JUSTICE DE LEON

DIZON | LORESCA | LUMINARIAS | SANTOS, K. | SY | TY | VILCHES Ateneo Law School

2-D ||

EFFECT ON COUNTERCLAIM
Pinga v. Santiago (06/30/06) Justice Tinga D: The dismissal of a complaint due to the fault of the plaintiff is without prejudice to the right of the defendant to prosecute any pending counterclaims of whatever nature in the same separate action. Action filed by plaintiff: Complaint for Injunction Petition with SC: Petition for Review under Rule 45 on a case of pure question of law Facts: 1. Pinga was named one of two defendants in a suit filed by the Heirs of Santiago accusing Pinga and Saavedra of committing acts of depredation on their properties. Pinga and Saavedra were said to have entered the Heirs of Santigos coco lands and cut wood and bamboos and harvested coconuts 2. Pinga and Saavedra filed an Amended Answer with Counterclaim and questioned the ownership of the Heirs of Santiago. They claim that the Pingas father, Edmundo Pinga has been in possession of the property since the 1930s and as far back as 1968, the Heirs of Santiago have been ordered to vacate the property by virtue of a forcible entry case filed by the Heirs of Edmundo Pinga. Pinga prayed for the award of P2.1 M plus cost of suit as compensation for the Heirs of Santiagos reckless filing of suit 1

3. Before trial can be completed, the case was dismissed after Pingas counsel sought to postpone again the set hearing. Prior to the dismissal, both petitioner and defendant to present their evidence. However, the RTC reversed the dismissal. 4. On the next scheduled hearing, the Heirs counsel failed to appear. The RTC dismissed the case for Pingas failure to prosecute the case within a reasonable time due to the Heirs fault. Pinga was allowed to present his evidence ex-parte 5. The Heirs of Santiago filed a motion for reconsideration asking the court to dismiss the case rather than reinstating the case. The Heirs wanted to prevent Pinga from presenting evidence ex-parte, hence the motion to dismiss. 6. RTC dismissed the counterclaim of Pinga since he did not oppose the Heirs motion for reconsideration. 7. The Heirs filed an Opposition to Pingas Urgent Motion for Reconsideration, wherein the Heirs argued that the prevailing jurisprudential rule is that "compulsory counterclaims cannot be adjudicated independently of plaintiffs cause of action," and "a conversu, the dismissal of the complaint carries with it the dismissal of the compulsory counterclaims 8. The case was elevated to the SC by Petition for Review under Rule 45 Issue: WON the dismissal of the complaint carries with it the dismissal of the counter-claim Held: No Ratio: 1. Section 3, Rule 17 of the 1997 Rules of Civil Procedure states that the dismissal of the complaint due to the fault of plaintiff (Heirs) does not necessarily carry with it the dismissal of the counterclaim, compulsory or otherwise. In

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JUSTICE DE LEON

DIZON | LORESCA | LUMINARIAS | SANTOS, K. | SY | TY | VILCHES Ateneo Law School

2-D ||

fact, the dismissal of the complaint is without prejudice to the right of defendants to prosecute the counterclaim. 2. From the facts, the RTC justified its decision of dismissing the counter-claim due to Pingas failure to file a timely motion for reconsideration. 3. There is no rule requiring the filing of a motion for reconsideration in order to prevent the dismissal of a counter-claim. "Failure to file an opposition to the Plaintiffs (Heirs of Santiagos) Motion for Reconsideration is not one among the established grounds for dismissal of the counterclaim. 4. Dismissal of the case was due to defendant Heirs fault. Their failure to appear led the RTC to dismiss the case based on Pingas failure to prosecute. 5. The dismissal of a complaint due to the fault of the plaintiff is without prejudice to the right of the defendant to prosecute any pending counterclaims of whatever nature in the same separate action. Under the revised rules, when the plaintiff moves for the dismissal of his complaint to which a counterclaim has been interposed, the dismissal shall be limited to the complaint. Such dismissal shall be without prejudice to the right of the defendant to either prosecute his counterclaim in a separate action or to have the same resolved in the same action. 6. Should the defendant decide to prosecute under the counterclaim, the court must order granting and reserving his right to prosecute his claim in a separate complaint. On the other hand, should the defendant decide to have his counterclaim disposed of in the same action wherein the complaint had been dismissed, he must manifest such preference to the trial court within 15 days from notice to him of plaintiffs motion to dismiss. The court also expressly stated that the rulings in BA Finance and other cases inconsistent with the ruling of this case are hereby abandoned. 2

IS CERTIORARI A PROPER REMEDY?

Jao v. CA (12/19/95) Justice Panganiban

D: The proper remedy of a party wrongly declared in default is either to appeal from the judgment by default or to file a petition for relief from judgment, and not certiorari

Petition for COA of Top Service: Collection with Damages Petition of Jao with CA: Petition for certiorari

Facts: 1. Jao & Company, Inc. (Jao) was sued by Top Service Inc. for collection of rentals and damages. The sheriff levied on the 2 barges of Jao and was set for public auction 2. RTC issued a TRO to stop prevent the auction sale 3. Jao failed to appear on its RTC hearing with Top

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JUSTICE DE LEON

DIZON | LORESCA | LUMINARIAS | SANTOS, K. | SY | TY | VILCHES Ateneo Law School

2-D ||

Service, Inc 4. The RTC issued an order dated April 14, 1989 declaring said Jao in default and allowed evidence to be presented ex-parte. The petitioner however filed an answer. 5. The RTC ordered Jao to pay Top Service P150,920.00 representing agreed rentals with 12% interest per annum from date of filing of the suit, attorney's fees of P5,000.00, plus costs. 6. Upon receipt of the adverse decision, Jao filed a motion for reconsideration and/or to set aside decision. Pending resolution of the motion, respondent judge restrained the sheriff from holding an auction sale of two barges he earlier levied on. 7. January 10, 1990, the trial court denied the said motion and lifted the restraining order against the auction sale. On January 12, 1990, the sheriff of Manila gave petitioner a Notice of Resetting of Execution Sale of Personal Properties on January 15, 1990. 8. Jao filed a petition on certiorari with the CA contesting the jurisdiction of the RTC. A day after such petition, the CA issued a TRO to stop the sheriff from conducting the sale. However, the 2 barges were already sold to different parties. Abadilla was the last buyer. The CA denied Jaos writ of preliminary injunction. 9. Top Service argues that the trial court's decision has become final and executory and that the barges have been bought and resold to buyers in good faith, 3

and that at any rate, the parties have another pending case for replevin of said properties pending in Branch I of the Regional Trial Court of Manila. 10.Jao avers that the decision could not become final because it was not given notice of the order of April 14, 1989 declaring it in default and of the decision of May 26, 1989

Note: the issue on preliminary injunction will not be discussed in this digest

Issue: WON the RTC decision promulgated on May 26, 1989 has become final Held: Yeeeeees. The certiorari filed by Joa was not a proper remedy; hence the decision has become final Ratio: 1. The proper remedy of a party wrongly declared in default is either to appeal from the judgment by default or to file a petition for relief from judgment, and not certiorari 2. A default judgment is an adjudication on the merits and is, thus, appealable. Since appeal is the proper remedy, the extraordinary writ of certiorari will not lie. 3. Also, even if JAo really failed to receive constructive notice from the RTCnotices of default and notice of

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JUSTICE DE LEON

DIZON | LORESCA | LUMINARIAS | SANTOS, K. | SY | TY | VILCHES Ateneo Law School

2-D ||

decisionsuch defect was cured when it filed a motion for reconsideration. 4. Jao should not have filed for certiorari. It should have filed an appeal instead

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