165.) Pinga vs.

Heirs of German Santiago

DOCTRINE:
FACTS:

In 1998, the Heirs of Santiago filed a complaint for injunction against Pinga
(Eduardo) and Saavedra, seeking to enjoin the latter from committing acts of
depredation on their properties.

Pinga and Saavedra filed their Amended Answer with Counterclaim, alleging that
Pinga's father (Edmundo) had been in possession of such properties since the 1930s,
that the Santiagos were previosusly ordered ejected from the properties after a
complaint for forcible entry filed by the Heirs of Pinga's father, and that owing to the
Santiagos' forcible re-entry and the irresponsible and reckless filing of the case, they
should be awarded damages instead.

By 2005, the Santiagos failed to present their evidence upon motion by Pinga and
Saavedra, the RTC dismissed the complaint for failure to prosecute. The RTC also
allowed Pinga and Saavedra to present their evidence ex parte.

Santiagos filed a Motion for Reconsideration, praying that the entire action,
including the counterclaim, be dismissed and that Pinga and Saavedra be disallowed
to present their evidence ex parte. Citing jurisprudence, they claimed that
compulsory counterclaims cannot be adjudicated independently of plaintiff's cause
of action, therefore, the dismissal of the complaint complaint carries with it that of
the compulsory counterclaim.

RTC granted the Santiagos' Motion for Reconsideration and dismissed the
counterclaim on the ground that there was no opposition to the MOR .

The matter was elevated directly to the SC by way of Petition for Review under

Rule 45 on a pure question of law.

ISSUE:
WON the dismissal of the complaint carries with it the dimissal of the compulsory
counterclaim. (NO)
HELD:

The Court said that the former jurisprudential rule can no longer stand in light of the
change introduced in Sec. 3, Rule 17 of the 1997 Rules of Civil Procedure which
contains an explicit proviso that if the complaint is dismissed due to the fault of the
plaintiff, such dismissal is WITHOUT PREJUDICE TO THE RIGHT OF THE
DEFENDANT TO PROSECUTE HIS COUNTERCLAIM IN THE SAME OR IN A
SEPARATE ACTION.
In a compulsory counterclaim, the fact that the culpable acts on which it is based are
founded withing the same transaction or occurrence as the complaint, is insufficient
causation to negate the counterclaim together with the complaint. While the
dismissal or withdrawal precludes the pursuit of litigation, either through his own
initiative or fault, it would be unfair to similarly encumber the defendant who did
not maintain such initiative or fault. If the defendant similarly moves or the
dismissal of the counterclaim or neglects to timely pursue such action, the dismissal
of the counterclaim should be premised on such grounds imputable to the defendants
and not on the actuations of the plaintiff.
If the RTC were to dismiss the counterclaim, it should be on the merits of such
counterclaim and not because of the survival of the complaint.