77 set vs. turn donk bet (FD hit)

[z28dreams]

Full Tilt Poker, $0.10/$0.25 NL Hold'em Cash Game, 6 Players
LeggoPoker.com - Hand History Converter

SB: $33.15
BB: $67.70
Hero (UTG): $42.30
MP: $25
CO: $12.55
BTN: $25

Pre-Flop: 7[img]/images/graemlins/spade.gif[/img] 7[img]/images/graemlins/diamond.gif[/img] dealt to Hero (UTG)
<font color="red">Hero raises to $0.85</font>, 3 folds, SB calls $0.75, BB folds

Flop: ($1.95) 8[img]/images/graemlins/spade.gif[/img] 5[img]/images/graemlins/spade.gif[/img] 7[img]/images/graemlins/club.gif[/img] (2 Players)
SB checks, <font color="red">Hero bets $1.50</font>, SB calls $1.50

Turn: ($4.95) K[img]/images/graemlins/spade.gif[/img] (2 Players)
<font color="red">SB bets $3</font>, <font color="red">Hero ???

<font color="blue">
Villain is 41/26 and doesn't seem too good.
He flat calls my flop bet, then donks into me on the turn when th flush completes.

Questions:
1. Do you raise here?
2. (more importantly) if he shoves on top, do you call?
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