GR L 16592; (October,1961) (Digest)
G.R. No. L-16592; October 27, 1961
ENRIQUE ICASIANO, plaintiff-appellee, vs. FELISA ICASIANO, defendant-appellant.
FACTS
Plaintiff Enrique Icasiano filed a complaint to recover P20,000 from defendant Felisa Icasiano. Within the reglementary period, the defendant filed an answer containing two counterclaims. The first counterclaim sought to recover P150 allegedly borrowed by the plaintiff from the defendant. The second counterclaim was for moral and exemplary damages, attorney’s fees, and litigation expenses.
The plaintiff moved to dismiss the first counterclaim. The lower court granted this motion in an order dated December 7, 1959, dismissing said counterclaim and setting the case for hearing. The defendant appealed from this order. The plaintiff moved to dismiss the appeal, arguing the order was interlocutory and the appeal frivolous. This Court initially denied the motion to dismiss the appeal, leading to the resolution of the case on its merits.
ISSUE
Whether the lower court erred in dismissing the defendant’s first counterclaim for P150.
RULING
Yes, the lower court erred. The Supreme Court reversed the order dismissing the first counterclaim. The legal logic proceeds from the nature of compensation under the Civil Code. Articles 1278, 1279, 1286, and 1290 establish that when two persons are mutually debtors and creditors of each other for liquidated and demandable sums, compensation takes place by operation of law. This legal compensation extinguishes both debts to the concurrent amount automatically, even if the parties are unaware of it or do not expressly plead it.
Therefore, the defendant’s counterclaim for P150 was not merely an independent claim for a sum below a potential jurisdictional amount. It was effectively a plea of set-off or compensation. If proven true, this debt would operate to reduce the plaintiff’s P20,000 claim by P150, regardless of whether the counterclaim was formally asserted. The Court noted the counterclaim was set up precisely for this purpose—to reduce any potential judgment against her, not solely to obtain an affirmative money judgment. Consequently, the trial court had jurisdiction to entertain it as a defensive pleading in the nature of compensation. The case was remanded to the lower court for further proceedings.