FIRST DIVISION

[G.R. No. 129718. August 17, 1998.]

SANTO TOMAS UNIVERSITY HOSPITAL, petitioner, vs. CESAR
ANTONIO Y. SURLA and EVANGELINE SURLA, respondents.

Legaspi & Associates for petitioner.

Cruz, Cruz & Navarro III for private respondents.
SYNOPSIS
Respondent spouses sued petitioner hospital for damages before the Regional Trial
Court of Quezon City based on their claim that their son, Emmanuel Cesar Surla,
while conned at the said hospital for having been born prematurely, had
accidentally fallen from his incubator possibly causing serious harm on the child. In
its answer with compulsory counterclaim, petitioner asserted that respondents still
owed to it hospital bills for their son's connement thereat, and claimed moral and
exemplary damages, plus attorney's fees. Respondents sought dismissal of
petitioner's counterclaim on the ground that it was not accompanied with a
certicate of non-forum shopping pursuant to Supreme Court Administrative
Circular No. 04-94. Petitioner, however, contended that since its counterclaim was
compulsory in nature, the circular did not apply to it. The trial court dismissed
petitioner's counterclaim as the circular does not distinguish whether the
counterclaim should be permissive or compulsory. Petitioner's petition for certiorari
with the Court of Appeals was dismissed. Hence, this appeal.
The Supreme Court ruled that the language of Circular No. 04-94 distinctly suggests
that it is primarily intended to cover an initiatory pleading or an incipient
application of a party asserting a claim for relief. The circular has not been
contemplated to include a kind of claim which, by its very nature as being auxiliary
to the proceedings in the suit and as deriving its substantive and jurisdictional
support therefrom, can only be appropriately pleaded in the answer and not remain
outstanding for independent resolution except by the court where the main case
pends. The appealed decision was modied and the claim for moral, exemplary
damages and attorney's fees of petitioner was ordered reinstated.
SYLLABUS
1.
REMEDIAL LAW; CIVIL PROCEDURE; JUDGMENT; FINAL JUDGMENT OR
ORDER, DISTINGUISHED FROM INTERLOCUTORY ORDER. The concept of a nal
judgment or order. distinguished from an interlocutory issuance, is that the former
decisively puts to a close, or disposes of, a case or a disputed issue leaving nothing
else to be done by the court in respect thereto. Once that judgment or order is

rendered, the adjudicative task of the court is likewise ended on the particular
matter involved. An order is interlocutory, upon the other hand, if its eects would
only be provisional in character and would still leave substantial proceedings to be
further had by the issuing court in order to put the controversy to rest.
2.
ID.; ID.; ID.; ERROR OF JUDGMENT, NOT REVIEWABLE BY EXTRAORDINARY
REMEDY OF CERTIORARI . As a rule, errors of judgment, as well as of procedure,
neither relating to the jurisdiction of the court nor involving grave abuse of
discretion, are not reviewable by the extraordinary remedy of certiorari. As long as a
court acts within its jurisdiction and does not gravely abuse its discretion in the
exercise thereof, any supposed error committed by it will amount to nothing more
than an error of judgment reviewable by a timely appeal and not assailable by a
special civil action of certiorari. This rule, however, is not a rigid and inexible
technicality. This Court has not too infrequently given due course to a petition for
certiorari even when the proper remedy would have been an appeal, where valid
and compelling considerations could warrant such a recourse. Certiorari has been
deemed to be justied, for instance, in order to prevent irreparable damage and
injury to a party where the trial judge has capriciously and whimsically exercised his
judgment, or where there may be danger of clear failure of justice, or where an
ordinary appeal would simply be inadequate to relieve a party from the injurious
effects of the judgment complained of.
3.
ID.; FORUM-SHOPPING; ADMINISTRATIVE CIRCULAR NO. 04-94; PURPOSE.
It bears stressing, once again, that the real oce of Administrative Circular No. 0494, made eective on 01 April 1994, is to curb the malpractice commonly referred
to also as forum-shopping. It is an act of a party against whom an adverse judgment
has been rendered in one forum of seeking and possibly getting a favorable opinion
in another forum, other than by appeal or the special civil action of certiorari or the
institution of two or more actions or proceedings grounded on the same cause on
the supposition that one or the other court would make a favorable disposition. The
language of the circular distinctly suggests that it is primarily intended to cover an
initiatory pleading or an incipient application of a party asserting a claim for relief.
4.
ID.; ID.; ID.; APPLICATION IN CASE OF COUNTERCLAIM. It should not be too
dicult, foregoing rationale of the circular aptly taken, to sustain the view that the
circular in question has not, in fact, been contemplated to include a kind of claim
which, but its very nature as being auxiliary to the proceedings in the suit and as
deriving its substantive and jurisdictional support therefrom, can only be
appropriately pleaded in the answer and not remain outstanding for independent
resolution except by the court where the main case pends. Prescinding from the
foregoing, the proviso in the second paragraph of Section 5, Rule 8, of the 1997
Rules of Civil Procedure, i.e., that the violation of the anti-forum shopping rule
"shall not be curable by mere amendment . . . but shall be cause for the dismissal of
the case without prejudice," being predicated on the applicability of the need for a
certication against forum shopping, obviously does not include a claim which
cannot be independently set up. Petitioner, nevertheless, is entitled to a mere
partial relief. The so-called "counterclaim" of petitioner really consists of two
segregative parts: (1) for unpaid hospital bills of respondents' son, Emmanuel Surla,

in the total amount of P82,632.10; and (2) for damages, moral and exemplary, plus
attorney's fees by reason of the alleged malicious and unfounded suit led against
it. It is the second, not the rst, claim that the Court here refers to as not being
initiatory in character and thereby not covered by the provisions of Administrative
Circular No. 04-94.
DECISION
VITUG, J :
p

Can a compulsory counterclaim pleaded in an Answer be dismissed on the ground of

a failure to accompany it with a certicate of non-forum shopping? This question is
the core issue presented for resolution in the instant petition.
dctai

First, a factual background.

On 26 December 1995, respondent spouses led a complaint for damages against
petitioner Santo Tomas University Hospital with the Regional Trial Court of Quezon
City predicated on an allegation by the spouses that their son, Emmanuel Cesar
Surla, while conned at the said hospital for having been born prematurely, had
accidentally fallen from his incubator on 16 April 1995 possibly causing serious
harm on the child. The case was raed and assigned to Branch 226 of the Regional
Trial Court of Quezon City, presided over by the Hon Leah S. Domingo-Regala, and
there docketed Civil Case No, Q-95-25977.
On 28 February 1996, petitioner hospital led its Answer with Compulsory
Counterclaim asserting that respondents still owed to it the amount of P82,632.10
representing hospital bills for Emmanuel's connement at the hospital and making
a claim for moral and exemplary damages, plus attorney's fees, by reason of the
supposed unfounded and malicious suit filed against it.
On 21 March 1996, petitioner received a copy of respondents Reply to Counterclaim,
dated 12 March 1996, that sought, inter alia, the dismissal of petitioner's
counterclaim for its non-compliance with Supreme Court Administrative Circular No.
04-94 requiring that a complaint and other initiatory pleadings, such as a
counterclaim, cross- claim, third (fourth, etc.) party complaint, be accompanied with
a certificate of non-forum shopping.
In its Rejoinder to respondents Reply to Counterclaim, petitioner contended that the
subject circular should be held to refer only to a permissive counterclaim, an
initiatory pleading not arising out of, nor necessarily connected with, the subject
matter of the plainti's claim but not to a compulsory counterclaim spawned by the
ling of a complaint and so intertwined therewith and logically related thereto that
it verily could not stand for independent adjudication. Petitioner concluded that,
since its counterclaim was compulsory in nature, the subject circular did not perforce
apply to it. 1

In its Order of 22 March 1996, the trial court dismissed petitioners counterclaim; it
held:
"Administrative Circular No. 04-94 provides; among others:
"'The complaint and other initiatory pleadings referred to and subject
of this Circular are the original civil complaint, counterclaim,
crossclaim, third (fourth, etc.) party complaint, or complaint-inintervention, petition or application wherein a party asserts his claim
on (sic) relief.
It will be noted that the counterclaim does not distinguish whether the same
should be permissive or compulsory, hence this Court nds that the
counterclaim referred to in said Circular covers both kinds.
WHEREFORE, the counterclaim of defendant is hereby DISMISSED. Let the
pre-trial of this case be set on May 14, 1996 at 2:00 o clock in the afternoon
. . ." 2

On 16 April 1996, petitioner led before the same court an Omnibus Motion seeking
a clarication of the courts Order of 14 March 1996 denying respondents' Reply to
Counterclaim and a reconsideration of the 22nd March 1996. Order dismissing the
compulsory counterclaim. 3 On 22 April 1996, petitioner received a copy of the
courts Order, dated 16 April 1996 which pertinently read:

"WHEREFORE, the Order dated Mar h 14, 1996 is hereby clarified as follows:

"xxx xxx xxx

'The Reply to counterclaim led by counsel for plaintis is hereby
NOTED.
SO ORDERED.'
"The Motion for Reconsideration of this Courts Order dated March 22, 1996
is hereby DENIED. The pre-trial conference set on May 14, 1996 will go on as
scheduled." 4

Petitioner forthwith elevated the matter to the Court of Appeals by way of a

special civil action for certiorari under Rule 65, Revised Rules of Court,
asseverating grave abuse of discretion by public respondent in dismissing the
compulsory counterclaim and in espousing the view that Administrative Circular
No. 04-94 should apply even to compulsory counterclaims.
The Court of Appeals, in its Decision promulgated on 12 March 1997, dismissed the
petition for certiorari; it opined:
". . . the Supreme Court circular aforequoted requires without equivocation
that to the original civil complaint, counterclaim, crossclaim, third (fourth,

etc.) party complaint, or complaint-in-intervention, petition, or application

wherein a party asserts his claim for relief to be led in all courts and
agencies other than the Supreme Court and the Court of Appeals must be
annexed and simultaneously led therewith the required certication under
oath to avoid forum shopping or multiple ling of petitions and complaints.
Non-compliance therewith is a cause for the dismissal of the complaint,
petition, application or other initiatory pleading. Included in such initiatory
pleading is the defendant's counterclaim, permissive or compulsory.
"A counterclaim partakes of the nature of a complaint and/or a cause of
action against the plainti in a case . . ., only this time it is the original
defendant who becomes the plainti. It stands on the same footing and is
tested by the same rules as if it were an independent action." 5

In its present recourse, petitioner contends that"The Court of Appeals (has) committed serious, evident and palpable error in
ruling that:
"5.1
THE SPECIAL CIVIL ACTION OF CERTIORARI UNDER RULE 65 OF
THE REVISED RULES OF COURT IS UNAVAILING. THE DISMISSAL OF THE
COMPULSORY, COUNTERCLAIM BEING A FINAL ORDER, THE PETITIONER
SHOULD HAVE TAKEN AN APPEAL THEREFROM; AND
"5.2
ADMINISTRATIVE CIRCULAR NO. 04-94 OF THIS HONORABLE
COURT LIKEWISE APPLIES TO BOTH KINDS OF COUNTERCLAIMS,
PERMISSIVE AND COMPULSORY. 6

The petition is partly meritorious.

The appellate court ruled that the dismissal of the counterclaim, being a nal order,
petitioner's remedy was to appeal therefrom and, such appeal being then available,
the special civil action of certiorari had been improperly filed.
The concept of a nal judgment or order, distinguished from an interlocutory
issuance, is that the former decisively puts to a close, or disposes of, a case or a
disputed issue leaving nothing else to be done by the court in respect thereto. Once
that judgment or order is rendered, the adjudicative task of the court is likewise
ended on the particular matter involved. 7 An order is interlocutory, upon the other
hand, if its eects would only be provisional in character and would still leave
substantial proceedings to be further had by the issuing court in order to put the
controversy to rest. 8
The order of the trial court dismissing petitioner's counterclaim was, a nal order
since the dismissal, although based on a technicality, would require nothing else to
be done by the court with respect to that specic subject except only to await the
possible ling during the reglementary period of a motion for reconsideration or the
taking of an appeal therefrom.
cdtai

As a rule, errors of judgment, as well as of procedure, neither relating to the

jurisdiction of the court nor involving grave abuse of discretion, are not reviewable
by the extraordinary remedy of certiorari. 9 As long as a court acts within its
jurisdiction and does not gravely abuse its discretion in the exercise thereof, any
supposed error committed by it will amount to nothing more than an error of
judgment reviewable by a timely appeal and not assailable by a special civil action
o f certiorari. 10 This rule, however, is not a rigid and inexible technicality. This
Court has not too infrequently given due course to a petition for certiorari, even
when the proper remedy would have been an appeal, where valid and compelling
considerations could warrant such a recourse. 11 Certiorari has been deemed to be
justied, for instance, in order to prevent irreparable damage and injury to a party
where the trial judge has capriciously and whimsically exercised his judgment, or
where there may be danger of clear failure of justice, or where an ordinary appeal
would simply be inadequate to relieve a party from the injurious eects of the
judgment complained of. 12
In the case at bar, an appeal from the dismissal of the counterclaim, although not
totally unavailable, could have well been ineective, if not futile, as far as petitioner
is concerned since no single piece of evidence has yet been presented by it, that
opportunity having been foreclosed by the trial court, on the dismissed counterclaim
which could form part of the records to be reviewed by the appellate court. The
object of procedural law is not to cause an undue protraction of the litigation, but to
facilitate the adjudication of conicting claims and to serve, rather than to defeat,
the ends of justice. 13
The opinion of this Court on the next issue persuades it to accept, tested by the
foregoing disquisition, the instant petition for its consideration.
The pertinent provisions of Administrative Circular No. 04-94 provide:
"1. The plainti, petitioner, applicant or principal party seeking relief in the
complaint, petition, application or other initiatory pleading shall certify under
oath in such original pleading, or in a sworn certication annexed thereto
and simultaneously led therewith, to the truth of the following facts and
undertakings: (a) he has not theretofore commenced any other action or
proceeding involving the same issues in the Supreme Court, the Court of
Appeals, or any other tribunal or agency; (b) to the best of his knowledge,
no such action or proceeding is pending in the Supreme Court, the Court of
Appeals, or any other tribunal or agency; (c) if there is any such action or
proceeding which is either pending or may have been terminated, he must
state the status thereof; and (d) if he should thereafter learn that a similar
action or proceeding has been led or is pending before the Supreme Court,
the Court of Appeals or any other tribunal or agency, he undertakes to
report that fact within ve (5) days therefrom to the court or agency
wherein the original pleading and sworn certication contemplated here have
been filed.
"The complaint and other initiatory pleadings referred to and subject of this
Circular are the original civil, complaint, counterclaim, cross-claim third
(fourth, etc.) party complaint or complaint-in-intervention, petition, or

application wherein a party asserts his claim for relief ." (Emphasis supplied).

It bears stressing, once again, that the real oce Of Administrative Circular No. 0494, made eective on 01 April 1994, is to curb the malpractice commonly referred
to also as forum-shopping. It is an act of a party against whom an adverse judgment
has been rendered in one forum of seeking and possibly getting a favorable opinion
In another forum, other than by appeal or the special civil action of certiorari, or the
institution Of two or more actions or proceedings grounded on the same cause on
the supposition that one or the other court would make a favorable disposition. 14
The language of the circular distinctly suggests that it is primarily intended to cover
an initiatory pleading or an incipient application of a party asserting a claim for
relief. 15
It should not be too dicult, the foregoing rationale of the circular aptly taken, to
sustain the view that the circular in question has not, in fact, been contemplated to
include a kind of claim which, by its very nature as being auxiliary to the proceeding
in the suit and as deriving its substantive and jurisdictional support therefrom, can
only be appropriately pleaded in the answer and not remain outstanding for
independent resolution except by the court where the main case pends. Prescinding
from the foregoing, the proviso in the second paragraph of Section 5, Rule 8, of the
1997 Rules of Civil Procedure, i.e., that the violation of the anti-forum shopping rule
"shall not be curable by mere amendment . . . but shall be cause for the dismissal of
the case without prejudice," being predicated on the applicability of the need for a
certication against forum shopping, obviously does not include a claim which
cannot be independently set up.
Petitioner, nevertheless, is entitled to a mere partial relief. The so-called
"counterclaim" of petitioner really consists of two segregative parts: (1) for unpaid
hospital bills of respondents son, Emmanuel Surla, in the total amount of
P82,632.10; and (2) for damages, moral and exemplary, plus attorneys fees by
reason of the alleged malicious and unfounded suit led against it. 16 It is the
second, not the rst, claim that the Court here refers to as not being initiatory in
character and thereby not covered by the provisions of Administrative Circular No.
04-94.
WHEREFORE, the appealed decision is hereby modied in that the claim for moral,
exemplary damages and attorney's fees in Civil Case No. Q-95-25977 of petitioner
is ordered reinstated. The temporary restraining order priorly issued by this Court is
lifted. No costs.
dctai

SO ORDERED.

Davide, Jr., Bellosillo, Panganiban, and Quisumbing, JJ ., concur.

Footnotes
1.

Rollo, pp. 77-78.

2.

Rollo, pp. 81-82.