Sievert v. Court of Appeals

Facts

Alberto Sievert ("Sievert") received by mail a Petition for Issuance of a Preliminary Attachment, despite not having previously received any summons or any copy of a complaint. Sievert's counsel appeared before the court to question its jurisdiction over Sievert's person. The trial court denied Sievert's objections and proceeded to hear the application.

Issue

Whether or not the trial court acquired jurisdiction over the person of Sievert.

Held

No.

Ratio Decidendi

A preliminary attachment is an ancillary remedy. Hence, the court's lack of jurisdiction over the person of the defendant in the principal action would necessarily mean that it likewise lacks such jurisdiction in the ancillary proceeding. In this case, jurisdiction has not been acquired over Sievert in the principal action as no summons has been served upon him. Hence, it was an error for the trial court to proceed with the hearing on the application for writ of preliminary attachment.

Davao Light v. Court of Appeals

Facts

The Davao Light and Power Co., Inc. ("Davao Light") filed a collection suit against Queensland Hotel ("Queensland") and Teodorico Adarna ("Adarna") with an ex parte application for a writ of preliminary attachment. On 3 May 1989, the trial court issued an Order of Attachment, and the corresponding Writ of Attachment on 11 May 1989. On 12 May 1989, the summons, a copy of the complaint, and the writ of attachment was served upon Queensland and Adarna. Queensland and Adarna filed a motion to discharge the attachment on the ground that at the time the Order of Attachment and Writ of Attachment were issued, the trial court has yet to acquire jurisdiction over the cause of action and over the persons of the defendants.

Issue

Whether or not the writ of preliminary attachment was validly issued.

Held

Yes. A writ of preliminary attachment may be issued before the court acquires jurisdiction over the person of the defendant.

Ratio Decidendi
The court may validly issue a writ of preliminary injunction prior to the acquisition of jurisdiction over the person of the defendant. There is an appreciable period of time between the commencement of the action (takes place upon the filing of an initiatory pleading) and the service of summons to the defendant. In the meanwhile, there are a number of actions which the plaintiff or the court may validly take, including the application for and grant of the provisional remedy of preliminary attachment. There is nothing in the law which prohibits the court from granting the remedy prior to the acquisition of jurisdiction over the person of the defendant. In fact, Rule 57 of the Rules of Court allows the granting of a writ of preliminary injunction at the commencement of the suit. In the cases of Toledo v. Burgos and Filinvest Credit Corporation v. Relova, it was held that notice and hearing are not prerequisites to the issuance of a writ of preliminary attachment. Further, in the case of Mindanao Savings & Loan Association, Inc. v. Court of Appeals, it was ruled that giving notice to the defendant would defeat the purpose of the remedy by affording him or her the opportunity to dispose of his properties before the writ can be issued.
A preliminary attachment may be discharged with the same ease as obtaining it. In any case, the ease of availing the provisional remedy of preliminary attachment is matched by the ease with which it can be remedied by either the posting of a counterbond, or by a showing of its improper or irregular issuance. The second means of defeating a preliminary attachement, however, may not be availed of if the writ was issued upon a ground which is at the same time the applicant's cause of action.
Preliminary attachment not binding until jurisdiction over the person of the defendant is acquired. The writ of preliminary attachment, however, even though validly issued, is not binding upon the defendant until jurisdiction over his person is first acquired.

Shaffer v. Heitner

Facts

Arnold Heitner ("Heitner") owned a share of stock in Greyhound Corporation ("the corporation"), which was incorporated in Delaware. He instituted a derivative suit in Delaware against 28 of the corporation's officers, most of whom reside outside the state, for causing the corporation to perform acts which eventually led to it incurring substantial anti-trust liabilities. In connection with the said suit, Heitner filed a motion to have the shares of the defendant officers in the corporation sequestered. None of the concerned certificates of stock were physically in Delaware. Nevertheless, Delaware law provides that the said certificates shall be deemed within the said state as it was the state of incorporation.

Service of notice was effected by registered mail to the defendant officers' last known addresses and by publication in a newspaper. The defendant officers objected, arguing that the mode of service denied them of due process and that they did not have sufficient contacts with Delaware so as to justify the said state's exercise of jurisdiction over them.

Issue

Whether or not the Delaware has jurisdiction over the defendant officers by virtue of their ownership of stock of a Delaware corporation.

Held

No. There is no sufficient contacts between the forum state and the defendants.

Ratio Decidendi

Mere ownership of property within a state does not justify that state's automatic assumption of personal jurisdiction over a party. The shares of stock held by the defendant officers is not the subject matter of the suit. Further, the cause of action underlying the suit is not related to the said shares. Heitner's argument that Delaware, being the state of incorporation, has a strong interest in the supervision of the corporation and therefore, jurisdiction over its officers as corporate fiduciaries deserve little consideration. Delaware law bases its jurisdiction not on the status of the defendant officers as corporate fiduciaries, but on the presence of their property in the said state. In any case, if the argued strong interest did exist, then the Delaware Legislature would have enacted a statute establishing such jurisdiction. Moreover, Heitner's contention that fairness dictates that the defendant officers be made accountable for misusing benefits given to them by Delaware law is untenable. It does not demonstrate that the defendant officers deliberately took advantage of the said privileges within Delaware so as to justify the exercise of the said state's jurisdiction over them. The defendant officers were not required to acquire their respective shares in order to hold their position. Mere acquisition of the said interests within a state is not a waiver of their rights to be sued only in states where they have minimum contacts.