Banco de Oro Universal Bank v. Locsin
REITERATIONFacts
The Antecedents: Respondents, spouses Gabriel and Ma. Geraldine Locsin, obtained several loans from petitioner, Banco de Oro Universal Bank (BDO). These included a P700,000.00 Term Loan Agreement (1st TLA) secured by their property (TCT No. N-138739), and a P800,000.00 second Term Loan Agreement (2nd TLA) secured by another property (TCT No. 67286), which was later settled. They also entered into a P2.5 Million Credit Line Agreement (CLA) secured by properties of their business partners, the spouses Evidente (TCT Nos. N-166336 and N-166337). The Locsins made regular payments until October 1997. BDO subsequently initiated extra-judicial foreclosure proceedings against the Evidente properties and the Locsin property securing the 2nd TLA. An amended application for foreclosure was later filed, including the Evidente properties and the Locsin property securing the 1st TLA (TCT No. N-138739). Procedural History: On August 24, 1998, two days before a scheduled auction, the Locsins filed a complaint against BDO for Specific Performance, Tort, and Damages, seeking to enjoin the foreclosure. The Regional Trial Court (RTC) of Quezon City denied their prayer for a Temporary Restraining Order. BDO filed an Answer with Compulsory Counterclaim. Subsequently, the Locsins filed a Supplemental Complaint, alleging that the foreclosure auction proceeded on September 23, 1998, contrary to law, and sought its cancellation. More than eight months later, BDO filed a separate complaint for Collection of Sum of Money before the RTC of Mandaluyong, seeking to recover the deficiency after the foreclosure sale. The Locsins moved to dismiss BDO's complaint, arguing it should have been raised as a compulsory counterclaim in their original case and was therefore barred. The Mandaluyong RTC denied the motion, deeming the claim permissive. However, the Court of Appeals reversed this, finding BDO's claim to be a compulsory counterclaim that was barred, and also citing litis pendentia and forum shopping. The Petition: BDO filed a Petition for Review on Certiorari with the Supreme Court, arguing that the Court of Appeals erred in holding its collection complaint to be a compulsory counterclaim, in finding litis pendentia, and in ruling that it engaged in forum shopping. BDO contended that its claim arose from contract and law, distinct from the Locsins' tort claim, and that its cause of action for deficiency only arose after the foreclosure sale, which occurred after it had filed its initial Answer. The Locsins, in their Comment, maintained that BDO's claim was logically related to their own, arose from the same transactions, and should have been raised as a compulsory counterclaim. The Supreme Court granted the petition, finding that BDO's cause of action for the deficiency claim had not yet arisen at the time it filed its Answer to the Locsins' original complaint, and therefore, it was not barred from filing a separate action for that claim. The Court also found no identity of rights asserted and reliefs sought to support litis pendentia or forum shopping.
Issue(s)
Whether petitioner's complaint for collection of deficiency claim is a compulsory counterclaim that should have been set up in the Locsins' original complaint. Whether litis pendentia and res judicata apply to bar petitioner's complaint. Whether petitioner is guilty of forum shopping.
Ruling
The petition is GRANTED. The assailed decision of the Court of Appeals is SET ASIDE. The case is REMANDED to the Regional Trial Court of Mandaluyong, Branch 213, to continue with the proceedings in Civil Case No. MC-99-935.
Ratio Decidendi
On the nature of the counterclaim: The Supreme Court held that petitioner's claim for deficiency judgment did not arise until after the extra-judicial foreclosure sale on September 23, 1998, and the Locsins' subsequent failure to pay the deficiency. When petitioner filed its Answer with Compulsory Counterclaim on September 11, 1998, the foreclosure had not yet occurred, and thus, the cause of action for deficiency had not yet arisen. The Court emphasized that a counterclaim must exist at the time of filing the answer. Since the claim matured after the filing of the Answer, it was an "after-acquired counterclaim." While it could have been set up in a supplemental pleading after the Locsins filed their Supplemental Complaint, such a counterclaim is merely permissive, not compulsory. Therefore, it was not barred from being filed as an independent action. On litis pendentia and res judicata: The Court found that the allegations in both complaints did not reflect an identity of rights asserted and reliefs sought to a degree sufficient to give rise to litis pendentia or res judicata. The Locsins' complaint in Civil Case No. Q-98-35337 primarily sought specific performance, tort, damages, and annulment of foreclosure, while petitioner's complaint in Civil Case No. MC-99-935 was for the collection of a deficiency judgment arising from the foreclosure sale. The Court noted that the deficiency claim arose after the foreclosure, which occurred after the initial complaint was filed. The nature of the claims and the reliefs sought were distinct enough to warrant separate proceedings, especially considering the timing of the deficiency claim's accrual. On forum shopping: The Court concluded that petitioner was not guilty of forum shopping. Forum shopping requires the identity of parties, rights asserted, reliefs prayed for, and the fact that a judgment in one case would amount to res judicata in the other. Given the Court's findings on the distinct nature of the claims and the fact that the deficiency claim was an "after-acquired" claim that could not have been set up as a compulsory counterclaim in the initial action, the elements of litis pendentia and res judicata were not met. Therefore, the filing of a separate action for the deficiency claim did not constitute willful and deliberate forum shopping.
Main Doctrine
A claim that arises or matures after the filing of an answer, even if it is logically related to the plaintiff's claim, is considered an "after-acquired counterclaim" and is merely permissive, not compulsory. Consequently, it is not barred if not set up in the original answer and can be filed as an independent action.