PEDRO T. SANTOS, JR. vs. PNOC EXPLORATION CORPORATION G.R. No. 170943 Sept.

23, 2008
Topic: Failure to Plead: Default Sec. 3, Rule 9

Petitioner: Santos
Respondent: PNOC

RULING: WHEREFORE, the petition is DENIED.

DOCTRINE: If the defendant fails to file his answer on time, he may be declared in default upon motion of the plaintiff with notice to the said
defendant. If he is declared in default, court shall proceed to render judgment granting the plaintiff such relief as his pleading may warrant,
unless the court requires the plaintiff to submit evidence. The defaulting defendant may not take part in the trial but shall be entitled to notice of
subsequent proceedings. An order of default can be validly issued only upon motion of the claiming party unless the residence or whereabouts of
the defending party is not known or he cannot be located.

PNOC to RTC: complaint for
a sum of money against
Santos
RTC allowed service of
summons by publication
RTC granted PNOC’s motion
for the reception of its
evidence ex parte after
Santos failed to f file answer
within prescribed period
Santos to RTC: Omnibus
Motion for Reconsideration
and to Admit Attached
Answer
 To collect Santos’ unpaid balance of the car loan (P698,502.10) advanced to him by PNOC when he was still
a member of its BOD
 Personal service of summon to Santos failed: he could not be located in his last known address
 PNOC caused publication of the summons in Remate (newspaper of gen. circulation) on May 20, 2003
 PNOC submitted the affidavit of publication of the advertising manager of Remate and an affidavit of service
of PNOC’s employee to the effect that he sent a copy of the summons by registered mail to Santos’ last
known address.
 Case was submitted for decision after PNOC proceeded with ex parte presentation and formal offer of
evidence
 The affidavit of service submitted by PNOC failed to comply with Sec. 19, Rule 14 as it was not executed by
the clerk of court.
 He was denied due process as he was not notified of the Court order granting reception of evidence ex parte
 Prayed that PNOC’s evidence ex parte be stricken off the records and that his answer be admitted.

PNOC opposed the motion
RTC: denied Santos’ MR
 It complied with the rules on service of publication
 Santos was already deemed in default for failure to file an answer within the prescribed period as ordered by
RTC
 The rules did not require the affidavit of complementary service by registered mail to be executed by the
clerk of court.
 Due process was observed as a copy of the RTC order was actually mailed to Santos at his last known
address.
 Denied the motion to admit Santos’ answer because the same was filed way beyond the reglementary
period.

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 Santos to CA: petition for  The orders were issued with grave abuse of discretion:
certiorari  taking cognizance of the case despite lack of jurisdiction due to improper service of summons
 failing to furnish him with copies of its orders and processes
 upholding technicality over equity and justice

While pending, RTC decision:  Ordered Santos to Pay PNOC the unpaid balance of car loan
CA decision  Sustained RTC order for reception of its evidence ex parte and denial of MR
Santos to SC: Petition for  Reiterated grounds raised in CA
review  Claimed that the rule on service by publication under Sec. 14, Rule 14 applies only to actions in rem, not
actions in personam like a complaint for a sum of money.
 The affidavit of service of a copy of the summons should have been prepared by the clerk of court, not
PNOC’s messenger.

ISSUE: WON Santos was validly declared in default
HELD: NO. However, even if Santos was not validly declared in
default, he could not reasonably demand that copies of orders and
processes be furnished him since his residence or whereabouts is
not known or he cannot be located.
RATIO:
Propriety of Service by Publication: properly served to Santos
• Since Santos could not be personally served with summons despite
diligent efforts to locate his whereabouts, PNOC sought and was
granted leave of court to effect service of summons upon him by
publication in a newspaper of general circulation.
SEC. 14. Service upon defendant whose identity or
whereabouts are unknown. In any action where the defendant
is designated as an unknown owner, or the like, or whenever
his whereabouts are unknown and cannot be ascertained by
diligent inquiry, service may, by leave of court, be effected
upon him by publication in a newspaper of general circulation
and in such places and for such times as the court may order.
• The substituted service now applies to any action, whether in
personam, in rem or quasi in rem.
• The present rule expressly states that it applies in any action
where the defendant is designated as an unknown owner, or the
like, or whenever his whereabouts are unknown and cannot be
ascertained by diligent inquiry.
• Service of summons by publication is proved by the affidavit of the
printer, his foreman or principal clerk, or of the editor, business or
advertising manager of the newspaper which published the
summons.
• It is complemented by service of summons by registered mail
to the defendants last known address.
• This complementary service is evidenced by an affidavit
showing the deposit of a copy of the summons and order for
publication in the post office, postage prepaid, directed to the
defendant by registered mail to his last known address (Sec.
19, Rule 14).
• The rules, however, do not require that the affidavit of
complementary service be executed by the clerk of court.
• While the TC ordinarily does the mailing of copies of its orders
and processes, the duty to make the complementary service
by registered mail is imposed on the party who resorts to
service by publication.
• Even assuming that the service of summons was defective, the TC
acquired jurisdiction over the person of Santos by his own
voluntary appearance in the action against him when he filed the
Omnibus Motion for Reconsideration and to Admit Attached
Answer. This was equivalent to service of summons and vested the
trial court with jurisdiction over the person of Santos.
• Sec. 20, Rule 14: Voluntary appearance. The defendants
voluntary appearance in the action shall be equivalent to
service of summons. The inclusion in a motion to dismiss of
other grounds aside from lack of jurisdiction over the person
of the defendant shall not be deemed a voluntary appearance.
Entitlement to Notice of Proceedings
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• The effects of a defendant’s failure to file an answer within the could not validly do since it can be made only upon motion of the
time allowed therefor are governed by Secs. 3 and 4, Rule 9 (on claiming party.
Effect of Failure to Plead): • Since no motion was filed, no default order should have been
SEC. 3. Default; declaration of. If the defending party fails to issued.
answer within the time allowed therefor, the court shall, upon • If the residence or whereabouts of the defending party is not
motion of the claiming party with notice to the defending known or he cannot be located, there is obviously no way
party, and proof of such failure, declare the defending party in notice can be sent to him and the notice requirement cannot
default. Thereupon, the court shall proceed to render apply to him.
judgment granting the claimant such relief as his pleading
may warrant, unless the court in its discretion requires the Correctness of Non-admission of Answer
claimant to submit evidence. Such reception of evidence may • Considering that Santos’ answer was belatedly filed, RTC did not
be delegated to the clerk of court. abuse its discretion in denying its admission.
• Santos’ plea for equity must fail in the face of the clear and express
SEC. 4. Effect of order of default. A party in default shall be language of the rules of procedure and of the RTC order regarding
entitled to notice of subsequent proceedings but not to take the period for filing the answer.
part in the trial. • Equity is available only in the absence of law, not as its
• If the defendant fails to file his answer on time, he may be declared replacement.
in default upon motion of the plaintiff with notice to the said • Equity may be applied only in the absence of rules of procedure,
defendant. never in contravention thereof.
• If declared in default: court shall proceed to render judgment
granting the plaintiff such relief as his pleading may warrant,
unless the court requires the plaintiff to submit evidence. The
defaulting defendant may not take part in the trial but shall be
entitled to notice of subsequent proceedings.
• Even Santos himself does not dispute that he failed to file his
answer on time; this is why he had to file an Omnibus MR and to
Admit Attached Answer.
• PNOC moved only for the ex parte presentation of evidence, not
for the declaration of petitioner in default.
• The disputed RTC Order allowing the presentation of evidence ex-
parte was a finding that the Santos was in default for failure to file
an answer or any responsive pleading within the period fixed in the
publication because he could not be found and for which reason,
service of summons by publication was ordered.
• It is illogical and impractical to notify Santos of the Order since
he was no longer residing and/or found on his last known
address and his whereabouts unknown.
• The records showed that a copy of the order was mailed to him
at his last known address but it was not claimed.
• The RTC order did not limit itself to permitting PNOC to present its
evidence ex parte but in effect issued an order of default which it