The Citizens' Surety & Insurance Company issued surety bonds guaranteed by Santiago and Josefina Dacanay. When the bonds were not paid, the Company sued to recover losses. The trial court dismissed the case, finding it did not have jurisdiction over the defendants because summons was done by publication, not personal service. The Supreme Court affirmed, stating that personal jurisdiction requires personal service of summons. It set aside dismissal and held the case pending to allow the Company to locate the defendants or their property to effect valid service and stop prescription of the debt.
The Citizens' Surety & Insurance Company issued surety bonds guaranteed by Santiago and Josefina Dacanay. When the bonds were not paid, the Company sued to recover losses. The trial court dismissed the case, finding it did not have jurisdiction over the defendants because summons was done by publication, not personal service. The Supreme Court affirmed, stating that personal jurisdiction requires personal service of summons. It set aside dismissal and held the case pending to allow the Company to locate the defendants or their property to effect valid service and stop prescription of the debt.
The Citizens' Surety & Insurance Company issued surety bonds guaranteed by Santiago and Josefina Dacanay. When the bonds were not paid, the Company sued to recover losses. The trial court dismissed the case, finding it did not have jurisdiction over the defendants because summons was done by publication, not personal service. The Supreme Court affirmed, stating that personal jurisdiction requires personal service of summons. It set aside dismissal and held the case pending to allow the Company to locate the defendants or their property to effect valid service and stop prescription of the debt.
The Citizens' Surety & Insurance Company issued surety bonds guaranteed by Santiago and Josefina Dacanay. When the bonds were not paid, the Company sued to recover losses. The trial court dismissed the case, finding it did not have jurisdiction over the defendants because summons was done by publication, not personal service. The Supreme Court affirmed, stating that personal jurisdiction requires personal service of summons. It set aside dismissal and held the case pending to allow the Company to locate the defendants or their property to effect valid service and stop prescription of the debt.
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CITIZENS’ SURETY &INSURANCE COMPANY,INC. vs. HON.JUDGE A.
MELENCIO- HERRERA, SANTIAGO
DACANAY, and JOSEFINA DACANAY No. L-32170. March 31, 1971 Nature: PETITION to review an order of the Court of First Instance Ponente: REYES, J.B.L., J. Facts: Defendant Santiago requested the Surety Company to issue Surety Bonds Nos. 4942 (in favor of Gregorio Fajardo to guarantee payment of a P5K promissory note) and 4944 (in favor of Manufacturers Bank & Trust Co., to guarantee payment of another promissory note in like amount). In consideration of said bonds, Santiago and Josefina executed Indemnity Agreements, binding themselves jointly and severally to indemnify plaintiff for any losses, with interest at 12% per annum. Also, as additional security, the Dacanays mortgaged to plaintiff a parcel of land in Baguio City. The promissory notes were not paid. Thus, plaintiff Surety was compelled to pay it. The Dacanays failed to pay the Surety. The Surety then caused an extrajudicial foreclosure of the mortgage to pay its claim. There was a balance of and they are seeking to recover from defendants Dacanay, plus 10% thereof as attorneys’ fees, and the costs. Petitioner then filed a case. Respondent Judge then had the summons made by publication in the newspaper Philippines Herald. Defendants did not appear within the period of 60 days from last publication, as required by the summons. Plaintiff then asked that defendants be declared in default; but instead, the Judge asked it to show cause why the action should not be dismissed, the suit being in personam and defendants not having appeared. Respondent Judge dismissed the case, despite plaintiff’s argument that the summons by publication was sufficient and valid. Issue: Whether the court acquire jurisdiction over the case Held: NO. Ratio: We agree with respondent Judge that the action of plaintiff petitioner, being in personam, the Court could not validly acquire jurisdiction on a non-appearing defendant, absent a personal service of summons within the forum. We have explicitly so ruled in Pantaleon vs. Asunción, 105 Phil. 765, pointing out without such personal service, any judgment on a non- appearing defendant would be violative of due process. The proper recourse for a creditor in the same situation as petitioner is to locate properties, real or personal, of the resident defendant debtor with unknown address and cause them to be attached under Rule 57, section 1(f), in which case, the attachment converts the action into a proceeding in rem or quasi in rem and the summons by publication may then accordingly be deemed valid and effective. But because debtors who abscond and conceal themselves are also quite adept at concealing their properties, the dismissal of the case below by respondent Judge should be set aside and the case held pending in the court’s archives, until petitioner as plaintiff succeeds in determining the whereabouts of the defendants’ person or properties and causes valid summons to be served personally or by publication as the case may be. In this manner, the tolling of the period of prescription for as long as the debtor remains in hiding would properly be a matter of court record, and he can not emerge after a sufficient lapse of time from the dismissal of the case to profit from his own misdeed and claim prescription of his just debt.