[17] PERKIN ELMER SINGAPORE vs. DAKILA TRADING CORP.
existing under Philippine laws, and engaged in the business of selling and leasing out
GR No. 172242 | August 14, 2007 | J. Chico-Nazario
TOPIC: III. Jurisdiction, F. Service of Summons
PETITIONERS/PROSECUTORS: Perkin Elmer Singapore Pte. Ltd.
RESPONDENTS/DEFENDANTS: Dakila Trading Corporation
CASE SUMMARY: Dakila Trading Corp. entered into a Distribution Agreement with Perkin-
Elmer Instruments Asia Pte Ltd. (PEIA), a corporation duly organized and existing under the
laws of Singapore. Under the Distribution Agreement, Dakila shall order the products of
PEIA, which it shall sell in the Philippines, either from PEIA itself or from Perkin-Elmer
Instruments (Philippines) Corporation (PEIP), an affiliate of PEIA. PEIA unilaterally
terminated the Distribution Agreement, prompting respondent to file before the RTC of
Mandaluyong City a Complaint for Collection of Sum of Money and Damages with Prayer
for Issuance of a Writ of Attachment against PEIA and PEIP. RTC deputized respondent’s
General Manager to serve extraterritorial summons on petitioner in Singapore. The Court
held that RTC had no jurisdiction over petitioner because there was no valid service of
summons. The case involving collection of a sum of money and damages is, indeed, an
action in personam, as it deals with the personal liability of the petitioner to the respondent
by reason of the alleged unilateral termination by the former of the Distribution Agreement.
Thus, being an action in personam, personal service of summons within the Philippines is
necessary in order for the RTC to validly acquire jurisdiction over the person of the
petitioner, and this is not possible in the present case because the petitioner is a non-
resident and is not found within the Philippines.
DOCTRINE:
 The proper service of summons differs depending on the nature of the civil case
instituted by the plaintiff or petitioner: whether it is in personam, in rem or quasi in rem.
 Under Section 15, Rule 14 of the 1997 Revised Rules of Civil Procedure, there are only
four instances wherein a defendant who is a non-resident and is not found in the
country may be served with summons by extraterritorial service, to wit: (1) when the
action affects the personal status of the plaintiff; (2) when the action relates to, or the
subject of which is property, within the Philippines, in which the defendant claims a lien
or an interest, actual or contingent; (3) when the relief demanded in such action
consists, wholly or in part, in excluding the defendant from any interest in property
located in the Philippines; and (4) when the defendant non-resident’s property has been
attached within the Philippines.
 In these instances, service of summons may be effected by (a) personal service out of
the country, with leave of court; (b) publication, also with leave of court; or (c) any other
manner the court may deem sufficient;
 Extraterritorial service of summons applies only where the action is in rem or quasi in
rem but not if an action is in personam.
FACTS
 Petitioner Perkin Elmer Singapore Pte. Ltd. is a corporation duly organized and
existing under the laws of Singapore. It is not considered as a foreign corporation
“doing business” in the Philippines.
 Herein respondent Dakila Trading Corporation is a corporation organized and
laboratory instrumentation and process control instrumentation, and trading of
laboratory chemicals and supplies.
 Respondent entered into a Distribution Agreement with Perkin-Elmer Instruments
Asia Pte Ltd. (PEIA), a corporation duly organized and existing under the laws of
Singapore and engaged in the business of manufacturing, producing, selling or
distributing various laboratory/ analytical instruments.
o By virtue of the said agreement, PEIA appointed the respondent as the sole
distributor of its products in the Philippines.
o The respondent was likewise granted the right to purchase and sell the products of
PEIA subject to the terms and conditions set forth in the Distribution Agreement.
o PEIA, on the other hand, shall give respondent a commission for the sale of its
products in the Philippines.
 Under the same Distribution Agreement, respondent shall order the products of PEIA,
which it shall sell in the Philippines, either from PEIA itself or from Perkin-Elmer
Instruments (Philippines) Corporation (PEIP), an affiliate of PEIA.
o PEIP is a corporation duly organized and existing under Philippine laws, and
involved in the business of wholesale trading of all kinds of scientific,
biotechnological, and analytical instruments and appliances.
o PEIA allegedly owned 99% of the shares of PEIP.
 However, PEIA unilaterally terminated the Distribution Agreement, prompting
respondent to file before the RTC of Mandaluyong City a Complaint for Collection of
Sum of Money and Damages with Prayer for Issuance of a Writ of Attachment against
PEIA and PEIP.
 RTC issued an Order denying respondent’s prayer for the issuance of a writ of
attachment.
 Respondent then filed Ex Parte Motions for Issuance of Summons and for Leave of
Court to Deputize Respondent’s General Manager, Richard A. Tee, to Serve Summons
Outside of the Philippines, which the RTC granted in its Order, dated 27 April 2000.
 Thus, an Alias Summons, dated 4 September 2000, was issued by the RTC to PEIA.
But the said Alias Summons was served on and received by Perkinelmer Asia, a
Singaporean based sole proprietorship, owned by the petitioner and, allegedly, a
separate and distinct entity from PEIA.
 PEIP moved to dismiss the Complaint filed by respondent on the ground that it states
no cause of action.
 Perkinelmer Asia, on the other hand, through its counsel, sent letters to the respondent
and to the RTC, respectively, to inform them of the wrongful service of summons upon
Perkinelmer Asia.
 Respondent filed an Ex Parte Motion to Admit Amended Complaint, together with the
Amended Complaint claiming that PEIA had become a sole proprietorship owned by
the petitioner, and subsequently changed its name to Perkinelmer Asia.
o Being a sole proprietorship of the petitioner, a change in PEIA’s name and juridical
status did not detract from the fact that all its due and outstanding obligations to
third parties were assumed by the petitioner.
o Hence, in its Amended Complaint respondent sought to change the name of PEIA
to that of the petitioner.
 In an Order, dated 24 July 2001, the RTC admitted the Amended Complaint filed by the
respondent.
 Respondent then filed another Motion for the Issuance of Summons and for Leave of
 Court to Deputize Respondent’s General Manager, Richard A. Tee, to Serve Summons
Outside the Philippines.
 In another Order, the RTC deputized respondent’s General Manager to serve summons
on petitioner in Singapore. Acting on the said Order, respondent’s General Manager
went to Singapore and served summons on the petitioner.
 RTC denied the Motion to Dismiss filed by PEIP, compelling the latter to file its Answer
to the Amended Complaint.
 Petitioner subsequently filed with the RTC a Special Appearance and Motion to Dismiss
respondent’s Amended Complaint on 30 May 2002 based on the following grounds:
(1) the RTC did not acquire jurisdiction over the person of the petitioner;
(2) the respondent failed to state a cause of action against the petitioner because it is
not the real party-in-interest;
(3) even assuming arguendo that the respondent correctly filed the case against the
petitioner, the Distribution Agreement which was the basis of its claim grants PEIA
the right to terminate the contract at any time; and
(4) the venue was improperly laid.
 The RTC denied petitioner’s Motion to Dismiss.
 CA affirmed.
ISSUE / RATIO
1. WON there was proper service of summons -- NO. Thus, RTC failed to acquire
jurisdiction over the person of the petitioner.
 Petitioner: The case is an action in personam and thus personal service of summons,
not extraterritorial service, should have been performed to give RTC jurisdiction over
the petitioner.
 Jurisdiction is the power with which courts are invested for administering justice; that is,
for hearing and deciding cases. In order for the court to have authority to dispose of the
case on the merits, it must acquire jurisdiction over the subject matter and the parties.
 Jurisdiction of the court over the subject matter is conferred only by the Constitution or
by law. It is determinable on the basis of allegations in the complaint.
 Courts acquire jurisdiction over the plaintiffs upon the filing of the complaint, while
jurisdiction over the defendants in a civil case is acquired either through the service of
summons upon them in the manner required by law or through their voluntary
appearance in court and their submission to its authority.
 If the defendants have not been summoned, unless they voluntarily appear in court, the
court acquires no jurisdiction over their persons and a judgment rendered against them
is null and void.
 Service of summons is intended to give notice to the defendant or respondent that a
civil action has been commenced against him.
 The proper service of summons differs depending on the nature of the civil case
instituted by the plaintiff or petitioner: whether it is in personam, in rem, or quasi in rem.
 Actions in personam, are those actions brought against a person on the basis of his
personal liability;
 actions in rem are actions against the thing itself instead of against the person; and
 actions are quasi in rem, where an individual is named as defendant and the purpose of
the proceeding is to subject his or her interest in a property to the obligation or loan
burdening the property.
 Under Section 15, Rule 14 of the 1997 Revised Rules of Civil Procedure, there are only
four instances wherein a defendant who is a non-resident and is not found in the
country may be served with summons by extraterritorial service, to wit:
(1) when the action affects the personal status of the plaintiff;
(2) when the action relates to, or the subject of which is property, within the
Philippines, in which the defendant claims a lien or an interest, actual or
contingent;
(3) when the relief demanded in such action consists, wholly or in part, in excluding
the defendant from any interest in property located in the Philippines; and
(4) when the defendant non-resident’s property has been attached within the
Philippines.
 In these instances, service of summons may be effected by
(1) personal service out of the country, with leave of court;
(2) publication, also with leave of court; or
(3) any other manner the court may deem sufficient.
 Undoubtedly, extraterritorial service of summons applies only where the action is
in rem or quasi in rem, but not if an action is in personam.
 When the case instituted is an action in rem or quasi in rem, Philippine courts already
have jurisdiction to hear and decide the case because, in actions in rem and quasi in
rem, jurisdiction over the person of the defendant is not a prerequisite to confer
jurisdiction on the court, provided that the court acquires jurisdiction over the res.
 Thus, in such instance, extraterritorial service of summons can be made upon the
defendant. The said extraterritorial service of summons is not for the purpose of vesting
the court with jurisdiction, but for complying with the requirements of fair play or due
process
 On the other hand, when the defendant or respondent does not reside and is not found
in the Philippines, and the action involved is in personam, Philippine courts cannot try
any case against him because of the impossibility of acquiring jurisdiction over his
person unless he voluntarily appears in court.
 IN THE CASE: The case before the court a quo involving collection of a sum of money
and damages is, indeed, an action in personam, as it deals with the personal liability of
the petitioner to the respondent by reason of the alleged unilateral termination by the
former of the Distribution Agreement.
o Thus, being an action in personam, personal service of summons within the
Philippines is necessary in order for the RTC to validly acquire jurisdiction over
the person of the petitioner, and this is not possible in the present case
because the petitioner is a non-resident and is not found within the
Philippines.
 Respondent’s allegation in its Amended Complaint that petitioner had personal property
within the Philippines in the form of shares of stock in PEIP did not make Civil Case
No. MC99-605 fall under any of the four instances mentioned in Section 15, Rule 14 of
the Rules of Court, as to convert the action in personam to an action in rem or quasi in
rem and, subsequently, make the extraterritorial service of summons upon the
petitioner valid.
 The petitioner is correct in saying that “mere allegations of personal property within the
Philippines does not necessarily make the action as one that relates to or the subject of
which is, property within the Philippines as to warrant the extraterritorial service of
summons. For the action to be considered one that relates to, or the subject of
which, is the property within the Philippines, the main subject matter of the
 action must be the property itself of the petitioner in the Philippines.”
o Respondent’s allegation in its Amended Complaint that petitioner had personal
property within the Philippines in the form of shares of stock in PEIP does not
convert Civil Case No. MC99-605 from an action in personam to one quasi in
rem, so as to qualify said case under the fourth instance mentioned in Section
15, Rule 14.
o What is required under the aforesaid provision of the Revised Rules of Civil
Procedure is not a mere allegation of the existence of personal property
belonging to the non-resident defendant within the Philippines but, more
precisely, that the non-resident defendant’s personal property located within
the Philippines must have been actually attached.
 If there was no valid summons served upon petitioner, could RTC have acquired
jurisdiction over the person of the petitioner by the latter’s voluntary
appearance?
o A party who makes a special appearance in court for the purpose of challenging
the jurisdiction of said court, based on the invalidity of the service of summons,
cannot be considered to have voluntarily submitted himself to the jurisdiction of the
court.
o In the present case, petitioner has been consistent in all its pleadings in assailing
the service of summons upon it and the jurisdiction of the RTC over its person.
o Thus, the petitioner cannot be declared in estoppel when it filed an Answer ad
cautelam with compulsory counterclaim before the RTC while the instant Petition
was still pending before this Court.
REVERSED AND SET ASIDE. Respondent’s Amended Complaint in Civil Case No. MC99-
605 as against the petitioner is hereby ordered DISMISSED, and all the proceedings
against petitioner in the court a quo by virtue thereof are hereby DECLARED NULL AND
VOID. The Regional Trial Court of Mandaluyong City, Branch 212, is DIRECTED to proceed
without further delay with the resolution of respondent’s Complaint in Civil Case No. MC99-
605 as to defendant PEIP, as well as petitioner’s counterclaim. No costs.
PROVISIONS:
Rule 14, Section 15. Extraterritorial service. — When the defendant does not reside and
is not found in the Philippines, and the action affects the personal status of the plaintiff or
relates to, or the subject of which is, property within the Philippines, in which the defendant
has or claims a lien or interest, actual or contingent, or in which the relief demanded
consists, wholly or in part, in excluding the defendant from any interest therein, or the
property of the defendant has been attached within the Philippines, service may, by leave of
court, be effected out of the Philippines by personal service as under section 6; or by
publication in a newspaper of general circulation in such places and for such time as the
court may order, in which case a copy of the summons and order of the court shall be sent
by registered mail to the last known address of the defendant, or in any other manner the
court may deem sufficient. Any order granting such leave shall specify a reasonable time,
which shall not be less than sixty (60) days after notice, within which the defendant must
answer.

2. WON there was a cause of action in respondent’s Amended Complaint -- YES

 When a Motion to Dismiss is grounded on the failure to state a cause of action, a ruling
thereon should be based only on the facts alleged in the complaint. o The court must
pass upon this issue based solely on such allegations, assuming them to be true.
 For it to do otherwise would be a procedural error and a denial of plaintiff’s right to due
process.
 The defense of the petitioner that it is not the real party-in-interest is evidentiary in
nature which must be proven in trial.

3. WON the venue was proper -- YES

 Despite the venue stipulation found in the Distribution Agreement stipulating that the
exclusive jurisdiction over disputes arising from the same shall lie in the courts of
Singapore or of the Territory (referring to the Philippines), whichever is elected by PEIA
(or petitioner, as PEIA’s alleged successor), the RTC of the Philippines cannot be
considered as an improper venue.
 Truly, the venue stipulation used the word “exclusive,” however, a closer look on the
Distribution Agreement would reveal that the venue stipulation was really in the
alternative i.e., courts of Singapore or of the Territory, meaning, the Philippines; thus,
the court a quo is not an improper venue for the present case.

DISPOSITIVE: WHEREFORE, premises considered, the instant Petition is hereby

GRANTED. The Decision of the Court of Appeals, dated 4 April 2006, in CA-G.R. SP No.
78981, affirming the Orders, dated 4 November 2002 and 20 June 2003, of the Regional
Trial Court of Mandaluyong City, Branch 212, in Civil Case No. MC99-605, is hereby