Intestate Estate of Dalisay v. Marasigan
REITERATIONFacts
The Antecedents: Petitioner, representing the Intestate Estate of Amado B. Dalisay, filed an unlawful detainer case against private respondent Lourdes Oppus for occupying a leased portion of a lot on a monthly basis. Petitioner alleged that it gave a one-month advance notice of lease termination and demanded the respondent vacate by April 1, 1993, but the respondent remained in possession. Procedural History: The private respondent countered that she did not receive any demand letter and that petitioner continued to collect rentals. She raised lack of jurisdiction due to non-compliance with the condition precedent of a prior demand to vacate as an affirmative defense and filed a counterclaim for moral damages and attorney's fees, invoking her right as a builder in good faith. During pre-trial, both parties stipulated that petitioner sent a notice via registered mail on March 11, 1993, but it was not effectively delivered. The Municipal Trial in Cities (MTCC) dismissed the case for lack of jurisdiction and awarded moral damages and attorney's fees to the respondent. The Regional Trial Court (RTC) affirmed the dismissal for lack of jurisdiction, holding that notice of termination is a condition precedent in month-to-month leases, but deleted the award for moral damages while sustaining attorney's fees. The Petition: Petitioner filed a petition for certiorari, questioning the RTC's jurisdiction to award attorney's fees after affirming the MTCC's dismissal for lack of jurisdiction over the main action. Petitioner argued that if the court had no jurisdiction over the principal action, it also had no jurisdiction over the compulsory counterclaim for attorney's fees.
Issue(s)
Whether the Regional Trial Court had jurisdiction to award attorney's fees after affirming the dismissal of the unlawful detainer case for lack of jurisdiction. Whether a compulsory counterclaim for attorney's fees can be adjudicated independently when the main action is dismissed for lack of jurisdiction.
Ruling
The petition is meritorious. The assailed decision of the RTC is modified to exclude the award of attorney's fees in favor of the private respondent.
Ratio Decidendi
On the issue of jurisdiction to award attorney's fees: The Court held that if the court dismisses the main action for lack of jurisdiction, no jurisdiction remains for any grant of relief under a compulsory counterclaim. The private respondent herself caused the dismissal of her counterclaim by moving for the dismissal of the complaint, stating that "a person cannot eat his cake and have it at the same time." If the civil case is dismissed, so also is the counterclaim filed therein. On the issue of independent adjudication of a compulsory counterclaim: The Court held that a counterclaim is compulsory if it arises out of, or is necessarily connected with, the transaction or occurrence that is the subject matter of the opposing party's claim, does not require the presence of third parties over whom the court cannot acquire jurisdiction, and the trial court has jurisdiction to entertain the claim. The private respondent's claim for attorney's fees was found to be a compulsory counterclaim. The Court reiterated its consistent holding that a compulsory counterclaim cannot remain pending for independent adjudication. It derives its jurisdictional support from the main action; therefore, if the court dismisses the main action for lack of jurisdiction, the compulsory counterclaim, being ancillary, must likewise be dismissed as no jurisdiction remains for any grant of relief under the counterclaim. This doctrine aligns with the objective of avoiding circuity of action by litigating the entire controversy in one action.
Main Doctrine
A court that lacks jurisdiction over the principal action also lacks jurisdiction over a compulsory counterclaim, which is auxiliary to the main action and derives its jurisdictional support therefrom.