Skip to main content

Fighting Back Lawsuit Through Counterclaim

Filing a counterclaim is probably the best way to fight back a lawsuit. This is especially effective if you have valid grounds for a claim against the other party. It may or may not be related to the transaction or incident subject of the complaint. It may be a compulsory or permissive counterclaim. Regardless as to the type of counterclaim you have over the plaintiff, the purpose of counterclaim is to deter lawsuit, cushion the impact of an adverse judgment, force the other party to settle amicably, or offset contending claims.

One must be mindful as to what kind of counterclaim you have against the adverse party. The two types of counterclaims have different effects or governed under different rules. For example, if it is a compulsory counterclaim, you do not have to pay the docket fees but if it is a permissive counterclaim, docket fees should be paid depending on the amount prayed for. If you do not file a compulsory counterclaim, you will be deemed to have waived it and you are barred in filing it later on. On the other hand, a permissive counterclaim may be pursued through filing a different or separate case against the other party.

Moreover, if the main action subject of counterclaim is dismissed, it is incumbent upon you to object to the dismissal if the counterclaim is compulsory. Failure to do so would be deemed a waiver to present evidence as to prove such counterclaim. The rule is a compulsory counterclaim cannot remain pending for independent adjudication of the court.

That is why in BA Finance Corporation vs Rufino Co, et al., GR No. 105751, June 30, 1993, the Court advised members of the legal profession that the proper recourse for those who want to pursue his counterclaim if grounds to dismiss are present is to file a motion to declare the plaintiff non-suited and not motion to dismiss. This way, the court still retains jurisdiction over the case and the compulsory counterclaim.

So how do you know that the counterclaim you have against the adverse party is one that is compulsory or not? the SC in the case of Cabaero vs. Santos, GR No. 102942, April 18, 1997, citing Justice Cruz, said:

A counterclaim is compulsory and is considered barred if not set up where the following circumstances are present: (1) that 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) that it does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction, and (3) that the court has jurisdiction to entertain the claim.

In the aforementioned Supreme Court decision, the august body struggled how to apply the Javier doctrine and ultimately decided not to apply it and dismissed the counterclaim just because there is no clear cut rules on how to deal with counterclaims based on impliedly instituted independent civil action. 

The problem in the said case is that the respondents filed a counterclaim based on malicious prosection. I think it would have been better to have resolved the case using Justice Regalado's argument that the counterclaim in issue has no valid, complete and enforceable cause of action. How else would we know if it is a malicious prosecution if the complaint has not been decided yet?

If it were not due to this brilliant discussions on counterclaim in the said case, I am pretty sure that every lawsuit will be meted out with an answer with counterclaim for malicious prosecution.

Popular posts from this blog

How To Terminate Leasehold Tenancy Relationship on Agricultural Property

Pursuant to RA 3844, a tenant of an agricultural land has a security of tenure. Meaning, he cannot be ejected outside those grounds provided under the law. His right to cultivate the land can be passed on to qualified immediate family members. Once established, expressly or impliedly, this seemingly infinite right of the tenant to hold and cultivate a landowner's agricultural land can be problematic to those who want to sell the land, change tenants or to those landowners who want to handle production by themselves.  Under the law, there are three instances tenancy may be dissolved or extinguished: 1. By court order; 2. By voluntary surrender of landholding in favor of the landlord; 3. By absence of immediate family member to continue cultivation in case of permanent disability, old age or death of the tenant. Outside the said three instances, a tenant may not be legally ousted from his cultivation of the land. Some landowners would complain to the concerned ...

Opening Statement

Welcome! This site is dedicated to actual and practical application of law especially in the Philippines. It does not really matter much if you are abroad because the spirit and the logic behind law around the world is basically the same. Just bear in mind that discussions in this site on law and court decisions as applied to different situations reflect the opinions of the authors on the matter. All persons and situations discussed in this site are fictional and/or purposely changed to protect the identity of the persons concerned.

Small Claims: Faster Way to Collect Money?

One consideration in filing a collection case against somebody is the amount of money owed to you. But kudos to the Supreme Court for passing the 2016 Revised Rules of Procedure for Small Claims Cases. Without it, it was impractical to file a suit for collection especially if it involves a measly 4 to 5 figures before. Say, you loaned P20,000 to B. B defaulted in paying. It would be impractical to hire a lawyer to collect the indebtedness from B considering that a lawyer's retainer would usually cost you P20,000 also. Instead of getting back the money, you will find yourself losing some more on account of hiring a lawyer and the cost of litigation. With the Rules on Small Claims Cases, this immensely helped ordinary Juans to easily collect money because it specifically does not allow representation by a lawyer.  All you have to do is to download a readily available form online (just make sure it is the 2016 format) or ask for some forms with the MTC, fill it up, attach the sup...