G.R. Nos. 72664-65 March 20, 1990
UNITED COCONUT PLANTERS BANK, petitioner, vs. HON. INTERMEDIATE APPELLATE COURT and MAKATI BEL-AIR CONDOMINIUM DEVELOPERS, INC., respondents.

FACTS

Petitioner United Coconut Planters Bank (UCPB) filed a complaint-in-interpleader against Makati Bel-Air Condominium Developers, Inc. (Makati Bel-Air) and Altiura Investors, Inc. (Altiura) concerning a manager’s check for P494,000. Altiura had purchased the check payable to Makati Bel-Air as partial payment for a condominium unit. Altiura subsequently requested UCPB to stop payment, alleging a discrepancy in the unit’s area. UCPB, informed of conflicting claims from both parties and with Makati Bel-Air refusing to voluntarily withhold presentment of the check, filed the interpleader to have the court determine the rightful claimant and deposited the funds.
Makati Bel-Air filed an answer with a counterclaim for P5 million in damages against UCPB, alleging the bank violated its guarantee on the manager’s check by effectively stopping payment. Later, Makati Bel-Air cancelled the sale, returned the check to UCPB, and raised no objection when the trial court ordered the release of the funds to Altiura. UCPB then moved to withdraw its interpleader complaint and to dismiss the counterclaim. The trial court granted the motion, dismissing the counterclaim as the interpleader had become moot.

ISSUE

Whether the trial court correctly dismissed Makati Bel-Air’s counterclaim against UCPB upon the withdrawal and dismissal of the interpleader complaint.

RULING

Yes, the trial court correctly dismissed the counterclaim. The Supreme Court reversed the appellate court’s decision that had reinstated the counterclaim. The Court held that Makati Bel-Air’s counterclaim was compulsory in nature. A compulsory counterclaim arises out of or is necessarily connected with the transaction or occurrence constituting the subject matter of the opposing party’s claim. Here, the counterclaim for damages was directly based on UCPB’s act of filing the interpleader suit and its consequent refusal to honor the check immediately—actions which were the very essence of the bank’s complaint.
The legal logic is that when a complaint is dismissed, a compulsory counterclaim dependent thereon must also be dismissed, as it cannot stand independently. The Court found UCPB’s recourse to interpleader was proper and not in bad faith, as it faced genuine adverse claims from its depositor, Altiura, and the payee, Makati Bel-Air. Since the trial court validated the propriety of the interpleader by dismissing it as moot after the underlying dispute between the claimants was resolved, it logically followed that Makati Bel-Air could not recover damages for an action the court deemed justified. Furthermore, Makati Bel-Air was not a holder in due course of the check, as it was aware of the partial failure of consideration (the area discrepancy) and the adverse claim at the time it received the instrument. Thus, the compulsory counterclaim was extinguished with the dismissal of the main complaint.