AGUSTIN v BACALAN W/n a CFI, in an appeal to it, can award a counterclaim in an
Petitioner: Glicerio Agustin (Admin of Intestate Estate of
Susana Agustin)
Respondents: Laureano Bacalan, Provincial Sheriff of Cebu
G.R. No. L-46000; March 18, 1985; J. Gutierrez Jr.
DOCTRINE:
An appellate court cannot grant a counterclaim beyond the
jurisdiction of the court of the court of origin.
FACTS
1. Bacalan was a lessee of a building owned by Susana. An
action against him was filed because of non-payment of
rentals in the City Court of Cebu.
2. Bacalan, as a counterclaim in the said case, asked for
actual, moral, and exemplary damages and attorneys fees
(because he alleges that the suit was done to harass him)
3. City Court of Cebu dismissed the counterclaim and
ordered Bacalan to vacate the premises. Bacalan
appealed this decision to the CFI of Cebu (CFI 1) .
4. CFI of Cebu awarded the following to Bacalan: P10k as
moral damages, P5k as exemplary damages, and P1k as
attorneys fees (total of P16k)
5. Agustins counsel was unable to appeal the decision of the
CFI of Cebu, thus making the decision final and executory
6. With a new counsel, Agustin filed a complaint in another
branch of the CFI of Cebu (CFI 2) raising the ground that
CFI 1 granted a relief that was null and void because its
award is beyond the jurisdiction given to a City Court
which, as given by Sec. 88 of the Judiciary Act of 1948,
only covers civil cases involving P10k as the maximum
amount. CFI 2 dismissed the case.
7. CA certified to SC because it involved only pure questions
of law.
MAIN ISSUE
amount exceeding or beyond the jurisdiction of the court of
origin?
HELD/RATIO
No. the CFI cant award the counterclaim to Bacalan that
exceeded the jurisdictional amount of the City Court of Cebu
(the court of origin).
A court has no jurisdiction to hear and determine a
counterclaim in excess of its jurisdiction. A counterclaim may
only be pleaded by way of defense, to weaken the plaintiffs
claim, but not to obtain affirmative relief.
In the case-at-bar, Bacalan presented his claim before the
City Court of Cebu, thus submitting the same to the jurisdiction
of the court. He became bound thereby. The amount of P10k
being the jurisdictional amount assigned to a City Court,
Bacalan is thereby deemed to have waived the excess of his
claim beyond P10k.
A counterclaim not presented in the inferior court cannot be
entertained in the CFI on appeal (Bernardo v Genato). Thus,
Bacalan's counterclaim beyond P10k should be treated as
having been deemed waived. It is as though it has never been
brought before trial court and may not be entertained on
appeal.
Appellate jurisdiction is a continuation of the exercise of the
same judicial power which has been executed in the court of
original jurisdiction and also presupposes that the original and
appellate courts are capable of participating in the exercise of
the same judicial power.
When a court transcends the limits prescribed for it by law
and assumes to act where it has no jurisdiction, its
adjudications will be utterly void and of no effect either as an
estoppel or otherwise
OTHER ISSUES
1. W/n moral damages can be awarded in ejectment cases?
 Yes, IF it was awarded in the concept of a counterclaim.
A claim for money may be set in the counterclaim, which
the court may grant.
2. W/n an action to declare the nullity of award is a proper
remedy even if the award has become final and executory?
Yes. In this case it was a proper award because the CFI
awarded judgment in excess of the jurisdictional amount of
the court of origin. BUT the courts jurisdiction over the
main action will remain unaffected. So the counterclaim
here, not beyond the jurisdictional amount of the City Court
of Cebu, will remain

DISPOSITION:
Decision of CFI of Cebu is declared null and void with respect
to the excess of P6000 beyond its appellate jurisdiction. The
decision in all other respects is affirmed. Bacalans
counterclaim is granted to the extent of P10k.