59.

Fletcher Challenge Petroleum Inc vs CA

Facts:

Certain Oil Companies filed a Complaint against Fletcher

by which the latter filed an Answer with Counterclaim.

The Original Complaint was dismissed upon a Motion by

the Oil Corporations.

Thus, the Court dismissed the Complaint, including the

Counterclaim.

Issue: Should the Counterclaim be dismissed?

Ruling: The Counterclaim should not have been dismissed.

The dismissal of both the Complaint and Counterclaim is

only proper when the trial court has no jurisdiction to
entertain the main action of the case.

The rule is that the counterclaim may not be dismissed if

defendant objects, unless it can be independently
considered by the court. 

 Here, it should not have been dismissed but there was no

objection made by Fletcher; and thus, Fletcher waived its
right to oppose said dismissal.

At any rate, Fletcher Corp is not without a remedy because

under Rule 17, 2, the dismissal of the counterclaim is
without prejudice to its filing as a separate action for the
collection of the amounts owed by the Corporations under
their joint operating agreement and other agreements.