HEIRS OF WILFREDO C. DELOS SANTOS, NAMELY: MA. GRACIA DELOS SANTOS, RAYMOND C. DELOS SANTOS AND MINORS RICHARD C. DELOS, WILFRED C. DELOS SANTOS, ARNOLD C. DELOS SANTOS, EDWARD …

Heirs of Delos Santos versus Del Rosario

The Case

This is a petition for review brought by the heirs of Wilfredo Delos Santos, together with Ma. Gracia Delos Santos, against Felisa Del Rosario. The controversy began as a complaint for replevin and damages over pieces of jewelry, but what reaches the Supreme Court is a narrower and very teachable question of procedure: was the trial court's decision validly served on the defendants' counsel when the postman handed it, not to the lawyer or his clerk, but to an employee of a neighboring corporation? The case matters because it fixes the rule on service of judgments and shows how a void service keeps a decision from becoming final and executory, with the dramatic consequence that a payment already made in satisfaction of that judgment must be returned.

Procedural History

Felisa Del Rosario filed a complaint for replevin and damages with the Regional Trial Court of Legazpi City against Wilfredo Delos Santos, doing business as Rich-mon Pawnshop. Ma. Gracia Delos Santos, the owner and operator of the pawnshop, later filed an answer and was impleaded as defendant. The trial court rendered judgment for Del Rosario, ordering the defendants to deliver the jewelry or pay its value, plus attorney's fees, litigation expenses, and costs.

Counsel for the defendants filed a notice of appeal, but the trial court dismissed the appeal as filed out of time. Counsel then filed a petition for relief under Rule 38, pleading mistake and excusable negligence. The trial court dismissed the petition for relief and issued a writ of execution, and it denied the motion for reconsideration. The defendants went up to the Court of Appeals on certiorari, and that court dismissed the petition and affirmed the trial court. Hence the petition for review to the Supreme Court. Wilfredo died during the pendency of the case, and his heirs substituted him.

Facts

Del Rosario owned jewelry valued at approximately 250,000 pesos. She delivered it to Lolita Sanio for sale on commission, on the condition that Del Rosario would keep ownership until the full value was paid. Sanio neither returned nor paid for the jewelry, and Del Rosario later learned that the pieces had been pawned to Rich-mon Pawnshop. She sued for their recovery.

The trial court ruled for Del Rosario, finding that the pawnshop owners unlawfully deprived her of possession and rejecting Grace's claim of good faith. The court mailed a copy of its decision to the office of the defendants' counsel, Atty. Oliver Olaybal. But from late March to mid April 1998, the lawyer's lone clerk was on leave, and the lawyer himself was sick with influenza, so the law office was closed. On 2 April 1998 the postman delivered the decision to Bernadeth Faye Alamares, a clerk of Asaphil Corporation, whose office was adjacent to the lawyer's. She signed the registry return card.

When Atty. Olaybal returned on 17 April 1998, Alamares turned over the mail, including the decision. Asked for the date of receipt, she could only say it was before the holidays, meaning before Bataan Day on 9 April. The lawyer concluded she received it on 8 April and counted the last day to appeal as 23 April. He filed the notice of appeal on 20 April 1998, the next business day. The trial court nonetheless dismissed the appeal as late, and later denied relief.

Issues

• Whether or not there was valid service of the trial court's decision on the petitioners or their counsel when it was delivered to Alamares, an employee of a neighboring corporation.
• Whether or not Alamares's mistaken recollection of the date of receipt binds the petitioners and their counsel.
• Whether or not the counsel's erroneous reliance on that recollection constitutes mistake or excusable negligence warranting relief from judgment.
• Whether or not the notice of appeal, filed on 20 April 1998, was filed within the reglementary period.

Applicable Provisions

Section 2 of Rule 13 defines filing and service and fixes upon whom service is made:

Service is the act of providing a party with a copy of the pleading or paper concerned. If any party has appeared by counsel, service upon him shall be made upon his counsel or one of them, unless service upon the party himself is ordered by the court.

This is the core rule: because the defendants appeared by counsel, service had to be made on that counsel.

Section 7 of Rule 13 governs service by registered mail:

Service by registered mail shall be made by depositing the copy in the office, in a sealed envelope, plainly addressed to the party or his counsel at his office, if known, otherwise at his residence, if known, with postage fully prepaid, and with instructions to the postmaster to return the mail to the sender after ten days if undelivered.

The envelope must be addressed to the counsel at his office, which is precisely what was not done here.

Section 9 of Rule 13 governs service of judgments:

Judgments, final orders or resolutions shall be served either personally or by registered mail.

This confirms that a judgment must be served personally or by registered mail in the manner the Rules prescribe.

Ruling

On the first issue, the Court held that there was no valid service. Alamares was neither an associate nor an employee of Atty. Olaybal; she worked for a neighboring corporation, and nothing showed that the lawyer authorized her or that corporation to receive his mail. The Court stressed that if she had authority, she would have noted the exact date of receipt. It also found that counsel did not intend to delay, since he filed the notice of appeal on the very next working day.

On the remaining issues, the Court held that the reckoning of the fifteen-day appeal period must run, not from the void delivery on 2 April 1998, but from 17 April 1998, when counsel actually received the decision. The notice of appeal filed on 20 April 1998 was therefore timely. The trial court's decision never became final and executory, and the payment made in satisfaction of that judgment is void.

Doctrine

First, when a party has appeared by counsel, service of a judgment must be made upon counsel, personally or by registered mail addressed to counsel at his office. Second, service on a person who is neither counsel nor his employee, and who was not authorized to receive the mail, is void and does not start the appeal period. Third, the period to appeal runs only from the date of valid service or actual receipt by counsel. Fourth, a judgment that was never validly served does not become final and executory, and any payment made to satisfy it is void.

Disposition

The Court granted the petition, reversed the Court of Appeals, annulled the order dismissing the appeal, reinstated the notice of appeal as timely filed, and ordered Del Rosario to return immediately the payment made in satisfaction of the trial court's judgment.

Remember This

Memorize this line: service of a judgment on one who is neither counsel nor his employee is void, and the appeal period runs only from valid service or actual receipt. Examiners use this case on service of judgments, the reckoning of the appeal period, and petitions for relief.