SPOUSES REYNALDO AND ESTELITA JAVIER, PETITIONERS, VS. INTERMEDIATE APPELLATE COURT AND LEON S. GUTIERREZ, JR., RESPONDENTS.

It is not disputed that the private respondent issued to the
petitioners a check that was subsequently dishonored and not made good despite
the required notice of dishonor.  For
this he has been charged with estafa under B.P. Blg. 22 in the Regional Trial Court of Makati.  His reason for issuing the check is not
before us now.  The question we are asked
to resolve is whether or not he can raise that reason in another court, in a
separate civil action for damages filed by him against the petitioners.

The information against Leon S. Gutierrez, Jr. was filed on April
1, 1985, and docketed as Criminal Case No. 15581 in the Regional Trial Court of
Makati.^[1]
The civil case was not reserved.  On
September 5, 1985, Gutierrez filed a complaint for damages against the
petitioners in the Regional Trial Court of Catarman,
Northern Samar. 
This was docketed as Civil Case No. C-355.  In this complaint, the defendants were
charged with having inveigled Gutierrez into signing the very check subject of
the criminal case in
the Makati court.^[2] The complaint in effect
explains why he issued the check for which he is now facing prosecution.

On September 17, 1985, the petitioners filed a motion to dismiss
Civil Case No. C-355 on the grounds of lack of a cause of action and litis pendentia.^[3]
The motion was denied on September 24, 1985. 
On the other hand, the private respondent moved to suspend proceedings
in Criminal Case No. 15581 pending the resolution of what was claimed to be the
prejudicial question raised in the civil case. 
The petitioners filed an opposition. 
The motion was also to be denied later.

Petitioners not having submitted their answer in the civil case,
the private respondent moved to declare them in default and that he be allowed
to present his evidence ex parte.^[4]
Pending resolution of this motion, the petitioners moved for reconsideration of
the order denying their motion to dismiss.^[5]
This was denied on November 27, 1985.^[6]
On January 3, 1986, the petitioners filed a second motion for reconsideration
based on the original two grounds and alleging the additional ground of
improper venue.^[7]
The record does not show if this second motion for reconsideration was acted
upon, but on January 17, 1986, the respondent judge declared the petitioners in
default and set the civil case for trial.^[8]
Three days later, the motion to suspend proceedings in the Regional Trial Court
of Makati was denied and the criminal case was set
for hearing on the merits.^[9]

The petitioners went to the Intermediate Appellate Court to
question the orders of Judge Cesar R. Cinco of the
Regional Trial Court of Catarman, Northern Samar, denying their motion to dismiss and their motion for
reconsideration of the denial.  Failing
to obtain relief there,^[10]
they are now before us in this petition for review on certiorari under Rule 45 of the Rules of
Court.  Challenged are the decision of
the respondent court dated May 29, 1986, and its resolution dated July 16,
1986, denying reconsideration.^[11]

We shall reverse.  The
respondent court erred in sustaining the trial judge.

As the civil action was not reserved by the petitioners, it was
deemed impliedly instituted with the criminal case in the Regional Trial Court
of Makati.  The
applicable provision is Rule 111, Section 1, of the Rules of Court, reading in
full as follows:

Section 1.  Institution of
criminal and civil actions. — When a criminal action is instituted, the civil action for the recovery
of civil liability arising from the offense charged is impliedly instituted
with the criminal action, unless the offended party expressly waives the civil
action or reserves his right to institute it separately.  However, after the criminal action has been
commenced, the civil action cannot be instituted until final judgment has been
rendered in the criminal action.

When the offended party seeks to enforce civil liability against
the accused by way of actual, moral, nominal, temperate or exemplary damages,
the filing fees for such civil action as provided in these Rules shall first be
paid to the Clerk of Court of the court where the criminal case is filed.  In all other cases, the filing fees
corresponding to the civil liability awarded by the court shall constitute a
first lien on the judgment award and no payment by execution or otherwise may
be made to the offended party without his first paying the amount of such
filing fees to the Clerk of Court.

It was before the Makati court that the
private respondent, as defendant in the criminal charge of violation of B.P. Blg. 22, could explain why he had issued the bouncing
check.  As the civil action based on the
act was also deemed filed there, it was also before that same court that he
could offer evidence to refute the claim for damages made by the petitioners.  This he should have done in the form of a
counterclaim for damages for his alleged deception by the petitioners.  In fact, the counterclaim was compulsory and
should have been filed by the private respondent upon the implied institution
of the civil action for damages in the criminal action.

A counterclaim is compulsory and is considered barred if not set
up where the following circumstances are present:  (1) that is arises out of, or is necessarily
connected with the transaction or occurrence that is the subject matter of the
opposing party’s claim; (2) that it does not require for its adjudication the presense of third parties of whom the court cannot acquire
jurisdiction, and (3) that the court has jurisdiction to entertain the claim.^[12]

All these circumstances are present in the case before the
Regional Trial Court of Makati.

This being so, it was improper for the private respondent to file
his civil complaint in the Regional Trial Court of Northern Samar
alleging the very defense he should be making in the Regional Trial Court of Makati.  It is, of course, not possible for him now to
invoke a different defense there
because he would be contradicting his own verified complaint in the Regional
Trial Court in Northern Samar.  In effect, therefore, he is arguing that both
courts have jurisdiction to consider the same claim of deception he is
making in connection with the same transaction and involving the same parties.

The Court suspects that not having set it up against the civil
claim for damages in the Regional Trial Court of Makati,
the private respondent is now seeking to make amends by filing a separate civil
action based on the same matter in the Regional Trial Court of Northern Samar.  That is bad
enough.  But what could be worse is that
he may have filed the civil complaint in the second court for the more
censurable purpose of deliberately delaying the trial of the criminal case,
which has been deferred long enough as it is. 
That should not be permitted.

The principal reason of the respondent court in sustaining the
trial judge is that Civil Case No. C-355 is not barred because it was filed not
by the petitioners but by the private respondent.  That reasoning is hardly worthy of the Court
of Appeals.  If such logic were accepted,
every accused could file his own civil complaint against the offended party
based on the same transaction involved in the prosecution, but in another
court.  The effect would not only be
multiplicity of suits but delay and frustration of the criminal case.

What the Court finds especially questionable here is the choice
of the venue for the civil action. 
Although both parties appear to be residents and running their affairs
in Metro Manila, the private respondent filed his complaint in Catarman, Northern Samar in an
obvious attempt to inconvenience the petitioners.  The lower courts should have taken this
matter into consideration if only for reasons of equity.  Legally, of course, the lack of proper venue
was deemed waived by the petitioners when they failed to invoke it in their
original motion to dismiss.^[13]
Even so, the motivation of the private respondent should have been taken into
account by both the trial judge and the respondent court in arriving at their
decisions.

As Chief Justice Concepcion said in Aytona v. Castillo:^[14]

Good faith, morality and propriety form the basic foundation of
claims to equitable reliefs x x
x.  Needless to
say, there are instances wherein not only strict, legality, but also fairness,
justice and righteousness should be taken into account.

Courts should not allow themselves to be used as instruments for harassment and the
circumvention of the law through cunning manipulations of the procedural rules
by counsel who may be too clever for their own good.  Rules of procedure are intended to expedite
rather than complicate, and much less to obstruct, the administration of justice.  There is no excuse why the bench and the bar
should not know this principle by now.

WHEREFORE, the decision of the respondent court dated May
29, 1986, and its resolution dated July 16, 1986, are SET ASIDE and Civil Case No.
C-355 in the Regional Trial Court of Catarman,
Northern Samar is DISMISSED, with costs against the
private respondent.  It is so ordered.

Narvasa, (Chairman), Gancayco, Griño-Aquino, and Medialdea, JJ., concur.

^[1]
Rollo, p. 21.

^[2]
Original Records, pp. 96-97.

^[3]
Ibid., pp. 9-12.

^[4]
Id., pp. 18-20.

^[5]
Id., pp. 14-16.

^[6]
Id., p. 17.

^[7]
Id., pp. 21-25.

^[8]
Id., p. 37.

^[9]
Id., p. 33.

^[10]
Id., pp. 59-64.

^[11]
Rollo, pp. 2-8.

^[12]
Sec. 4, Rule 9, Revised Rules of Court.

^[13]
Sec. 4, Rule 4, Revised Rules of Court.

^[14]
4 SCRA 1.