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Metals Engineering Resources Corporation v CA


G.R. No. 95631 | October 28, 1991
Facts:

Petitioner and private respondent, Plaridel Jose, executed an Agreement to Buy


and Sell. This agreement though was challenged by petitioner as patently
imperfect and incomplete as the payment of the purchase price is allegedly
uncertain and is subject to terms and conditions to be determined and agreed
upon separately and subsequently. It wrote a letter to Jose rescinding and/or
withdrawing from the "Agreement" and tendered a check of P50,000.00
representing full refund of the earnest money previously delivered by him.
Respondent, however, refused and even made adverse claims in the title of the
subject lands. Petitioner, thus, filed a civil case for annulment of the
abovementioned agreement. In its petition, averred that Jose, in accordance
with said imperfect agreement, prematurely caused the preparation of a
subdivision plan of the lands into several sub-lots and offered them for sale to
the public via an advertisement published in Manila Bulletin.
For his defense, Jose filed an Answer with Counterclaim. He insisted that the
Agreement is valid and, thus, due to injuries he sustained from the suit filed by
petitioner, he demanded payment of damages and attorneys fees.
Before the case could be heard on pre-trial, however, private respondent filed a
Motion to Expunge the Complaint on the ground that the same did not specify
the amount of damages sought either in the body or in the prayer thereof. This
prompted the trial court to require petitioner to amend its complaint to specify
the amount of damages prayed for. Petitioner complied.
Unsatisfied though, respondent moved for reconsideration of the trial court's
order allowing petitioner to file an amended complaint. Trial court granted it and
dismissed petitioners complaint.
Thereafter, respondent filed a Motion to Set Case for Presentation of Evidence in
support of his counterclaim. Petitioner opposed this, averring that since private
respondent's counterclaim is compulsory in nature, as a result of the dismissal
of petitioner's complaint, the compulsory counterclaim can no longer remain
pending for independent adjudication. The court a quo decided, however,
decided in favor of respondent. CA affirmed. Hence, this case was filed.

Issue:

WON respondent can present evidence in support of his compulsory counterclaim


despite the dismissal of the complaint?

Ruling:

The Court disagreed.

Private respondents counterclaim is compulsory in nature since (1) it arises out of,
or is necessarily connected with, the transaction or occurrence that is the subject
matter of the opposing party's claim; (2) it does not require for its adjudication the
presence of third parties over whom the court cannot acquire jurisdiction; and (3)
the court has jurisdiction to entertain the claim.

A compulsory counterclaim is auxiliary to the proceeding in the original suit and


derives its jurisdictional support therefrom. It follows then, as in this case, that if
the court does not have jurisdiction to entertain the main action of the case and
dismisses it, then the compulsory counterclaim, being ancillary to the principal
controversy, must likewise be dismissed since no jurisdiction remained for any
grant of relief under the counterclaim. Moreover, it was at the instance of
respondent that the complaint was dismissed. A person cannot eat his cake and
have it at the same time.

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