/app/code/core/Mage/Catalog/Model/Layer/Filter/Category.php

<?php
/**
 * Magento
 *
 * NOTICE OF LICENSE
 *
 * This source file is subject to the Open Software License (OSL 3.0)
 * that is bundled with this package in the file LICENSE.txt.
 * It is also available through the world-wide-web at this URL:
 * http://opensource.org/licenses/osl-3.0.php
 * If you did not receive a copy of the license and are unable to
 * obtain it through the world-wide-web, please send an email
 * to license@magento.com so we can send you a copy immediately.
 *
 * DISCLAIMER
 *
 * Do not edit or add to this file if you wish to upgrade Magento to newer
 * versions in the future. If you wish to customize Magento for your
 * needs please refer to http://www.magento.com for more information.
 *
 * @category    Mage
 * @package     Mage_Catalog
 * @copyright  Copyright (c) 2006-2016 X.commerce, Inc. and affiliates (http://www.magento.com)
 * @license    http://opensource.org/licenses/osl-3.0.php  Open Software License (OSL 3.0)
 */

/**
 * Layer category filter
 *
 * @category    Mage
 * @package     Mage_Catalog
 * @author      Magento Core Team <core@magentocommerce.com>
 */
class Mage_Catalog_Model_Layer_Filter_Category extends Mage_Catalog_Model_Layer_Filter_Abstract
{
    /**
     * Active Category Id
     *
     * @var int
     */
    protected $_categoryId;

    /**
     * Applied Category
     *
     * @var Mage_Catalog_Model_Category
     */
    protected $_appliedCategory = null;

    /**
     * Class constructor
     */
    public function __construct()
    {
        parent::__construct();
        $this->_requestVar = 'cat';
    }

    /**
     * Get filter value for reset current filter state
     *
     * @return mixed
     */
    public function getResetValue()
    {
        if ($this->_appliedCategory) {
            /**
             * Revert path ids
             */
            $pathIds = array_reverse($this->_appliedCategory->getPathIds());
            $curCategoryId = $this->getLayer()->getCurrentCategory()->getId();
            if (isset($pathIds[1]) && $pathIds[1] != $curCategoryId) {
                return $pathIds[1];
            }
        }
        return null;
    }

    /**
     * Apply category filter to layer
     *
     * @param   Zend_Controller_Request_Abstract $request
     * @param   Mage_Core_Block_Abstract $filterBlock
     * @return  Mage_Catalog_Model_Layer_Filter_Category
     */
    public function apply(Zend_Controller_Request_Abstract $request, $filterBlock)
    {
        $filter = (int) $request->getParam($this->getRequestVar());
        if (!$filter) {
            return $this;
        }
        $this->_categoryId = $filter;

        Mage::register('current_category_filter', $this->getCategory(), true);

        $this->_appliedCategory = Mage::getModel('catalog/category')
            ->setStoreId(Mage::app()->getStore()->getId())
            ->load($filter);

        if ($this->_isValidCategory($this->_appliedCategory)) {
            $this->getLayer()->getProductCollection()
                ->addCategoryFilter($this->_appliedCategory);

            $this->getLayer()->getState()->addFilter(
                $this->_createItem($this->_appliedCategory->getName(), $filter)
            );
        }

        return $this;
    }

    /**
     * Validate category for be using as filter
     *
     * @param   Mage_Catalog_Model_Category $category
     * @return unknown
     */
    protected function _isValidCategory($category)
    {
        return $category->getId();
    }

    /**
     * Get filter name
     *
     * @return string
     */
    public function getName()
    {
        return Mage::helper('catalog')->__('Category');
    }

    /**
     * Get selected category object
     *
     * @return Mage_Catalog_Model_Category
     */
    public function getCategory()
    {
        if (!is_null($this->_categoryId)) {
            $category = Mage::getModel('catalog/category')
                ->load($this->_categoryId);
            if ($category->getId()) {
                return $category;
            }
        }
        return $this->getLayer()->getCurrentCategory();
    }

    /**
     * Get data array for building category filter items
     *
     * @return array
     */
    protected function _getItemsData()
    {
        $key = $this->getLayer()->getStateKey().'_SUBCATEGORIES';
        $data = $this->getLayer()->getAggregator()->getCacheData($key);

        if ($data === null) {
            $categoty   = $this->getCategory();
            /** @var $categoty Mage_Catalog_Model_Categeory */
            $categories = $categoty->getChildrenCategories();

            $this->getLayer()->getProductCollection()
                ->addCountToCategories($categories);

            $data = array();
            foreach ($categories as $category) {
                if ($category->getIsActive() && $category->getProductCount()) {
                    $data[] = array(
                        'label' => Mage::helper('core')->escapeHtml($category->getName()),
                        'value' => $category->getId(),
                        'count' => $category->getProductCount(),
                    );
                }
            }
            $tags = $this->getLayer()->getStateTags();
            $this->getLayer()->getAggregator()->saveCacheData($data, $key, $tags);
        }
        return $data;
    }
}