1.

Cruz v Agana
FACTS: As response to Cruz’s Complaint for annulment of title, Agana filed an Answer
with compulsory counterclaim. Cruz moved to dismiss this for lack of a certificate of
non-forum shopping. Trial Court denied the motion and found the counterclaim
compulsory in nature, and as such, does not require a certificate of non-forum shopping,
pursuant to Sto. Tomas Univ. Hospital v. Surla.
FIRST RELEVANT ISSUE: Is the counterclaim herein compulsory or permissive? -
COMPULSORY
SECOND RELEVANT ISSUE: Was the Trial Court correct in saying that a certificate of non-
forum shopping is required? – YES.
RULING ON FIRST RELEVANT ISSUE: It is clear that the counterclaim set up by
respondent arises from the filing of plaintiff's complaint. The counterclaim is so
intertwined with the main case that it is incapable of proceeding independently. The
counterclaim will require a re-litigation of the same evidence if the counterclaim is
allowed to proceed in a separate action.
RULING ON SECOND RELEVANT ISSUE: Administrative Circular No. 04-94 (re mandatory
nature of the certificate of non-forum shopping) does not apply to compulsory
counterclaims. The circular applies to initiatory and similar pleadings. compulsory
counterclaim set up in the answer is not an "initiatory " or similar pleading. The
initiatory pleading is the plaintiff's complaint. A respondent has no choice but to raise a
compulsory counterclaim the moment the plaintiff files the complaint. Otherwise,
respondent waives the compulsory counterclaim. In short, the compulsory counterclaim
is a reaction or response, mandatory upon pain of waiver, to an initiatory pleading
which is the complaint.