JESSE U. LUCAS V. JESUS S.

LUCAS

FACTS:

Petitioner filed a Petition to Establish Filiation with a Motion for the Submission of Parties to DNA Testing
before the Regional Trial Court (RTC). Petitioner alleged that he is the son of his mother Elsie who got
acquainted with respondent in Manila. He also submitted proper documents.

Respondent learned of this and he filed a Special Appearance and Comment manifesting that the petition
was adversarial in nature and therefore summons should be served on him. The RTC dismissed the case
and held that petitioner failed to establish compliance with the four procedural aspects for a paternity
action enumerated in the case of Herrera v. Alba namely, a prima facie case, affirmative defences,
presumption of legitimacy, and physical resemblance between the putative father and the child.

This prompted the petitioner to file a Motion for Reconsideration which the RTC granted. A new hearing
was scheduled where the RTC held that ruling on the grounds relied upon by the respondent for filing the
instant petition is premature considering that a full-blown trial has not yet taken place. Respondent filed a
Motion for Reconsideration which was denied by the RTC. He then filed a petition for certiorari with the
CA and ruled in favor of respondent, it noted that petitioner failed to show that the four significant aspects
of a traditional paternity action had been met and held that DNA testing should not be allowed when the
petitioner has failed to establish a prima facie case.

Petitioner contends that respondent never raised as issue in his petition for certiorari the courts lack of
jurisdiction over his person. Hence, the CA had no legal basis to discuss the same, because issues not
raised are deemed waived or abandoned. Moreover, he alleged that respondent had already voluntarily
submitted to the jurisdiction of the trial court by his filing of several motions asking for affirmative relief.

ISSUE:

- Whether it was necessary, in the first place, to serve summons on respondent for the court to acquire
jurisdiction over the case.

RULING:

The Court ruled that the petition is meritorious.

In this case, the court defined the distinction of the nature of petitioners action, that is, whether it is an
action in personam, in rem, or quasi in rem.

An action in personam is lodged against a person based on personal liability; an action in rem is directed
against the thing itself instead of the person; while an action quasi in rem names a person as defendant,
but its object is to subject that person's interest in a property to a corresponding lien or obligation. A
petition directed against the "thing" itself or the res, which concerns the status of a person, like a petition
for adoption, annulment of marriage, or correction of entries in the birth certificate, is an action in rem.

In an action in personam, jurisdiction over the person of the defendant is necessary for the court to validly
try and decide the case. In a proceeding in rem or quasi in rem, jurisdiction over the person of the
defendant is not a prerequisite to confer jurisdiction on the court, provided that the latter has jurisdiction
over the res. Jurisdiction over the resis acquired either (a) by the seizure of the property under legal
process, whereby it is brought into actual custody of the law, or (b) as a result of the institution of legal
proceedings, in which the power of the court is recognized and made effective.

The herein petition to establish illegitimate filiation is an action in rem. By the simple filing of the petition to
establish illegitimate filiation before the RTC, which undoubtedly had jurisdiction over the subject matter
of the petition, the latter thereby acquired jurisdiction over the case. An in rem proceeding is validated
essentially through publication. Publication is notice to the whole world that the proceeding has for its
object to bar indefinitely all who might be minded to make an objection of any sort to the right sought to
be established. Through publication, all interested parties are deemed notified of the petition. If at all,
service of summons or notice is made to the defendant, it is not for the purpose of vesting the court with
jurisdiction, but merely for satisfying the due process requirements. This is but proper in order to afford
the person concerned the opportunity to protect his interest if he so chooses. Hence, failure to serve
summons will not deprive the court of its jurisdiction to try and decide the case. In such a case, the lack of
summons may be excused where it is determined that the adverse party had, in fact, the opportunity to
file his opposition, as in this case.

The Court further stated that the due process requirement with respect to respondent has been satisfied,
considering that he has participated in the proceedings in this case and he has the opportunity to file his
opposition to the petition to establish filiation.

LEGASPI TOWERS vs. AMELIA P. MUER et. Al

FACTS:

Pursuant to the by-laws of Legaspi Towers 300, Inc., petitioners Lilia Marquinez Palanca, Rosanna D.
Imai, Gloria Domingo and Ray Vincent, the incumbent Board of Directors, set the annual meeting of the
members of the condominium corporation and the election of the new Board of Directors at the lobby of
Legaspi Towers 300, Inc. The Committee on Elections of Legaspi Towers 300, Inc., however, found most
of the proxy votes, at its face value, irregular, thus, questionable; and for lack of time to authenticate the
same, petitioners adjourned the meeting for lack of quorum. However, the group of respondents
challenged the adjournment of the meeting. Despite petitioners' insistence that no quorum was obtained
during the annual meeting held on April 2, 2004, respondents pushed through with the scheduled election
and were elected as the new Board of Directors and officers of Legaspi Towers 300, Inc. and
subsequently submitted a General Information Sheet to the Securities and Exchange Commission (SEC).

On plaintiffs’ motion to admit amended complaint (to include Legaspi Towers 300, Inc. as plaintiff), the
RTC ruled denying the motion for being improper. Then, petitioners filed with the Court of Appeals and
held that Judge Antonio I. De Castro of the Regional Trial Court (RTC) of Manila, did not commit grave
abuse of discretion in issuing the Orders denying petitioners’ Motion to Admit Second Amended
Complaint and that petitioners the justified the inclusion of Legaspi Towers 300, Inc. as plaintiff by
invoking the doctrine of derivative suit.

Petitioners’ motion for reconsideration was denied by the Court of Appeals thereafter. Hence this petition.

ISSUE:

Whether or not Derivative Suit proper in this case

RULING:

The Supreme Court DENIED the petition and AFFIRMED the Decision of the Court of Appeals. Derivative
Suit is not applicable. Since it is the corporation that is the real party-in-interest in a derivative suit, then
the reliefs prayed for must be for the benefit or interest of the corporation. When the reliefs prayed for do
not pertain to the corporation, then it is an improper derivative suit.

A derivative suit must be differentiated from individual and representative or class suits, thus:

Where a stockholder or member is denied the right of inspection, his suit would be individual because the
wrong is done to him personally and not to the other stockholders or the corporation. Where the wrong is
done to a group of stockholders, as where preferred stockholders' rights are violated, a class or
representative suit will be proper for the protection of all stockholders belonging to the same group. But
where the acts complained of constitute a wrong to the corporation itself, the cause of action belongs to
the corporation and not to the individual stockholder or member. Although in most every case of wrong to
the corporation, each stockholder is necessarily affected because the value of his interest therein would
be impaired, this fact of itself is not sufficient to give him an individual cause of action since the
corporation is a person distinct and separate from him, and can and should itself sue the wrongdoer.
Otherwise, not only would the theory of separate entity be violated, but there would be multiplicity of suits
as well as a violation of the priority rights of creditors. Furthermore, there is the difficulty of determining
the amount of damages that should be paid to each individual stockholder.

However, in cases of mismanagement where the wrongful acts are committed by the directors or trustees
themselves, a stockholder or member may find that he has no redress because the former are vested by
law with the right to decide whether or not the corporation should sue, and they will never be willing to sue
themselves. The corporation would thus be helpless to seek remedy. Because of the frequent occurrence
of such a situation, the common law gradually recognized the right of a stockholder to sue on behalf of a
corporation in what eventually became known as a "derivative suit." It has been proven to be an effective
remedy of the minority against the abuses of management. Thus, an individual stockholder is permitted to
institute a derivative suit on behalf of the corporation wherein he holds stock in order to protect or
vindicate corporate rights, whenever officials of the corporation refuse to sue or are the ones to be sued
or hold the control of the corporation. In such actions, the suing stockholder is regarded as the nominal
party, with the corporation as the party-in- interest.

The requisites for a derivative suit are as follows:

a) The party bringing suit should be a shareholder as of the time of the act or transaction complained of,
the number of his shares not being material;

b) The has tried to exhaust intra-corporate remedies, i.e., has made a demand on the board of directors
for the appropriate relief but the latter has failed or refused to heed his plea; and

c) The cause of action actually devolves on the corporation, the wrongdoing or harm having been, or
being caused to the corporation and not to the particular stockholder bringing the suit.

As stated by the Court of Appeals, petitioners’ complaint seek to nullify the said election, and to protect
and enforce their individual right to vote. The cause of action devolves on petitioners, not the
condominium corporation, which did not have the right to vote. Hence, the complaint for nullification of the
election is a direct action by petitioners, who were the members of the Board of Directors of the
corporation before the election, against respondents, who are the newly-elected Board of Directors.
Under the circumstances, the derivative suit filed by petitioners in behalf of the condominium corporation
in the Second Amended Complaint is improper