules of Court, in relation
to Section 128 of the Corporation Code. Hence, SHARP’s contention that such manner of
service is not valid under Philippine laws holds no water.
We find NORTHWEST’s claim for attorney’s fees, litigation expenses, and exemplary
damages to be without merit. We find no evidence that would justify an award for attorney’s
fees and litigation expenses under Article 2208 of the Civil Code of the Philippines. Nor is an
award for exemplary damages warranted.
WHEREFORE, the instant petition is partly GRANTED, and the challenged decision is
AFFIRMED insofar as it denied NORTHWEST’s claims for attorneys fees, litigation expenses,
and exemplary damages but REVERSED insofar as in sustained the trial court’s dismissal of
NORTHWEST’s complaint in Civil Case No. 83-17637 of Branch 54 of the Regional Trial
Court of Manila, and another in its stead is hereby rendered ORDERING private respondent
C.F. SHARP L COMPANY, INC. to pay to NORTHWEST the amounts adjudged in the foreign
judgment subject of said case, with interest thereon at the legal rate from the filing of the
complaint therein until the said foreign judgment is fully satisfied.
G.R. No. 46631             November 16, 1939
IDONAH SLADE PERKINS, petitioner, vs.ARSENIO P. DIZON, Judge of First
Instance of Manila, EUGENE ARTHUR PERKINS, and BENGUET
CONSOLIDATED MINING COMPANY, respondents.
On July 6, 1938, respondent, Eugene Arthur Perkins, instituted an action in the Court of First
Instance of Manila against the Benguet Consolidated Mining Company for dividends
amounting to P71,379.90 on 52,874 shares of stock registered in his name, payment of which
was being withheld by the company; and, for the recognition of his right to the control and
disposal of said shares, to the exclusion of all others. To the complaint, the company filed its
answer alleging, by way of defense, that the withholding of such dividends and the non-
recognition of plaintiff's right to the disposal and control of the shares were due to certain
demands made with respect to said shares by the petitioner herein, Idonah Slade Perkins,
and by one George H. Engelhard. The answer prays that the adverse claimants be made
parties to the action and served with notice thereof by publication, and that thereafter all such
parties be required to interplead and settle the rights among themselves. On September 5,
1938, the trial court ordered respondent Eugene Arthur Perkins to include in his complaint as
parties defendant petitioner, Idonah Slade Perkins, and George H. Engelhard. The complaint
was accordingly amended and in addition to the relief prayed for in the original complaint,
respondent Perkins prayed that petitioner Idonah Slade Perkins and George Engelhard be
adjudged without interest in the shares of stock in question and excluded from any claim they
assert thereon. Thereafter, summons by publication were served upon the non-resident
defendants, Idonah Slade Perkins and George H. Engelhard, pursuant to the order of the trial
court. On December 9, 1938, Engelhard filed his answer to the amended complaint, and on
December 10, 1938, petitioner Idonah Slade Perkins, through counsel, filed her pleading
entitled "objection to venue, motion to quash, and demurrer to jurisdiction" wherein she
challenged the jurisdiction of the lower court over her person. Petitioner's objection, motion
and demurrer having been overruled as well as her motion for reconsideration of the order of
denial, she now brought the present petition for certiorari, praying that the summons by
publication issued against her be declared null and void, and that, with respect to her,
respondent Judge be permanently prohibited from taking any action on the case.
The controlling issue here involved is whether or not the Court of First Instance of Manila has
acquired jurisdiction over the person of the present petitioner as a non-resident defendant, or,
notwithstanding the want of such jurisdiction, whether or not said court may validly try the
case. The parties have filed lengthy memorandums relying on numerous authorities, but the
principles governing the question are well settled in this jurisdiction.
Section 398 of our Code of Civil Procedure provides that when a non-resident defendant is
sued in the Philippine courts and it appears, by the complaint or by affidavits, that the action
relates to real or personal property within the Philippines in which said defendant has or
claims a lien or interest, actual or contingent, or in which the relief demanded consists, wholly
or in part, in excluding such person from any interest therein, service of summons maybe
made by publication.
We have fully explained the meaning of this provision in El Banco Español Filipino vs.
Palanca, 37 Phil., 921, wherein we laid down the following rules:
(1) In order that the court may validly try a case, it must have jurisdiction over the
subject-matter and over the persons of the parties. Jurisdiction over the subject-
matter is acquired by concession of the sovereign authority which organizes a court
and determines the nature and extent of its powers in general and thus fixes its
jurisdiction with reference to actions which it may entertain and the relief it may
grant. Jurisdiction over the persons of the parties is acquired by their voluntary
appearance in court and their submission to its authority, or by the coercive power
of legal process exerted over their persons.
(2) When the defendant is a non-resident and refuses to appear voluntary, the court
cannot acquire jurisdiction over his person even if the summons be served by
publication, for he is beyond the reach of judicial process. No tribunal established
by one State can extend its process beyond its territory so as to subject to its
decisions either persons or property located in another State. "There are many
expressions in the American reports from which it might be inferred that the court
acquires personal jurisdiction over the person of the defendant by publication and
notice; but such is not the case. In truth, the proposition that jurisdiction over the
person of a non-resident cannot be acquired by publication and notice was never
clearly understood even in the American courts until after the decision had been
rendered by the Supreme Court of the United States in the leading case
of Pennoyer v. Neff (95 U.S., 714; 24 Law. ed., 565). In the light of that decisions
which have subsequently been rendered in that and other courts, the proposition
that jurisdiction over the person cannot be thus acquired by publication and notice
is no longer open to question; and it is now fully established that a personal
judgment upon constructive or substituted service against a non-resident who does
not appear is wholly invalid. This doctrine applies to all kinds of constructive or
substituted process, including service by publication and personal service outside of
the jurisdiction in which the judgment is rendered; and the only exception seems to
be found in the case where the non-resident defendant has expressly or impliedly
consented to the mode of service. (Note to Raher vs. Raher, 35 L. R. A. [N. S.],
292; see also L.R.A. 585; 35 L.R.A. [N.S.], 312.)
(3) The general rule, therefore, is that a suit against a non-resident cannot be
entertained by a Philippine court. Where, however, the action is in rem or quasi in
rem in connection with property located in the Philippines, the court acquires
jurisdiction over the res, and its jurisdiction over the person of the non-resident is
non-essential. In order that the court may exercise power over the res, it is not
necessary that the court should take actual custody of the property, potential
custody thereof being sufficient. There is potential custody when, from the nature of
the action brought, the power of the court over the property is impliedly recognized
by law. "An illustration of what we term potential jurisdiction over the res, is found in
the proceeding to register the title of land under our system for the registration of
land. Here the court, without taking actual physical control over the property ,
assumes, at the instance of some person claiming to be owner, to exercise a
jurisdiction in rem over the property and to adjudicate the title in favor of the
petitioner against all the world."
(4) As before stated, in an action in rem or quasi in rem against a non-resident
defendant, jurisdiction over his person is non-essential, and if the law requires in
such case that the summons upon the defendant be served by publication, it is
merely to satisfy the constitutional requirement of due process. If any be said, in
this connection, that "may reported cases can be cited in which it is assumed that
the question of the sufficiency of publication or notice in the case of this kind is a
question affecting the jurisdiction of the court, and the court is sometimes said to
acquire jurisdiction by virtue of the publication. This phraseology was undoubtedly
originally adopted by the court because of the analogy between service by
publication and personal service of process upon the defendant; and, as has
already been suggested, prior to the decision of Pennoyer v. Neff (supra), the
difference between the legal effects of the two forms of service was obscure. It is
accordingly not surprising that the modes of expression which had already been
moulded into legal tradition before that case was decided have been brought down
to the present day. But it is clear that the legal principle here involved is not affected
by the peculiar languages in which the courts have expounded their
ideas."lawphi1.net
The reason for the rule that Philippine courts cannot acquire jurisdiction over the person of a
non-resident, as laid down by the Supreme Court of the United States in Pennoyer v. Neff,
supra, may be found in a recognized principle of public law to the effect that "no State can
exercise direct jurisdiction and authority over persons or property without its territory. Story,
Confl. L., ch. 2; Wheat, Int. L., pt. 2, ch. 2. The several States are of equal dignity and
authority, and the independence of one implies the exclusion of power from all others. And so
it is laid down by jurists, as an elementary principle, that the laws of one State have no
operation outside of its territory, except so far as is allowed by comity; and that no tribunal
established by it can extend its process beyond that territory so as to subject either persons or
property to its decisions. "Any exertion of authority of this sort beyond this limit," says Story,
"is a mere nullity, and incapable of binding such persons or property in any other tribunals."
Story, Confl. L., sec. 539." (Pennoyer v. Neff, 95 U.S., 714; 24 Law. ed., 565, 568-569.).
When, however, the action relates to property located in the Philippines, the Philippine courts
may validly try the case, upon the principle that a "State, through its tribunals, may subject
property situated within its limits owned by non-residents to the payment of the demand of its
own citizens against them; and the exercise of this jurisdiction in no respect infringes upon the
sovereignty of the State where the owners are domiciled. Every State owes protection to its
citizens; and, when non-residents deal with them, it is a legitimate and just exercise of
authority to hold and appropriate any property owned by such non-residents to satisfy the
claims of its citizens. It is in virtue of the State's jurisdiction over the property of the non-
resident situated within its limits that its tribunals can inquire into the non-resident's obligations
to its own citizens, and the inquiry can then be carried only to the extent necessary to control
the disposition of the property. If the non-resident has no property in the State, there is
nothing upon which the tribunals can adjudicate." (Pennoyer v. Neff, supra.)
In the instant case, there can be no question that the action brought by Eugene Arthur Perkins
in his amended complaint against the petitioner, Idonah Slade Perkins, seeks to exclude her
from any interest in a property located in the Philippines. That property consists in certain
shares of stocks of the Benguet Consolidated Mining Company, a sociedad anonima,
organized in the Philippines under the provisions of the Spanish Code of Commerce, with its
principal office in the City of Manila and which conducts its mining activities therein. The situs
of the shares is in the jurisdiction where the corporation is created, whether the certificated
evidencing the ownership of those shares are within or without that jurisdiction. (Fletcher
Cyclopedia Corporations, Permanent ed. Vol. 11, p. 95). Under these circumstances, we hold
that the action thus brought is quasi in rem, for while the judgement that may be rendered
therein is not strictly a judgment in rem, "it fixes and settles the title to the property in
controversy and to that extent partakes of the nature of the judgment in rem." (50 C.J., p 503).
As held by the Supreme Court of the United States in Pennoyer v. Neff (supra);
It is true that, in a strict sense, a proceeding in rem is one taken directly against
property, and has for its object the disposition of the property, without reference to
the title of individual claimants; but , in a large and more general sense, the terms
are applied to actions between parties, where the direct object is to reach and
dispose of property owned by them, or of some interest therein.
The action being in quasi in rem, The Court of First Instance of Manila has jurisdiction over
the person of the non-resident. In order to satisfy the constitutional requirement of due
process, summons has been served upon her by publication. There is no question as to the
adequacy of publication made nor as to the mailing of the order of publication to the
petitioner's last known place of residence in the United States. But, of course, the action
being quasi in rem and notice having be made by publication, the relief that may be granted
by the Philippine court must be confined to the res, it having no jurisdiction to render a
personal judgment against the non-resident. In the amended complaint filed by Eugene Arthur
Perkins, no money judgment or other relief in personam is prayed for against the petitioner.
The only relief sought therein is that she be declared to be without any interest in the shares
in controversy and that she be excluded from any claim thereto.
Petitioner contends that the proceeding instituted against her is one of interpleading and is
therefore an action in personam. Section 120 of our Code of Civil Procedure provides that
whenever conflicting claims are or may be made upon a person for or relating to personal
property, or the performance of an obligation or any portion thereof, so that he may be made
subject to several actions by different persons, such person may bring an action against the
conflicting claimants, disclaiming personal interest in the controversy, and the court may order
them to interplead with one another and litigate their several claims among themselves, there
upon proceed to determine their several claims. Here, The Benguet Consolidated Mining
Company, in its answer to the complaint filed by Eugene Arthur Perkins, averred that in
connection with the shares of stock in question, conflicting claims were being made upon it by
said plaintiff, Eugene Arthur Perkins, his wife Idonah Slade Perkins, and one named George
H. Engelhard, and prayed that these last two be made parties to the action and served with
summons by publication, so that the three claimants may litigate their conflicting claims and
settle their rights among themselves. The court has not issued an order compelling the
conflicting claimants to interplead with one another and litigate their several claims among
themselves, but instead ordered the plaintiff to amend his complaint including the other two
claimants as parties defendant. The plaintiff did so, praying that the new defendants thus
joined be excluded fro any interest in the shares in question, and it is upon this amended
complaint that the court ordered the service of the summons by publication. It is therefore,
clear that the publication of the summons was ordered not in virtue of an interpleading, but
upon the filing of the amended complaint wherein an action quasi in rem is alleged.
Had not the complaint been amended, including the herein petitioner as an additional
defendant, and had the court, upon the filing of the answer of the Benguet Consolidated
Mining Company, issued an order under section 120 of the Code of Civil Procedure, calling
the conflicting claimants into court and compelling them to interplead with one another, such
order could not perhaps have validly been served by publication or otherwise, upon the non-
resident Idonah Slade Perkins, for then the proceeding would be purely one of interpleading.
Such proceeding is a personal action, for it merely seeks to call conflicting claimants into court
so that they may interplead and litigate their several claims among themselves, and no
specific relief is prayed for against them, as the interpleader have appeared in court, one of
them pleads ownership of the personal property located in the Philippines and seeks to
exclude a non-resident claimant from any interest therein, is a question which we do not
decide not. Suffice it to say that here the service of the summons by publication was ordered
by the lower court by virtue of an action quasi in rem against the non-resident defendant.
Respondents contend that, as the petitioner in the lower court has pleaded over the subject-
matter, she has submitted herself to its jurisdiction. We have noticed, however, that these
pleas have been made not as independent grounds for relief, but merely as additional
arguments in support of her contention that the lower court had no jurisdiction over the
person. In other words, she claimed that the lower court had no jurisdiction over her person
not only because she is a non-resident, but also because the court had no jurisdiction over
the subject-matter of the action and that the issues therein involved have already been
decided by the New York court and are being relitigated in the California court. Although this
argument is obviously erroneous, as neither jurisdiction over the subject-matter nor res
adjudicata nor lis pendens has anything to do with the question of jurisdiction over her
person, we believe and so hold that the petitioner has not, by such erroneous argument,
submitted herself to the jurisdiction of the court. Voluntary appearance cannot be implied from
either a mistaken or superflous reasoning but from the nature of the relief prayed for.
For all the foregoing, petition is hereby denied, with costs against petitioner.
PENNOYER VS NEFF
Syllabus
1. A statute of Oregon, after providing for service of summons upon parties or their
representatives, personally or at their residence, declares that, when service cannot be thus
made, and the defendant, after due diligence, cannot be found within the State, and
that fact appears, by affidavit, to the satisfaction of the court or judge thereof, and it, in like
manner, appears that a cause of action exists against the defendant, or that he is a proper
party to an action relating to real property in the State, such court or judge may grant an order
that the service be made by publication of summons . . . when the defendant is not a resident
of the State, but has property therein, and the court has jurisdiction of the subject of the
action,
-- the order to designate a newspaper of the county where the action is commenced in which
the publication shall be made -- and that proof of such publication shall be "the affidavit of the
printer, or his foreman, or his principal clerk."
Held, that defects in the affidavit for the order can only be taken advantage of on appeal, or by
some other direct proceeding, and cannot be urged to impeach the judgment collaterally, and
that the provision as to proof of the publication is satisfied when the affidavit is made by the
editor of the paper.
2. A personal judgment is without any validity if it be rendered by a State court in an action
upon a money demand against a nonresident of the State who was served by a publication of
summons, but upon whom no personal service of process within the State was made, and
who did not appear; and no title to property passes by a sale under an execution issued upon
such a judgment.
3. The State, having within her territory property of a nonresident, may hold and appropriate it
to satisfy the claims of her citizens against him, and her tribunals may inquire into his
obligations to the extent necessary to control the disposition of that property. If he has no
property in the State, there is nothing upon which her tribunals can adjudicate.
4. Substituted service by publication, or in any other authorized form, is sufficient to inform a
nonresident of the object of proceedings taken where[p715] property is once brought under
the control of the court by seizure or some equivalent act, but where the suit is brought to
determine his personal rights and obligations, that is, where it is merely in personam, such
service upon him is ineffectual for any purpose.
5. Process from the tribunals of one State cannot run into another State and summon a party
there domiciled to respond to proceedings against him, and publication of process or of notice
within the State in which the tribunal sits cannot create any greater obligation upon him to
appear. Process sent to him out of the State, and process published within it, are equally
unavailing in proceedings to establish his personal liability.
6. Except in cases affecting the personal status of the plaintiff, and in those wherein that
mode of service may be considered to have been assented to in advance, the substituted
service of process by publication allowed by the law of Oregon and by similar laws in other
States where actions are brought against nonresidents is effectual only where, in connection
with process against the person for commencing the action, property in the State is brought
under the control of the court and subjected to its disposition by process adapted to that
purpose, or where the judgment is sought as a means of reaching such property or affecting
some interest therein; in other words, where the action is in the nature of a proceeding in rem.
7. Whilst the courts of the United States are not foreign tribunals in their relations to the State
courts, they are tribunals of a different sovereignty, and are bound to give a judgment of a
State court only the same faith and credit to which it is entitled in the courts of another State.
8. The term "due process of law," when applied to judicial proceedings, means a course of
legal proceedings according to those rules and principles which have been established by our
jurisprudence for the protection and enforcement of private rights. To give such proceedings
any validity, there must be a competent tribunal to pass upon their subject matter, and if that
involves merely a determination of the personal liability of the defendant, he must be brought
within its jurisdiction by service of process within the State, or by his voluntary appearance.
This action was brought by Neff against Pennoyer for the recovery of a tract of land situated in
Multnomah County, Oregon. Pennoyer, in his answer, denied Neff's title and right to
possession, and set up a title in himself.
By consent of parties, and in pursuance of their written stipulation filed in the case, the cause
was tried by the court, and a special verdict given, upon which judgment was rendered in
favor of Neff; whereupon Pennoyer sued out this writ of error.
The parties respectively claimed title as follows: Neff under a patent issued to him by the
United States, March 19,[p716] 1866; and Pennoyer by virtue of a sale made by the sheriff of
said county, under an execution sued out upon a judgment against Neff, rendered Feb. 19,
1866, by the Circuit Court for said county, in an action wherein he was defendant and J. H.
Mitchell was plaintiff. Neff was then a nonresident of Oregon.
In Mitchell v. Neff, jurisdiction of Neff was obtained by service of summons by publication.
Pennoyer offered in evidence duly certified copies of the complaint, summons, order for
publication of summons, affidavit of service by publication, and the judgment in that case, to
the introduction of which papers the plaintiff objected because, 1, said judgment is in
personam, and appears to have been given without the appearance of the defendant in the
action or personal service of the summons upon him, and while he was a nonresident of the
State, and is, therefore, void; 2, said judgment is not in rem, and therefore constitutes no
basis of title in the defendant; 3, said copies of complaint, &c., do not show jurisdiction to give
the judgment alleged, either in rem or personam;and, 4, it appears from said papers that no
proof of service by publication was ever made, the affidavit thereof being made by the "editor"
of the "Pacific Christian Advocate," and not by "the printer, or his foreman or principal clerk."
The court admitted the evidence subject to the objections.
The finding of the court in regard to the facts bearing upon the asserted jurisdiction of the
State court is as follows: --
That, on Nov. 13, 1865, Mitchell applied to said Circuit Court, upon his own affidavit of that
date, for an order allowing the service of the summons in said action to be made upon Neff by
publication thereof, whereupon said court made said order, in the words following:
Now, at this day, comes the plaintiff in his proper person, and by his attorneys, Mitchell and
Dolph, and files affidavit of plaintiff, and motion for an order of publication of summons, as
follows, to wit:
Now comes the plaintiff, by his attorneys, and upon the affidavit of plaintiff, herewith filed,
moves the court for an order of publication of summons against defendant, as required by
law, he being a nonresident;
and it appearing to the satisfaction of the court that the defendant cannot, after due diligence,
be[p717] found in this State, and that he is a nonresident thereof, that his place of residence
is unknown to plaintiff, and cannot, with reasonable diligence, be ascertained by him, and that
the plaintiff has a cause of action of action against defendant, and that defendant has property
in this county and State, it is ordered and adjudged by the court that service of the summons
in this action be made by publication for six weeks successively in the "Pacific Christian
Advocate," a weekly newspaper published in Multnomah County, Oregon, and this action is
continued for such service.
That the affidavit of plaintiff, referred to in said order, is in the words following:
I, J. H. Mitchell, being first duly sworn, say that the defendant, Marcus Neff, is a nonresident
of this State; that he resides somewhere in the State of California, at what place affiant knows
not, and he cannot be found in this State; that plaintiff has a just cause of action against
defendant for a money demand on account; that this court has jurisdiction of such action; that
the defendant has property in this county and State.
That the complaint in said action was verified and filed on Nov. 3, 1865, and contained facts
tending to prove that, at that date, said Mitchell had a cause of action against said Neff for
services as an attorney, performed "between Jan. 1, 1862, and May 15, 1863." That the entry
of judgment in said action contained the following averments:
And it appearing to the court that the defendant was, at the time of the commencement of this
action, and ever since has been, a nonresident of this State; and it further appearing that he
has property in this State, and that defendant had notice of the pendency of this action by
publication of the summons for six successive weeks in the "Pacific Christian Advocate," a
weekly newspaper of general circulation published in Multnomah County, State of Oregon, the
last issue of which was more than twenty days before the first day of this term.
That the affidavit showing the publication of the summons in the "Advocate" aforesaid was
made as stated therein by the "editor" of that paper. That said complaint, summons, affidavit
of Mitchell and of the "editor" of the "Advocate" aforesaid, and entry of judgment, were in the
judgment roll, made up by the clerk in the case, but the order for publication of the summons
aforesaid was not placed in said roll[p718] by said clerk, but remains on the files of said court;
and that, when said court made said order for publication, and gave said judgment against
Neff, the only evidence it had before it to prove the facts necessary to give it jurisdiction
therefor, and particularly to authorize it to find and state that Neff's residence was unknown to
Mitchell, and could not, with reasonable diligence, be ascertained by him, and that Neff had
notice of the pendency of said action by the publication of the summons as aforesaid, was, so
far as appears by the said roll and the records and files of the said court, the said complaint
and affidavits of Mitchell and the editor of the "Advocate."
The statute of Oregon at the time of the commencement of the suit against Neff was as
follows: --
SECT. 55. When service of the summons cannot be made as prescribed in the last preceding
section, and the defendant, after due diligence, cannot be found within the State, and when
that fact appears, by affidavit, to the satisfaction of the court or judge thereof, or justice in an
action in a justice's court, and it also appears that a cause of action exists against the
defendant, or that he is a proper party to an action relating to real property in this State, such
court or judge or justice may grant an order that the service be made by publication of
summons in either of the following cases: . . .
3. When the defendant is not a resident of the State, but has property therein, and the court
has jurisdiction of the subject of the action.
SECT. 56. The order shall direct the publication to be made in a newspaper published in the
county where the action is commenced, and, if no newspaper be published in the county, then
in a newspaper to be designated as most likely to give notice to the person to be served, and
for such length of time as may be deemed reasonable, not less than once a week for six
weeks. In case of publication, the court or judge shall also direct a copy of the summons and
complaint to be forthwith deposited in the post office, directed to the defendant, at his place of
residence, unless it shall appear that such residence is neither known to the party making the
application, nor can, with reasonable diligence, be ascertained by him. When publication is
ordered, personal service of a copy of the summons and complaint out of the State shall be
equivalent to publication and deposit in the post office. In either case, the defendant shall
appear and answer by the first day of the term following the[p719] expiration of the time
prescribed in the order for publication; and, if he does not, judgment may be taken against
him for want thereof. In case of personal service out of the State, the summons shall specify
the time prescribed in the order for publication.
SECT. 57. The defendant against whom publication is ordered, or his personal
representatives, on application and sufficient cause shown, at any time before judgment, shall
be allowed to defend the action; and the defendant against whom publication is ordered, or
his representatives, may in like manner, upon good cause shown, and upon such terms as
may be proper, be allowed to defend after judgment, and within one year after the entry of
such judgment, on such terms as may be just; and, if the defence be successful, and the
judgment or any part thereof have been collected or otherwise enforced, such restitution may
thereupon be compelled as the court shall direct. But the title to property sold upon execution
issued on such judgment to a purchaser in good faith shall not be thereby affected.
SECT. 60. Proof of the service of summons shall be, in case of publication, the affidavit of the
printer, or his foreman, or his principal clerk, showing the same.
Opinion
FIELD, J., Opinion of the Court
This is an action to recover the possession of a tract of land, of the alleged value of $15,000,
situated in the State of Oregon. The plaintiff asserts title to the premises by a patent of the
United States issued to him in 1866, under the act of Congress of Sept. 27, 1850, usually
known as the Donation Law of Oregon. The defendant claims to have acquired the premises
under a sheriff's deed, made upon a sale of the property on execution issued upon a
judgment recovered against the plaintiff in one of the circuit courts of the State. The case
turns upon the validity of this judgment.
It appears from the record that the judgment was rendered in February, 1866, in favor of J. H.
Mitchell, for less than $300, including costs, in an action brought by him upon a demand for
services as an attorney; that, at the time the action was commenced and the judgment
rendered, the defendant therein, the plaintiff here, was a nonresident of the State;[p720] that
he was not personally served with process, and did not appear therein; and that the judgment
was entered upon his default in not answering the complaint, upon a constructive service of
summons by publication.
The Code of Oregon provides for such service when an action is brought against a
nonresident and absent defendant who has property within the State. It also provides, where
the action is for the recovery of money or damages, for the attachment of the property of the
nonresident. And it also declares that no natural person is subject to the jurisdiction of a court
of the State
unless he appear in the court, or be found within the State, or be a resident thereof, or have
property therein; and, in the last case, only to the extent of such property at the time the
jurisdiction attached.
Construing this latter provision to mean that, in an action for money or damages where a
defendant does not appear in the court, and is not found within the State, and is not a resident
thereof, but has property therein, the jurisdiction of the court extends only over such property,
the declaration expresses a principle of general, if not universal, law. The authority of every
tribunal is necessarily restricted by the territorial limits of the State in which it is established.
Any attempt to exercise authority beyond those limits would be deemed in every other forum,
as has been said by this Court, an illegitimate assumption of power, and be resisted as mere
abuse.D'Arcy v. Ketchum et al., 11 How. 165. In the case against the plaintiff, the property
here in controversy sold under the judgment rendered was not attached, nor in any way
brought under the jurisdiction of the court. Its first connection with the case was caused by a
levy of the execution. It was not, therefore, disposed of pursuant to any adjudication, but only
in enforcement of a personal judgment, having no relation to the property, rendered against a
nonresident without service of process upon him in the action or his appearance therein. The
court below did not consider that an attachment of the property was essential to its jurisdiction
or to the validity of the sale, but held that the judgment was invalid from defects in the affidavit
upon which the order of publication was obtained and in the affidavit by which the publication
was proved.[p721]
There is some difference of opinion among the members of this Court as to the rulings upon
these alleged defects. The majority are of opinion that, inasmuch as the statute requires, for
an order of publication, that certain facts shall appear by affidavit to the satisfaction of the
court or judge, defects in such affidavit can only be taken advantage of on appeal, or by some
other direct proceeding, and cannot be urged to impeach the judgment collaterally. The
majority of the court are also of opinion that the provision of the statute requiring proof of the
publication in a newspaper to be made by the "affidavit of the printer, or his foreman, or his
principal clerk" is satisfied when the affidavit is made by the editor of the paper. The term
"printer," in their judgment, is there used not to indicate the person who sets up the type -- he
does not usually have a foreman or clerks -- it is rather used as synonymous with publisher.
The Supreme Court of New York so held in one case; observing that, for the purpose of
making the required proof, publishers were "within the spirit of the statute." Bunce v. Reed, 16
Barb. (N. Y.) 350. And, following this ruling, the Supreme Court of California held that an
affidavit made by a "publisher and proprietor" was sufficient. Sharp v. Daugney, 33 Cal. 512.
The term "editor," as used when the statute of New York was passed, from which the Oregon
law is borrowed, usually included not only the person who wrote or selected the articles for
publication, but the person who published the paper and put it into circulation. Webster, in an
early edition of his Dictionary, gives as one of the definitions of an editor, a person "who
superintends the publication of a newspaper." It is principally since that time that the business
of an editor has been separated from that of a publisher and printer, and has become an
independent profession.
If, therefore, we were confined to the rulings of the court below upon the defects in the
affidavits mentioned, we should be unable to uphold its decision. But it was also contended in
that court, and is insisted upon here, that the judgment in the State court against the plaintiff
was void for want of personal service of process on him, or of his appearance in the action in
which it was rendered and that the premises in controversy could not be subjected to the
payment of the demand[p722] of a resident creditor except by a proceeding in rem, that is, by
a direct proceeding against the property for that purpose. If these positions are sound, the
ruling of the Circuit Court as to the invalidity of that judgment must be sustained
notwithstanding our dissent from the reasons upon which it was made. And that they are
sound would seem to follow from two well established principles of public law respecting the
jurisdiction of an independent State over persons and property. The several States of the
Union are not, it is true, in every respect independent, many of the right and powers which
originally belonged to them being now vested in the government created by the Constitution.
But, except as restrained and limited by that instrument, they possess and exercise the
authority of independent States, and the principles of public law to which we have referred are
applicable to them. One of these principles is that every State possesses exclusive jurisdiction
and sovereignty over persons and property within its territory. As a consequence, every State
has the power to determine for itself the civil status and capacities of its inhabitants; to
prescribe the subjects upon which they may contract, the forms and solemnities with which
their contracts shall be executed, the rights and obligations arising from them, and the mode
in which their validity shall be determined and their obligations enforced; and also the regulate
the manner and conditions upon which property situated within such territory, both personal
and real, may be acquired, enjoyed, and transferred. The other principle of public law referred
to follows from the one mentioned; that is, that no State can exercise direct jurisdiction and
authority over persons or property without its territory. Story, Confl. Laws, c. 2; Wheat. Int.
Law, pt. 2, c. 2. The several States are of equal dignity and authority, and the independence
of one implies the exclusion of power from all others. And so it is laid down by jurists as an
elementary principle that the laws of one State have no operation outside of its territory except
so far as is allowed by comity, and that no tribunal established by it can extend its process
beyond that territory so as to subject either persons or property to its decisions. "Any exertion
of authority of this sort beyond this limit," says Story, "is a mere nullity, and incapable of
binding[p723] such persons or property in any other tribunals." Story, Confl.Laws, sect. 539.
But as contracts made in one State may be enforceable only in another State, and property
may be held by nonresidents, the exercise of the jurisdiction which every State is admitted to
possess over persons and property within its own territory will often affect persons and
property without it. To any influence exerted in this way by a State affecting persons resident
or property situated elsewhere, no objection can be justly taken; whilst any direct exertion of
authority upon them, in an attempt to give ex-territorial operation to its laws, or to enforce an
ex-territorial jurisdiction by its tribunals, would be deemed an encroachment upon the
independence of the State in which the persons are domiciled or the property is situated, and
be resisted as usurpation.
Thus the State, through its tribunals, may compel persons domiciled within its limits to
execute, in pursuance of their contracts respecting property elsewhere situated, instruments
in such form and with such solemnities as to transfer the title, so far as such formalities can
be complied with; and the exercise of this jurisdiction in no manner interferes with the
supreme control over the property by the State within which it is situated. Penn v. Lord
Baltimore, 1 Ves. 444; Massie v. Watts, 6 Cranch 148; Watkins v. Holman, 16 Pet.
25; Corbett v. Nutt, 10 Wall. 464.
So the State, through its tribunals, may subject property situated within its limits owned by
nonresidents to the payment of the demand of its own citizens against them, and the exercise
of this jurisdiction in no respect infringes upon the sovereignty of the State where the owners
are domiciled. Every State owes protection to its own citizens, and, when nonresidents deal
with them, it is a legitimate and just exercise of authority to hold and appropriate any property
owned by such nonresidents to satisfy the claims of its citizens. It is in virtue of the State's
jurisdiction over the property of the nonresident situated within its limits that its tribunals can
inquire into that nonresident's obligations to its own citizens, and the inquiry can then be
carried only to the extent necessary to control the disposition of the property. If the
nonresident[p724] have no property in the State, there is nothing upon which the tribunals
can adjudicate.
These views are not new. They have been frequently expressed, with more or less
distinctness, in opinions of eminent judges, and have been carried into adjudications in
numerous cases. Thus, in Picquet v. Swan, 5 Mas. 35, Mr. Justice Story said:--
Where a party is within a territory, he may justly be subjected to its process, and bound
personally by the judgment pronounced on such process against him. Where he is not within
such territory, and is not personally subject to its laws, if, on account of his supposed or actual
property being within the territory, process by the local laws may, by attachment, go to compel
his appearance, and, for his default to appear, judgment may be pronounced against him,
such a judgment must, upon general principles, be deemed only to bind him to the extent of
such property, and cannot have the effect of a conclusive judgment in personam, for the plain
reason, that, except so far as the property is concerned, it is a judgment coram non judice.
And in Boswell's Lessee v. Otis, 9 How. 336, where the title of the plaintiff in ejectment was
acquired on a sheriff's sale under a money decree rendered upon publication of notice against
nonresidents, in a suit brought to enforce a contract relating to land, Mr. Justice McLean
said:--
Jurisdiction is acquired in one of two modes: first, as against the person of the defendant by
the service of process; or, secondly, by a procedure against the property of the defendant
within the jurisdiction of the court. In the latter case, the defendant is not personally bound by
the judgment beyond the property in question. And it is immaterial whether the proceeding
against the property be by an attachment or bill in chancery. It must be substantially a
proceeding in rem.
These citations are not made as authoritative expositions of the law, for the language was
perhaps not essential to the decision of the cases in which it was used, but as expressions of
the opinion of eminent jurists. But in Cooper v. Reynolds, reported in the 10th of Wallace, it
was essential to the disposition of the case to declare the effect of a personal action against
an absent party, without the jurisdiction of the court, not served[p725] with process or
voluntarily submitting to the tribunal, when it was sought to subject his property to the
payment of a demand of a resident complainant; and, in the opinion there delivered, we have
a clear statement of the law as to the efficacy of such actions, and the jurisdiction of the court
over them. In that case, the action was for damages for alleged false imprisonment of the
plaintiff; and, upon his affidavit that the defendants had fled from the State, or had absconded
or concealed themselves so that the ordinary process of law could not reach them, a writ of
attachment was sued out against their property. Publication was ordered by the court, giving
notice to them to appear and plead, answer or demur, or that the action would be taken as
confessed and proceeded in ex parte as to them. Publication was had, but they made default,
and judgment was entered against them, and the attached property was sold under it. The
purchaser having been put into possession of the property, the original owner brought
ejectment for its recovery. In considering the character of the proceeding, the Court, speaking
through Mr. Justice Miller, said:--
Its essential purpose or nature is to establish, by the judgment of the court, a demand or claim
against the defendant, and subject his property lying within the territorial jurisdiction of the
court to the payment of that demand. But the plaintiff is met at the commencement of his
proceedings by the fact that the defendant is not within the territorial jurisdiction, and cannot
be served with any process by which he can be brought personally within the power of the
court. For this difficulty, the statute has provided a remedy. It says that, upon affidavit's being
made of that fact, a writ of attachment may be issued and levied on any of the defendant's
property, and a publication may be made warning him to appear; and that thereafter the court
may proceed in the case, whether he appears or not. If the defendant appears, the cause
becomes mainly a suit in personam, with the added incident that the property attached
remains liable, under the control of the court, to answer to any demand which may be
established against the defendant by the final judgment of the court. But if there is no
appearance of the defendant, and no service of process on him, the case becomes in its
essential nature a proceeding in rem, the only effect of which is to subject the property
attached to the payment of the demand which the court may find to be due to the plaintiff.
That such is[p726] the nature of this proceeding in this latter class of cases is clearly evinced
by two well established propositions: first, the judgment of the court, though in form a personal
judgment against the defendant, has no effect beyond the property attached in that suit. No
general execution can be issued for any balance unpaid after the attached property is
exhausted. No suit can be maintained on such a judgment in the same court, or in any other;
nor can it be used as evidence in any other proceeding not affecting the attached property;
nor could the costs in that proceeding be collected of defendant out of any other property than
that attached in the suit. Second, the court in such a suit cannot proceed unless the officer
finds some property of defendant on which to levy the writ of attachment. A return that none
can be found is the end of the case, and deprives the court of further jurisdiction, though the
publication may have been duly made and proven in court.
The fact that the defendants in that case had fled from the State, or had concealed
themselves, so as not to be reached by the ordinary process of the court, and were not
nonresidents, was not made a point in the decision. The opinion treated them as being
without the territorial jurisdiction of the court, and the grounds and extent of its authority over
persons and property thus situated were considered when they were not brought within its
jurisdiction by personal service or voluntary appearance.
The writer of the present opinion considered that some of the objections to the preliminary
proceedings in the attachment suit were well taken, and therefore dissented from the
judgment of the Court, but, to the doctrine declared in the above citation, he agreed, and he
may add that it received the approval of all the judges. It is the only doctrine consistent with
proper protection to citizens of other States. If, without personal service, judgments in
personam, obtained ex parte against nonresidents and absent parties, upon mere publication
of process, which, in the great majority of cases, would never be seen by the parties
interested, could be upheld and enforced, they would be the constant instruments of fraud
and oppression. Judgments for all sorts of claims upon contracts and for torts, real or
pretended, would be thus obtained, under which property would be seized, when the evidence
of the transactions upon[p727] which they were founded, if they ever had any existence, had
perished.
Substituted service by publication, or in any other authorized form, may be sufficient to inform
parties of the object of proceedings taken where property is once brought under the control of
the court by seizure or some equivalent act. The law assumes that property is always in the
possession of its owner, in person or by agent, and it proceeds upon the theory that its
seizure will inform him not only that it is taken into the custody of the court, but that he must
look to any proceedings authorized by law upon such seizure for its condemnation and sale.
Such service may also be sufficient in cases where the object of the action is to reach and
dispose of property in the State, or of some interest therein, by enforcing a contract or a lien
respecting the same, or to partition it among different owners, or, when the public is a party, to
condemn and appropriate it for a public purpose. In other words, such service may answer in
all actions which are substantially proceedings in rem. But where the entire object of the
action is to determine the personal rights and obligations of the defendants, that is, where the
suit is merely in personam, constructive service in this form upon a nonresident is ineffectual
for any purpose. Process from the tribunals of one State cannot run into another State, and
summon parties there domiciled to leave its territory and respond to proceedings against
them. Publication of process or notice within the State where the tribunal sits cannot create
any greater obligation upon the nonresident to appear. Process sent to him out of the State,
and process published within it, are equally unavailing in proceedings to establish his
personal liability.
The want of authority of the tribunals of a State to adjudicate upon the obligations of
nonresidents, where they have no property within its limits, is not denied by the court below:
but the position is assumed, that, where they have property within the State, it is immaterial
whether the property is in the first instance brought under the control of the court by
attachment or some other equivalent act, and afterwards applied by its judgment to the
satisfaction of demands against its owner; or such demands be first established in a personal
action, and[p728] the property of the nonresident be afterwards seized and sold on execution.
But the answer to this position has already been given in the statement that the jurisdiction of
the court to inquire into and determine his obligations at all is only incidental to its jurisdiction
over the property. Its jurisdiction in that respect cannot be made to depend upon facts to be
ascertained after it has tried the cause and rendered the judgment. If the judgment be
previously void, it will not become valid by the subsequent discovery of property of the
defendant, or by his subsequent acquisition of it. The judgment, if void when rendered, will
always remain void; it cannot occupy the doubtful position of being valid if property be found,
and void if there be none. Even if the position assumed were confined to cases where the
nonresident defendant possessed property in the State at the commencement of the action, it
would still make the validity of the proceedings and judgment depend upon the question
whether, before the levy of the execution, the defendant had or had not disposed of the
property. If, before the levy, the property should be sold, then, according to this position, the
judgment would not be binding. This doctrine would introduce a new element of uncertainty in
judicial proceedings. The contrary is the law: the validity of every judgment depends upon the
jurisdiction of the court before it is rendered, not upon what may occur subsequently.
In Webster v. Reid, reported in 11th of Howard, the plaintiff claimed title to land sold under
judgments recovered in suits brought in a territorial court of Iowa, upon publication of notice
under a law of the territory, without service of process; and the court said:
These suits were not a proceeding in rem against the land, but were in personam against the
owners of it. Whether they all resided within the territory or not does not appear, nor is it a
matter of any importance. No person is required to answer in a suit on whom process has not
been served, or whose property has not been attached. In this case, there was no personal
notice, nor an attachment or other proceeding against the land, until after the judgments. The
judgments, therefore, are nullities, and did not authorize the executions on which the land was
sold.[p729]
The force and effect of judgments rendered against nonresidents without personal service of
process upon them, or their voluntary appearance, have been the subject of frequent
consideration in the courts of the United States and of the several States, as attempts have
been made to enforce such judgments in States other than those in which they were
rendered, under the provision of the Constitution requiring that "full faith and credit shall be
given in each State to the public acts, records, and judicial proceedings of every other State;"
and the act of Congress providing for the mode of authenticating such acts, records, and
proceedings, and declaring that, when thus authenticated,
they shall have such faith and credit given to them in every court within the United States as
they have by law or usage in the courts of the State from which they are or shall or taken.
In the earlier cases, it was supposed that the act gave to all judgments the same effect in
other States which they had by law in the State where rendered. But this view was afterwards
qualified so as to make the act applicable only when the court rendering the judgment had
jurisdiction of the parties and of the subject matter, and not to preclude an inquiry into the
jurisdiction of the court in which the judgment was rendered, or the right of the State itself to
exercise authority over the person or the subject matter. M'Elmoyle v. Cohen, 13 Pet. 312. In
the case of D'Arcy v. Ketchum, reported in the 11th of Howard, this view is stated with great
clearness. That was an action in the Circuit Court of the United States for Louisiana, brought
upon a judgment rendered in New York under a State statute, against two joint debtors, only
one of whom had been served with process, the other being a nonresident of the State. The
Circuit Court held the judgment conclusive and binding upon the nonresident not served with
process, but this Court reversed its decision, observing, that it was a familiar rule that
countries foreign to our own disregarded a judgment merely against the person, where the
defendant had not been served with process nor had a day in court; that national comity was
never thus extended; that the proceeding was deemed an illegitimate assumption of power,
and resisted as mere abuse; that no faith and credit or force and effect had been given to
such judgments by any State of the Union, so far[p730] as known; and that the State courts
had uniformly, and in many instances, held them to be void. "The international law," said the
court,
as it existed among the States in 1790, was that a judgment rendered in one State, assuming
to bind the person of a citizen of another, was void within the foreign State, when the
defendant had not been served with process or voluntarily made defence, because neither the
legislative jurisdiction nor that of courts of justice had binding force.
And the Court held that the act of Congress did not intend to declare a new rule, or to
embrace judicial records of this description. As was stated in a subsequent case, the doctrine
of this Court is that the act
was not designed to displace that principle of natural justice which requires a person to have
notice of a suit before he can be conclusively bound by its result, nor those rules of public law
which protect persons and property within one State from the exercise of jurisdiction over
them by another.
The Lafayette Insurance Co. v. French et al., 18 How. 404.
This whole subject has been very fully and learnedly considered in the recent case
of Thompson v. Whitman, 18 Wall. 457, where all the authorities are carefully reviewed and
distinguished, and the conclusion above stated is not only reaffirmed, but the doctrine is
asserted that the record of a judgment rendered in another State may be contradicted as to
the facts necessary to give the court jurisdiction against its recital of their existence. In all the
cases brought in the State and Federal courts, where attempts have been made under the act
of Congress to give effect in one State to personal judgments rendered in another State
against nonresidents, without service upon them, or upon substituted service by publication,
or in some other form, it has been held, without an exception, so far as we are aware, that
such judgments were without any binding force except as to property, or interests in property,
within the State, to reach and affect which was the object of the action in which the judgment
was rendered, and which property was brought under control of the court in connection with
the process against the person. The proceeding in such cases, though in the form of a
personal action, has been uniformly treated, where service was not obtained, and the party
did not voluntarily[p731] appear, as effectual and binding merely as a proceeding in rem, and
as having no operation beyond the disposition of the property, or some interest therein. And
the reason assigned for this conclusion has been that which we have already stated -- that the
tribunals of one State have no jurisdiction over persons beyond its limits, and can inquire only
into their obligations to its citizens when exercising its conceded jurisdiction over their
property within its limits. In Bissell v. Briggs, decided by the Supreme Court of Massachusetts
as early as 1813, the law is stated substantially in conformity with these views. In that case,
the court considered at length the effect of the constitutional provision, and the act of
Congress mentioned, and after stating that, in order to entitle the judgment rendered in any
court of the United States to the full faith and credit mentioned in the Constitution, the court
must have had jurisdiction not only of the cause, but of the parties, it proceeded to illustrate its
position by observing, that, where a debtor living in one State has goods, effects, and credits
in another, his creditor living in the other State may have the property attached pursuant to its
laws, and, on recovering judgment, have the property applied to its satisfaction, and that the
party in whose hands the property was would be protected by the judgment in the State of the
debtor against a suit for it, because the court rendering the judgment had jurisdiction to that
extent; but that, if the property attached were insufficient to satisfy the judgment, and the
creditor should sue on that judgment in the State of the debtor, he would fail because the
defendant was not amenable to the court rendering the judgment. In other words, it was held
that over the property within the State the court had jurisdiction by the attachment, but had
none over his person, and that any determination of his liability, except so far as was
necessary for the disposition of the property, was invalid.
In Kilbourn v. Woodworth, 5 Johns. (N.Y.) 37, an action of debt was brought in New York
upon a personal judgment recovered in Massachusetts. The defendant in that judgment was
not served with process, and the suit was commenced by the attachment of a bedstead
belonging to the defendant, accompanied with a summons to appear, served on his wife after
she had left her place in Massachusetts. The court held that[p732] the attachment bound only
the property attached as a proceeding in rem, and that it could not bind the defendant,
observing, that to bind a defendant personally when he was never personally summoned or
had notice of the proceeding would be contrary to the first principles of justice, repeating the
language in that respect of Chief Justice DeGrey, used in the case of Fisher v. Lane, 3 Wils.
297, in 1772. See also Borden v. Fitch, 15 Johns. (N. Y.) 121, and the cases there cited,
and Harris v. Hardeman et al., 14 How. 334. To the same purport, decisions are found in all
the State courts. In several of the cases, the decision has been accompanied with the
observation that a personal judgment thus recovered has no binding force without the State in
which it is rendered, implying that, in such State, it may be valid and binding. But if the court
has no jurisdiction over the person of the defendant by reason of his nonresidence, and
consequently no authority to pass upon his personal rights and obligations; if the whole
proceeding, without service upon him or his appearance, is coram non judiceand void; if to
hold a defendant bound by such a judgment is contrary to the first principles of justice -- it is
difficult to see how the judgment can legitimately have any force within the State. The
language used can be justified only on the ground that there was no mode of directly
reviewing such judgment or impeaching its validity within the State where rendered, and that
therefore it could be called in question only when its enforcement was elsewhere attempted.
In later cases, this language is repeated with less frequency than formerly, it beginning to be
considered, as it always ought to have been, that a judgment which can be treated in any
State of this Union as contrary to the first principles of justice, and as an absolute nullity,
because rendered without any jurisdiction of the tribunal over the party, is not entitled to any
respect in the State where rendered.Smith v. McCutchen, 38 Mo. 415; Darrance v.
Preston, 18 Iowa, 396; Hakes v. Shupe, 27 id. 465; Mitchell's Administrator v. Gray, 18 Ind.
123.
Be that as it may, the courts of the United States are not required to give effect to judgments
of this character when any right is claimed under them. Whilst they are not foreign tribunals in
their relations to the State courts, they are tribunals[p733] of a different sovereignty,
exercising a distinct and independent jurisdiction, and are bound to give to the judgments of
the State courts only the same faith and credit which the courts of another State are bound to
give to them.
Since the adoption of the Fourteenth Amendment to the Federal Constitution, the validity of
such judgments may be directly questioned, and their enforcement in the State resisted, on
the ground that proceedings in a court of justice to determine the personal rights and
obligations of parties over whom that court has no jurisdiction do not constitute due process of
law. Whatever difficulty may be experienced in giving to those terms a definition which will
embrace every permissible exertion of power affecting private rights, and exclude such as is
forbidden, there can be no doubt of their meaning when applied to judicial proceedings. They
then mean a course of legal proceedings according to those rules and principles which have
been established in our systems of jurisprudence for the protection and enforcement of
private rights. To give such proceedings any validity, there must be a tribunal competent by its
constitution -- that is, by the law of its creation -- to pass upon the subject matter of the suit;
and if that involves merely a determination of the personal liability of the defendant, he must
be brought within its jurisdiction by service of process within the State, or his voluntary
appearance.
Except in cases affecting the personal status of the plaintiff and cases in which that mode of
service may be considered to have been assented to in advance, as hereinafter mentioned,
the substituted service of process by publication, allowed by the law of Oregon and by similar
laws in other States, where actions are brought against nonresidents, is effectual only where,
in connection with process against the person for commencing the action, property in the
State is brought under the control of the court, and subjected to its disposition by process
adapted to that purpose, or where the judgment is sought as a means of reaching such
property or affecting some interest therein; in other words, where the action is in the nature of
a proceeding in rem. As stated by Cooley in his Treatise on Constitutional Limitations 405, for
any other purpose than to subject the property of a nonresident to valid claims
against[p734] him in the State, "due process of law would require appearance or personal
service before the defendant could be personally bound by any judgment rendered."
It is true that, in a strict sense, a proceeding in rem is one taken directly against property, and
has for its object the disposition of the property, without reference to the title of individual
claimants; but, in a larger and more general sense, the terms are applied to actions between
parties where the direct object is to reach and dispose of property owned by them, or of some
interest therein. Such are cases commenced by attachment against the property of debtors,
or instituted to partition real estate, foreclose a mortgage, or enforce a lien. So far as they
affect property in the State, they are substantially proceedings in rem in the broader sense
which we have mentioned.
It is hardly necessary to observe that, in all we have said, we have had reference to
proceedings in courts of first instance, and to their jurisdiction, and not to proceedings in an
appellate tribunal to review the action of such courts. The latter may be taken upon such
notice, personal or constructive, as the State creating
the tribunal may provide. They are considered as rather a continuation of the original litigation
than the commencement of a new action. Nations et al. v. Johnson et al., 24 How. 195.
It follows from the views expressed that the personal judgment recovered in the State court of
Oregon against the plaintiff herein, then a nonresident of the State, was without any validity,
and did not authorize a sale of the property in controversy.
To prevent any misapplication of the views expressed in this opinion, it is proper to observe
that we do not mean to assert by anything we have said that a State may not authorize
proceedings to determine the status of one of its citizens towards a nonresident which would
be binding within the State, though made without service of process or personal notice to the
nonresident. The jurisdiction which every State possesses to determine the civil status and
capacities of all its inhabitants involves authority to prescribe the conditions on which
proceedings affecting them may be commenced and carried on within its territory. The State,
for example, has absolute[p735] right to prescribe the conditions upon which the marriage
relation between its own citizens shall be created, and the causes for which it may be
dissolved. One of the parties guilty of acts for which, by the law of the State, a dissolution may
be granted may have removed to a State where no dissolution is permitted. The complaining
party would, therefore, fail if a divorce were sought in the State of the defendant; and if
application could not be made to the tribunals of the complainant's domicile in such case, and
proceedings be there instituted without personal service of process or personal notice to the
offending party, the injured citizen would be without redress. Bish. Marr. and Div., sect. 156.
Neither do we mean to assert that a State may not require a nonresident entering into a
partnership or association within its limits, or making contracts enforceable there, to appoint
an agent or representative in the State to receive service of process and notice in legal
proceedings instituted with respect to such partnership, association, or contracts, or to
designate a place where such service may be made and notice given, and provide, upon their
failure, to make such appointment or to designate such place that service may be made upon
a public officer designated for that purpose, or in some other prescribed way, and that
judgments rendered upon such service may not be binding upon the nonresidents both within
and without the State. As was said by the Court of Exchequer in Vallee v. Dumergue, 4 Exch.
290,
It is not contrary to natural justice that a man who has agreed to receive a particular mode of
notification of legal proceedings should be bound by a judgment in which that particular mode
of notification has been followed, even though he may not have actual notice of them.
See also The Lafayette Insurance Co. v. French et al., 18 How. 404, and Gillespie v.
Commercial Mutual Marine Insurance Co., 12 Gray (Mass.), 201. Nor do we doubt that a
State, on creating corporations or other institutions for pecuniary or charitable purposes, may
provide a mode in which their conduct may be investigated, their obligations enforced, or their
charters revoked, which shall require other than personal service upon their officers or
members. Parties becoming members of such corporations or institutions would hold
their[p736] interest subject to the conditions prescribed by law. Copin v. Adamson, Law Rep.
9 Ex. 345.
In the present case, there is no feature of this kind, and consequently no consideration of
what would be the effect of such legislation in enforcing the contract of a nonresident can
arise. The question here respects only the validity of a money judgment rendered in one State
in an action upon a simple contract against the resident of another without service of process
upon him or his appearance therein.
Judgment affirmed.
MR. JUSTICE HUNT dissenting.
I am compelled to dissent from the opinion and judgment of the court, and, deeming the
question involved to be important, I take leave to record my views upon it.
The judgment of the court below was placed upon the ground that the provisions of the statute
were not complied with. This is of comparatively little importance, as it affects the present
case only. The judgment of this Court is based upon the theory that the legislature had no
power to pass the law in question; that the principle of the statute is vicious, and every
proceeding under it void. It, therefore, affects all like cases, past and future, and in every
State.
The precise case is this: a statute of Oregon authorizes suits to be commenced by the service
of a summons. In the case of a nonresident of the State, it authorizes the service of the
summons to be made by publication for not less than six weeks, in a newspaper published in
the county where the action is commenced. A copy of the summons must also be sent by
mail, directed to the defendant at his place of residence, unless it be shown that the residence
is not known and cannot be ascertained. It authorizes a judgment and execution to be
obtained in such proceeding. Judgment in a suit commenced by one Mitchell in the Circuit
Court of Multnomah County, where the summons was thus served, was obtained against
Neff, the present plaintiff, and the land in question, situate in Multnomah County, was bought
by the defendant Pennoyer at a sale upon the judgment in such suit. This court now holds
that, by reason of the absence of a personal service of[p737] the summons on the defendant,
the Circuit Court of Oregon had no jurisdiction, its judgment could not authorize the sale of
land in said county, and, as a necessary result, a purchaser of land under it obtained no title;
that, as to the former owner, it is a case of depriving a person of his property without due
process of law.
In my opinion, this decision is at variance with the long established practice under the statutes
of the States of this Union, is unsound in principle, and, I fear, may be disastrous in its effects.
It tends to produce confusion in titles which have been obtained under similar statutes in
existence for nearly a century; it invites litigation and strife, and overthrows a well settled rule
of property.
The result of the authorities on the subject, and the sound conclusions to be drawn from the
principles which should govern the decision, as I shall endeavor to show, are these:--
1. A sovereign State must necessarily have such control over the real and personal property
actually being within its limits, as that it may subject the same to the payment of debts justly
due to its citizens.
2. This result is not altered by the circumstance that the owner of the property is nonresident,
and so absent from the State that legal process cannot be served upon him personally.
3. Personal notice of a proceeding by which title to property is passed is not indispensable; it
is competent to the State to authorize substituted service by publication or otherwise, as the
commencement of a suit against nonresidents, the judgment in which will authorize the sale of
property in such State.
4. It belongs to the legislative power of the State to determine what shall be the modes and
means proper to be adopted to give notice to an absent defendant of the commencement of a
suit; and if they are such as are reasonably likely to communicate to him information of the
proceeding against him, and are in good faith designed to give him such information, and an
opportunity to defend is provided for him in the event of his appearance in the suit, it is not
competent to the judiciary to declare that such proceeding is void as not being by due process
of law.
5. Whether the property of such nonresident shall be seized[p738] upon attachment as the
commencement of a suit which shall be carried into judgment and execution, upon which it
shall then be sold, or whether it shall be sold upon an execution and judgment without such
preliminary seizure, is a matter not of constitutional power, but of municipal regulation only.
To say that a sovereign State has the power to ordain that the property of nonresidents within
its territory may be subjected to the payment of debts due to its citizens, if the property is
levied upon at the commencement of a suit, but that it has not such power if the property is
levied upon at the end of the suit, is a refinement and a depreciation of a great general
principle that, in my judgment, cannot be sustained.
A reference to the statutes of the different States, and to the statutes of the United States, and
to the decided cases, and a consideration of the principles on which they stand, will more
clearly exhibit my view of the question.
The statutes are of two classes: first, those which authorize the commencement of actions by
publication, accompanied by an attachment which is levied upon property, more or less, of an
absent debtor; second, those giving the like mode of commencing a suit without an
attachment.
The statute of Oregon relating to publication of summons, supra, p. 718, under which the
question arises, is nearly a transcript of a series of provisions contained in the New York
statute, adopted thirty years since. The latter authorizes the commencement of a suit against
a nonresident by the publication of an order for his appearance, for a time not less than six
weeks, in such newspapers as shall be most likely to give notice to him, and the deposit of a
copy of the summons and complaint in the post office, directed to him at his residence, if it
can be ascertained; and provides for the allowance to defend the action before judgment, and
within seven years after its rendition, upon good cause shown, and that, if the defence be
successful, restitution shall be ordered. It then declares: "But the title to property sold under
such judgment to a purchaser in good faith shall not be thereby affected." Code, sects. 34, 35;
5 Edm.Rev.Stat. of N.Y., pp. 37-39.
Provisions similar in their effect, in authorizing the commencement of suits by attachment
against absent debtors, in[p739] which all of the property of the absent debtor, real and
personal, not merely that seized upon the attachment, is placed under the control of trustees,
who sell it for the benefit of all the creditors, and make just distribution thereof, conveying
absolute title to the property sold have been upon the statute book of New York for more than
sixty years. 2 id., p. 2 and following; 1 Rev.Laws, 1813, p. 157.
The statute of New York, before the Code, respecting proceedings in chancery where absent
debtors are parties, had long been in use in that State, and was adopted in all cases of
chancery jurisdiction. Whenever a defendant resided out of the State, his appearance might
be compelled by publication in the manner pointed out. A decree might pass against him, and
performance be compelled by sequestration of his real or personal property, or by causing
possession of specific property to be delivered, where that relief is sought. T he relief was not
confined to cases of mortgage foreclosure, or where there was a specific claim upon the
property, but included cases requiring the payment of money as well. 2 Edm.Rev.Stat. N.Y.,
pp. 193-195; 186, m.
I doubt not that many valuable titles are now held by virtue of the provisions of these statutes.
The statute of California authorizes the service of a summons on a nonresident defendant by
publication, permitting him to come in and defend upon the merits within one year after the
entry of judgment. Code, sects. 10,412, 10,473. In its general character, it is like the statutes
of Oregon and New York already referred to.
The Code of Iowa, sect. 2618, that of Nevada, sect. 1093, and that of Wisconsin, are to the
same general effect. The Revised Statutes of Ohio, sects. 70, 75, 2 Swan & Critchfield,
provide for a similar publication, and that the defendant may come in to defend within five
years after the entry of the judgment, but that the title to property held by any purchaser in
good faith under the judgment shall not be affected thereby.
The attachment laws of New Jersey, Nixon Dig. (4th ed.), p. 55, are like those of New York
already quoted, by which title may be transferred to all the property of a nonresident debtor.
And the provisions of the Pennsylvania statute regulating[p740] proceedings in equity,
Brightly's Purden's Dig., p. 5988, sects. 51, 52, give the same authority in substance, and the
same result is produced as under the New York statute.
Without going into a wearisome detail of the statutes of the various States, it is safe to say
that nearly every State in the Union provides a process by which the lands and other property
of a nonresident debtor may be subjected to the payment of his debts, through a judgment or
decree against the owner, obtained upon a substituted service of the summons or writ
commencing the action.
The principle of substituted service is also a rule of property under the statutes of the United
States.
The act of Congress "to amend the law of the District of Columbia in relation to judicial
proceedings therein," approved Feb. 23, 1867, 14 Stat. 403, contains the same general
provisions. It enacts (sect. 7) that publication may be substituted for personal service when
the defendant cannot be found in suits for partition, divorce, by attachment, for the foreclosure
of mortgages and deeds of trust, and for the enforcement of mechanics' liens and all other
liens against real or personal property, and in all actions at law or in equity having for their
immediate object the enforcement or establishment of any lawful right, claim, or demand to or
against any real or personal property within the jurisdiction of the court.
A following section points out the mode of proceeding, and closes in these words:
The decree, besides subjecting the thing upon which the lien has attached to the satisfaction
of the plaintiff's demand against the defendant, shall adjudge that the plaintiff recover his
demand against the defendant, and that he may have execution thereof as at law.
Sect. 10.
A formal judgment against the debtor is thus authorized by means of which any other property
of the defendant within the jurisdiction of the court, in addition to that which is the subject of
the lien, may be sold, and the title transferred to the purchaser.
All these statutes are now adjudged to be unconstitutional and void. The titles obtained under
them are not of the value[p741] of the paper on which they are recorded, except where a
preliminary attachment was issued.
Some of the statutes and several of the authorities I cite go further than the present case
requires. In this case, property lying in the State where the suit was brought, owned by the
nonresident debtor, was sold upon the judgment against him, and it is on the title to that
property that the controversy turns.
The question whether, in a suit commenced like the present one, a judgment can be obtained
which, if sued upon in another State, will be conclusive against the debtor, is not before us;
nor does the question arise as to the faith and credit to be given in one State to a judgment
recovered in another. The learning on that subject is not applicable. The point is simply
whether land lying in the same State may be subjected to process at the end of a suit thus
commenced.
It is here necessary only to maintain the principle laid down by Judge Cooley in his work on
Constitutional Limitations, p. 404, and cited by Mr. Justice Field in Galpin v. Page, 3 Sawyer
93, in these words:
The fact that process was not personally served is a conclusive objection to the judgment as a
personal claim, unless the defendant caused his appearance to be entered in the attachment
proceedings. Where a party has property in a State, and resides elsewhere, his property is
justly subject to all valid claims that may exist against him there; but, beyond this, due process
of law would require appearance or personal service before the defendant could be personally
bound by any judgment rendered.
The learned author does not make it a condition that there should be a preliminary seizure of
the property by attachment; he lays down the rule that all a person's property in a State may
be subjected to all valid claims there existing against him.
The objection now made that suits commenced by substituted service, as by publication, and
judgments obtained without actual notice to the debtor, are in violation of that constitutional
provision that no man shall be deprived of his property "without due process of law," has often
been presented.
In Matter of the Empire City Bank, 18 N.Y. 199, which[p742] was a statutory proceeding to
establish and to enforce the responsibility of the stockholders of a banking corporation, and
the proceedings in which resulted in a personal judgment against the stockholders for the
amount found due, the eminent and learned Judge Denio, speaking as the organ of the Court
of Appeals, says:
The notice of hearing is to be personal, or by service at the residence of the parties who live
in the county, or by advertisement as to others. It may therefore happen that some of the
persons who are made liable will not have received actual notice, and the question is whether
personal service of process or actual notice to the party is essential to constitute due process
of law. We have not been referred to any adjudication holding that no man's right of property
can be affected by judicial proceedings unless he have personal notice. It may be admitted
that a statute which should authorize any debt or damages to be adjudged against a person
upon a purely ex parteproceeding, without a pretence of notice or any provision for defending,
would be a violation of the Constitution, and be void; but where the legislature has prescribed
a kind of notice by which it is reasonably probable that the party proceeded against will be
apprised of what is going on against him, and an opportunity is afforded him to defend, I am of
the opinion that the courts have not the power to pronounce the proceeding illegal. The
legislature has uniformly acted upon that understanding of the Constitution.
Numerous provisions of the statutes of the State are commented upon, after which he
proceeds:
Various prudential regulations are made with respect to these remedies; but it may possibly
happen, notwithstanding all these precautions, that a citizen who owes nothing, and has done
none of the acts mentioned in the statute, may be deprived of his estate without any actual
knowledge of the process by which it has been taken from him. If we hold, as we must in
order to sustain this legislation, that the Constitution does not positively require personal
notice in order to constitute a legal proceeding due process of law, it then belongs to the
legislature to determine whether the case calls for this kind of exceptional legislation, and
what manner of constructive notice shall be sufficient to reasonably apprise the party
proceeded against of the legal steps which are taken against him.[p743]
In Happy v. Mosher, 48 id. 313, the court say:
An approved definition of due process of law is "law in its regular administration through
courts of justice." 2 Kent Com. 13. It need not be a legal proceeding according to the course
of the common law, neither must there be personal notice to the party whose property is in
question. It is sufficient if a kind of notice is provided by which it is reasonably probable that
the party proceeded against will be apprised of what is going on against him, and an
opportunity afforded him to defend.
The same language is used in Westervelt v. Gregg, 12 id. 202, and in Campbell v.
Evans, 45 id. 356. Campbell v. Evans and The Empire City Bank are cases not of
proceedings against property to enforce a lien or claim, but, in each of them, a personal
judgment in damages was rendered against the party complaining.
It is undoubtedly true, that, in many cases where the question respecting due process of law
has arisen, the case in hand was that of a proceeding in rem. It is true also, as is asserted,
that the process of a State cannot be supposed to run beyond its own territory. It is equally
true, however, that, in every instance where the question has been presented, the validity of
substituted service, which is used to subject property within the State belonging to a
nonresident to a judgment obtained by means thereof has been sustained. I have found no
case in which it is adjudged that a statute must require a preliminary seizure of such property
as necessary to the validity of the proceeding against it, or that there must have been a
previous specific lien upon it; that is, I have found no case where such has been the judgment
of the court upon facts making necessary the decision of the point. On the contrary, in the
case of the attachment laws of New York and of New Jersey, which distribute all of the
nonresident's property, not merely that levied on by the attachment, and in several of the
reported cases already referred to, where the judgment was sustained, neither of these
preliminary facts existed.
The case of Galpin v. Page, reported in 18 Wall. 350 and again in 3 Sawyer 93, is cited in
hostility to the views I have expressed. There may be general expressions which will
justify[p744] this suggestion, but the judgment is in harmony with those principles. In the case
as reported in this Court, it was held that the title of the purchaser under a decree against a
nonresident infant was invalid, for two reasons: 1st, that there was no jurisdiction of the
proceeding under the statute of California, on account of the entire absence of an affidavit of
nonresidence, and of diligent inquiry for the residence of the debtor; 2d, the absence of any
order for publication in Eaton's case -- both of which are conditions precedent to the
jurisdiction of the court to take any action on the subject. The title was held void, also, for the
reason that the decree under which it was obtained had been reversed in the State court, and
the title was not taken at the sale, nor held then by a purchaser in good faith, the purchase
being made by one of the attorneys in the suit, and the title being transferred to his law
partner after the reversal of the decree. The court held that there was a failure of jurisdiction in
the court under which the plaintiff claimed title, and that he could not recover. The learned
justice who delivered the opinion in the Circuit Court and in this Court expressly affirms the
authority of a State over persons not only, but property as well, within its limits, and this by
means of a substituted service. The judgment so obtained, he insists, can properly be used as
a means of reaching property within the State, which is thus brought under the control of the
court and subjected to its judgment. This is the precise point in controversy in the present
action.
The case of Cooper v. Reynolds, 10 Wall. 308, is cited for the same purpose. There, the
judgment of the court below, refusing to give effect to a judgment obtained upon an order of
publication against a nonresident, was reversed in this Court. The suit was commenced, or
immediately accompanied (it is not clear which), by an attachment which was levied upon the
real estate sold, and for the recovery of which this action was brought. This Court sustained
the title founded upon the suit commenced against the nonresident by attachment. In the
opinion delivered in that case, there may be remarks, by way of argument or illustration,
tending to show that a judgment obtained in a suit not commenced by the levy of an
attachment will not give title to land purchased under it. They are,[p745] however,
extrajudicial, the decision itself sustaining the judgment obtained under the State statute by
publication.
Webster v. Reid, 11 How. 437, is also cited. There, the action involved the title to certain
lands in the State of Iowa, being lands formerly belonging to the half-breeds of the Sac and
Fox tribes; and title was claimed against the Indian right under the statutes of June 2, 1838,
and January, 1839. By these statutes, commissioners were appointed who were authorized to
hear claims for accounts against the Indians, and commence actions for the same, giving a
notice thereof of eight weeks in the Iowa "Territorial Gazette," and to enter up judgments
which should be a lien on the lands. It was provided that it should not be necessary to name
the defendants in the suits, but the words "owners of the half-breed lands lying in Lee County"
should be a sufficient designation of the defendants in such suits; and it provided that the
trials should be by the court, and not by a jury. It will be observed that the lands were not only
within the limits of the territory of Iowa, but that all the Indians who were made defendants
under the name mentioned were also residents of Iowa, and, for aught that appears to the
contrary, of the very county of Lee in which the proceeding was taken. Nonresidence was not
a fact in the case. Moreover, they were Indians, and, presumptively, not citizens of any State,
and the judgments under which the lands were sold were rendered by the commissioners for
their own services under the act.
The court found abundant reasons, six in number, for refusing to sustain the title thus
obtained. The act was apparently an attempt dishonestly to obtain the Indian title, and not
intended to give a substitution for a personal service which would be likely, or was reasonably
designed, to reach the persons to be affected.
The case of Voorhees v. Jackson, 10 Pet. 449, affirmed the title levied under the attachment
laws of Ohio, and laid down the principle of assuming that all had been rightly done by a court
having general jurisdiction of the subject matter.
In Cooper v. Smith, 25 Iowa, 269, it is said that where no process is served on the defendant,
nor property attached, nor garnishee charged, nor appearance entered, a judgment
based[p746] on a publication of the pendency of the suit will be void, and may be impeached,
collaterally or otherwise, and forms no bar to a recovery in opposition to it, nor any foundation
for a title claimed under it. The language is very general, and goes much beyond the
requirement of the case, which was an appeal from a personal judgment obtained by
publication against the defendant, and where, as the court say, the petition was not properly
verified. All that the court decided was that this judgment should be reversed. This is quite a
different question from the one before us. Titles obtained by purchase at a sale upon an
erroneous judgment are generally good, although the judgment itself be afterwards
reversed. McGoon v. Scales, 9 Wall. 311.
In Darrance v. Preston, 18 Iowa, 396, the distinction is pointed out between the validity of a
judgment as to the amount realized from the sale of property within the jurisdiction of the court
and its validity beyond that amount.Picquet v. Swan, 5 Mas. 35; Bissell v. Briggs, 9 Mass.
462; Ewer v. Coffin, 1 Cush. (Mass.) 23, are cited, but neither of them in its facts touches the
question before us.
In Drake on Attachment, the rule is laid down in very general language; but none of the cases
cited by him will control the present case. They are the following:--
Eaton v. Bridger, 33 N. H. 228, was decided upon the peculiar terms of the New Hampshire
statute, which forbids the entry of a judgment unless the debtor was served with process, or
actually appeared and answered in the suit. The court say the judgment was "not only
unauthorized by law, but rendered in violation of its express provisions."
Johnson v. Dodge was a proceeding in the same action to obtain a reversal on appeal of the
general judgment, and did not arise upon a contest for property sold under the
judgment. Carleton v. Washington Insurance Co., 35 id. 162, and Bruce v.
Cloutman, 45 id. 37, are to the same effect and upon the same statute.
Smith v. McCutchen, 38 Mo. 415, was a motion in the former suit to set aside the execution
by a garnishee, and it was held that the statute was intended to extend to that class of
cases. Abbott v. Shepard, 44 id. 273, is to the same effect, and is based upon Smith v.
McCutchen, supra.[p747]
So, in Eastman v. Wadleigh, 65 Me. 251, the question arose in debt on the judgment, not
upon a holding of land purchased under the judgment. It was decided upon the express
language of the statute of Maine, strongly implying the power of the legislature to make it
otherwise, had they so chosen.
It is said that the case where a preliminary seizure has been made, and jurisdiction thereby
conferred, differs from that where the property is seized at the end of the action, in this: in the
first case, the property is supposed to be so near to its owner that, if seizure is made of it, he
will be aware of the fact, and have his opportunity to defend, and jurisdiction of the person is
thus obtained. This, however, is matter of discretion and of judgment only. Such seizure is not
in itself notice to the defendant, and it is not certain that he will by that means receive notice.
Adopted as a means of communicating it, and although a very good means, it is not the only
one, nor necessarily better than a publication of the pendency of the suit, made with an
honest intention to reach the debtor. Who shall assume to say to the legislature that, if it
authorizes a particular mode of giving notice to a debtor, its action may be sustained, but, if it
adopts any or all others, its action is unconstitutional and void? The rule is universal that
modes, means, questions of expediency or necessity are exclusively within the judgment of
the legislature, and that the judiciary cannot review them. This has been so held in relation to
a bank of the United States, to the legal tender act, and to cases arising under other
provisions of the Constitution.
In Jarvis v. Barrett, 14 Wis. 591, such is the holding. The court say:
The essential fact on which the publication is made to depend is property of the defendant in
the State, and not whether it has been attached. . . . There is no magic about the writ [of
attachment] which should make it the exclusive remedy. The same legislative power which
devised it can devise some other, and declare that it shall have the same force and effect.
The particular means to be used are always within the control of the legislature, so that the
end be not beyond the scope of legislative power.
If the legislature shall think that publication and deposit in the post office are likely to give the
notice, there seems to be[p748] nothing in the nature of things to prevent their adoption in lieu
of the attachment. The point of power cannot be thus controlled.
That a State can subject land within its limits belonging to nonresident owners to debts due to
its own citizens as it can legislate upon all other local matters -- that it can prescribe the mode
and process by which it is to be reached -- seems to me very plain.
I am not willing to declare that a sovereign State cannot subject the land within its limits to the
payment of debts due to its citizens, or that the power to do so depends upon the fact whether
its statute shall authorize the property to be levied upon at the commencement of the suit or at
its termination. This is a matter of detail, and I am of opinion that, if reasonable notice be
given, with an opportunity to defend when appearance is made, the question of power will be
fully satisfied.
DIGEST
Facts:
  In 1866, Mitchell, attorney from OR, sued Neff, resident of CA, in OR state court to
recover unpaid legal fees.
 Mitchell published notice of the commencement of the action in an OR newspaper,
pursuant to state statute about giving notice to out of state defendants. Neff was not
personally served.
 When Neff failed to appear, Mitchell obtained a default judgment against him.
 Court attached a tract of land that Neff had purchased in OR. Land was sold to
Pennoyer at auction and proceeds awarded to Mitchell.
 Nine years later, Neff sued Pennoyer in OR federal court to recover the land.
Procedural History:
 Neff won in lower court (on basis of technical problems with 2 affidavits, not on
jurisdictional issues)
 Neff won in SCOTUS
Issues:
  Can a state court exercise personal jurisdiction over a non-resident who has not
been personally served while within the state and whose property within the state
was not attached before the onset of litigation?
Holding/Rule:
  A court may enter a judgment against a non-resident only if the party…
a. Is personally served with process while within the state, or
a. Has property within the state, and that property is attached before
litigation begins (as in quasi in rem jurisdiction)
Reasoning:
  "Field theory" of state-court jurisdiction
 o Every state possesses exclusive jurisdiction and sovereignty over
persons and property within its territory
o No state can exercise direct jurisdiction and authority over persons or
property outside its territory
 These principles follow because the states resemble independent nations
 Principles are rooted in the Due Process clause of the 14th Amendment. Courts
have to give other judgments "full faith and credit".
o "Full faith and credit" is not valid if the court did not have jurisdiction.
Dissent:
  None given.
Notes:
 Courts have to give other judgments "full faith and credit".
 SCOTUS doesn't say anything bad about the notice.
 State has power over people who are there and the land in its boundaries.
 The claim doesn't have to have anything to do with the property in the jurisdiction
 In personam - suit against a person
 In rem - suit against property
 Quasi in rem - suit against someone out of state through property in the state
 Oregon has a real interest in making its courts available to its citizens
 Since the adoption of DP, the validity of judgments like this may be directly
questioned and their enforcement in the state resisted on the ground that
proceedings in a court of justice to determine the personal rights and obligations of
parties over whom that court has no jurisdiction do not constitute due process of
law.
 Special appearance means you can enter a jurisdiction in order to dispute
jurisdiction issues in a case.
 Theology of Pennoyer
o States have power over their people
o States have power over their property
o All assertions of jurisdictional power must be justified consistent with One
and Two
o Problem - Underinclusive, need a way to protect citizens
 How to mitigate
 Create quasi-in-rem jurisdiction to permit assertion of
claims against non-residents by grabbing property
 Physical presence - if you can find them, grab them
 Consent can be either express and implied
 Status relationships like marriage
FACTS
In 1866, Mitchell (Neff’s attorney) sued Neff, a non-resident, in OR state court to recover
unpaid legal fees.  Mitchell sued Neff for land that had not yet been seized by the court.  Korea, summons was served by publication, as provided in the Rules of Court. Thereafter,
Mitchell published notice of the commencement of the action in an OR newspaper, in
accordance with state statute about giving notice to out of state defendants. Neff was not
personally served. Neff did not appear and Mitchell obtained a default judgment against him. 
Land was sold to Pennoyer at auction and proceeds awarded to Mitchell.  Neff sued Pennoyer
to recover the land.
PROCEDURAL HISTORY
Neff sued Pennoyer in federal district court in Oregon to recover possession of the property,
claiming that the original judgment against him was invalid for lack of personal
jurisdiction over both him and the land. The court found that the judgment in the lawsuit
between Mitchell and Pennoyer was invalid and that Neff still owned the land. Pennoyer lost
on appeal and the Supreme Court granted certiorari.
ISSUE
Can the state exercise personal jurisdiction on a non-resident who has not been personally
served and whose land was not attached prior to the law suit?
HOLDING:
Judgment for Neff affirmed.  A court cannot enter a judgment against a non-resident unless
that person is personally served while within the state or that person has attached land at the
time of suit.
REASONING
“If, without personal service, judgments in personam, obtained ex parte against non-residents
and absent parties, upon mere publication of process, which, in the great majority of cases,
would never be seen by the parties interested, could be upheld and enforced, they would be
the constant instruments of fraud and oppression.”  In this case the property was moved
against to satisfy a personal judgment against a non-resident.  Pre-trial seizure of the land
would have satisfied notification of a property judgment (in rem), because it is assumed that
property is attached to the person.  However, to satisfy a personal judgment (which was case
between Mitchell and Neff), seizure is not a sufficient method of notification, nor is public
notification.   Neff was not personally notified nor was his land attached at the time of
adjudication.  Judgments in rem for non-residents must be given due process, which involves
a personal appearance by the Defendant or personal service of notification or attachment of
land.
G.R. No. L-18176            October 26, 1966
LAZARO B. RAYRAY, plaintiff-appellant, vs.CHAE KYUNG
LEE, defendant-appellee.
Appeal from a decision of the Court of Juvenile and Domestic Relations.
Plaintiff Lazaro Rayray seeks the annulment of his marriage to defendant Chae Kyung Lee.
Inasmuch as, the latter's whereabouts is unknown, and she was formerly a resident of Pusan,
plaintiff moved that defendant be declared in default, she not having filed an answer, and that
a date be set for the reception of his evidence. Before acting on this motion, the lower court
referred the case to the City Fiscal of Manila pursuant to Articles 88 and 101 of the Civil Code
of the Philippines, for the purpose of determining whether or not a collusion between the
parties exists. Said officer having found no such collusion, the case was heard on the merits.
In due course, thereafter, decision was rendered dismissing plaintiff's complaint, without
costs, upon the ground: (1) that the court could not nullify a marriage contracted abroad; and
(2) that the facts proven do not warrant the relief prayed for. A reconsideration of this decision
having been denied, plaintiff appealed to the Court of Appeals, which certified the case to the
Supreme Court, the jurisdiction of the lower court being in issue in the appeal.
In relation thereto, the court a quo found that it had no jurisdiction to pass upon the validity of
plaintiff's marriage to the defendant, it having been solemnized in Seoul, Korea. Said
conclusion is erroneous. In order that a given case could be validly decided by a court of
justice, it must have jurisdiction over (1) the subject-matter of the litigation; (2) the person of
the parties therein; and (3) in actions in rem or quasi-in-rem, the res.1
The subject-matter of the present case is the annulment of plaintiff's marriage to the
defendant, which is within the jurisdiction of our courts of first instance,2 and, in Manila, of its
Court of Juvenile and Domestic Relations.3
The same acquired jurisdiction over plaintiff herein by his submission thereto in consequence
of the filing of the complaint herein.4 Defendant was placed under the jurisdiction of said court,
upon the service of summons by publication.5
This is an action in rem, for it concerns the status of the parties herein, and status affects or
binds the whole word. The res in the present case is the relation between said parties, or their
marriage tie.6 Jurisdiction over the same depends upon the nationality or domicile of the
parties, not the place of celebration of marriage, or the locus celebrationis.7 Plaintiff here is a
citizen of the Philippines, domiciled therein. His status is, therefore, subject to our jurisdiction,
on both counts. True that defendant was and — under plaintiff's — theory still is a non-
resident alien. But, this fact does not deprive the lower court of its jurisdiction to pass upon the
validity of her marriage to plaintiff herein.
Indeed, marriage is one of the cases of double status, in that the status therein involves and
affects two persons. One is married, never in abstract or a vacuum, but, always to somebody
else. Hence, a judicial decree on the marriage status of a person necessarily reflects upon the
status of another and the relation between them. The prevailing rule is, accordingly, that a
court has jurisdiction over the res, in an action for annulment of marriage, provided, at least,
one of the parties is domiciled in, or a national of, the forum.8 Since plaintiff is a Filipino,
domiciled in the Philippines, it follows that the lower court had jurisdiction over the res, in
addition to its jurisdiction over the subject-matter and the parties. In other words, it could
validly inquire into the legality of the marriage between the parties herein.
As regards the substantial validity of said marriage, plaintiff testified that he met the defendant
in Pusan Korea, sometime in 1952, where she was operating a nightclub; that they lived
together from November 1952 to April 1955; that they were married in Pusan Korea, on March
15, 1953, as attested to by their marriage certificate Exhibit D; that before the wedding she
obtained the "police clearance" Exhibit A, written in Korean language, and dated February 16,
1953, which was necessary in order that she could contract marriage; that on June 30, 1953,
he proceeded to India and left the defendant, then in advanced stage of pregnancy, in Korea;
that in October, 1953, she joined him in India, bringing with her said Exhibit A, and its
translation into English, Exhibit B; that he then noticed that, on February 16, 1958, defendant
was already married, according to said Exhibit B; that as he confronted the defendant with the
contents of this document, her reply was that it is not unusual for a Korean girl to marry twice
in Korea; that when he inquired about her status on March 15, 1953, defendant confided to
him that she had lived with about two (2) Americans and a Korean, adding, however, that
there was no impediment to her contracting marriage with him; and that, later on, they were
separated and her whereabouts are now unknown to him.
The lower court considered plaintiffs evidence insufficient to establish that defendant was
married to another person prior to March 15, 1953, and we agree with this conclusion. To
begin with, Exhibit A is not signed. It merely purports to bear the seal of the Chief of Pusan
National Police. Secondly, the record does not show who prepared it, much less that he had
personal knowledge of the truth of the entry therein concerning defendant's status on
February 15, 1953. It should be noted, that defendant was a native, not of Pusan but of
Seoul, Korea. Hence, Exhibit A could, at best, be no more than hearsay evidence. Again,
when plaintiff allegedly confronted the defendant with the contents of Exhibit B, defendant
did not say that she had been married before. Plaintiff declared that she admitted having
previously lived with several other men, adding, however, that she had no impediment, thus,
in effect, negating the alleged previous marriage.
Thirdly, if Exhibit A was obtained on February 16, 1953, in order to establish defendant's
qualification to contract marriage, why is it that the wedding took place, despite the entry in
said document to the effect that defendant was married already? There is no competent
evidence to the effect that Korean laws permit bigamy or polygamy. Moreover, the
presumption is that the foreign law is identical to the lex fori, or, in the case at bar, the
Philippine Law.9 In fact, the statement, imputed by plaintiff to the defendant, to the effect that,
although she had cohabited before with other men, there was no impediment to her marrying
him, clearly suggests that a previous marriage on her part would have been, in her opinion, a
legal obstacle to her marriage with the plaintiffs. Then too, the marriage certificate Exhibit D
contains spaces for the entry of data on whether any of the contracting parties had been
previously married; whether the prior marriage had been dissolved by a decree of divorce;
and, if there had been such decree, the date thereof. Surely, these data would be absolutely
irrelevant if polygamy were sanctioned in Korea. And, again, why is it that Exhibit D states that
defendant had had no previous marriage?
Last, but not least, plaintiff cannot possibly secure the relief prayed for unless full faith and
credence are given to his testimony, but we cannot believe him for the records show that he
would not hesitate to lie when it suits his purpose. Thus, for instance, when plaintiff contracted
marriage with the defendant, he said that he was single, although, he admitted, this was a lie,
because, sometime in 1940, he married in Baguio, one Adelaida Melecio or Valdez.10 But,
then he would, also, have us believe that his marriage with the latter was illegal or fictitious,
because Adelaida and he did no more than sign, on a small window in the City Hall of Baguio,
certain documents the contents of which he did not read.
WHEREFORE, the decision appealed from should be, as it is hereby, affirmed, with the costs
of this instance against plaintiff-appellant. It is so ordered.
Article 45
Rayray married Lee in 1952 in Pusan, Korea. Before the marriage, Lee was able to secure a
marriage license which is a requirement in Korea prior to marrying. They lived together until
1955. Rayray however later found out that Lee had  previously lived with 2 Americans and a
Korean. Lee answered by saying that it is not unusual in Korea for a woman to have more
than one partner and that it is legally permissive for them to do so and that there is no legal
impediment to her marriage with Rayray.  Eventually they pursued their separate ways.
Rayray later filed before lower court of Manila for an action to annul his marriage with Lee
because Lee’s whereabouts  cannot be determined and that his consent in marrying Lee
would have not been for the marriage had he known prior that Lee had been living with other
men. His action for annulment had been duly published and summons were made known to
Lee but due to her absence Rayray moved to have Lee be declared in default. The lower
court denied Rayray’s action stating that since the marriage was celebrated in Korea the court
cannot take cognizance of the case and that the facts presented by Rayray is not sufficient to
debunk his marriage with Lee.
ISSUE: Whether or not Rayray’s marriage with Lee is null and void.
HELD: The lower court erred in ruling that Philippine courts do not have jurisdiction over the
case. As far as marriage status is concerned, the nationality principle is controlling NOT lex
loci celebracionis. The lower court is however correct in ruling that Rayray’s evidence is not
sufficient to render his marriage with Lee null and void. Rayray  said that the police clearance
secured by Lee is meant to allow her to marry after her subsequent cohabitation/s with the
other men – which is considered bigamous in Philippine law. The SC ruled that the police
clearance is wanting for it lacks the signature of the person who prepared it and there is no
competent document to establish the identity of the same. Also, through Rayray himself, Lee
averred that it is ok in Korea for a person who cohabited with other men before to marry
another man. This is an indication that Lee herself is aware that if it were a previous marriage
that is concerned then that could be a legal impediment to any subsequent marriage. Rayray
cannot be given credence in claiming that his consent could have been otherwise altered had
he known all these facts prior to the marriage because he would lie to every opportunity given
him by the Court so as to suit his case.
[G.R.No.150656. April29,2003]
MARGARITA ROMUALDEZ LICAROS, petitioner, vs. ABELARDO B.
LICAROS, respondent.
The Case
This is a petition for review on certiorari[1] to annul the Decision[2] dated 9 August 2001 of the
Court of Appeals in CA-G.R. SP No. 58487, as well as the Resolution dated 23 October 2001
denying the motion for reconsideration. The Court of Appeals dismissed the petition to annul
the following decisions[3] rendered by Branch 143 of the Regional Trial Court of Makati:
(1) The Decision dated 27 December 1990[4] granting the dissolution of the conjugal
partnership of gains of the spouses Abelardo B. Licaros and Margarita Romualdez-Licaros;
(2) The Decision dated 8 November 1991[5] declaring the marriage between the same
spouses null and void.
The Facts
The antecedent facts as found by the Court of Appeals are as follows:
x x x Abelardo Licaros (Abelardo, for short) and Margarita Romualdez-Licaros (Margarita,
hereafter) were lawfully married on December 15, 1968. Out of this marital union were born
Maria Concepcion and Abelardo, Jr. Ironically, marital differences, squabbles and
irreconcilable conflicts transpired between the spouses, such that sometime in 1979, they
agreed to separate from bed and board.
In 1982, Margarita left for the United States and there, to settle down with her two (2)
children. In the United States, on April 26, 1989, Margarita applied for divorce before the
Superior Court of California, County of San Mateo (Annex 1, Rejoinder, pp. 164-165) where
she manifested that she does not desire counseling at that time (Quotation, p. 166,
Rollo). On August 6, 1990, Margarita was granted the decree of divorce (Annex 2, Answer,
p. 108, Rollo) together with a distribution of properties between her and Abelardo (pp. 167-
168, Rollo).
Not long after, on August 17, 1990, Abelardo and Margarita executed an Agreement of
Separation of Properties (pp. 60-64, Rollo). This was followed-up by a petition filed on August
21, 1990 before the Regional Trial Court of Makati for the dissolution of the conjugal
partnership of gains of the spouses and for the approval of the agreement of separation of
their properties. This was docketed as Special Proceeding No. 2551. On December 27, 1990,
a decision was issued granting the petition and approving the separation of property
agreement.
For his part, on June 24, 1991, Abelardo commenced Civil Case No. 91-1757, for the
declaration of nullity of his marriage with Margarita, based on psychological incapacity under
the New Family Code. As Margarita was then residing at 96 Mulberry Lane, Atherton,
California, U.S.A., Abelardo initially moved that summons be served through the International
Express Courier Service. The court a quo denied the motion. Instead, it ordered that
summons be served by publication in a newspaper of general circulation once a week for
three (3) consecutive weeks, at the same time furnishing respondent a copy of the order, as
well as the corresponding summons and a copy of the petition at the given address in the
United States through the Department of Foreign Affairs, all at the expense of
Abelardo. Respondent was given sixty (60) days after publication to file a responsive
pleading.
On July 15, 1991, Process Server, Maximo B. Dela Rosa, submitted his Officers Return
quoted hereunder:
OFFICERS RETURN
THIS IS TO CERTIFY that on July 3, 1991, I have served a copy of summons and complaint
with annexes together with order dated June 28, 1991 issued by the Court in the above-
entitled case upon defendant Margarita Romualdez-Licaros c/o DFA. (sent by Mail) thru Pat
G. Martines receiving Clerk of Department of Foreign Affairs a person authorized to receive
this kind of process who acknowledged the receipt thereof at ADB Bldg., Roxas Blvd., Pasay
City, Metro Manila. (p. 40, Rollo)
As required by law, the case was referred to Trial Prosecutor Bruselas, Jr. to find out any
possible collusion between the parties in the case. Thereafter, with the negative report of
collusion, Abelardo was allowed to present his evidence ex-parte. On November 8, 1991, the
Decision (Annex A, Petition) was handed down in Civil Case No. 91-1757 declaring the
marriage between Abelardo and Margarita null and void.
Almost nine (9) years later, on April 28, 2000, the petition at bench was commenced when
Margarita received a letter dated November 18, 1991 from a certain Atty. Angelo Q. Valencia
informing her that she no longer has the right to use the family name Licaros inasmuch as
her marriage to Abelardo had already been judicially dissolved by the Regional Trial Court of
Makati on November 8, 1991. Asseverating to have immediately made some verifications and
finding the information given to be true, petitioner commenced the instant petition on the
following grounds:
(A) THERE WAS EXTRINSIC FRAUD IN THE PREPARATION AND FILING BY
ABELARDO OF THE PETITION FOR DISSOLUTION OF THE CONJUGAL
PARTNERSHIP OF GAINS AND ITS ANNEX, THE AGREEMENT OF
SEPARATION OF PROPERTIES.
(B) THE TRIAL COURT LACKED JURISDICTION TO HEAR AND DECIDE THE
PETITION FOR DECLARATION OF NULLITY OF MARRIAGE.[6]
The Ruling of the Court of Appeals
The Court of Appeals debunked the claim of Margarita that there was extrinsic fraud in
the preparation and filing by Abelardo of the Petition for Dissolution of Conjugal Partnership of
Gains and its annex, the Agreement of Separation of Properties. The Court of Appeals stated:
x x x, the extrinsic fraud alluded to consists of Abelardo coercing Margarita into signing the
petition to dissolve their conjugal partnership of gains together with the agreement of
separation of properties, by threatening to cut-off all financial and material support of their
children then still studying in the United States; that petitioner had no hand directly or
indirectly in the preparation of the petition and agreement of separation of properties; that
petitioner never met the counsel for the petitioner, nor the notary public who notarized the
deed; and, petitioner never received any notice of the pendency of the petition nor a copy of
the decision.
Antithetically, a meticulous perusal of the controversial petition (Annex B-1) and the
agreement of separation of properties (pp. 60-64, Rollo) readily shows that the same were
signed by the petitioner on the proper space after the prayer and on the portion for the
verification of the petition. The same is true with the agreement of separation of
properties. What is striking to note is that on August 6, 1990, Margarita appeared before
Amado P. Cortez, Consul of the Republic of the Philippines at the San Francisco, California,
United States Consulate Office, to affirm and acknowledge before said official that she
executed the agreement of separation of properties of her own free will and deed, after being
informed of the contents thereof. And yet, there is no showing that Abelardo was with her at
the Philippine Consulate Office in confirming the separation of property agreement. Moreover,
on page 2 of the same agreement, it is specifically stated that such property separation
document shall be subject to approval later on by the proper court of competent jurisdiction.
The clear import of this is that the agreement must have to be submitted before the proper
court for approval, which explains and confirms petitioners signature on the petition filed in
court.
In main, We see no indication nor showing of coercion or fraud from these facts, which could
very well be considered as extrinsic or collateral fraud to justify a petition under Rule 47. From
all indications, the pretended coerced documents were rather freely and voluntarily executed
by the parties therein knowing fully well the imports thereof. This conclusion finds more weight
if We consider the fact that the separation of property was fully implemented and enforced,
when apparently both parties correspondingly received the properties respectively assigned to
each of them under the said document.[7]
The Court of Appeals also rejected Margaritas claim that the trial court lacked
jurisdiction to hear and decide the Petition for Declaration of Nullity of Marriage for improper
service of summons on her. The case involves the marital status of the parties, which is an
action in rem or quasi in rem. The Court of Appeals ruled that in such an action the purpose of
service of summons is not to vest the trial court with jurisdiction over the person of the
defendant, but only to comply with due process. The Court of Appeals concluded that any
irregularity in the service of summons involves due process which does not destroy the trial
courts jurisdiction over the res which is the parties marital status. Neither does such
irregularity invalidate the judgment rendered in the case. Thus, the Court of Appeals
dismissed the petition for annulment of judgment, stating that:
At bar, the case involves the personal (marital) status of the plaintiff and the defendant. This
status is the res over which the Philippine court has acquired jurisdiction. This is also the kind
of action which the Supreme Court had ruled that service of summons may be served
extraterritorially under Section 15 (formerly Section 17) of Rule 14 and where such service
of summons is not for the purpose of vesting the trial court with jurisdiction over the person of
the defendant but only for the purpose of complying with the requirements of fair play and due
process. A fortiori, the court a quo had properly acquired jurisdiction over the person of
herein petitioner-defendant when summons was served by publication and a copy of the
summons, the complaint with annexes, together with the Order of June 28, 1991, was served
to the defendant through the Department of Foreign Affairs by registered mail and duly
received by said office to top it all. Such mode was upon instruction and lawful order of the
court and could even be treated as any other manner the court may deem sufficient.[8]
Hence, the instant petition.
The Issues
The issues raised by Margarita are restated as follows:
I. Whether Margarita was validly served with summons in the case for declaration of nullity of
her marriage with Abelardo;
II. Whether there was extrinsic fraud in the preparation and filing by Abelardo of the Petition
for Dissolution of the Conjugal Partnership of Gains and its annex, the Agreement of
Separation of Properties.
The Courts Ruling
The petition is bereft of merit.
First Issue: Validity of the Service of Summons on Margarita
Margarita insists that the trial court never acquired jurisdiction over her person in the
petition for declaration of nullity of marriage since she was never validly served with
summons. Neither did she appear in court to submit voluntarily to its jurisdiction.
On the other hand, Abelardo argues that jurisdiction over the person of a non-resident
defendant in an action in rem or quasi in rem is not necessary. The trial and appellate courts
made a clear factual finding that there was proper summons by publication effected through
the Department of Foreign Affairs as directed by the trial court. Thus, the trial court acquired
jurisdiction to render the decision declaring the marriage a nullity.
Summons is a writ by which the defendant is notified of the action brought against
him. Service of such writ is the means by which the court acquires jurisdiction over his person.
[9]
As a rule, when the defendant does not reside and is not found in the Philippines,
Philippine courts cannot try any case against him because of the impossibility of acquiring
jurisdiction over his person unless he voluntarily appears in court. But when the case is one of
actions in rem or quasi in rem enumerated in Section 15,[10] Rule 14 of the Rules of Court,
Philippine courts have jurisdiction to hear and decide the case. In such instances, Philippine
courts have jurisdiction over the res, and jurisdiction over the person of the non-resident
defendant is not essential.[11]
Actions in personam [12] and actions in rem or quasi in rem differ in that actions in
personam are directed against specific persons and seek personal judgments. On the other
hand, actions in rem or quasi in rem are directed against the thing or property or status of a
person and seek judgments with respect thereto as against the whole world.[13]
At the time Abelardo filed the petition for nullity of the marriage in 1991, Margarita was
residing in the United States. She left the Philippines in 1982 together with her two
children. The trial court considered Margarita a non-resident defendant who is not found in the
Philippines. Since the petition affects the personal status of the plaintiff, the trial court
authorized extraterritorial service of summons under Section 15, Rule 14 of the Rules of
Court. The term personal status includes family relations, particularly the relations between
husband and wife.[14]
Under Section 15 of Rule 14, a defendant who is a non-resident and is not found in the
country may be served with summons by extraterritorial service in four instances: (1) when
the action affects the personal status of the plaintiff; (2) when the action relates to, or the
subject of which is property within the Philippines, in which the defendant has or claims a lien
or interest, actual or contingent; (3) when the relief demanded consists, wholly or in part, in
excluding the defendant from any interest in property located in the Philippines; or (4) when
the property of the defendant has been attached within the Philippines.
In these instances, extraterritorial service of summons may be effected under any of
three modes: (1) by personal service out of the country, with leave of court; (2) by publication
and sending a copy of the summons and order of the court by registered mail to the
defendants last known address, also with leave of court; or (3) by any other means the
judge may consider sufficient.
Applying the foregoing rule, the trial court required extraterritorial service of summons to
be effected on Margarita in the following manner:
x x x, service of Summons by way of publication in a newspaper of general circulation once a
week for three (3) consecutive weeks, at the same time, furnishing respondent copy of this
Order as well as the corresponding Summons and copy of the petition at her given address at
No. 96 Mulberry Lane, Atherton, California, U.S.A., thru the Department of Foreign Affairs,
all at the expense of petitioner.[15](Emphasis ours)
The trial courts prescribed mode of extraterritorial service does not fall under the first or
second mode specified in Section 15 of Rule 14, but under the third mode. This refers to any
other means that the judge may consider sufficient.
The Process Servers Return of 15 July 1991 shows that the summons addressed to
Margarita together with the complaint and its annexes were sent by mail to the Department of
Foreign Affairs with acknowledgment of receipt. The Process Servers certificate of service of
summons is prima facie evidence of the facts as set out in the certificate.[16] Before proceeding
to declare the marriage between Margarita and Abelardo null and void, the trial court stated in
its Decision dated 8 November 1991 that compliance with the jurisdictional requirements
hav(e) (sic) been duly established. We hold that delivery to the Department of Foreign
Affairs was sufficient compliance with the rule. After all, this is exactly what the trial court
required and considered as sufficient to effect service of summons under the third mode of
extraterritorial service pursuant to Section 15 of Rule 14.
Second Issue: Validity of the Judgment Dissolving the
Conjugal Partnership of Gains
Margarita claims that Abelardo coerced her into signing the Petition for Dissolution of
the Conjugal Partnership of Gains (Petition) and its annex, the Agreement of Separation of
Properties (Agreement). Abelardo allegedly threatened to cut off all financial and material
support to their children if Margarita did not sign the documents.
The trial court did not find anything amiss in the Petition and Agreement that Abelardo
filed, and thus the trial court approved the same. The Court of Appeals noted that a
meticulous perusal of the Petition and Agreement readily shows that Margarita signed the
same on the proper space after the prayer and on the portion for the verification of the
petition. The Court of Appeals observed further that on 6 August 1990, Margarita appeared
before Consul Amado Cortez in the Philippine Consulate Office in San Francisco, California,
to affirm that she executed the Agreement of her own free will. There was no showing that
Abelardo was at that time with her at the Philippine Consulate Office. Abelardo secured
judicial approval of the Agreement as specifically required in the Agreement.
The Court is bound by the factual findings of the trial and appellate courts that the
parties freely and voluntarily executed the documents and that there is no showing of coercion
or fraud. As a rule, in an appeal by certiorari under Rule 45, the Court does not pass upon
questions of fact as the factual findings of the trial and appellate courts are binding on the
Court. The Court is not a trier of facts. The Court will not examine the evidence introduced by
the parties below to determine if the trial and appellate courts correctly assessed and
evaluated the evidence on record.[17]
The due and regular execution of an instrument acknowledged before an officer
authorized to administer oaths cannot be overthrown by bare allegations of coercion but only
by clear and convincing proof.[18] A person acknowledging an instrument before an officer
authorized to administer oaths acknowledges that he freely and voluntarily executed the
instrument, giving rise to a prima facie presumption of such fact.
In the instant case, Margarita acknowledged the Agreement before Consul Cortez. The
certificate of acknowledgment signed by Consul Cortez states that Margarita personally
appeared before him and acknowledged before me that SHE executed the same of her own
free will and deed.[19] Thus, there is a prima facie presumption that Margarita freely and
voluntarily executed the Agreement. Margarita has failed to rebut this prima facie presumption
with clear and convincing proof of coercion on the part of Abelardo.
A document acknowledged before a notary public is prima facie evidence of the due
and regular execution of the document. [20] A notarized document has in its favor the
presumption of regularity in its execution, and to contradict the same, there must be evidence
that is clear, convincing and more than merely preponderant.[21]
WHEREFORE, the Decision of the Court of Appeals in CA-G.R. SP No. 58487
dismissing the petition to annul judgment is AFFIRMED.
DIGEST
FRAUD and VOIDABLE MARRIAGE
Summons is a writ by which the defendant is notified of the action brought against him.
Service of such writ is the means by which the court acquires jurisdiction over his person.
Facts:
Abelardo and Margarita were lawfully married. Marital differences, squabbles and
irreconcilable conflicts transpired between the spouses, such that sometime in 1979, they
agreed to separate from bed and board. Margarita then left for the United States with her
children. She filed with the courts of California a petition to divorce her husband, and it was
granted.
Abelardo and Margarita executed an “Agreement of Separation of Properties”, which was duly
granted by the RTC Makati.
Meanwhile, Abelardo commenced the proceeding on the voiding his marriage with Margarita
on account of psychological incapacity. As Margarita was in the US, Abelardo initially moved
that summons be served through the International Express Courier Service. The court a quo
denied the motion. Instead, it ordered that summons be served by publication in a newspaper
of general circulation once a week for three (3) consecutive weeks, at the same time
furnishing respondent a copy of the order, as well as the corresponding summons and a copy
of the petition at the given address in the United States through the Department of Foreign
Affairs, all at the expense of Abelardo. An Officer’s return was duly submitted declaring the
completion of the service of summons. Finally, the marriage was declared void through Article
36 Family Code by the RTC.
Margarita appeared before the Consulate Office in San Francisco to sign the agreement on
separation of property. Abelardo allegedly threatened to cut off all financial and material
support to their children if Margarita did not sign the documents.
9 years later, Margarita contested such declaration of nullity of marriage on account of
extrinsic fraud and questioned the court that it did not acquire jurisdiction over her, hence
such decision is void and ineffectual.
Issue:
WON Margarita was validly served with summons in the case for declaration of nullity of her
marriage with Abelardo? YES
WON there was extrinsic fraud in the preparation and filing by Abelardo of the Petition for
Dissolution of the Conjugal Partnership of Gains and its annex, the Agreement of Separation
of Properties? NO
Held:
As a rule, when the defendant does not reside and is not found in the Philippines, Philippine
courts cannot try any case against him because of the impossibility of acquiring jurisdiction
over his person unless he voluntarily appears in court. But when the case is one of actions in
rem or quasi in rem enumerated in Section 15, Rule 14 of the Rules of Court, Philippine
courts have jurisdiction to hear and decide the case. In such instances, Philippine courts have
jurisdiction over the res, and jurisdiction over the person of the non-resident defendant is not
essential.
Jurisdiction over the person of a non-resident defendant in an action in rem or quasi in rem is
not necessary. The trial and appellate courts made a clear factual finding that there was
proper summons by publication effected through the Department of Foreign Affairs as
directed by the trial court. Thus, the trial court acquired jurisdiction to render the decision
declaring the marriage a nullity.
Under Section 15 of Rule 14, a defendant who is a non-resident and is not found in the
country may be served with summons by extraterritorial service in four instances: (1)when the
action affects the personal status of the plaintiff; (2) when the action relates to, or the subject
of which is property within the Philippines, in which the defendant has or claims a lien or
interest, actual or contingent; (3) when the relief demanded consists, wholly or in part, in
excluding the defendant from any interest in property located in the Philippines; or (4) when
the property of the defendant has been attached within the Philippines.
In these instances, extraterritorial service of summons may be effected under any of three
modes: (1) by personal service out of the country, with leave of court; (2) by publication and
sending a copy of the summons and order of the court by registered mail to the defendant’s
last known address, also with leave of court; or (3) by any other means the judge may
consider sufficient. The trial court’s prescribed mode of extraterritorial service does not fall
under the first or second mode specified in Section 15 of Rule 14, but under the third mode.
On the Issue of Fraud: A meticulous perusal of the Petition and Agreement readily shows that
Margarita signed the same on the proper space after the prayer and on the portion for the
verification of the petition. In the instant case, Margarita acknowledged the Agreement before
Consul Cortez. The certificate of acknowledgment signed by Consul Cortez states that
Margarita personally appeared before him and “acknowledged before me that SHE executed
the same of her own free will and deed.” Thus, there is a prima facie presumption that
Margarita freely and voluntarily executed the Agreement. Margarita has failed to rebut this
prima facie presumption with clear and convincing proof of coercion on the part of Abelardo.
International Shoe v. State of Washington, 326 U.S. 310 (1945)
APPEAL FROM THE SUPREME COURT OF WASHINGTON
Syllabus
Activities within a State of salesmen in the employ of a foreign corporation, exhibiting samples
of merchandise and soliciting orders from prospective buyers to be accepted or rejected by
the corporation at a point outside the State, were systematic and continuous, and resulted in a
large volume of interstate business. A statute of the State requires employers to pay into the
state unemployment compensation fund a specified percentage of the wages paid for the
services of employees within the State.
Held:
1. In view of 26 U.S.C. § 1606(a) , providing that no person shall be relieved from compliance
with a state law requiring payments to an unemployment fund on the ground that he is
engaged in interstate commerce, the fact that the corporation is engaged in interstate
commerce does not relieve it from liability for payments to the state unemployment
compensation fund. P. 326 U. S. 315.
2. The activities in behalf of the corporation render it amenable to suit in courts of the State to
recover payments due to the state unemployment compensation fund. P. 326 U. S. 320.
(a) The activities in question established between the State and the corporation sufficient
contacts or ties to make it reasonable and just, and in conformity to the due process
requirements of the Fourteenth Amendment, for the State to enforce against the corporation
an obligation arising out of such activities. P. 326 U. S. 320.
(b) In such a suit to recover payments due to the unemployment compensation fund, service
of process upon one of the corporation's salesmen within the State, and notice sent by
registered mail to the corporation at its home office, satisfies the requirements of due process.
P. 326 U. S. 320.
Page 326 U. S. 311
3. The tax imposed by the state unemployment compensation statute -- construed by the
state court, in its application to the corporation, as a tax on the privilege of employing
salesmen within the State -- does not violate the due process clause of the Fourteenth
Amendment. P. 326 U. S. 321.
22 Wash.2d 146, 154 P.2d 801, affirmed.
APPEAL from a judgment upholding the constitutionality of a state unemployment
compensation statute as applied to the appellant corporation.
MR. CHIEF JUSTICE STONE delivered the opinion of the Court.
The questions for decision are (1) whether, within the limitations of the due process clause of
the Fourteenth Amendment, appellant, a Delaware corporation, has, by its activities in the
State of Washington, rendered itself amenable to proceedings in the courts of that state to
recover unpaid contributions to the state unemployment compensation fund exacted by state
statutes, Washington Unemployment Compensation Act, Washington Revised Statutes, §
9998-103a through § 9998-123a, 1941 Supp., and (2) whether the state can exact those
contributions consistently with the due process clause of the Fourteenth Amendment.
The statutes in question set up a comprehensive scheme of unemployment compensation,
the costs of which are defrayed by contributions required to be made by employers to a state
unemployment compensation fund.
Page 326 U. S. 312
The contributions are a specified percentage of the wages payable annually by each
employer for his employees' services in the state. The assessment and collection of the
contributions and the fund are administered by appellees. Section 14(c) of the Act
(Wash.Rev.Stat., 1941 Supp., § 9998-114c) authorizes appellee Commissioner to issue an
order and notice of assessment of delinquent contributions upon prescribed personal service
of the notice upon the employer if found within the state, or, if not so found, by mailing the
notice to the employer by registered mail at his last known address. That section also
authorizes the Commissioner to collect the assessment by distraint if it is not paid within ten
days after service of the notice. By §§ 14e and 6b, the order of assessment may be
administratively reviewed by an appeal tribunal within the office of unemployment upon
petition of the employer, and this determination is, by § 6i, made subject to judicial review on
questions of law by the state Superior Court, with further right of appeal in the state Supreme
Court, as in other civil cases.
In this case, notice of assessment for the years in question was personally served upon a
sales solicitor employed by appellant in the State of Washington, and a copy of the notice was
mailed by registered mail to appellant at its address in St. Louis, Missouri. Appellant appeared
specially before the office of unemployment, and moved to set aside the order and notice of
assessment on the ground that the service upon appellant's salesman was not proper service
upon appellant; that appellant was not a corporation of the State of Washington, and was not
doing business within the state; that it had no agent within the state upon whom service could
be made; and that appellant is not an employer, and does not furnish employment within the
meaning of the statute.
The motion was heard on evidence and a stipulation of facts by the appeal tribunal, which
denied the motion
Page 326 U. S. 313
and ruled that appellee Commissioner was entitled to recover the unpaid contributions. That
action was affirmed by the Commissioner; both the Superior Court and the Supreme Court
affirmed. 22 Wash.2d 146, 154 P.2d 801. Appellant in each of these courts assailed the
statute as applied, as a violation of the due process clause of the Fourteenth Amendment,
and as imposing a constitutionally prohibited burden on interstate commerce. The cause
comes here on appeal under § 237(a) of the Judicial Code, 28 U.S.C. § 344(a), appellant
assigning as error that the challenged statutes, as applied, infringe the due process clause of
the Fourteenth Amendment and the commerce clause.
The facts, as found by the appeal tribunal and accepted by the state Superior Court and
Supreme Court, are not in dispute. Appellant is a Delaware corporation, having its principal
place of business in St. Louis, Missouri, and is engaged in the manufacture and sale of shoes
and other footwear. It maintains places of business in several states other than Washington,
at which its manufacturing is carried on and from which its merchandise is distributed
interstate through several sales units or branches located outside the State of Washington.
Appellant has no office in Washington, and makes no contracts either for sale or purchase of
merchandise there. It maintains no stock of merchandise in that state, and makes there no
deliveries of goods in intrastate commerce. During the years from 1937 to 1940, now in
question, appellant employed eleven to thirteen salesmen under direct supervision and
control of sales managers located in St. Louis. These salesmen resided in Washington; their
principal activities were confined to that state, and they were compensated by commissions
based upon the amount of their sales. The commissions for each year totaled more than
$31,000. Appellant supplies its salesmen with a line of samples, each consisting of one shoe
of a pair, which
Page 326 U. S. 314
they display to prospective purchasers. On occasion, they rent permanent sample rooms, for
exhibiting samples, in business buildings, or rent rooms in hotels or business buildings
temporarily for that purpose. The cost of such rentals is reimbursed by appellant.
The authority of the salesmen is limited to exhibiting their samples and soliciting orders from
prospective buyers, at prices and on terms fixed by appellant. The salesmen transmit the
orders to appellant's office in St. Louis for acceptance or rejection, and, when accepted, the
merchandise for filling the orders is shipped f.o.b. from points outside Washington to the
purchasers within the state. All the merchandise shipped into Washington is invoiced at the
place of shipment, from which collections are made. No salesman has authority to enter into
contracts or to make collections.
The Supreme Court of Washington was of opinion that the regular and systematic solicitation
of orders in the state by appellant's salesmen, resulting in a continuous flow of appellant's
product into the state, was sufficient to constitute doing business in the state so as to make
appellant amenable to suit in its courts. But it was also of opinion that there were sufficient
additional activities shown to bring the case within the rule, frequently stated, that solicitation
within a state by the agents of a foreign corporation plus some additional activities there are
sufficient to render the corporation amenable to suit brought in the courts of the state to
enforce an obligation arising out of its activities there. International Harvester Co. v.
Kentucky, 234 U. S. 579, 234 U. S. 587; People's Tobacco Co. v. American Tobacco Co., 246
U. S. 79, 246 U. S. 87; Frene v. Louisville Cement Co., 77 U.S.App.D.C. 129, 134 F.2d 511,
516. The court found such additional activities in the salesmen's display of samples
sometimes in permanent display rooms, and the salesmen's residence within the state,
continued over a period of years, all resulting in a
Page 326 U. S. 315
substantial volume of merchandise regularly shipped by appellant to purchasers within the
state. The court also held that the statute, as applied, did not invade the constitutional power
of Congress to regulate interstate commerce, and did not impose a prohibited burden on such
commerce.
Appellant's argument, renewed here, that the statute imposes an unconstitutional burden on
interstate commerce need not detain us. For 53 Stat. 1391, 26 U.S.C. § 1606(a) provides that
"No person required under a State law to make payments to an unemployment fund shall be
relieved from compliance therewith on the ground that he is engaged in interstate or foreign
commerce, or that the State law does not distinguish between employees engaged in
interstate or foreign commerce and those engaged in intrastate commerce."
It is no longer debatable that Congress, in the exercise of the commerce power, may
authorize the states, in specified ways, to regulate interstate commerce or impose burdens
upon it. Kentucky Whip & Collar Co. v. Illinois Central R. Co., 299 U. S. 334; Perkins v.
Pennsylvania, 314 U.S. 586; Standard Dredging Corp. v. Murphy, 319 U. S. 306, 319 U. S.
308; Hooven & Allison Co. v. Evatt, 324 U. S. 652, 324 U. S. 679; Southern Pacific Co. v.
Arizona, 325 U. S. 761, 325 U. S. 769.
Appellant also insists that its activities within the state were not sufficient to manifest its
"presence" there, and that, in its absence, the state courts were without jurisdiction, that,
consequently, it was a denial of due process for the state to subject appellant to suit. It refers
to those cases in which it was said that the mere solicitation of orders for the purchase of
goods within a state, to be accepted without the state and filled by shipment of the purchased
goods interstate, does not render the corporation seller amenable to suit within the state. See
Green v. Chicago, B. & Q. R. Co., 205 U. S. 530, 205 U. S. 533; International Harvester Co.
v. Kentucky, supra, 234 U. S. 586-587; Philadelphia
Page 326 U. S. 316
& Reading R. Co. v. McKibbin, 243 U. S. 264, 243 U. S. 268; People's Tobacco Co. v.
American Tobacco Co., supra, 246 U. S. 87. And appellant further argues that, since it was
not present within the state, it is a denial of due process to subject it to taxation or other
money exaction. It thus denies the power of the state to lay the tax or to subject appellant to a
suit for its collection.
Historically, the jurisdiction of courts to render judgment in personam is grounded on their de
facto power over the defendant's person. Hence, his presence within the territorial jurisdiction
of a court was prerequisite to its rendition of a judgment personally binding him. Pennoyer v.
Neff, 95 U. S. 714, 95 U. S. 733. But now that the capias ad respondendum has given way to
personal service of summons or other form of notice, due process requires only that, in order
to subject a defendant to a judgment in personam, if he be not present within the territory of
the forum, he have certain minimum contacts with it such that the maintenance of the suit
does not offend "traditional notions of fair play and substantial justice." Milliken v. Meyer, 311
U. S. 457, 311 U. S. 463. See Holmes, J., in McDonald v. Mabee, 243 U. S. 90, 243 U. S.
91.Compare Hoopeston Canning Co. v. Cullen, 318 U. S. 313, 318 U. S. 316, 318 U. S.
319. See Blackmer v. United States, 284 U. S. 421; Hess v. Pawloski, 274 U. S. 352; Young
v. Masci, 289 U. S. 253. ,
Since the corporate personality is a fiction, although a fiction intended to be acted upon as
though it were a fact, Klein v. Board of Supervisors, 282 U. S. 19, 282 U. S. 24, it is clear that,
unlike an individual, its "presence" without, as well as within, the state of its origin can be
manifested only by activities carried on in its behalf by those who are authorized to act for it.
To say that the corporation is so far "present" there as to satisfy due process requirements,
for purposes of taxation or the maintenance of suits against it in the courts of the state, is to
beg the question to be decided. For the terms "present" or "presence" are
v. Reynolds, 255 U.S. 565; Tauza v. Susquehanna Coal Co., 220 N.Y. 259, 115 N.E. 915; cf.
St. Louis S.W. R. Co. v. Alexander, supra.
Finally, although the commission of some single or occasional acts of the corporate agent in a
state sufficient to impose an obligation or liability on the corporation has not been thought to
confer upon the state authority to enforce it, Rosenberg Bros. & Co. v. Curtis Brown Co., 260
U. S. 516, other such acts, because of their nature and quality and the circumstances of their
commission, may be deemed sufficient to render the corporation liable to suit. Cf. Kane v.
New Jersey, 242 U. S. 160; Hess v. Pawloski, supra; Young v. Masci, supra. True, some of
the decisions holding the corporation amenable to suit have been supported by resort to the
legal fiction that it has given its consent to service and suit, consent being implied from its
presence in the state through the acts of its authorized agents. Lafayette Insurance Co. v.
French, 18 How. 404, 59 U. S. 407; St. Clair v. Cox, supra, 106 U. S. 356; Commercial
Mutual Co. v. Davis, supra, 213 U. S. 254; Washington v. Superior Court, 289 U. S. 361, 289
U. S. 364-365. But, more realistically, it may be said that those authorized acts were of such a
nature as to justify the fiction. Smolik v. Philadelphia &
Page 326 U. S. 319

Page 326 U. S. 317

Reading Co., 222 F. 148, 151. Henderson, The Position of Foreign Corporations in American
Constitutional Law, 94-95.
used merely to symbolize those activities of the corporation's agent within the state which
courts will deem to be sufficient to satisfy the demands of due process. L. Hand, J.,
It is evident that the criteria by which we mark the boundary line between those activities
in Hutchinson v. Chase & Gilbert, 45 F.2d 139, 141. Those demands may be met by such
which justify the subjection of a corporation to suit and those which do not cannot be simply
contacts of the corporation with the state of the forum as make it reasonable, in the context of
mechanical or quantitative. The test is not merely, as has sometimes been suggested,
our federal system of government, to require the corporation to defend the particular suit
whether the activity, which the corporation has seen fit to procure through its agents in
which is brought there. An "estimate of the inconveniences" which would result to the
another state, is a little more or a little less. St. Louis S.W. R. Co. v. Alexander, supra, 227 U.
corporation from a trial away from its "home" or principal place of business is relevant in this
S. 228; International Harvester Co. v. Kentucky, supra, 234 U. S. 587. Whether due process
connection. Hutchinson v. Chase & Gilbert, supra, 141.
is satisfied must depend, rather, upon the quality and nature of the activity in relation to the
fair and orderly administration of the laws which it was the purpose of the due process clause
"Presence" in the state in this sense has never been doubted when the activities of the to insure. That clause does not contemplate that a state may make binding a judgment in
corporation there have not only been continuous and systematic, but also give rise to the personam against an individual or corporate defendant with which the state has no contacts,
liabilities sued on, even though no consent to be sued or authorization to an agent to accept ties, or relations. Cf. Pennoyer v. Neff, supra; Minnesota Commercial Assn. v. Benn, 261 U.
service of process has been given. St. Clair v. Cox, 106 U. S. 350, 106 U. S. S. 140.
355; Connecticut Mutual Co. v. Spratley, 172 U. S. 602, 172 U. S. 610-611; Pennsylvania
Lumbermen's Ins. Co. v. Meyer, 197 U. S. 407, 197 U. S. 414-415; Commercial Mutual Co. v.
But, to the extent that a corporation exercises the privilege of conducting activities within a
Davis, 213 U. S. 245, 213 U. S. 255-256; International Harvester Co. v. Kentucky, supra; cf.
state, it enjoys the benefits and protection of the laws of that state. The exercise of that
St. Louis S.W. R. Co. v. Alexander, 227 U. S. 218. Conversely, it has been generally
privilege may give rise to obligations, and, so far as those obligations arise out of or are
recognized that the casual presence of the corporate agent, or even his conduct of single or
connected with the activities within the state, a procedure which requires the corporation to
isolated items of activities in a state in the corporation's behalf, are not enough to subject it to
respond to a suit brought to enforce them can, in most instances, hardly be said to be
suit on causes of action unconnected with the activities there. St. Clair v. Cox, supra, 106 U.
undue. Compare International Harvester Co. v. Kentucky, supra, with Green v. Chicago, B. &
S. 359, 106 U. S. 360; Old Wayne Life Assn. v. McDonough, 204 U. S. 8, 204 U. S. 21; Frene
Q. R. Co., supra, and People's Tobacco Co. v. American Tobacco Co., supra. Compare
v. Louisville Cement Co., supra, 515, and cases cited. To require the corporation in such
Connecticut Mutual Co. v. Spratley, supra, 172 U. S. 619, 172 U. S. 620, and Commercial
circumstances to defend the suit away from its home or other jurisdiction where it carries on
Mutual Co. v. Davis, supra, with Old Wayne Life Assn. v. McDonough, supra. See 29
more substantial activities has been thought to lay too great and unreasonable a burden on
Columbia Law Review, 187-195.
the corporation to comport with due process.

Page 326 U. S. 320

Page 326 U. S. 318

Applying these standards, the activities carried on in behalf of appellant in the State of
While it has been held, in cases on which appellant relies, that continuous activity of some
Washington were neither irregular nor casual. They were systematic and continuous
sorts within a state is not enough to support the demand that the corporation be amenable to
throughout the years in question. They resulted in a large volume of interstate business, in the
suits unrelated to that activity, Old Wayne Life Assn. v. McDonough, supra; Green v. Chicago,
course of which appellant received the benefits and protection of the laws of the state,
B. & Q. R. Co., supra; Simon v. Southern R. Co., 236 U. S. 115; People's Tobacco Co. v.
including the right to resort to the courts for the enforcement of its rights. The obligation which
American Tobacco Co., supra; cf. Davis v. Farmers Co-operative Co., 262 U. S. 312, 262 U.
is here sued upon arose out of those very activities. It is evident that these operations
S. 317, there have been instances in which the continuous corporate operations within a state
establish sufficient contacts or ties with the state of the forum to make it reasonable and just,
were thought so substantial and of such a nature as to justify suit against it on causes of
according to our traditional conception of fair play and substantial justice, to permit the state to
action arising from dealings entirely distinct from those activities. See Missouri, K. & T. R. Co.
enforce the obligations which appellant has incurred there. Hence, we cannot say that the
maintenance of the present suit in the State of Washington involves an unreasonable or
undue procedure.
We are likewise unable to conclude that the service of the process within the state upon an
agent whose activities establish appellant's "presence" there was not sufficient notice of the
suit, or that the suit was so unrelated to those activities as to make the agent an inappropriate
vehicle for communicating the notice. It is enough that appellant has established such
contacts with the state that the particular form of substituted service adopted there gives
reasonable assurance that the notice will be actual. Connecticut Mutual Co. v. Spratley,
supra, 172 U. S. 618, 172 U. S. 619; Board of Trade v. Hammond Elevator Co., 198 U. S.
424, 198 U. S. 437-438; Commercial Mutual Co. v. Davis, supra, 213 U. S. 254-255. Cf.
Riverside Mills v. Menefee, 237 U. S. 189, 237 U. S. 194, 237 U. S. 195; See Knowles v.
Gaslight & Coke Co., 19 Wall. 58, 86 U. S. 61; McDonald v. Mabee, supra; Milliken v. Meyer,
supra. Nor can we say that the mailing of the notice of suit to appellant by registered mail at
its home office was not reasonably calculated to apprise appellant of the suit. Compare Hess
v. Pawloski, supra, with McDonald v. Mabee, supra,
Page 326 U. S. 321
243 U. S. 92, and Wuchter v. Pizzutti, 276 U. S. 13, 276 U. S. 19, 276 U. S. 24; cf. Becquet v.
MacCarthy, 2 B. & Ad. 951; Maubourquet v. Wyse, 1 Ir.Rep.C.L. 471. See Washington v.
Superior Court, supra, 289 U. S. 365.
Only a word need be said of appellant's liability for the demanded contributions to the state
unemployment fund. The Supreme Court of Washington, construing and applying the statute,
has held that it imposes a tax on the privilege of employing appellant's salesmen within the
state measured by a percentage of the wages, here, the commissions payable to the
salesmen. This construction we accept for purposes of determining the constitutional validity
of the statute. The right to employ labor has been deemed an appropriate subject of taxation
in this country and England, both before and since the adoption of the Constitution. Steward
Machine Co. v. Davis, 301 U. S. 548, 301 U. S. 579, et seq. And such a tax imposed upon the
employer for unemployment benefits is within the constitutional power of the
states. Carmichael v. Southern Coal Co., 301 U. S. 495, 301 U. S. 508, et seq.
Appellant having rendered itself amenable to suit upon obligations arising out of the activities
of its salesmen in Washington, the state may maintain the present suit in personam to collect
the tax laid upon the exercise of the privilege of employing appellant's salesmen within the
state. For Washington has made one of those activities which, taken together, establish
appellant's "presence" there for purposes of suit the taxable event by which the state brings
appellant within the reach of its taxing power. The state thus has constitutional power to lay
the tax and to subject appellant to a suit to recover it. The activities which establish its
"presence" subject it alike to taxation by the state and to suit to recover the tax. Equitable Life
Society v. Pennsylvania, 238 U. S. 143, 238 U. S. 146; cf. International Harvester Co. v.
Department of Taxation, 322 U. S. 435, 322 U. S. 442, et seq.; Hoopeston Canning Co. v.
Cullen,
Page 326 U. S. 322
supra, 318 U. S. 316-319; see General Trading Co. v. Tax Comm'n, 322 U. S. 335.
Affirmed.
MR. JUSTICE JACKSON took no part in the consideration or decision of this case.
MR. JUSTICE BLACK delivered the following opinion.
Congress, pursuant to its constitutional power to regulate commerce, has expressly provided
that a State shall not be prohibited from levying the kind of unemployment compensation tax
here challenged. 26 U.S.C. 1600. We have twice decided that this Congressional consent is
an adequate answer to a claim that imposition of the tax violates the Commerce
Clause. Perkins v. Pennsylvania, 314 U.S. 586, affirming 342 Pa. 529; Standard Dredging
Corp. v. Murphy, 319 U. S. 306, 319 U. S. 308. Two determinations by this Court of an issue
so palpably without merit are sufficient. Consequently, that part of this appeal which again
seeks to raise the question seems so patently frivolous as to make the case a fit candidate for
dismissal. Fay v. Crozer, 217 U. S. 455. Nor is the further ground advanced on this appeal,
that the State of Washington has denied appellant due process of law, any less devoid of
substance. It is my view, therefore, that we should dismiss the appeal as unsubstantial,
[Footnote 1] Seaboard Air Line R. Co. v. Watson, 287 U. S. 86, 287 U. S. 90, 287 U. S. 92,
and decline the invitation to formulate broad rules as to the meaning of due process, which
here would amount to deciding a constitutional question "in advance of the necessity for its
decision." Federation of Labor v. McAdory, 325 U. S. 450, 325 U. S. 461.
Page 326 U. S. 323
Certainly appellant cannot, in the light of our past decisions, meritoriously claim that notice by
registered mail and by personal service on its sales solicitors in Washington did not meet the
requirements of procedural due process. And the due process clause is not brought in issue
any more by appellant's further conceptualistic contention that Washington could not levy a
tax or bring suit against the corporation because it did not honor that State with its mystical
"presence." For it is unthinkable that the vague due process clause was ever intended to
prohibit a State from regulating or taxing a business carried on within its boundaries simply
because this is done by agents of a corporation organized and having its headquarters
elsewhere. To read this into the due process clause would, in fact, result in depriving a State's
citizens of due process by taking from the State the power to protect them in their business
dealings within its boundaries with representatives of a foreign corporation. Nothing could be
more irrational, or more designed to defeat the function of our federative system of
government. Certainly a State, at the very least, has power to tax and sue those dealing with
its citizens within its boundaries, as we have held before. Hoopeston Canning Co. v.
Cullen, 318 U. S. 313. Were the Court to follow this principle, it would provide a workable
standard for cases where, as here, no other questions are involved. The Court has not
chosen to do so, but instead has engaged in an unnecessary discussion, in the course of
which it has announced vague Constitutional criteria applied for the first time to the issue
before us. It has thus introduced uncertain elements confusing the simple pattern and tending
to curtail the exercise of State powers to an extent not justified by the Constitution.
The criteria adopted, insofar as they can be identified, read as follows: Due Process does
permit State courts to "enforce the obligations which appellant has incurred" if
Page 326 U. S. 324
it be found "reasonable and just according to our traditional conception of fair play and
substantial justice." And this, in turn, means that we will "permit" the State to act if, upon
"an 'estimate of the inconveniences' which would result to the corporation from a trial away
from its 'home' or principal place of business,"
we conclude that it is "reasonable" to subject it to suit in a State where it is doing business.
It is true that this Court did use the terms "fair play" and "substantial justice" in explaining the
philosophy underlying the holding that it could not be "due process of law" to render a
personal judgment against a defendant without notice and an opportunity to be heard. Milliken
v. Meyer, 311 U. S. 457. In McDonald v. Mabee, 243 U. S. 90, 243 U. S. 91, cited in
the Milliken, case, Mr. Justice Holmes, speaking for the Court, warned against judicial
curtailment of this opportunity to be heard, and referred to such a curtailment as a denial of
"fair play," which even the common law would have deemed "contrary to natural justice." And
previous cases had indicated that the ancient rule against judgments without notice had
stemmed from "natural justice" concepts. These cases, while giving additional reasons why
notice under particular circumstances is inadequate, did not mean thereby that all legislative
enactments which this Court might deem to be contrary to natural justice ought to be held
invalid under the due process clause. None of the cases purport to support or could support a
holding that a State can tax and sue corporations only if its action comports with this Court's
notions of "natural justice." I should have thought the Tenth Amendment settled that.
I believe that the Federal Constitution leaves to each State, without any "ifs" or "buts," a
power to tax and to open the doors of its courts for its citizens to sue corporations whose
agents do business in those States. Believing that the Constitution gave the States that
power, I think it a judicial deprivation to condition its exercise upon this
Page 326 U. S. 325
Court's notion of "fair play," however appealing that term may be. Nor can I stretch the
meaning of due process so far as to authorize this Court to deprive a State of the right to
afford judicial protection to its citizens on the ground that it would be more "convenient" for the
corporation to be sued somewhere else.
There is a strong emotional appeal in the words "fair play," "justice," and "reasonableness."
But they were not chosen by those who wrote the original Constitution or the Fourteenth
Amendment as a measuring rod for this Court to use in invalidating State or Federal laws
passed by elected legislative representatives. No one, not even those who most feared a
democratic government, ever formally proposed that courts should be given power to
invalidate legislation under any such elastic standards. Express prohibitions against certain
types of legislation are found in the Constitution, and, under the long-settled practice, courts
invalidate laws found to conflict with them. This requires interpretation, and interpretation, it is
true, may result in extension of the Constitution's purpose. But that is no reason for reading
the due process clause so as to restrict a State's power to tax and sue those whose activities
affect persons and businesses within the State, provided proper service can be had.
Superimposing the natural justice concept on the Constitution's specific prohibitions could
operate as a drastic abridgment of democratic safeguards they embody, such as freedom of
speech, press and religion, [Footnote 2] and the right to counsel. This
Page 326 U. S. 326
has already happened. Betts v. Brady, 316 U. S. 455. Compare Feldman v. United
States, 322 U. S. 487, 322 U. S. 494-503. For application of this natural law concept, whether
under the terms "reasonableness," "justice," or "fair play," makes judges the supreme arbiters
of the country's laws and practices. Polk Co. v. Glover, 305 U. S. 5, 305 U. S. 17-18; Federal
Power Commission v. Natural Gas Pipeline Co., 315 U. S. 575, 315 U. S. 600, n. 4. This
result, I believe, alters the form of government our Constitution provides. I cannot agree.
True, the State's power is here upheld. But the rule announced means that tomorrow's
judgment may strike down a State or Federal enactment on the ground that it does not
conform to this Court's idea of natural justice. I therefore find myself moved by the same fears
that caused Mr. Justice Holmes to say in 1930:
"I have not yet adequately expressed the more than anxiety that I feel at the ever-increasing
scope given to the Fourteenth Amendment in cutting down what I believe to be the
constitutional rights of the States. As the decisions now stand, I see hardly any limit but the
sky to the invalidating of those rights if they happen to strike a majority of this Court as for any
reason undesirable."
Baldwin v. Missouri, 281 U. S. 586, 281 U. S. 595.
[Footnote 1]
This Court has, on several occasions, pointed out the undesirable consequences of a failure
to dismiss frivolous appeals.Salinger v. United States, 272 U. S. 542, 272 U. S. 544; United
Surety Co. v. American Fruit Product Co., 238 U. S. 140; De Bearn v. Safe Deposit & Trust
Co., 233 U. S. 24, 233 U. S. 33-34.
[Footnote 2]
These First Amendment liberties -- freedom of speech, press and religion -- provide a graphic
illustration of the potential restrictive capacity of a rule under which they are protected at a
particular time only because the Court, as then constituted, believes them to be a requirement
of fundamental justice. Consequently, under the same rule, another Court, with a different
belief as to fundamental justice, could, at least as against State action, completely or partially
withdraw Constitutional protection from these basic freedoms, just as though the First
Amendment had never been written.
DIGEST
  International Shoe was a Delaware based corporation with a main office in St.
Louis, MO. It had no offices, made no contracts for sale, and did not keep any
warehouses of goods in WA.
 International Shoe did have several salesmen employees who lived and sold
merchandise for the company in WA.
 The state of WA sued Shoe in WA court for unpaid contributions to the state's
unemployment fund.
 Notice was served to a salesman for the company in WA and via registered mail to
the corporation's headquarters in MO.
Procedural History:
  Lower court found for WA.
 Shoe appealed and lost.
 Shoe appealed to SCOTUS and lost.
Issues:
 Can a state impose jurisdiction on a corporation not in the borders of the state?
 Can a corporation's activities in a state make it subject to the jurisdiction of that
state?
Holding/Rule:
  If a party has "minimum contacts" in a state, that corporation is subject to the
jurisdiction of that state as long as it does not offend "traditional notions of fair play
and substantial justice".
o Test for "minimum contacts" jurisdiction:
 Does the defendant come within the terms of the applicable
long-arm statute?
 Does the defendant have "minimum contacts" with the forum
state such that the assertion of jurisdiction would not violate the
Due Process Clause?
 Has the defendant "purposely availed" itself of the
privilege of conducting activities in the forum state,
 thereby invoking the benefits and protections of the
state's laws?
 Does the lawsuit arise out of or related to the
defendant's purposeful contacts with the forum or, if
it does not, are the defendant's forum contacts so
extensive that no such relationship is necessary?
 Would the exercise of jurisdiction be unfair and unreasonable,
taking into account the interests of the defendant, the forum
state, the plaintiff, and other states that may have an interest in
the matter?
Reasoning:
  The corporation enjoyed the protection and benefits from its activities in a state;
thus, it must be subject to the jurisdiction of that state.
 "To the extent that a corporation exercises the privilege of conducting activities
within a state, it enjoys the benefits and protection of the laws of that state. The
exercise of that privilege may give rise to obligations; and, so far as those
obligations arise out of or are connected with the activities within the state, a
procedure which requires the corporation to respond to a suit brought to enforce
them can, in most instances, hardly be said to be undue. "
Dissent:
  Black disagreed with the vagueness of the "fair play" clause.
Notes:
 Minimum contacts is not a quantitative measure, but qualitative in nature.
 Contact quality can be measured in terms of its relation to the subject of the lawsuit.
 Matrix in minimum contacts
o Continuous and related - jurisdiction
o Noncontinuous but related - tough jurisdiction
o Continuous but unrelated - tough jurisdiction
o Noncontinuous and unrelated - no jurisdiction
Yes, due process requires only that in order to subject a defendant to a judgment in
personam, if he is not present within the territory of the forum, he have certain minimum
contacts with it such that the maintenance of the suit does not offend “traditional notions of fair
play and substantial justice. The conduct of appellant corporation's salesmen in soliciting
business in the forum state was sufficient minimum contact with the state to subject appellant
to suit for a liability to the state unemployment compensation fund that arose out of that
conduct.
Reasoning: 
To the extent that a corporation exercises the privilege of conducting activities within a state, it
enjoys the benefits and protection of the laws of that state. Applying these standards, the
activities carried on in behalf of appellant in the State of Washington were neither irregular nor
casual. They were “systematic and continuous” throughout the years in question. They
resulted in a large volume of interstate business, in the course of which appellant received the
benefits and protection of the laws of the state, including the right to resort to the courts for
the enforcement of its rights. The obligation which is here sued upon arose out of those very
activities. It is evident that these operations establish sufficient contacts or ties with the state
of the forum to make it reasonable and just, according to our traditional conception of fair play
and substantial justice, to permit the state to enforce the obligations which appellant has
incurred there.
Evaluation of Decision:
The ruling in Shoe makes sense, but I tend to agree more strongly with Justice Black’s
dissent. Essentially the manner in which the majority has sided, as Justice Black points out,
takes away certain rights of a state’s citizens. When the contacts are deemed to be too
minimum to acquire in personam jurisdiction over a corporation, a state loses its ability to
protect its citizens from issues arising out of their contacts with the corporation. I further agree
with Justice Black, and equally agitated by the majority’s notion of depriving a State of the
right to protect its citizens simply because it would be more “convenient” for the corporation to
litigate elsewhere.

DIGEST 2

Facts: 
International Shoe Co. (P) was a Delaware corporation that employed 11 to 13 salespersons
that worked and lived in Washington (D) state; however, the salesmen were under the
supervision of managers located in Missouri. The salesmen were not allowed to enter
contracts or make collections for P. Further, P did not have an office in D’s state, nor did P
contract in D’s state. Allegedly, P did not pay unemployment insurance over a three year
period to D. A notice of assessment was served on one of P’s salespersons while in
Washington. In accordance with a Washington state statute, the unemployment commissioner
of Washington (D), then mailed a notice of assessment to collect unpaid unemployment
compensation to International Shoe Co. (P), a non-resident corporation.
Issue: 
For a state to subject International Shoe Co., a non-resident, to in personam jurisdiction, will
due process be satisfied if only minimum contact with the state seeking jurisdiction have been
made?
Holding: