JOSE C. ZULUETA, BENITO MACROHON, AS PROVINCIAL SHERIFF OF RIZAL, PASIG, RIZAL, AND HON. ANDRES S. SIOCHI, AS MUNICIPAL JUDGE OF PASIG, RIZAL, PETITIONERS, VS. HON. CECILIA MUÑO…

Zulueta versus Muñoz Palma

The Case

This is an original petition for certiorari and prohibition, with a prayer for a writ of preliminary injunction, filed by Jose Zulueta and the Provincial Sheriff of Rizal against Judge Cecilia Muñoz Palma of the Court of First Instance of Rizal, Branch One, in Pasig, together with Victoria Lasin Vda. de Atienza and her children Gregorio and Rosario Atienza. The petitioners ask the Supreme Court to annul four orders issued in a civil case that had been brought to restrain the execution of a judgment in an ejectment case. The case matters because it teaches the remedial rules that every litigator must know: how summons must be served on a defendant abroad, who is the real party in interest, when a defect in the parties is merely formal and curable by amendment or intervention, and when a third person claiming levied property may intervene instead of filing a separate action.

Procedural History

The story begins in the Municipal Court of Pasig, Rizal, where Jose Zulueta sued Gregorio Atienza for ejectment. Gregorio was declared in default and judgment was rendered against him. His mother, Victoria Lasin Vda. de Atienza, moved for reconsideration, but her motion was denied. She then filed a petition for certiorari and mandamus with preliminary injunction in the Court of First Instance of Rizal, impleading the municipal judge, the Provincial Sheriff, and Zulueta, mainly to annul the municipal court's decision. The Court of First Instance issued a restraining order. Judge Guillermo Torres then resolved to dissolve that restraining order unless a bond of 15,000 pesos was filed and monthly rentals were deposited with the Clerk of Court. After the case was assigned to Branch One, Judge Cecilia Muñoz Palma denied the motion to dismiss, allowed the substitution of Gregorio Atienza as the real party in interest, and reduced the bond to 8,000 pesos. She later allowed Gregorio to intervene, approved the bond, and restrained the sheriff from carrying out the writ of execution. She also ordered the restoration of possession of the premises to Victoria and directed the sheriff to discharge the levy on personal properties claimed by Rosario Atienza de Guzman without need of a counterbond. Zulueta and the sheriff then came to the Supreme Court by this original petition for certiorari and prohibition. The Supreme Court granted a preliminary injunction on February 11, 1966, and later decided the petition on the merits.

Facts

On September 15, 1964, Jose Zulueta filed an ejectment complaint against Gregorio Atienza in the Municipal Court of Pasig. At that time Gregorio was abroad, having left the Philippines on June 26, 1964 for San Diego, California, to serve as an enlisted man of the United States Navy. When the sheriff attempted to serve summons on September 26, 1964, he delivered it instead to Gregorio's sister, Rosario Atienza de Guzman, at General Malvar Street, Pasig.

Because nobody appeared and no answer was filed for Gregorio, he was declared in default on December 15, 1964, and judgment was rendered ordering him to vacate the premises, deliver possession to Zulueta, and pay accrued rentals, monthly rentals, attorney's fees, and costs. A copy of the decision sent by registered mail was returned undelivered. A writ of execution issued on January 4, 1965, and the sheriff levied on personal properties and issued a notice of sale. Victoria moved for reconsideration, explaining that Gregorio was abroad and that she learned of the decision only when the writ was served on her, but her motion was denied.

Victoria then filed the petition for certiorari and mandamus in the Court of First Instance, which became the case where the questioned orders were issued. Rosario, meanwhile, filed a third-party claim with the sheriff, asserting that the levied personal properties belonged exclusively to her. The trial court allowed Gregorio to intervene as the real party in interest, restrained the sheriff, restored possession of the premises to Victoria, and ordered the discharge of the levy in favor of Rosario without a counterbond. These orders are what the petitioners assail.

Issues

• Whether or not the summons in the ejectment case was validly served on Gregorio Atienza, who was then a resident of the United States.
• Whether or not the trial court acted without or in excess of jurisdiction, or with grave abuse of discretion, in denying the motion to dismiss and in allowing the substitution of Gregorio Atienza as the real party in interest.
• Whether or not the trial court gravely abused its discretion in granting Gregorio Atienza's motion for intervention.
• Whether or not the trial court gravely abused its discretion in ordering the restoration of possession of the premises to Victoria Lasin Vda. de Atienza.
• Whether or not the trial court gravely abused its discretion in ordering the discharge of the levy on the personal properties claimed by Rosario Atienza de Guzman without the filing of a counterbond.

Applicable Provisions

Section 17, Rule 14 of the Revised Rules of Court governs service of summons on a defendant who is outside the Philippines, and the Court holds that the summons here was not served in the manner it requires:

Section 17. Service upon defendant outside of the Philippines. When the defendant is outside of the Philippines, service may, by leave of court, be effected personally or by registered mail, and the court may, in its discretion, prescribe the time within which the defendant shall plead.

Section 2, Rule 12 of the Revised Rules of Court lists the grounds for intervention, and the Court relies on its last clause to sustain Rosario's intervention:

Section 2. Intervention. A person may, at any period of a trial, be permitted by the court, in its discretion, to intervene in an action, if he has legal interest in the matter in litigation, or in the success of either of the parties, or an interest against both, or when he is so situated as to be adversely affected by a distribution or other disposition of property in the custody of the court or of an officer thereof.

Ruling

On the first issue, the Court finds that when the ejectment complaint was filed, Gregorio was a resident of the United States, and the summons intended for him was delivered to his sister at Pasig. These facts clearly show that the summons was not served in the manner provided by Section 17, Rule 14 of the Revised Rules of Court. This defect in the service of summons is the root of the whole controversy.

On the second issue, the Court holds that while Victoria was not the real party in interest, this defect was obviously not jurisdictional, as Zulueta erroneously contended, but merely formal. The respondent judge correctly allowed the petition to be amended by substituting Gregorio, the real party in interest, in place of his mother. The Court notes that this is proper and correct procedure, long settled in Alonzo versus Villamor and more recently in Torres versus Caluag. The suggestion that the case should instead be dismissed so that Gregorio could file a new action is but an attempt to resort to a technicality that serves no useful purpose and would multiply judicial proceedings.

On the third issue, the Court holds that allowing Gregorio's intervention was neither an act without or in excess of jurisdiction nor tainted with grave abuse of discretion. The intervention was intended to correct the same formal defect, and it was absolutely necessary in order to bring the real party in interest into court.

On the fourth issue, the Court holds that the order restoring possession of the premises to Victoria, in effect to Gregorio, is in consonance with the restraining order issued by Judge Torres. Zulueta's rights were protected by the 8,000 peso bond filed precisely to maintain that restraining order and to prevent execution of the ejectment judgment while the certiorari case was pending.

On the fifth issue, the Court holds that Rosario's intervention was proper. Under the old procedure, a third person claiming ownership of property attached or levied upon had no right to intervene because he had no interest in the debt sued upon. That principle has been abandoned. A third person claiming ownership may not only file a third-party claim with the sheriff but also intervene in the action to ask that the writ of attachment or levy be quashed. The Court quotes Manila Herald versus Ramos:

Yet, the right to intervene, unlike the right to bring a new action, is not absolute but left to the sound discretion of the court to allow.

The Court adds that although the intervention was allowed in the certiorari case rather than in the ejectment case, the certiorari case was instituted precisely to annul the decision and the proceedings in the ejectment case, including the levy on the properties Rosario claimed. She therefore had the right to intervene. The discharge of the levy without a counterbond is likewise in consonance with the restraining order.

Doctrine

First, a defect in the parties, where the plaintiff is not the real party in interest, is merely formal and not jurisdictional, and it may be cured by amendment or by intervention of the real party in interest. Second, the court should not dismiss an action on such a technicality when doing so would only multiply judicial proceedings. Third, a third person claiming ownership of property levied upon in execution may file a third-party claim with the sheriff and may also intervene in the action to ask that the levy be quashed, although the right to intervene is not absolute but is addressed to the sound discretion of the court. Fourth, service of summons on a defendant outside the Philippines must follow Section 17, Rule 14 of the Revised Rules of Court, and service on a relative at a local address does not comply with that rule.

Disposition

The Supreme Court denied the writs prayed for, dismissed the petition for certiorari and prohibition with costs, and set aside the preliminary injunction it had earlier issued. The petitioners lost, and the questioned orders of the trial court were left standing.

Remember This

The one line to memorize is that a defect in the parties is formal, not jurisdictional, and may be cured by amendment or intervention of the real party in interest. Examiners like to use this case on the distinction between formal and jurisdictional defects, on the requisites of valid summons on a defendant abroad, and on the third-party claimant's remedy of intervention under the Rules of Court.