2/18/2017 NorthwesternUniversityIncvsArquillo:AC6632:August2,2005:J.

Panganiban:EnBanc:Decision

ENBANC

[A.C.No.6632.August2,2005]

NORTHWESTERNUNIVERSITY,INC.,andBENA.NICOLAS,complainants,vs.Atty.MACARIOD.ARQUILLO,
respondent.

DECISION
PANGANIBAN,J.:

Representing conflicting interests is prohibited by the Code of Professional Responsibility. Unless all the affected clients written
consent is given after a full disclosure of all relevant facts, attorneys guilty of representing conflicting interests shall as a rule be
sanctionedwithsuspensionfromthepracticeoflaw.

TheCaseandtheFacts

[1]
ThisadministrativecasestemsfromaswornLetterComplaint filedwiththeIntegratedBarofthePhilippinesCommissiononBar
Discipline(IBPCBD)byBenA.Nicolas,actingforhimselfandonbehalfofNorthwesternUniversity,Inc.InthatLetterComplaint,Atty.
Macario D. Arquillo was charged with deceit, malpractice, gross misconduct and/or violation of his oath as attorney by representing
conflictinginterests.ThematerialavermentsoftheComplaintaresummarizedbytheIBPCBDasfollows:

Herein[c]omplainants,NorthwesternUniversity,Inc.andMr.BenA.Nicolas,accuses(sic)herein[r]espondent,Atty.MacarioD.Arquillo,of
engaginginconflictinginterestinacasebeforetheNationalLaborRelationsCommission,RegionalArbitrationBranchNo.1,SanFernando,La
Union.

Complainantallegesthatinaconsolidatedcase,herein[r]espondentappearedandactedascounselsforbothcomplainants(eightoutoftheeighteen
complainantstherein)andrespondent(oneoutofthetenrespondentstherein).

InaconsolidationofNLRCCases[Nos.]105108697,105108797,105108897,105109197,105109297,105109797,105110997,1
05109697(consolidatedcases),herein[r]espondentappearedascounselforcomplainantstherein,TeresitaA.Velasco,GervacioA.Velasco,Mariel
S.Hernando,VirginioC.Rasos,BonifacioS.Blas,RonaldA.Daoang,LuzvimindaT.UrcioandAraceliQuimoyog.Intheverysameconsolidated
case,[r]espondentwasalsothecounselofoneoftherespondentstherein,JoseG.Castro.

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Complainants,astheirevidence,submittedtheMotiontoDismissdatedAugust12,1997filedbyJoseG.Castro,representedbyhiscounsel,herein
[r]espondentfiledbeforetheNLRCofSanFernando,LaUnion.Sixteen(16)dayslateroronAugust28,1997,[r]espondentfiledaComplainants
[2]
ConsolidatedPositionPaper,thistimerepresentingsomeofthecomplainantsintheverysameconsolidatedcase. (Citationsomitted)

[3]
RespondentfailedtofilehisAnswertotheComplaintdespiteaJune241998Order oftheIBPCBDdirectinghimtodoso.Even
afterreceivingfivenotices,hefailedtoappearinanyofthescheduledhearings.Consequently,hewasdeemedtohavewaivedhisright
to participate in the proceedings. Thereafter, the complainants were ordered to submit their verified position paper with supporting
[4] [5]
documents,afterwhichthecasewastobedeemedsubmittedfordecision. IntheirManifestation datedAugust30,2004,theysaid
thattheywouldnolongerfileapositionpaper.TheyagreedtosubmitthecasefordecisiononthebasisoftheirLetterAffidavitdated
March16,1998,togetherwithalltheaccompanyingdocuments.

ReportandRecommendationoftheIBP

[6]
InhisReport, CommissionerDennisB.FunafoundrespondentguiltyofviolatingtheconflictofinterestsruleundertheCodeof
Professional Responsibility. Thus, the former recommended the latters suspension from the practice of law for a period of six (6)
months.
In Resolution No. XVI2004415 dated October 7, 2004, the Board of Governors of the IBP adopted the Report and
RecommendationofCommissionerFuna,withthemodificationthattheperiodofsuspensionwasincreasedtotwo(2)years.
On December 12, 2004, the Resolution and the records of the case were transmitted to this Court for final action, pursuant to
Section 12(b) of Rule 139B of the Rules of Court. On January 20, 2005, respondent filed a Motion for Reconsideration to set aside
ResolutionNo.XVI2004415.TheIBPdeniedtheMotion.

TheCourtsRuling

WeagreewiththefindingsoftheIBPBoardofGovernors,butreducetherecommendedperiodofsuspensiontooneyear.

AdministrativeLiabilityofRespondent

The Code of Professional Responsibility requires lawyers to observe candor, fairness and loyalty in all their dealings and
[7]
transactions with their clients. Corollary to this duty, lawyers shall not represent conflicting interests, except with all the concerned

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[8]
clientswrittenconsent,givenafterafulldisclosureofthefacts.
When a lawyer represents two or more opposing parties, there is a conflict of interests, the existence of which is determined by
threeseparatetests:(1)when,inrepresentationofoneclient,alawyerisrequiredtofightforanissueorclaim,butisalsodutyboundto
opposeitforanotherclient(2)whentheacceptanceofthenewretainerwillrequireanattorneytoperformanactthatmayinjuriously
affect the first client or, when called upon in a new relation, to use against the first one any knowledge acquired through their
professional connection or (3) when the acceptance of a new relation would prevent the full discharge of an attorneys duty to give
[9]
undividedfidelityandloyaltytotheclientorwouldinvitesuspicionofunfaithfulnessordoubledealingintheperformanceofthatduty.
Inthepresentcase,Atty.MacarioD.Arquillo,ascounselforRespondentJoseC.CastroinNLRCCaseNos.I05108397toI05
110997, filed a Motion to Dismiss those cases. Shortly thereafter, a position paper was filed by Atty. Arquillo as counsel for several
complainants in consolidated NLRC Case Nos. I05108797, I05108897, I05109197, I05109297, I05109697, I05109797,
andI05110997.Allthecasesinthesecondsetwereincludedinthefirstone,forwhichhehadfiledthesubjectMotiontoDismiss.
Furthermore,inhispositionpaperforthecomplainants,Atty.Arquilloprotectedhisotherclient,RespondentJoseC.Castro,inthese
words:

3.Morethanlackofvalidcauseforthedismissalofcomplainants,respondents,exceptAtty.JoseC.CastroandAtty.ErnestoB.Asuncion,should
[10]
bemadeaccountablefornotaccordingcomplainantstheirrighttodueprocess.

InhistwopageMotionforReconsideration,Atty.Arquilloclaimsthattherewasnoconflictofinterestinhisrepresentationofboth
therespondentandthecomplainantsinthesameconsolidatedcases,becauseallofthemwereallegedlyonthesameside.Attaching
to the Motion the Decision of Labor Arbiter Norma C. Olegario on the consolidated NLRC cases, Atty. Arquillo theorizes that her
judgmentabsolvedCastroofpersonalliabilityfortheillegaldismissalofthecomplainantsthisfactallegedlyshowedthattherewasno
conflictintheinterestsofallthepartiesconcerned.
ThisCourtdoesnotagree.Atty.Arquillosactscannotbejustifiedbythefactthat,intheend,Castrowasproventobenotpersonally
liablefortheclaimsofthedismissedemployees.Havingagreedtorepresentoneoftheopposingpartiesfirst,thelawyershouldhave
knownthattherewasanobviousconflictofinterests,regardlessofhisallegedbeliefthattheywereallonthesameside.Itcannotbe
deniedthatthedismissedemployeeswerethecomplainantsinthesamecasesinwhichCastrowasoneoftherespondents.Indeed,
CommissionerFunacorrectlyenounced:

Ascounselforcomplainants,[r]espondenthadthedutytoopposetheMotiontoDismissfiledbyJoseG.Castro.Butunderthecircumstance,itwould
beimpossiblesince[r]espondentisalsothecounselofJoseG.Castro.Anditappearsthatitwas[r]espondentwhopreparedtheMotiontoDismiss,
whichheshouldbeopposing[a]scounselofJoseG.Castro,RespondenthadthedutytoprovetheComplaintwrong.ButRespondentcannotdo
thisbecauseheisthecounselforthecomplainants.Hereliestheinconsistency.Theinconsistencyofinterestsisveryclear.

Thusithasbeennoted

Theattorneyinthatsituationwillnotbeabletopursue,withvigorandzeal,theclientsclaimagainsttheotherandtoproperlyrepresentthelatterin
theunrelatedaction,or,ifhecandoso,hecannotavoidbeingsuspectedbythedefeatedclientofdisloyaltyorpartialityinfavorofthesuccessful

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client.Theforegoingconsiderationswillstronglytendtodeprivetherelationofattorneyandclientofthosespecialelementswhichmakeitoneof
[11]
trustandconfidence[.](LegalEthics,Agpalo,p.230,4thed.InreDelaRosa,21Phil.258)

Anattorneycannotrepresentadverseinterests.Itisahornbookdoctrinegroundedonpublicpolicythatalawyersrepresentationof
bothsidesofanissueishighlyimproper.Theproscriptionapplieswhentheconflictinginterestsarisewithrespecttothesamegeneral
[12]
matter,howeverslightsuchconflictmaybe.Itappliesevenwhentheattorneyactsfromhonestintentionsoringoodfaith.
The IBP Board of Governors recommended that respondent be suspended from the practice of law for two years. Considering,
[13]
however,priorrulingsincasesalsoinvolvingattorneysrepresentingconflictinginterests,wereducethesuspensiontoone(1)year.
WHEREFORE,Atty.MacarioD.ArquilloisfoundGUILTYofmisconductandisherebySUSPENDEDfromthepracticeoflawfora
periodofone(1)yeareffectiveuponhisreceiptofthisDecision,withawarningthatasimilarinfractionshallbedealtwithmoreseverely
inthefuture.
SOORDERED.
Davide,Jr.,C.J.,Puno,Quisumbing,YnaresSantiago,SandovalGutierrez,Carpio,AustriaMartinez,CarpioMorales,Callejo,Sr.,
Azcuna,Tinga,ChicoNazario,andGarcia,JJ.,concur.
Corona,J.,onofficialleave.

[1]
DatedMarch16,1998rollo,pp.23.
[2]
ReportoftheIBPCBD,pp.12.
[3]
IBPCBDOrder,perCommissionerMa.CarminaM.AlejandroAbbasrollo,p.17.
[4]
IBPCBDOrder,August18,2004rollo,p.36.
[5]
Rollo,pp.3839.
[6]
ReportoftheIBPInvestigatingCommissioner,August27,2004.
[7]
Canon15oftheCodeofProfessionalResponsibility.
[8]
Rule15.03,id.
[9]
Santosv.Beltran,418SCRA17,December11,2003Hornillav.Salunat,405SCRA220,223,July1,2003.SeeAgpalo,TheCodeofProfessionalResponsibility
forLawyers,p.166.

[10]
ComplainantsPositionPapersignedbyAtty.MacarioD.Arquillo,p.8,August28,1997rollo,p.14.Emphasisours.
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[11]
ReportofIBPInvestigatingCommissioner,p.4.
[12]
Nakpilv.Valdes,350Phil.412,March4,1998.
[13]
SeeSantosv.Beltran,supraNakpilv.Valdes,supraTianiav.Ocampo,200SCRA472,August12,1991.

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