BOSTON EQUITY RESOURCES, INC. vs. COURT OF APPEALS & LOLITA G.

TOLEDO

G.R. No. 173946. June 19, 2013

FACTS:

In 1997, petitioner filed a COMPLAINT FOR SUM OF MONEY with a prayer for the issuance of a
writ of preliminary attachment against the spouses Manuel and Lolita Toledo.

Respondent filed an Answer and later a Motion for Leave to Admit Amended Answer alleging that
her husband and co-defendant, Manuel Toledo (Manuel), is already dead. Manuel was substituted
by his children.

Pre-trial and trial ensued. Plaintiff presented its evidence and its exhibits were thereafter admitted.

Defendant was given a period of 15 days within which to file a DEMURRER TO EVIDENCE. 

Defendant instead filed a MOTION TO DISMISS the complaint alleging, among others, that, the trial
court did not acquire jurisdiction over the person of Manuel.

The trial court denied the motion to dismiss for having been filed out of time.

Respondent’s MR was likewise denied on the ground that "defendants’ attack on the jurisdiction of
this Court is now barred by estoppel by laches" since respondent failed to raise the issue despite
several chances to do so.

Aggrieved, respondent filed a petition for certiorari with the Court of Appeals alleging that the trial
court seriously erred and gravely abused its discretion in denying her motion to dismiss despite
discovery, during the trial of the case, of evidence that would constitute a ground for dismissal of the
case.

ISSUE:

Was the question of the lack of jurisdiction over the person of Manuel waived?

HELD: YES.

On whether or not respondent is estopped from

questioning the jurisdiction of the trial court

At the outset, it must be here stated that, as the succeeding discussions will demonstrate,
jurisdiction over the person of Manuel should not be an issue in this case. A protracted discourse on
jurisdiction is, nevertheless, demanded by the fact that jurisdiction has been raised as an issue from
the lower court, to the Court of Appeals and, finally, before this Court. For the sake of clarity, and in
order to finally settle the controversy and fully dispose of all the issues in this case, it was deemed
imperative to resolve the issue of jurisdiction.

1. Aspects of Jurisdiction

Petitioner calls attention to the fact that respondent’s motion to dismiss questioning the trial court’s
jurisdiction was filed more than six years after her amended answer was filed. According to
petitioner, respondent had several opportunities, at various stages of the proceedings, to assail the
trial court’s jurisdiction but never did so for six straight years. Citing the doctrine laid down in the
case of Tijam, et al. v. Sibonghanoy, et al.30 petitioner claimed that respondent’s failure to raise the
question of jurisdiction at an earlier stage bars her from later questioning it, especially since she
actively participated in the proceedings conducted by the trial court.

Petitioner’s argument is misplaced, in that, it failed to consider that the concept of jurisdiction has
several aspects, namely: (1) jurisdiction over the subject matter; (2) jurisdiction over the parties; (3)
jurisdiction over the issues of the case; and (4) in cases involving property, jurisdiction over the res
or the thing which is the subject of the litigation.31
The aspect of jurisdiction which may be barred from being assailed as a result of estoppel by laches
is jurisdiction over the subject matter. Thus, in Tijam, the case relied upon by petitioner, the issue
involved was the authority of the then Court of First Instance to hear a case for the collection of a
sum of money in the amount of ₱1,908.00 which amount was, at that time, within the exclusive
original jurisdiction of the municipal courts.

In subsequent cases citing the ruling of the Court in Tijam, what was likewise at issue was the
jurisdiction of the trial court over the subject matter of the case. Accordingly, in Spouses Gonzaga v.
Court of Appeals,32 the issue for consideration was the authority of the regional trial court to hear and
decide an action for reformation of contract and damages involving a subdivision lot, it being argued
therein that jurisdiction is vested in the Housing and Land Use Regulatory Board pursuant to PD 957
(The Subdivision and Condominium Buyers Protective Decree). In Lee v. Presiding Judge, MTC,
Legaspi City,33 petitioners argued that the respondent municipal trial court had no jurisdiction over
the complaint for ejectment because the issue of ownership was raised in the pleadings. Finally, in
People v. Casuga,34 accused-appellant claimed that the crime of grave slander, of which she was
charged, falls within the concurrent jurisdiction of municipal courts or city courts and the then courts
of first instance, and that the judgment of the court of first instance, to which she had appealed the
municipal court's conviction, should be deemed null and void for want of jurisdiction as her appeal
should have been filed with the Court of Appeals or the Supreme Court.

In all of these cases, the Supreme Court barred the attack on the jurisdiction of the respective courts
concerned over the subject matter of the case based on estoppel by laches, declaring that parties
cannot be allowed to belatedly adopt an inconsistent posture by attacking the jurisdiction of a court
to which they submitted their cause voluntarily.35

Here, what respondent was questioning in her motion to dismiss before the trial court was that
court’s jurisdiction over the person of defendant Manuel. Thus, the principle of estoppel by laches
finds no application in this case. Instead, the principles relating to jurisdiction over the person of the
parties are pertinent herein.

The Rules of Court provide:

RULE 9
EFFECT OF FAILURE TO PLEAD

Section 1. Defenses and objections not pleaded. – Defenses and objections not pleaded either in a
motion to dismiss or in the answer are deemed waived. However, when it appears from the
pleadings or the evidence on record that the court has no jurisdiction over the subject matter, that
there is another action pending between the same parties for the same cause, or that the action is
barred by a prior judgment or by statute of limitations, the court shall dismiss the claim.

RULE 15
MOTIONS

Sec. 8. Omnibus motion. – Subject to the provisions of Section 1 of Rule 9, a motion attacking a
pleading, order, judgment, or proceeding shall include all objections then available, and all
objections not so included shall be deemed waived.

Based on the foregoing provisions, the "objection on jurisdictional grounds which is not waived even
if not alleged in a motion to dismiss or the answer is lack of jurisdiction over the subject matter. x x x
Lack of jurisdiction over the subject matter can always be raised anytime, even for the first time on
appeal, since jurisdictional issues cannot be waived x x x subject, however, to the principle of
estoppel by laches."36

Since the defense of lack of jurisdiction over the person of a party to a case is not one of those
defenses which are not deemed waived under Section 1 of Rule 9, such defense must be invoked
when an answer or a motion to dismiss is filed in order to prevent a waiver of the defense. 37 If the
objection is not raised either in a motion to dismiss or in the answer, the objection to the jurisdiction
over the person of the plaintiff or the defendant is deemed waived by virtue of the first sentence of
the above-quoted Section 1 of Rule 9 of the Rules of Court. 38

The Court of Appeals, therefore, erred when it made a sweeping pronouncement in its questioned
decision, stating that "issue on jurisdiction may be raised at any stage of the proceeding, even for
the first time on appeal" and that, therefore, respondent timely raised the issue in her motion to
dismiss and is, consequently, not estopped from raising the question of jurisdiction. As the question
of jurisdiction involved here is that over the person of the defendant Manuel, the same is deemed
waived if not raised in the answer or a motion to dismiss. In any case, respondent cannot claim the
defense since "lack of jurisdiction over the person, being subject to waiver, is a personal defense
which can only be asserted by the party who can thereby waive it by silence."39

2. Jurisdiction over the person of a defendant is acquired through a valid service of summons; trial
court did not acquire jurisdiction over the person of Manuel Toledo

In the first place, jurisdiction over the person of Manuel was never acquired by the trial court. A
defendant is informed of a case against him when he receives summons. "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." 40

In the case at bar, the trial court did not acquire jurisdiction over the person of Manuel since there
was no valid service of summons upon him, precisely because he was already dead even before the
complaint against him and his wife was filed in the trial court. The issues presented in this case are
similar to those in the case of Sarsaba v. Vda. de Te. 41

In Sarsaba, the NLRC rendered a decision declaring that Patricio Sereno was illegally dismissed
from employment and ordering the payment of his monetary claims. To satisfy the claim, a truck in
the possession of Sereno’s employer was levied upon by a sheriff of the NLRC, accompanied by
Sereno and his lawyer, Rogelio Sarsaba, the petitioner in that case. A complaint for recovery of
motor vehicle and damages, with prayer for the delivery of the truck pendente lite was eventually
filed against Sarsaba, Sereno, the NLRC sheriff and the NLRC by the registered owner of the truck.
After his motion to dismiss was denied by the trial court, petitioner Sarsaba filed his answer. Later
on, however, he filed an omnibus motion to dismiss citing, as one of the grounds, lack of jurisdiction
over one of the principal defendants, in view of the fact that Sereno was already dead when the
complaint for recovery of possession was filed.

Although the factual milieu of the present case is not exactly similar to that of Sarsaba, one of the
issues submitted for resolution in both cases is similar: whether or not a case, where one of the
named defendants was already dead at the time of its filing, should be dismissed so that the claim
may be pursued instead in the proceedings for the settlement of the estate of the deceased
defendant. The petitioner in the Sarsaba Case claimed, as did respondent herein, that since one of
the defendants died before summons was served on him, the trial court should have dismissed the
complaint against all the defendants and the claim should be filed against the estate of the deceased
defendant. The petitioner in Sarsaba, therefore, prayed that the complaint be dismissed, not only
against Sereno, but as to all the defendants, considering that the RTC did not acquire jurisdiction
over the person of Sereno.42 This is exactly the same prayer made by respondent herein in her
motion to dismiss.

The Court, in the Sarsaba Case, resolved the issue in this wise:

x x x We cannot countenance petitioner’s argument that the complaint against the other defendants
should have been dismissed, considering that the RTC never acquired jurisdiction over the person of
Sereno. The court’s failure to acquire jurisdiction over one’s person is a defense which is personal to
the person claiming it. Obviously, it is now impossible for Sereno to invoke the same in view of his
death. Neither can petitioner invoke such ground, on behalf of Sereno, so as to reap the benefit of
having the case dismissed against all of the defendants. Failure to serve summons on Sereno’s
person will not be a cause for the dismissal of the complaint against the other defendants,
considering that they have been served with copies of the summons and complaints and have long
submitted their respective responsive pleadings. In fact, the other defendants in the complaint were
given the chance to raise all possible defenses and objections personal to them in their respective
motions to dismiss and their subsequent answers.43 (Emphasis supplied.)

Hence, the Supreme Court affirmed the dismissal by the trial court of the complaint against Sereno
only.

Based on the foregoing pronouncements, there is no basis for dismissing the complaint against
respondent herein. Thus, as already emphasized above, the trial court correctly denied her motion to
dismiss.