G.R. No. L-11143; February 26, 1958
ELIZALDE TRADING CORPORATION, petitioner, vs. HON. S.C. MOSCOSO, ETC., and PILAR S. BASILIO, respondents.

FACTS

Petitioner Elizalde Trading Corporation filed a claim for P536.66 in the intestate estate proceedings of Pedro Basilio. The respondent administratrix, Pilar S. Basilio, admitted the claim, and the court approved it on August 23, 1952. Despite several court orders directing payment, the administratrix failed to settle the claim. On January 25, 1956, in response to a motion for contempt, the administratrix asserted a belated counterclaim for about P1,000.00 against the petitioner, alleging it was for gasoline, oil, and diesel fuel furnished to “Florentine Craft Works (Teresa Marble Works),” which she claimed belonged to the petitioner. The respondent Judge, in an order dated August 4, 1956, allowed the administratrix to prove this offsetting claim, setting aside the final order of approval and reopening the claim. Petitioner’s motion for reconsideration was denied.

ISSUE

Whether the respondent Judge acted with grave abuse of discretion in setting aside the final and executory order approving the petitioner’s claim and in allowing the administratrix to prove a belated counterclaim.

RULING

Yes. The order of the respondent Judge dated August 4, 1956, is annulled and set aside. The respondent administratrix is ordered to pay the petitioner’s claim forthwith. The court’s approval of the claim on August 23, 1952, was final and executory. The counterclaim was filed out of time under Section 10, Rule 87 of the Rules of Court, which bars such claims if not presented within five days after service of the creditor’s claim. Furthermore, the counterclaim referred to an obligation of a different entity (Florentine Craft Works/Teresa Marble Works), not the petitioner. Equity cannot be invoked to justify setting aside a final order based on an untimely and unrelated counterclaim.