PALE CASES 2/21/17

1. Metropolitan Bank and Trust Company vs. CA [G.R. No. 86100-03 January 23,
1990]

Ponente: REGALADO, J.

FACTS:

Petitioner Metrobank filed a petition for review on certiorari after the Court of Appeals ruled
that petitioner should pay the certain amountbased on the charging lien on the civil case
filed against them which resulted to dismissal. In the dismissed case, private respondent
filed a motion to fix its attorneys fees, based on quantum meruit, which precipitated an
exchange of arguments between the parties. Petitioner manifested that it had fully paid
private respondent, Arturo Alafriz and Associates. Private respondent countered and
attempted to arrange a compromise with petitioner in order to avoid suit, but the
negotiations were unsuccessful.

ISSUES:

Whether or not: (1) respondent is entitled to the enforcement of its charging lien for
payment of its attorneys fees; (2) a separate civil suit is necessary for the enforcement of
such lien, and (3) private respondent is entitled to twenty-five (25%) percent of the actual
and current market values of the litigated properties on a quantum meruit basis.

HELD:

(1) NO. (2) YES. (3) Ruling subject to separate trial.

RATIO:

1
[A] charging lien, to be enforceable as security for the payment of attorneys fees, requires
as a condition sine qua non a judgment for money and execution in pursuance of such
judgment secured in the main action by the attorney in favor of his client

The persons who are entitled to or who must pay attorneys fees have the right to be heard
upon the question of their propriety or amount. Hence, the obvious necessity of a hearing is
beyond cavil.

[I]n fixing a reasonable compensation for the services rendered by a lawyer on the basis of
quantum meruit, the determination of elements to be considered would indispensably
require nothing less than a full-blown trial.

G.R. No. 86100-03 January 23, 1990

METROPOLITAN BANK AND TRUST COMPANY, petitioner,

vs.
THE HONORABLE COURT OF APPEALS and ARTURO ALAFRIZ and
ASSOCIATES, respondents.

Bautista, Picazo, Buyco, Tan & Fider for petitioner.

Arturo A. Alafriz & Associates for and in their own behalf.

REGALADO, J.:

This petition for review on certiorari impugns the decision of the Court of Appeals in CA-G.R.
Nos. 08265-08268 1affirming the order of Branch 168, Regional Trial Court, National Capital
Judicial Region, in Civil Cases Nos. 19123-28, 19136 and 19144, fixing attorney's fees and
directing herein petitioner Metropolitan Bank and Trust Company (Metrobank, for brevity), as
defendant in said civil cases, to pay its attorneys, herein private respondent Arturo Alafriz
and Associates, movant therein, the amount of P936,000.00 as attorney's fees on
a quantum meruit basis.

The records show that from March, 1974 to September, 1983, private respondent handled
the above-mentioned civil cases before the then Court of First Instance of Pasig (Branches I,
II, VI, X, XIII, XIX, XX AND XXIV) in behalf of petitioner. 2 The civil cases were all for the
declaration of nullity of certain deeds of sale, with damages.

2
The antecedental facts 3 which spawned the filing of said actions are undisputed and are
hereinunder set forth as found by the trial court and adopted substantially in the decision of
respondent court. A certain Celedonio Javier bought seven (7) parcels of land owned by
Eustaquio Alejandro, et al., with a total area of about ten (10) hectares. These properties
were thereafter mortgaged by Javier with the petitioner to secure a loan obligation of one
Felix Angelo Bautista and/or International Hotel Corporation. The obligors having defaulted,
petitioner foreclosed the mortgages after which certificates of sale were issued by the
provincial sheriff in its favor as purchaser thereof Subsequently, Alejandro, alleging deceit,
fraud and misrepresentation committed against him by Javier in the sale of the parcels of
land, brought suits against Javier et al., and included petitioner as defendant therein.

It was during the pendency of these suits that these parcels of land were sold by petitioner
to its sister corporation, Service Leasing Corporation on March 23, 1983 for the purported
price of P600,000.00. On the same day, the properties were resold by the latter to Herby
Commercial and Construction Corporation for the purported price of P2,500,000.00. Three
months later, or on June 7, 1983, Herby mortgaged the same properties with Banco de Oro
for P9,200,000.00. The lower court found that private respondent, did not have knowledge of
these transfers and transactions.

As a consequence of the transfer of said parcels of land to Service Leasing Corporation,

petitioner filed an urgent motion for substitution of party on July 28, 1983. Private
respondent, on its part, filed on August 16, 1983 a verified motion to enter in the records of
the aforesaid civil cases its charging lien, pursuant to Section 37, Rule 138 of the Rules of
Court, equivalent to twenty-five percent (25%) of the actual and current market values of
the litigated properties as its attorney's fees. Despite due notice, petitioner failed to appear
and oppose said motion, as a result of which the lower court granted the same and ordered
the, Register of Deeds of Rizal to annotate the attorney's liens on the certificates of title of
the parcels of land.

Meanwhile, the plaintiffs Alejandro, et al. in the aforesaid civil cases, which had been
consolidated and were pending before the Regional Trial Court of Pasig, filed a motion to
dismiss their complaints therein, which motion the lower court granted with prejudice in its
order dated September 5, 1983. On December 29, 1983, the same court ordered the
Register of Deeds to annotate the attorney's liens of private respondent on the derivative
titles which cancelled Transfer Certificates of Title Nos. 453093 to 453099 of the original
seven (7) parcels of land hereinbefore adverted to.

On May 28,1984, private respondent filed a motion to fix its attorney's fees, based
on quantum meruit, which motion precipitated an exchange of arguments between the
parties. On May 30, 1984, petitioner manifested that it had fully paid private respondent; the
latter, in turn, countered that the amount of P50,000.00 given by petitioner could not be
considered as full payment but merely a cash advance, including the amount of P14,000.00
paid to it on December 15, 1980. It further appears that private respondent attempted to
arrange a compromise with petitioner in order to avoid suit, offering a compromise amount
of P600,000.00 but the negotiations were unsuccessful.

3
Finally, on October 15,1984, the court a quo issued the order assailed on appeal before
respondent court, granting payment of attorney's fees to private respondent, under the
following dispositive portion:

PREMISES CONSIDERED, the motion is hereby granted and the Metropolitan

Bank and Trust Company (METROBANK) and Herby Commercial and
Construction Corporation 4 are hereby ordered to pay the movant Arturo
Alafriz and Associates the amount of P936,000.00 as its proper, just and
reasonable attorney's fees in these cases. 5

On appeal, respondent court affirmed the order of the trial court in its decision promulgated
on February 11, 1988. A motion for reconsideration, dated March 3, 1988, was filed by
petitioner but the same was denied in a resolution promulgated on November 19, 1988,
hence the present recourse.

The issues raised and submitted for determination in the present petition may be formulated
thus: (1) whether or not private respondent is entitled to the enforcement of its charging lien
for payment of its attorney's fees; (2) whether or not a separate civil suit is necessary for the
enforcement of such lien and (3) whether or not private respondent is entitled to twenty-five
(25%) of the actual and current market values of the litigated properties on a quantum
meruit basis.

On the first issue, petitioner avers that private respondent has no enforceable attorney's
charging lien in the civil cases before the court below because the dismissal of the
complaints therein were not, in the words of Section 37, Rule 138, judgments for the
payment of money or executions issued in pursuance of such judgments. 6

We agree with petitioner.

On the matter of attorney's liens Section 37, Rule 138 provides:

. . . He shall also have a lien to the same extent upon all judgments for the
payment of money, and executions issued in pursuance of such judgments,
which he has secured in a litigation of his client, from and after the time when
he shall have caused a statement of his claim of such lien to be entered upon
the records of the court rendering such judgment, or issuing such execution,
and shall have caused written notice thereof to be delivered to his client and
to the adverse party; and he shall have the same right and power over such
judgments and executions as his client would have to enforce his lien and
secure the payment of his just fees and disbursements.

Consequent to such provision, a charging lien, to be enforceable as security for the payment
of attorney's fees, requires as a condition sine qua non a judgment for money and execution
in pursuance of such judgment secured in the main action by the attorney in favor of his
client. A lawyer may enforce his right to fees by filing the necessary petition as an incident
in the main action in which his services were rendered when something is due his client in
the action from which the fee is to be paid. 7

4
In the case at bar, the civil cases below were dismissed upon the initiative of the plaintiffs
"in view of the frill satisfaction of their claims." 8 The dismissal order neither provided for any
money judgment nor made any monetary award to any litigant, much less in favor of
petitioner who was a defendant therein. This being so, private respondent's supposed
charging lien is, under our rule, without any legal basis. It is flawed by the fact that there is
nothing to generate it and to which it can attach in the same manner as an ordinary lien
arises and attaches to real or personal property.

In point is Morente vs. Firmalino, 9 cited by petitioner in support of its position. In that case,
movant-appellant attorney sought the payment of his fees from his client who was the
defendant in a complaint for injunction which was dismissed by the trial court after the
approval of an agreement entered into by the litigants. This Court held:

. . . The defendant having suffered no actual damage by virtue of the issuance

of a preliminary injunction, it follows that no sum can be awarded the
defendant for damages. It becomes apparent, too, that no amount having
been awarded the defendant, herein appellant's lien could not be enforced.
The appellant, could, by appropriate action, collect his fees as attorney.

Private respondent would nevertheless insist that the lien attaches to the "proceeds of a
judgment of whatever nature," 10 relying on the case of Bacolod-Murcia Milling
Co. Inc. vs. Henares 11 and some American cases holding that the lien attaches to the
judgment recovered by an attorney and the proceeds in whatever form they may be. 12

The contention is without merit just as its reliance is misplaced. It is true that there are some
American cases holding that the lien attaches even to properties in litigation. However, the
statutory rules on which they are based and the factual situations involved therein are
neither explained nor may it be said that they are of continuing validity as to be applicable
in this jurisdiction. It cannot be gainsaid that legal concepts of foreign origin undergo a
number of variegations or nuances upon adoption by other jurisdictions, especially those
with variant legal systems.

In fact, the same source from which private respondent culled the American cases it cited
expressly declares that "in the absence of a statute or of a special agreement providing
otherwise, the general rule is that an attorney has no lien on the land of his client,
notwithstanding such attorney has, with respect to the land in question, successfully
prosecuted a suit to establish the title of his client thereto, recovered title or possession in a
suit prosecuted by such client, or defended successfully such client's right and title against
an unjust claim or an unwarranted attack," 13 as is the situation in the case at bar. This is an
inescapable recognition that a contrary rule obtains in other jurisdictions thereby resulting in
doctrinal rulings of converse or modulated import.

To repeat, since in our jurisdiction the applicable rule provides that a charging lien attaches
only to judgments for money and executions in pursuance of such judgment, then it must be
taken in haec verba. The language of the law is clear and unequivocal and, therefore, it must
be taken to mean exactly what it says, barring any necessity for elaborate interpretation. 14

5
Notably, the interpretation, literal as it may appear to be, is not without support in Philippine
case law despite the dearth of cases on all fours with the present case. In Caina et
al. vs. Victoriano, et al., 15 the Court had the occasion to rule that "the lien of respondent is
not of a nature which attaches to the property in litigation but is at most a personal claim
enforceable by a writ of execution." In Ampil vs. Juliano-Agrava, et al., 16 the Court once
again declared that a charging lien "presupposes that the attorney has secured a favorable
money judgment for his client . . ." Further, in Director of Lands vs. Ababa, et al., 17 we held
that "(a) charging lien under Section 37, Rule 138 of the Revised Rules of Court is limited
only to money judgments and not to judgments for the annulment of a contract or for
delivery of real property as in the instant case."

Even in the Bacolod-Murcia Milling case, which we previously noted as cited by private
respondent, there was an express declaration that "in this jurisdiction, the lien does not
attach to the property in litigation."

Indeed, an attorney may acquire a lien for his compensation upon money due his client from
the adverse party in any action or proceeding in which the attorney is employed, but such
lien does not extend to land which is the subject matter of the litigation. 18 More specifically,
an attorney merely defeating recovery against his client as a defendant is not entitled to a
lien on the property involved in litigation for fees and the court has no power to fix the fee of
an attorney defending the client's title to property already in the client's
possession. 19

While a client cannot defeat an attorney's right to his charging lien by dismissing the case,
terminating the services of his counsel, waiving his cause or interest in favor of the adverse
party or compromising his action, 20 this rule cannot find application here as the termination
of the cases below was not at the instance of private respondent's client but of the opposing
party.

The resolution of the second issue is accordingly subsumed in the preceding discussion
which amply demonstrates that private respondent is not entitled to the enforcement of its
charging lien.

Nonetheless, it bears mention at this juncture that an enforceable charging lien, duly
recorded, is within the jurisdiction of the court trying the main case and this jurisdiction
subsists until the lien is settled. 21 There is certainly no valid reason why the trial court
cannot pass upon a petition to determine attorney's fees if the rule against multiplicity of
suits is to be activated. 22 These decisional rules, however, apply only where the charging
lien is valid and enforceable under the rules.

On the last issue, the Court refrains from resolving the same so as not to preempt or
interfere with the authority and adjudicative facility of the proper court to hear and decide
the controversy in a proper proceeding which may be brought by private respondent.

A petition for recovery of attorney's fees, either as a separate civil suit or as an incident in
the main action, has to be prosecuted and the allegations therein established as any other
money claim. The persons who are entitled to or who must pay attorney's fees have the

6
right to be heard upon the question of their propriety or amount. 23
Hence, the obvious
necessity of a hearing is beyond cavil.

Besides, in fixing a reasonable compensation for the services rendered by a lawyer on the
basis of quantum meruit, the elements to be considered are generally (1) the importance of
the subject matter in controversy, (2) the extent of the services rendered, and (3) the
professional standing of the lawyer. 24 These are aside from the several other considerations
laid down by this Court in a number of decisions as pointed out by respondent court. 25 A
determination of all these factors would indispensably require nothing less than a full-blown
trial where private respondent can adduce evidence to establish its right to lawful attorney's
fees and for petitioner to oppose or refute the same.

Nothing in this decision should, however, be misconstrued as imposing an unnecessary

burden on private respondent in collecting the fees to which it may rightfully be entitled.
But, as in the exercise of any other right conferred by law, the proper legal remedy should
be availed of and the procedural rules duly observed to forestall and obviate the possibility
of abuse or prejudice, or what may be misunderstood to be such, often to the undeserved
discredit of the legal profession.

Law advocacy, it has been stressed, is not capital that yields profits. The returns it births are
simple rewards for a job done or service rendered. It is a calling that, unlike mercantile
pursuits which enjoy a greater deal of freedom from government interference, is impressed
with public interest, for which it is subject to State regulation. 26

ACCORDINGLY, the instant petition for review is hereby GRANTED and the decision of
respondent Court of Appeals of February 11, 1988 affirming the order of the trial court is
hereby REVERSED and SET ASIDE, without prejudice to such appropriate proceedings as may
be brought by private respondent to establish its right to attorney's fees and the amount
thereof.

SO ORDERED.

2. A.C. No. 528 October 11, 1967

ANGEL ALBANO, complainant,

vs.
ATTY. PERPETUA COLOMA, respondent.

FERNANDO, J.:

This proceeding for disbarment was filed by complainant Angel Albano against respondent
Perpetua Coloma, a member of the Philippine Bar. In a letter dated June 20, 1962 addressed
to this Court, complainant alleged that during the Japanese occupation his mother, Delfina
Aquino, and he retained the services of respondent as counsel for them as plaintiffs in Civil
Case No. 4147 of the Court of First Instance of Ilocos Norte. After which came the accusation
that after liberation and long after the courts had been reorganized, respondent failed to
expedite the hearing and termination of the case, as a result of which they had themselves

7
represented by another lawyer. This notwithstanding, it was claimed that respondent
intervened in the case to collect her attorney's fees. It was then alleged that during the
hearing they were surprised when respondent presented in exhibit a document showing that
they as well as their co-plaintiffs in the case promised to pay her a contingent fee of 33-/3%
of whatever could be recovered whether in land or damages. A copy of such document was
attached to the letter. The more serious charge was that the signature therein appearing,
purportedly that of the complainant, and the writing after the name of his mother were not
made by them. It was further stated that the Honorable Delfin B. Flores, then Judge of the
Court of First Instance of Ilocos Norte, submitted the document in question to the National
Bureau of Investigation (hereinafter referred to as NBI) together with samples of his genuine
signature. A copy of the finding of the NBI was attached, the conclusion being that the
questioned signature "is NOT in the hand of the person whose sample signatures were
received."

Complainant stated that being a poor man, he could hardly pay for the services of a lawyer
to assist him in the disbarment proceedings. He added the information that respondent
Coloma "is a very influential woman in the province of Ilocos Norte" as she was then a
member of the provincial board. The prayer was for the "kind and generous help regarding
this matter in order that Atty. Perpetua Coloma may be made to stand before the bar of
justice and disbarred from the practice of her profession as a lawyer."

In a resolution dated July 20, 1962, this Court required respondent Perpetua Coloma to
answer the complaint. The answer came in September 4, 1962. There was a specific denial
of the allegation that the complainant was "a victim of injustice," respondent alleging that
the same was "untrue, unfounded and imaginary." While admitting that her services were
contracted by complainant and his mother and their co-plaintiffs, in Civil Case No. 4147, she
stated that there was a contingent fee of one-third (/3) of whatever land and damages
could be obtained for the plaintiffs. She denied that she did nothing to expedite the hearing
and termination of such civil case as the record would show that she filed "more than twenty
(20) papers and pleadings, went to trial for several days and with the assistance of her
sister, Atty. Oliva D. Coloma, obtained a favorable judgment in the Court of First Instance for
the petitioner and his co-plaintiffs and filed with the Honorable Court of Appeals a thirty-five
(35) page brief, finished after careful, conscientious and exhaustive study and preparation."
She attached a copy of the favorable decision rendered by Judge Simeon Ramos of
November 10, 1948;1 the decision of the Court of Appeals promulgated on October 13,
1950, confirming the above favorable decision, which was penned by the then Justice
Gutierrez David;2 and the dismissal of a petition for certiorari to review such decision in the
resolution of this Court of January 10, 1951.3 Then came a reference to a decision by the
Court of Appeals in CA-G.R. No. 10563-R, the complainant as one of the plaintiffs having
appealed from an order of the lower court, sustaining her lien upon the judgment as well as
"her share of one-third (/3) of the lands adjudicated" which according to the lower court
however would require that the proper action be filed. In the opinion of the Court of Appeals
penned by Justice Sanchez, now a member of this Court, an evaluation of her service was
made thus:

"Appellee served as plaintiffs' counsel for a period of about seven years. The record shows
that she was diligent in her work. That she had rendered valuable services cannot be
doubted. In fact, the final decision favorable to plaintiffs is almost wholly the result of her
efforts. Literally, she gambled on the success or failure of the litigation. She was a member
of the Bar since 1940. Gauged by the familiar rule that an attorney shall be entitled to have
reasonable compensation for his services, with a view to the importance of the subject
matter of the controversy, the extent of the services rendered, and the professional standing
of the attorney, . . ., we feel, as did the trial court, that appellee is entitled to one-third of all
the lands and damages recoverable by plaintiffs under the judgment of the Court below."
8
She likewise denied that she could have been removed for her failure to comply with her
obligations as counsel as she served "faithfully, efficiently, continuously and to the best of
her knowledge and capacity." Her dismissal then, according to her, "was made without cause
and without the consent of herein respondent and only on June 18, 1951, when the
undersigned had already won the case for them in the Court of First Instance and in the
Court of Appeals." In view of the failure of the new lawyers retained to be at times available
in the Court of First Instance of Ilocos Norte and as pleadings by opposing counsel were still
sent to her and out of loyalty to her former clients she continued "to render professional
legal services to complainant and his mother." Then came the allegation "that after the case
was won in the trial court and in the Court of Appeals, complainant and his co-plaintiffs
stopped seeing the undersigned and even disowned their contract with her in the trial of
[her] petition to record attorney's lien which was granted by the trial court and affirmed by
the Court of Appeals." Copies of the decisions of the trial court and the Court of Appeals,
were submitted together with the answer.4 She characterized as "false and unjust" the
averment of complainant "that the latter and his mother did not sign Annex 'A' because they
really signed the instrument in the presence of attesting witnesses who testified to and
confirmed the signing of the same, which fact (of signing) was found and confirmed by the
trial court after and affirmed by the Court of Appeals, . . . ."

Then came the denial of the allegation of complainant that due to the seriousness of the
charge, Judge Delfin B. Flores submitted the alleged falsified document to the NBI for
examination, the truth being that it was complainant who did so. She likewise "specifically
denies the authenticity and veracity of the alleged findings of the National Bureau of
Investigation on Annex 'A' because the signatures therein are genuine and have been found
to be so by the trial and appellate courts after hearing the testimony of the instrumental
witnesses and comparing the signatures in Annex 'A' with signatures admitted to be genuine
by the complainant as well as upon the affirmation of complainant's sister and a co-plaintiff
in Civil Case No. 4147." She then referred to a rule which she considered well-settled in this
jurisdiction that a question of whether or not a given document is genuine falls within the
general knowledge and competence of a judge who may inquire into its authenticity, the
testimony of instrumental witnesses sufficing, without the court being bound even by real
experts. Nor could she agree that the complainant was a poor man and could hardly afford
the services of a lawyer because thru her efforts, he and his co-plaintiffs were richer "by
about P100,000.00 (P85,000.00 in realty and P15,000.00 in cash as damages) by winning
Civil Case No. 4147 for them" notwithstanding, which ingratitude had been her reward.
Respondent also denied the insinuation that she was using her influence as a board member.
She stated that from 1944 to 1951, when she rendered her services for complainant, she
was in private life, not having been elected to the provincial board until 1959.

She concluded by saying that "during her practice of law for more than twenty (20) years
[she] has strictly adhered to the ethics of the profession and has always been guided by the
principles of justice, fairness and respect for individual rights and that as a public official,
[she] has never used her influence to corrupt public servants or ordinary citizens, and all the
people of Ilocos Norte well know that complainant has no sense of justice, no integrity to
preserve, no honor to treasure and no future to build. On the other hand, the people of said
province have faithfully supported [her] in her aspirations, first as councilor and then as
board member with overwhelming majorities. Said support speaks of vindication and means
full faith and credit to [her] integrity, ability and honesty." She further submitted as
affirmative defenses the cause of action being barred by (1) prior judgment and (2) by the
statute of limitations. She prayed for the dismissal of the complaint against her.

The matter was referred to the Solicitor General for investigation, report and
recommendation in a resolution of this Court dated September 7, 1962. On September 12,

9
1967, the report and recommendation of the Solicitor General was submitted. He asked
"that this case be dismissed." We grant such a plea.

In his report, the Solicitor General noted that in the investigation conducted on his behalf by
the provincial fiscal of Ilocos Norte, "only the complainant appeared."5 No evidence was
introduced by him other than the NBI report on the alleged falsified signatures. He
manifested that all his evidence could be found in the records of Civil Case No. 4147 of the
Court of First Instance of Ilocos Norte.6 Respondent on her part, according to the Solicitor
General, "merely filed a manifestation to the effect that the contract for attorney's fees in
question had already been declared genuine and authentic by the Court of First Instance of
Ilocos Norte, the Court of Appeals, and this Honorable Court, in their respective decisions,
copies of which were attached to her answer; that said Contract was signed by petitioner
and the instrumental witnesses thereto in her presence; and that she was submitting the
case on the annexes to her answer and the transcript of the trial of the proceedings on the
recording of her attorney's lien in Civil Case No. 4147. . . ."7

The facts as found by the Solicitor General in so far as the services of respondent as counsel
for the complainant and his mother were concerned reveal the utmost diligence and
conscientiousness on her part. What she said in her answer was sustained in all respects.

The express finding was then made by the Solicitor General that the question of the
genuineness and due execution to pay respondent her attorney's fees "had already been
litigated by the parties in the course of the proceedings for the recording and enforcement
of the attorney's lien of respondent in Civil Case No. 4147 of the Court of First Instance of
Ilocos Norte; that the plaintiffs in said case (one of whom is the complainant in this case)
denied the genuineness and due execution of said agreement Exh. 'A'; that they had full
opportunity to present evidence in support of their said contention; that after hearing, the
trial court found said document to be genuine (pp. 43-48, rec.); and that on appeal to the
Court of Appeals, said court likewise found said document genuine . . ."8

On this point an extended excerpt from the decision of the Court of Appeals, the opinion
being penned as noted by Justice Sanchez, was quoted. Thus:

1. Exhibit A, the written contract of professional services, shows that appellee, as

plaintiffs' attorney, is entitled to one-third of all the lands and damages which may be
awarded plaintiffs; otherwise, if the case is lost, then appellee is not entitled to
compensation.

That Exhibit A was duly executed is a proven fact. A witness to that document, namely,
Sergio Manuel, testified that the cross after the name of Delfina Aquino was placed by her
and that the signature of Angel Albano, one of the plaintiffs, is the genuine signature of the
said Angel Albano. It is true that on the witness stand Delfina Aquino denied that she placed
a cross after the typewritten words "Delfina Aquino" in Exhibit A, and that Angel Albano
likewise denied his signature therein. Suffice it to say that this negative testimony will not
prevail over the positive testimony of appellee and her witness aforesaid. People vs. Bueno,
41 Phil. 447, 452; People vs. Ferrer, 44 O.G., No. 1, pp. 112, 115.

Further, appellee's evidence on this point is not limited merely to Exhibit A. The record
shows that previous thereto, there was a verbal agreement regarding said attorney's fee's.
On this point, appellee finds corroboration in the testimony of Rosario Lagasca, a blood
relation of plaintiff and Silvina Guillermo.

Plaintiffs' evidence that in 1955 appellee undertook to take up the case of plaintiffs for a
stipulated contingent fee of P2,000.00 does not merit serious consideration. It does not
seem probable that appellee would take the case on a win-or-lose basis, i.e., for the sum of
10
P2,000.00 in case the litigation is won and nothing in case of loss, because at that time
P2,000.00 was worth only a few gantas of rice. No lawyer in his right mind would accept
such a miserable fee.

The following testimony of Felicidad Albano, one of the plaintiffs, given in an obviously
unguarded moment, stripped plaintiffs naked of the pretense that there was no such
contract for one-third share as fees:

"Q Did you not authorize your brother, Angel Albano, or your mother, to give one-third
(1/3) of all the properties and damages?

"A We authorized them." Tr., p. 8, Galapon.

The court below, therefore, is correct in declaring that, after weighing and considering the
evidence of both parties, Exhibit A is genuine. (pp. 61- 62, rec.)9

The Solicitor General thus concluded that the finding of the Court of First Instance of Ilocos
Norte, and of the Court of Appeals that the questioned document "is genuine, is now res
judicata and bars complainant Angel Albano (one of the plaintiffs in Civil Case No. 4147)
from raising said question anew in these disbarment proceedings. As repeatedly held, the
fundamental principle of res judicata applied to all cases and proceedings, in whatever form
they may be (Brillantes vs. Castro, L-9223, June 30, 1956, 99 Phil. 497; 60 C.J.S. 31, 267),
and a party can not escape the bar of a judgment against him in a new suit on the same
cause of action by varying the form of his action or adopting a different method of
presenting his cage (Wensel v. Surigao Consolidated Mining Inc., 57 O.G. 6958; Vda. de
Padilla vs. Paterno, G.R. No. L-8748, Dec. 26, 1961; 50 C. J., S. 98)."10

It was noted further that there was no oral testimony as to the alleged falsification, except
the report of the NBI, lacking in persuasive force in that it failed to state the reason or basis
for its conclusion. The observation of the Solicitor General here made is both pertinent and
relevant: "The mere conclusion in the aforesaid NBI report that the signature of complainant
Angel Albano on the document Exh. A was not written in the same hand that wrote the
genuine specimens of his signature, without any reason or reasons supporting it, is,
therefore, of little or no value in evidence and consequently, it cannot support the present
charge of falsification against respondent, apart from the fact that, as already stated, it is
inadmissible on the ground of estoppel by judgment."11 On the reasonableness of the
contingent fee collected by respondent, the Solicitor General adopted the same view found
in the decision of the Court of Appeals, already referred to being part of respondent's
answer, that such indeed was the case.

The Solicitor General could thus rightfully assert that if there was anyone guilty of bad faith
in this case "it is complainant and his co-plaintiffs in Civil Case No. 4147 who, after
benefiting from the valuable services of respondent in said case, tried to renege on their
agreement for the payment of the latter's contingent attorney's fees by dismissing her as
their counsel after she had already won for them said case in the trial court and the Court of
Appeals, and later, by attempting to impugn the authenticity and genuineness of their
written agreement for the payment of attorney's fees, . . . ."12

He was of the opinion then that even if for purposes of said case the findings in judicial
cases could not be considered binding "it is safe to conclude, from a review of the evidence
in said court proceedings taken together with the evidence before us in this case, that
respondent may be exonerated herein."13 With such a conclusion of the Solicitor General,
this Court, to repeat, is in full agreement.

11
Counsel, any counsel, who is worthy of his hire, is entitled to be fully recompensed for his
services. With his capital consisting solely of his brains and with his skill, acquired at
tremendous cost not only in money but in the expenditure of time and energy, he is entitled
to the protection of any judicial tribunal against any attempt on the part of a client to escape
payment of his fees. It is indeed ironic if after putting forth the best that is in him to secure
justice for the party he represents, he himself would not get his due. Such an eventuality
this Court is determined to avoid. It views with disapproval any and every effort of those
benefited by counsel's services to deprive him of his hard-earned honorarium. Such an
attitude deserves condemnation.

There is this additional point to consider. As Cardozo aptly observed: "Reputation [in the
legal profession] is a plant of tender growth, and its bloom, once lost, is not easily
restored."14 This Court, certainly is not averse to having such a risk minimized. Where, as in
this case, the good name of counsel was traduced by an accusation made in reckless
disregard of the truth, an action prompted by base ingratitude, the severest censure is
called for.

Certainly, this is not to say that if a case were presented showing nonfeasance or
malfeasance on the part of a lawyer, appropriate disciplinary action would not be taken. This
is not such a case however. Respondent, as has been so clearly shown, was in no wise
culpable; there is no occasion for the corrective power of this Court coming into play.

WHEREFORE, the charge against respondent Perpetua Coloma, member of the Philippine
Bar, is hereby dismissed.

3. G.R. No. L-40424 June 30, 1980

R. MARINO CORPUS, petitioner,

vs.
COURT OF APPEALS and JUAN T. DAVID, respondents

MAKASIAR, J.:

This is a petition for review on certiorari of the decision of the Court of Appeals promulgated
on February 14, 1975 in CA-G.R. No. 40583-R, affirming the decision of the court of Instance
of Manila, Branch V. dated september 4, 1967, in Civil Case no. 61802 entitled "Juan T.
David,plaintiff, versus R. Mariano Corpus, defendant', for the recovery of attorneys fees for
professional services rendered by the plaintiff, private respondent herein, to defendant,
petitioner herein.

Having been close friends, aside from being membres Civil Liberties Union, petitioner Corpus
intimately calls respondent David by his nickname "Juaning" and the latter addresses the
former simply as "Marino".

The factual setting of this case is stated in the decision of the lower court, thus:

It appears that in March, 1958, the defendant was charged administratively by several
employee of the Central Bank Export Department of which the defendant is the director. The
defendant was represented by Atty. Rosauro Alvarez. Pending the investigation and effective
March 18, 1958, he defendant was suspended from office. After the investigating committee
found the administrative charges to be without merit, and subsequently recommended the
immediate reinstatement of the defendant, the then Governor of Central Bank, Miguel
Cuaderno, Sr., recommended that the defendant be considered resigned as on the ground
12
that he had lost confidence in him. The Monetary Board, by a resolution of July 20, 1959,
declared the defendant as resigned as of the date of suspension.

On August 18, 1959, the defendant, thru Atty. Alvarez, filed the Court of First Instance of
Manila a petition for certiorari, mandamus and quo warranto with preliminary mandatory
injuction and damages against Miguel Cuaderno, Sr., the Central Bank and Mario Marcos who
was appointed to the position of the defendant, said case having been docketed as Civil
Case No. 41226 and assigned to Branch VII presided over by Judge Gregorio T. Lantin. On
September 7, 1959, the respondent filed a motion to dismiss the petition, alleging among
other grounds, the failure of the defendant to exhaust, available administrative remedies
(Exh. X). On September 25, 1959, the defendant, thru Atty. Alvarez, filed his opposition to
the said motion. On March 17, 1960, during the course of the presentation of the evidence
for the petition for a writ of preliminary mandatory injunction, Atty. Alvarez manifested that
the defendant was abandoning his prayer for a writ of preliminary mandatory injunction and
asked for a ruling on the motion to dismiss. On June 14, 1960, Judge Lantin dismissed Civil
Case No. 41226 for failure to exhaust she administrative remedies available to the herein
defendant.

On June 24, 1960, Atty. Alverez received a copy of the order of dismissal It was at this state
that the plaintiff entered into the case under circumstances about which the parties herein
have given divergent versions.

According to the plaintiff, six or seven days prior to the expiration of the period for appeal
from the order of dismissal, he chanced to meet the late Rafael Corpus, father of the
defendant, at the Taza de Oro coffee shop. After they talked about the defendant's having
lost his case before Judge Lantin, and knowing that the plaintiff and the defendant were both
members of the Civil Liberties Union, Rafael Corpus requested the plaintiff to go over the
case and further said that he would send his son, the herein defendant, to the plaintiff to
find out what could be done about the case. The defendant called up the plaintiff the
following morning for an appointment, and the plaintiff agreed to am him in the latter's
office. At said conference, the defendant requested the plaintiff to handle the case because
Atty. Alvarez had already been disenchanted and wanted to give up the case. Although at
first reluctant to handle the case, the plaintiff finally agreed on condition that he and Atty.
Alverez would collaborate in the case.

The defendant's version of how the plaintiff came into the case is as follows:

After the order of dismissal issued by Judge Lantin was published in the newspapers, the
plaintiff sought a conference with the defendant at Taza de Oro, but the defendant told him
that he would rather meet the plaintiff at the Swiss Inn. Even before the case was dismissed
the plaintiff had shown interest in the same by being present during the hearings of said
case in the sala of Judge Lantin When the plaintiff and the defendant met at the Swiss Inn,
the plaintiff handed the defendant a memorandum prepared by him on how he can secure
the reversal of the order of dismissal by means of a formula stated in said memorandum.
During the said occasion the plaintiff scribbled some notes on a paper napkin (Exhibit 19).
On June 28, 1960, the defendant wrote the plaintiff, sending with it a copy of the order of
Judge Lantin dated June 14, 1960 (Exhibit S Inasmuch as said letter, Exhibit S already
mentions the 'memorandum' of the plaintiff, the defendant contends that it was not six or
seven days prior to the expiration of the period of appeal (which should be on or about July 2
or 3, 1960) but on a date even earlier than June 28, 1960 that the plaintiff and the defendant
met together to discuss the latter's case.

Laying aside for the moment the true circumstances under which the plaintiff started
rendering professional services to the defendant, the undisputed evidence shows that on
July 7, 1960, the plaintiff filed a motion for reconsideration of the order of dismissal under
13
the joint signatures of the plaintiff and Atty. Alverez (Exhibit B). The plaintiff argued the said
motion during the hearing thereof On August 8, 1960, he file a 13-page 'Memorandum of
Authorities in support of said motion for reconsideration (Exhibit C). A 3-page supplemental
memorandum of authorities was filed by the plaintiff on September 6, 1960 (Exhibit D)

On November 15, 1960, Judge Lantin denied the motion for reconsideration. On November
19, 1960, the plaintiff perfected the appeal from the order of dismissal dated June 14, 1960.
For purposes of said appeal the plaintiff prepared a 232-page brief and submitted the same
before the Supreme Court in Baguio City on April 20, 1961. The plaintiff was the one who
orally argued the case before the Supreme Court. In connection with the trip to Baguio for
the said oral argument, the plaintiff used his car hich broke down and necessitated extensive
repairs paid for by the plaintiff himself.

On March 30, 1962, the Supreme Court promulgated its decision reversing the order of
dismissal and remanding the case for further proceedings. On April 18, 1962, after the
promulgation of the decision of the Supreme Court reversing the dismissal of the case the
defendant wrote the plaintiff the following letter, Exhibit 'Q'. .

xxx xxx xxx

Dear Juaning

Will you please accept the attached check in the amount of TWO THOUSAND P2,000.00)
PESOS for legal services in the handling of L-17860 recently decided by the Court? I wish I
could give more but as yu know we were banking on a SC decision reinstating me and
reimburse my backstage I had been wanting to offer some token of my appreciation of your
legal fight for and in my behalf, and it was only last week that I received something on
account of a pending claim.

Looking forward to a continuation of the case in the lower court, I remain

Sincerely yours, Illegible

xxx xxx xxx

In a reply letter dated April 25, 1962, the plaintiff returned the check, explaining said act as
follows:

April 25, 1962

My dear Marino:

Yesterday, I received your letter of April 18th with its enclosure. I wished thank you for your
kind thoughts, however, please don't take offense if I have to return the check. I will explain.

When I decided to render professional services in your case, I was motivated by the value to
me of the very intimate relations which you and I have enjoyed during the past many years.
It was nor primarily, for a professional fee.

Although we were not fortunate to have obtained a decision in your case which should have
put an end to it. I feel that we have reason to be jubilant over the outcome, because, the
final favorable outcome of the case seems certain irrespective of the length of time required
to terminate the same.

14
Your appreciation of the efforts I have invested in your case is enough compensation
therefor, however, when you shall have obtained a decision which would have finally
resolved the case in your favor, remembering me then will make me happy. In the
meantime, you will make me happier by just keeping the check.

Sincerely yours,

JUANING

xxx xxx xxx

When the case was remanded for further proceedings before Judge Lantin, the evidence for
the defendant was presented by Atty. 'Alvarez with the plaintiff cooperating in the same-'On
June 24, 1963, Judge Lantin rendered his decision in favor of the defendant declaring illegal
the resolution of the Monetary Board of July 20, 1959, and ordering the defendant's
reinstatement and the payment of his back salaries and allowances - The respondents in
said Civil Case No. 41226 filed a motion for reconsideration which was opposed by the
herein plaintiff. The said decision was appealed by the respondents, as well as by the herein
defendant with respect to the award of P5, 000. 00 attorney's feed The plaintiff prepared two
briefs for submission to the Court of Appeals one as appellee (Exhibit H) and the other as
appellant (Exhibit H-1). The Court of Appeal however, certified the case to the Supreme
Court in 1964.

On March 31, 1965, the Supreme Court rendered a decision affirming the judgment of the
Court of first Instance of Manila.

On April 19, 1965 the plaintiffs law office made a formal de command upon the defendant
for collection of 50% of the amount recovered by the defendant as back salaries and other
emoluments from the Central Bank (Exhibit N). This letter was written after the defendant
failed to appear at an appointment with the plaintiff so that they could go together to the
Central Bank to claim the possession of the office to which the defendant was reinstated and
after a confrontation in the office of the plaintiff wherein the plaintiff was remanding 50% of
the back salaries and other emoluments amounting to P203,000.00 recoverable by the
defendant. The defendant demurred to this demand inasmuch as he had plenty of
outstanding obligations and that his tax liability for said back salaries was around
P90,000.00, and that he expected to net only around P10,000.00 after deducting all
expenses and taxes.

On the same date, April 19,1965 the plaintiff wrote the Governor for of Central Bank
requesting that the amount representing the sack salaries of the defendant be made out in
two one in favor of the defendant and the other representing the professional fees
equivalent to 50% of the said back salaries being claimed by the plaintiff (Exhibit 8). F to
obtain the relief from the Governor of Central Bank, the plaintiff instituted this action before
this Court on July 20, 1965 (Emphasis supplied).

As therein defendant, herein petitioner Marino Corpus filed in August 5, 1965 an answer with
counter-claim. On August 30, 1965, private respondent Atty. Juan T. David, plaintiff therein,
filed a reply with answer to the counterclaim of petitioner.

After due trial, the lower court rendered judgment on September 4, 1967, the dispositive
portion of which reads:

WHEREFORE, judgment is hereby rendered, ordering the defendant to pay plaintiff the sum
of P30,000.00 in the concept of professional fees, and to pay the costs (pp. 112-113, CA
Record on Appeal p. 54, rec.)
15
After receipt on September 7, 1967 of a copy of the aforequoted judgment, petitioner Marino
Corpus, defendant therein, filed on October 7, 1967 a notice of appeal from said judgment to
the Court of Appeals. In his appeal, he alleged that the lower court erred:

1. In not holding that the plaintiff's professional services were offered and rendered
gratuitously;

2. Assuming that plaintiff is entitled to compensation in holding that he was entitled

to attorney's fees in the amount of P30,000.00 when at most he would be entitled to only
P2,500.00;

3. In not dismissing plaintiff's complaint; and

4. In not awarding damages and attorney's fees to the defendant (p. 2, CA Decision, p.
26, rec.)

Likewise, private respondent Atty. Juan T. David, plaintiff therein, appealed to the Court of
Appeals on October 9, 1967 assigning one error, to wit:

The lower court erred in ordering the defendant to pay the plaintiff only the sum of
P30,000.00 in the concept of attorney's fees (p. 1, CA Decision, p. 25, rec.).

On February 14, 1975, respondent Court of Appeals promulgated its decision affirming in
toto the decision of the lower court, with costs against petitioner Marino Corpus (Annex A,
Petition for Certiorari, p. 25, rec.)

Hence, the instant petition for review on certiorari, petitioner contending that the
respondent Court of Appeals erred in finding that petitioner accepted private respondent's
services "with the understanding of both that he (private respondent) was to be
compensated" in money; and that the fee of private respondent was contingent (pp. 3 & 5,
Petition for Certiorari, pp. 17 & 19, rec.).

On October 1, 1975, the case was deemed submitted for decision (p. 177, rec.), after the
parties filed their respective memoranda.

On January 31, 1978, private respondent Atty. Juan T. David filed a petition to remand the
case to the court a quo for execution of the latter's decision in Civil Case No. 61802, dated
September 4, 1967, alleging that said decision is already deemed affirmed pursuant to
Section 11(2), Article X of the New Constitution by reason of the failure of this Tribunal to
decide the case within 18 months. Then on July 7, 1978, another petition to remand the case
to the lower court to execution was filed by herein private respondent.

Subsequently, private respondent Atty. Juan T. David filed with The court a quo a motion
dated September 13, 1978 for the issuance of a writ of execution of the lower court's
decision in the aforesaid civil case, also invoking Section 11 (2), Article X of the 1973
Constitution. In an order dated September 19, 1978, the lower court, through Judge Jose H.
Tecson, directed the issuance of a writ of execution. The writ of execution was issued on
October 2, 1978 and a notice of garnishment was also issued n October 13, 1978 to garnish
the bank deposits of herein petitioner Marino Corpus in the Commercial Bank and Trust
Company, Makati Branch.

16
It appears that on October 13, 1978, herein petitioner filed a motion for reconsideration of
the September 19, 1978 order. Private respondent Atty. Juan T. David filed on October 19,
1978 an opposition to said motion and herein petitioner filed a reply on October 30, 1978.
The lower court denied said motion for reconsideration in its over dated November 7, 1978.

It appears also that in a letter dated October 18, 1978, herein petitioner Marino Corpus
requested this Court to inquire into what appears to be an irregularity in the issuance of the
aforesaid garnishment notice to the Commercial Bank and Trust Company, by virtue of which
his bank deposits were garnished and he was prevented from making withdrawals from his
bank account.

In OUR resolution of November 3, 1978, WE required private respondent Atty. Juan T. David
and the Commercial Bank and Trust Company to comment on petitioner's letter, and for the
bank to explain why it did not honor petitioner's withdrawals from his bank deposits when no
garnishment order has been issued by the Supreme Court. This Court further inquired from
the lower court whether it has issued any garnishment order during the pendency of the
present case.

On November 27, 1978, the Commercial Bank and Trust Company filed its comment which
was noted in the Court's resolution of December 4, 1978. In said resolution, the Court also
required Judge Jose H. Tecson to comply with the resolution of November 3, 1978, inquiring
as to whether he had issued any garnishment order, and to explain why a writ of execution
was issued despite the pendency of the present case before the Supreme Court.

Further, WE required private respondent Atty. Juan T. David Lo explain his failure to file his
comment, and to file the same as directed by the resolution of the Court dated November 3,
1978. Private respondent's compliance came on December 13, 1978, requesting to be
excused from the filing of his comment because herein petitioner's letter was unverified.
Judge Tecson's compliance was filed on December 15, 1978, to which herein petitioner
replied on January 11, 1979.

In OUR resolution dated January 3, 1979, WE set aside the order of Judge Jose H. Tecson
dated September 19, 1978, the writ of execution as well as the notice of garnishment, and
required private respondent Atty. Juan T. David to show cause why he should not be cited for
contempt for his failure to file his comment as directed by the resolution of the Court dated
December 4, 1978, and for filing a motion for execution knowing that the case is pending
appeal and review before this Court Likewise, the Court required Judge Jose H. Tecson to
show cause why he should not be cited for contempt for issuing an order directing the
issuance of a writ of execution and for issuing such writ despite the pendency of the present
case in the Supreme Court.

On January 12, 1979, Judge Jose H. Tecson filed his compliance explanation as directed by
the aforesaid resolution of January 3, 1979, while private respondent Atty. Juan T. David filed
on January 30, 19 79 his compliance and motion for reconsideration after the Court has
granted him an extension of time to file his compliance.

Private respondent Atty. Juan T. David filed on February 28, 1979, a petition praying that the
merits of his compliance be resolved by the Court en banc. Subsequently, on March 26,
1979, another petition was filed by herein private respondent asking the Chief

Justice and the members of the First Division to inhibit themselves from participating in the
determination of the merits of his compliance and for its merits to be resolved by the Court
en banc.

C
17
The main thrust of this petition for review is whether or not private respondent Atty. Juan T.
David is entitled to attorney's fees.

Petitioner Marino Corpus contends that respondent David is not entitled to attorney's fees
because there was no contract to that effect. On the other hand, respondent David contends
that the absence of a formal contract for the payment of the attorney's fees will not negate
the payment thereof because the contract may be express or implied, and there was an
implied understanding between the petitioner and private respondent that the former will
pay the latter attorney's fees when a final decision shall have been rendered in favor of the
petitioner reinstating him to -his former position in the Central Bank and paying his back
salaries.

WE find respondent David's position meritorious. While there was express agreement
between petitioner Corpus and respondent David as regards attorney's fees, the facts of the
case support the position of respondent David that there was at least an implied agreement
for the payment of attorney's fees.

Petitioner's act of giving the check for P2,000.00 through his aforestated April 18, 1962
letter to respondent David indicates petitioner's commitment to pay the former attorney's
fees, which is stressed by expressing that "I wish I could give more but as you know we were
banking on a SC decision reinstating me and reimbursing my back salaries This last
sentiment constitutes a promise to pay more upon his reinstatement and payment of his
back salaries. Petitioner ended his letter that he was "looking forward to a continuation of
the case in the lower court, ... to which the certiorari-mandamus-quo warranto case was
remanded by the Supreme Court for further proceedings.

Moreover, respondent David's letter-reply of April 25, 1962 confirms the promise of
petitioner Corpus to pay attorney's fees upon his reinstatement and payment of back
salaries. Said reply states that respondent David decided to be his counsel in the case
because of the value to him of their intimate relationship over the years and "not, primarily,
for a professional fee." It is patent then, that respondent David agreed to render professional
services to petitioner Corpus secondarily for a professional fee. This is stressed by the last
paragraph of said reply which states that "however, when you shall have obtained a decision
which would have finally resolved the case in your favor, remembering me then will make
me happy. In the meantime, you will make me happier by just keeping the check."
Thereafter, respondent David continued to render legal services to petitioner Corpus, in
collaboration with Atty. Alverez until he and Atty. Alvarez secured the decision directing
petitioner's reinstatement with back salaries, which legal services were undisputedly
accepted by, and benefited petitioner.

Moreover, there is no reason to doubt respondent David's assertion that Don Rafael Corpus,
the late father of petitioner Corpus, requested respondent to help his son, whose suit for
reinstatement was dismissed by the lower court; that pursuant to such request, respondent
conferred in his office with petitioner, who requested respondent to handle the case as his
lawyer, Atty. Alvarez, was already disenchanted and wanted to give up the case; and that
respondent agreed on the case. It would have been unethical for respondent to even offer
his services when petitioner had a competent counsel in the person of Atty. Alvarez, who has
been teaching political, constitutional and administrative law for over twenty years.

Likewise, it appears that after the Supreme Court affirmed on March 31, 1965 the order of
the lower court reinstating petitioner Corpus with back salaries and awarding attorney's fees
of P5,000.00, respondent David made a written demand on April 19, 1965 upon petitioner
18
Corpus for the payment of his attorney's fees in an amount equivalent to 50% of what was
paid as back salaries (Exh. N p. 75, Folder of Exhibits, Civil Case No. 61802). Petitioner
Corpus, in his reply dated May 7, 1965 to the aforesaid written demand, while disagreeing as
to the amount of attorney's fees demanded, did not categorically deny the right of
respondent David to attorney's fees but on the contrary gave the latter the amount of
P2,500.00, which is one-half () of the court-awarded attorney's fees of P5,000.00, thus
impliedly admitting the right of respondent David to attorney's fees (Exh. K, p. 57, Folder of
Exhibits, Civil Case No. 61802).

It is further shown by the records that in the motion filed on March 5, 1975 by petitioner
Corpus before the Court of Appeals for the reconsideration of its decision the order of the
lower court granting P30,000.00 attorney's fee's to respondent David, he admitted that he
was the first to acknowledge that respondent David was entitled to tion for legal services
rendered when he sent the chock for P2,000.00 in his letter of April 18, 1962, and he is still
to compensate the respondent but only to the extent of P10,000.00 (p. 44, rec.). This
admission serves only to further emphasize the fact that petitioner Corpus was aware all the
time that he was liable to pay attorney's fees to respondent David which is therefore
inconsistent with his position that the services of respondent David were gratuitous, which
did not entitle said respondent to compensation.

It may be advanced that respondent David may be faulted for not reducing the agreement
for attorney's fees with petitioner Corpus in writing. However, this should be viewed from
their special relationship. It appears that both have been friends for several years and were
co-members of the Civil Liberties Union. In addition, respondent David and petitioner's
father, the late Rafael Corpus, were also close friends. Thus, the absence of an express
contract for attorney's fees between respondent David and petitioner Corpus is no argument
against the payment of attorney's fees, considering their close relationship which signifies
mutual trust and confidence between them.

II

Moreover, the payment of attorney's fees to respondent David may also be justified by
virtue of the innominate contract of facio ut des (I do and you give which is based on the
principle that "no one shall unjustly enrich himself at the expense of another." innominate
contracts have been elevated to a codal provision in the New Civil Code by providing under
Article 1307 that such contracts shall be regulated by the stipulations of the parties, by the
general provisions or principles of obligations and contracts, by the rules governing the most
analogous nominate contracts, and by the customs of the people. The rationale of this
article was stated in the 1903 case of Perez vs. Pomar (2 Phil. 982). In that case, the Court
sustained the claim of plaintiff Perez for payment of services rendered against defendant
Pomar despite the absence of an express contract to that effect, thus:

It does not appear that any written contract was entered into between the parties for the
employment of the plaintiff as interpreter, or that any other innominate contract was
entered into but whethertheplaintiffsservicesweresolicitedorwhethertheywereoffered to the
defendant for his assistance, inasmuch as these services were accepted and made use of by
the latter, we must consider that there was a tacit and mutual consent as to the rendition of
the services. This gives rise to the obligation upon the person benefited by the services to
make compensation therefor, since the bilateral obligation to render service as interpreter,
on the one hand, and on the other to pay for the service rendered, is thereby incurred. (Arts.
1088, 1089, and 1262 of the Civil Code).

xxx xxx xxx

19
... Whether the service was solicited or offered, the fact remains that Perez rendered to
Pomar services as interpreter. As it does not appear that he did this gratuitously, the duty is
imposed upon the defendant, he having accepted the benefit of the service, to pay a just
compensation therefor, by virtue of the innominate contract of facio ut des implicitly
established.

xxx xxx xxx

... because it is a well-known principle of law that no one should permitted to enrich himself
to the damage of another" (emphasis supplied; see also Tolentino, Civil Code of the
Philippines, p. 388, Vol. IV 119621, citing Estate of Reguera vs. Tandra 81 Phil. 404 [1948];
Arroyo vs. Azur 76 Phil. 493119461; and Perez vs. Pomar. 2 Phil. 682 [1903]).

WE reiterated this rule in Pacific Merchandising Corp. vs. Consolacion Insurance & Surety
Co., Inc. (73 SCRA 564 [1976]) citing the case of Perez v. Pomar, supra thus:

Where one has rendered services to another, and these services are accepted by the latter,
in the absence of proof that the service was rendered gratuitously, it is but just that he
should pay a reasonable remuneration therefor because 'it is a well-known principle of law,
that no one should be permitted to enrich himself to the damage of another (emphasis
supplied).

Likewise, under American law, the same rule obtains (7 CJS 1079; FL Still & Co. v. Powell, 114
So 375).

III

There was no contract for contingent fee between Corpus and respondent David. Contingent
fees depend on an express contract therefor. Thus, "an attorney is not entitled to a
percentage of the amount recovered by his client in the absence of an express contract to
that effect" (7 C.J.S. 1063 citing Thurston v. Travelers Ins. Co., 258 N.W. 66, 128 Neb. 141).

Where services were rendered without any agreement whatever as to the amount or terms
of compensation, the attorney is not acting under a contract for a contingent fee, and a
letter by the attorney to the client stating that a certain sum would be a reasonable amount
to charge for his services and adding that a rate of not less than five percent nor more than
ten would be reasonable and customary does not convert the original agreement into a
contract for a contingent fee (7 C.J.S. 1063 citing Fleming v. Phinizy 134 S.E. 814).

While there was no express contract between the parties for the payment of attorney's fees,
the fact remains that respondent David rendered legal services to petitioner Corpus and
therefore as aforestated, is entitled to compensation under the innominate contract of facio
lit des And such being the case, respondent David is entitled to a reasonable compensation.

IV

In determining a reasonable fee to be paid to respondent David as compensation for his

services, on a quantum meruit basis, it is proper to consider all the facts and circumstances
obtaining in this case particularly the following:

The extent of the services rendered by respondent David should be considered together with
the extent of the services of Petitioner's other counsel, Atty. Rosauro Alvarez, It is undisputed
that Atty. Rosauro Alvarez had rendered legal services as principal counsel for more shall six
(6) years while respondent David has rendered legal services as collaborating counsel for
almost four (4) years. It appears that Atty. Alvarez started to render legal services after the
20
administrative case was filed on March 7, 1958 against petitioner Corpus. He represented
petitioner Corpus in the hearing of said case which was conducted from May 5, 1958 to
October 8, 1958, involving 56 sessions, and this resulted in the complete exoneration by the
Investigating Committee of all the charges against the petitioner. It appears further that
after the Monetary Board, in its resolution of July 20, 1959, declared petitioner Corpus as
being considered resigned from the service, Atty. Alvarez instituted on August 18, 1958 Civil
Case No. 41126 in the Court of First Instance of Manila for the setting aside of the
aforestated resolution and for the reinstatement of petitioner Corpus. Atty. Alvarez actively
participated in the proceedings.

On the other hand, respondent David entered his appearance as counsel for petitioner
Corpus sometime after the dismissal on June 14, 1960 of the aforesaid civil case. From the
time he entered his appearance, both he and Atty. Alvarez rendered legal services to
petitioner Corpus in connection with the appeals of the aforementioned civil case to the
Court of Appeals and to the Supreme Court. The records disclose that in connection with the
appeal from the June 14, 1960 order of dismissal, respondent David prepared and signed
pleadings although the same were made for and on behalf of Atty. Alvarez and himself And it
is not far-fetched to conclude that all appearances were made by both counsels considering
that Atty. Alverez was the principal counsel and respondent David was the collaborating
counsel. Thus, when the case was called for oral argument on April 20, 1961 before the
Supreme Court, respondent David and Atty. Alverez appeared for petitioner Corpus although
it was David who orally argued the case.

When the Supreme Court, in its decision of March 30, 1962, remanded the case to the lower
court for further it was Atty. Alverez who conducted the presentation of evidence while
respondent David assisted him The records also review that respondent David prepared and
signed for Atty. Alverez and himself. certain pleadings, including a memorandum. Moreover,
after the lower court rendered judgment on June 2 4, 1963 ordering the reinstatement and
payment of back salaries to petitioner Corpus and awarding him P5,000.00 by way of
attorney's fees, both petitioner Corpus and the respondents in said case appealed the
judgment. At that stage, respondent David again prepared and signed for Atty. Alvarez and
himself, the necessary pleadings, including two appeal briefs. And in addition, he made oral
arguments in the hearings of motions filed in the lower court before the records of the case
were forwarded to the appellate court. Furthermore, while it appears that it was Atty. Alvarez
who laid down the basic theory and foundation of the case of petitioner Corpus in the
administrative case and later in the civil case, respondent David also advanced legal
propositions. Petitioner Corpus contends that said legal propositions were invariably rejected
by the courts. This is, however, of no moment because the fact remains that respondent
David faithfully rendered legal services for the success of petitioner's case.

The benefits secured for petitioner Corpus may also be considered in ascertaining what
should be the compensation of respondent David. It cannot be denied that both Atty. Alvarez
and respondent David were instrumental in obtaining substantial benefits for petitioner
Corpus which consisted primarily of his reinstatement, recovery of back salaries and the
vindication of his honor and reputation. But, note should also be taken of the fact that
respondent David came at the crucial stage when the case of petitioner Corpus was
dismissed by the lower court.

Atty. Rosauro Alvarez admittedly was paid by petitioner Corpus the sum of P20,000.00 or at
most P22,500.00 (T.s.n., Jan. 11, 1967, pp. 34-35; T.s.n., Feb. 10, 1967, pp. 48-49). On the
other hand, petitioner Corpus, after WE suggested on August 15, 1975 that they settle the
case amicably has, in his September 15, 1975 pleading filed before this Court (p. 166, rec.),
manifested his willingness to pay P10,000.00 for the services of respondent David. However,
respondent David has not manifested his intention to accept the offer.

21
In his complaint in the instant case, he asked for P75,000.00 as his attorney's fees. The
records reveal that petitioner Corpus actually received only P150,158.50 as back salaries
and emoluments after deducting taxes as well as retirement and life insurance premiums
due to the GSIS. The amount thus claimed by respondent David represents 50% of the
amount actually received by petitioner Corpus. The lower court, however, awarded only
P30,000.00 and it was affirmed by the Court of Appeals.

Considering the aforestated circumstances, WE are of the opinion that the reasonable
compensation of respondent David should be P20,000.00.

WE find private respondent Juan T. David and Judge Jose H. Tecson, Presiding Judge of the
Court of First Instance of Manila, Branch V, guilty of contempt of court.

Respondent David filed on or about September 13, 1978 a motion with the court a quo for
the issuance of a writ of execution to enforce its decision in Civil Case No 61802, subject of
the present petition, knowing fully well that it was then still pending appeal before this
Court. In addition, no certification that the aforesaid decision is already deemed affirmed
had as yet been issued by the Chief Justice pursuant to Section 11, paragraph 2, Article X of
the New Constitution; because respondent David's petitions filed with the Supreme Court on
January 31, 1978 and on July 7, 1978 to remand the case to the trial court for execution and
for the issuance of such certification had not yet been acted upon as the same were still
pending consideration by this Court. In fact, this Court has not as of this time made any
pronouncement on the aforesaid provision of the New Constitution.

This act of respondent David constitutes disrespect to, as well as disregard of, the authority
of this Court as the final arbiter of all cases duly appealed to it, especially constitutional
questions. It must be emphasized that as a member of the Philippine Bar he is required "to
observe and maintain the respect due to the court of justice and judicial officers" (Section 20
(b), 138 of the Revised Rules of Court). Likewise, Canon 1 of. the Canons of Professional Ethic
expressly provide that: "It is the duty of the lawyer to maintain towards the Courts a
respectful attitude, not for the sake of the temporary incumbent of the judgement office, but
for the maintenance of its supreme importance." And this Court had stressed that "the duty
of an attorney to the courts 'can only be maintained by rendering no service involving any
disrespect to the judicial office which he is bound to uphold'" (Rheem of the Philippines v.
Ferrer, 20 SCRA 441, 444 [1967] citing the case of Lualhati v. Albert, 67 Phil. 86, 92 [1932]).

Moreover, this Court takes judicial notice of the fact that herein respondent David, in the
previous case of Integrated Construction Services, Inc. and Engineering Construction, Inc. v.
Relova (65 SCRA 638 [1975]), had sent letters addressed to the then Chief Justice Querube
C. Makalintal and later to the late Chief Justice Fred Ruiz Castro, requesting for the issuance
of certification on the basis of the aforementioned provision of the New Constitution which
were not given due consideration. And knowing this, respondent David should have been
more prudent and cautious in g with the court a quo any motion for execution.

Furthermore, there was even a taint of arrogance and defiance on the part of respondent
David in not filing his comment to the letter- complaint dated October 18, 1978 of petitioner
Corpus, as required by this Court in its November 3, 1978 and December 4,1978 resolutions
which were duly received by him, and instead, he sent on December 13, 1978 a letter
requesting to be excused from the filing of his comment on the lame excuse that petitioner's
letter-complaint was not verified.

On the part of Judge Jose H. Tecson, his presumptuous and precipitate act of granting the
motion for execution of dent David likewise constitutes disrespect to, as well as of, the
22
authority of this Court because he know for a that the case was still pending apply as the
had not yet been remanded to it and that no certification has been issued by this Court. As a
judicial officer, Judge Tecson is charged with the knowledge of the fact that this Court has
yet to make a definite pronouncement on Section 11, paragraph 2, Article X of the New
Constitution. Judge Tecson should know that only the Supreme Court can authoritatively
interpret Section 11 (2) of Article X of the 1973 Constitution. Yet, Judge Tecson assumed the
role of the Highest Court of the Land. He should be reminded of what Justice Laurel speaking
for the Court, has said in People v. Vera (65 Phil 56, 82 [1937]):

A becoming modesty of inferior courts demands conscious realization of the position that
they occupy in the interrelation and operation of the integrated judged system of the nation.

It may also be added that the improvident act of respondent David in firing the motion for
execution and the precipitate act of Judge Tecson in issuing the writ of execution are
intriguing as they invite suspicion that there was connivance between the two. Respondent
David would seem to imply that his claim for attorney's fees should be given preference over
the other cams now pending in this Court. Certainly, such should not be the case because
there are cases which by their nature require immediate or preferential attention by this
Tribunal like habeas corpus cases, labor cases and c cases involving death sentence, let
alone cases involving properties and property rights of poor litigants pending decision or
resolution long before the New Constitution of 1973. Nobility and exempt forbearance were
expected of Atty. David, who is old and experienced in the practice of the legal profession,
from which he has derived a great measure. of economic well-being and independence

Consequently, the filing of the motion for immediate tion and the issuance of the writ of
execution constitute a defiance and usurpation of the jurisdiction of the Supreme Court. As a
disciplinary measure for the preservation and vindication of the dignity of this Supreme
Tribunal respondent Atty. Juan T. David should be REPRIMANDED for his precipitate action of
filing a motion for execution as well as Judge Jose H. Tecson for his improvident issuance of a
writ of execution while the case is pending appeal before the Supreme Court, and a
repetition of said acts would be dealt with more severely.

WHEREFORE, PETITIONER R. MARINO CORPUS IS HEREBY DIRECTED TO PAY RESPONDENT

ATTY. JUAN T. DAVID THE SUM OF TWENTY THOUSAND (P20,000.00) PESOS AS ATTORNEY'S
FEES.

RESPONDENT ATTY. JUAN T. DAVID AND JUDGE JOSE H. TECSON OF THE COURT OF FIRST
INSTANCE OF MANILA, BRANCH V, ARE HEREBY DECLARED GUILTY OF CONTEMPT AND ARE
HEREBY REPRIMANDED, WITH A WARNING THAT REPETITION TION OF THE SAME OR SIMILAR
ACTS WILL BE DEALT WITH MORE SEVERELY.

COSTS AGAINST PETITIONER.

SO ORDERED.

4. A.C. No. 492 September 5, 1967

OLEGARIA BLANZA and MARIA PASION, complainants,

vs.
ATTY. AGUSTIN ARCANGEL, respondent.

BENGZON, J.P., J.:

Complainants Olegaria Blanza and Maria Pasion ask this Court to take disciplinary action
against respondent Atty. Agustin Arcangel for professional non-feasance. They complain that
23
way back in April, 1955, respondent volunteered to help them in their respective pension
claims in connection with the deaths of their husbands, both P.C. soldiers, and for this
purpose, they handed over to him the pertinent documents and also affixed their signatures
on blank papers. But subsequently, they noticed that since then, respondent had lost
interest in the progress of their claims and when they finally asked for the return of their
papers six years later, respondent refused to surrender them.

Respondent answered these accusations before Fiscal Raa to whom this case was referred
by the Solicitor General for investigation, report and recommendation. He admitted having
received the documents from complainants but explainer that it was for photostating
purposes only. His failure to immediately return them, he said, was due to complainants'
refusal to hand him the money to pay for the photostating costs which prevented him from
withdrawing said documents from the photostat service. Anyway, he had already advanced
the expenses himself and turned over, on December 13, 1961, the documents, their
respective photostats and the photostat service receipt to the fiscal.

Finding respondent's explanation satisfactory and considering that he charged complainants

nothing for his services, Fiscal Raa recommended the former's exoneration, or at most, that
he be reprimanded only. The Solicitor General, however, feels that respondent deserves at
least a severe reprimand considering (1) his failure to attend to complainants' pension
claims for six years; (2) his failure to immediately return the documents despite repeated
demands upon him, and (3) his failure to return to complainant Pasion, allegedly, all of her
documents.

At the hearing of the case before this Court on October 21, 1963, only respondent, thru
counsel, appeared. In lieu of oral arguments, therefore, respondent submitted his
memorandum, annexing therewith an affidavit executed by Olegaria Blanza asking for the
dismissal of the administrative case.1

Respondent first submits that he was not obliged to follow up complainants' pension claims
since there was no agreement for his compensation as their counsel. Respondent, however,
overlooks the fact that he volunteered his professional services and thus was not legally
entitled to recover fees.2 But having established the attorney-client relationship voluntarily,
he was bound to attend to complainants' claims with all due diligence.

Nevertheless, We find the evidence adduced insufficient to warrant the taking of disciplinary
action against respondent attorney. There is no clear preponderance of evidence
substantiating the accusations against him.3

Respondent's explanation for the delay in filing the claims and in returning the documents
has not been controverted by complainants. On the contrary, they admitted4 that
respondent asked them to shoulder the photostating expenses but they did not give him any
money therefor. Moreover, the documents and their photostats were actually returned by
respondent during the fiscal's investigation with him paying for the photostating costs
himself. And the condition of the photostats themselves they appear to have been in
existence for quite some time5 supports respondent's allegation that they remained in
possession of the photostat service for the failure of the owners (respondents and/or
complainants), to withdraw the same upon payment of the corresponding costs. Hence,
complainants themselves are partly to blame for the delay in filing their respective
claims.1awphl.nt

As for the alleged failure of respondent to return all her documents to complainant Pasion,
the former denies this. Fiscal Raa made no findings on the matter. The affidavit of Mrs.
Blanza pardoning respondent cannot prejudice complainant Pasion because res inter alios
acta alteri nocere non debet. Still, there is equiponderance of evidence which must
24
necessarily redound to respondent's benefit. Complainant Pasion had another opportunity to
substantiate her charges in the hearing set for October 21, 1963 but she let it go. Neither
she nor her counsel of record appeared.

But while We are constrained to dismiss the charges against respondent for being legally
insufficient, yet We cannot but counsel against his actuations as a member of the bar. A
lawyer has a more dynamic and positive role in the community than merely complying with
the minimal technicalities of the statute. As a man of law, he is necessarily a leader of the
community, looked up to as a model citizen. His conduct must, perforce, be par excellence,
especially so when, as in this case, he volunteers his professional services. Respondent here
has not lived up to that ideal standard. It was unnecessary to have complainants wait, and
hope, for six long years on their pension claims. Upon their refusal to co-operate, respondent
should have forthwith terminated their professional relationship instead of keeping them
hanging indefinitely. And altho We voted that he not be reprimanded, in a legal sense, let
this be a reminder to Atty. Arcangel of what the high standards of his chosen profession
require of him.

Accordingly, the case against respondent is dismissed. So ordered.

5. G.R. No. 109219 March 11, 1994

SUSANITA E. MENDOZA-PARKER, petitioner,

vs.
COURT OF APPEALS, RODOLFO TAN NG and TERESITA S. RIOSA, respondents.
Susanita E. Mendoza-Parker for and in her own behalf.
Nardo M. De Guzman, Sr. for private respondents.

QUIASON, J.:

This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court to
modify the decision of the Court of Appeals in CA G.R. No. 28140 and its resolution
denying petitioner's motion for reconsideration.

We affirm the decision of the Court of Appeals and deny the petition.

On December 18, 1989, private respondents Tan Ng and Teresita S. Riosa, represented by
Atty. Efren Barangan, filed with the Regional Trial Court, Branch 20, Quezon City, an action
for collection of a sum of money with foreclosure of real estate mortgage against Demetrio
G. Alcaras and Julieta Alcaras (Civil Case No. Q-89-4287).

On July 29, 1990, while the case was still at the pretrial stage, Atty. Barangan withdrew his
appearance and petitioner took over the case as substitute counsel.

On January 19, 1991, petitioner filed a motion for summary judgment, which was granted
and judgment was rendered on May 23, 1991 in favor of private respondents. The trial court
also awarded private respondents the amount of P10,000.00 as attorney's fees (Rollo, p.
102).

Thereafter, the defendants filed a petition for relief from judgment. While said case was still
pending, petitioner filed a motion to withdraw her appearance with a prayer for the payment
of her attorney's fees, stating that she demanded from private respondents the amount of
P73,199.75 as her contingent fees, which was equivalent to 15 percent of the total monetary
award granted by the trial court. Private respondents refused to pay the fees demanded by
25
petitioner, offering to pay her P20,000.00 as attorney's fees and P300.00 as appearance fees
or the same amount payable to their former counsel, Atty. Barangan.

The trial court, in its Order dated December 9, 1991, approved petitioner's motion (Rollo, pp.
52-54) and on December 23, 1991, directed private respondents to deposit the amount of
P73,119.75 as attorney's fees (Rollo, p. 55).Private respondents filed a motion for
reconsideration of the Order of the trial court dated December 9, 1991 with regard to the
amount of attorney's fees awarded. The trial court denied the motion for reconsideration
(Rollo, p. 57). Petitioner then filed a motion to cite private respondents in contempt of court
for their failure to obey the Orders dated December 9 and 23, 1991.

Subsequently, private respondents questioned the two orders of the trial court before the
Court of Appeals in CA-G.R. No. 281407, which modified the amount of attorney's fees
awarded to petitioner by the trial court and fixed the same at P30,000.00 in addition to the
award of P10,000.00 in the summary judgment. Petitioner's motion for reconsideration was
denied.

Hence, this appeal.

II

Petitioner assails as erroneous the giving of due course under Rule 65 of the Revised Rules
of Court by the Court of Appeals to the petition of private respondents, claiming that an
appeal under Rule 45 of the same Rules would have been the proper remedy (Rollo, pp. 17-
29). It is the stance of petitioner that if the appeal was made under Rule 45, the entire
record of the case would have been elevated "for the appreciation of evidence on the
reasonableness of the attorney's fees" (Rollo, p. 21).

The petition entertained by the Court of Appeals was filed by private respondents to set
aside the orders of the trial court dated December 9 and 23, 1991, which ordered them to
pay petitioner the amount of P73,199.76 as attorney's fees. The said orders were issued
after the summary judgment, which was secured by petitioner as counsel for private
respondents had become final.

An appeal from a summary judgment is governed by Circular No. 2-90 (superseding Rule 41)
while a review of an order of the trial court issued after the rendition of the summary
judgment is governed by Rule 65.

Under the Judiciary Act of 1948, the jurisdiction of the Court of Appeals was limited to the
issuance of the special writs under Rule 65 which are "in aid of its appellate jurisdiction."
Similarly thereto, the Supreme Court held that the Court of Appeals had no jurisdiction to
issue the special writs after the finality of the judgment of the trial court. The reason for this
is that said jurisdiction was based on the existence of a right of appeal to the appellate court
from the judgment of the trial court on the merits in the main case (J.M. Tuason & Co., Inc. v.
Jaramillo, 9 SCRA 189 [1963]; Vda. de Albar v. Carandang, 6 SCRA 211 [1962]. However,
under Section 9(1) of the Judiciary Reorganization Act of 1980, the jurisdiction of the Court of
Appeals to issue the special writs was expanded to include special writs "whether or not in
aid of its appellate jurisdiction" (Quiason, Philippine Courts and Their Jurisdictions, 1993 ed.,
p. 545).

Private respondents could not have questioned the two orders of the trial court before the
Court of Appeals through a Rule 45 petition as suggested by petitioner (Rollo, p. 19). This
remedy is available only in appeals from the decisions of the Court of Appeals to the
Supreme Court.

26
Petitioner confused a final order on the merits of the main case, which is the one appealable
to the Court of Appeals and a final order regarding an incident thereof, which is not
appealable at all and can be reviewed only by a special civil action under Rule 65. A
judgment on the merits is one rendered after a determination of which party is in the right
and must prevail (Santos v. Intermediate Appellate Court, 145 SCRA 238 [1986]; De Ocampo
v. Republic, 9 SCRA 440 [1963]).

Petitioner misread our ruling in Quirino v. Gorospe, 160 SCRA 787 (1988) to the effect that
the remedy from an order of the probate court fixing the attorney's fees claimed by a lawyer
against the estate is by an ordinary appeal (Rollo, p. 20). Quirino involved the settlement of
an estate, a special proceeding where multiple appeals are allowed (B.P. Blg. 129, Chapter
IV, Sec. 39; Echaus v. Court of Appeals, 187 SCRA 672 [1990]; BA Finance Corporation v.
Court of Appeals, 178 SCRA 589 [1989]).

Section 19(b) of the Judiciary Reorganization Act of 1980 provides:

In appeals in special proceedings in accordance with Rule 109 of the Rules of Court and
other cases wherein multiple appeals are allowed, the period of appeal shall be thirty (30)
days, a record on appeal being required.

Likewise under Section 1(e) of Rule 109 of the Revised Rules of Court, an interested party
may appeal from an order of the Regional Trial Court where such order "[c]onstitutes, in
proceedings relating to the settlement of the estate of a deceased person,. . . a final
determination in the lower court of the rights of the party appealing, except that no appeal
shall be allowed from the appointment of a special administrator."

In Quirino, the order fixing the award of attorney's fees was issued before the final
settlement of the estate and should have been appealed by the heirs opposing the award
under Rule 41 (the rule then applicable).

In the case at bench, the order questioned by private respondent was issued during the
execution stage of the foreclosure proceedings. Clearly, the remedy of ordinary appeal under
Circular No. 2-90 was no longer available.

Having disposed of the procedural aspect of the petition, we now address the question of
whether the Court of Appeals can interfere with the orders of the trial court, fixing the
attorney's fees awarded to a lawyer for legal services rendered to the client (Rollo, pp. 22-
35).

The Court of Appeals did not sustain the finding of the trial court that there was an
agreement between petitioner and her clients regarding the amount of attorney's fees to be
paid for her legal services. We agree with the Court of Appeals that neither the partial
payment of the attorney's fees by private respondents in the amount of P3,500.00 nor the
sending by petitioner of her demand letter was sufficient to establish that the parties had
arrived at an agreement as to the amount of her fees.

The Court of Appeals, in the exercise of its jurisdiction to review the decisions of lower courts
fixing the attorney's fees, can and did determine whether the attorney's fees fixed by said
courts are reasonable under the circumstances (Borcena v. Intermediate Appellate Court,
147 SCRA 111 [1987]).

After taking into consideration the various factors to guide the courts in fixing the attorney's
fees, an appellate court can reduce the attorney's fees stipulated by the parties in a contract
for professional services or awarded by a lower court, to levels which it deems reasonable

27
(Ramos v. Court of Appeals, 63 SCRA 331 [1975]; Verzosa v. Baytan, 107 Phil. 1010 [1960];
Bachrach v. Golingco, 39 Phil. 130 [1918]).

In the absence of an agreement as to the amount of the attorney's fees, the courts are
authorized to determine the amount to be paid to an attorney as reasonable compensation
for his professional services (Lorenzo v. Court of Appeals, 189 SCRA 260 [1990]; Lacson v.
Reyes, 182 SCRA 729 [1990]).

Even where the parties have agreed as to the amount of the fees, the courts have the power
to disregard the contract if the amount fixed is unreasonable (Bachrach v. Golingco, 39 Phil.
138 [1918]; Canon 20, Code of Professional Responsibility).

A lawyer, being an officer of the court, is placed under judicial control with regard to the
reasonableness of the amount of the attorney's fees demanded by him from his client
(Licudan v. Court of Appeals, 193 SCRA 293 [1991]; Ramos v. Bidin, 161 SCRA 561 [1988]).

The determination of the attorney's fees depends on various factors like: the amount and
character of the services rendered; the responsibility imposed; the amount of money or the
value of the property involved in the controversy; the skill and experience called for in the
performance of the services; the professional standing of the attorney; the results secured;
and whether or not the payment of the fees is contingent or absolute (Mambulao Lumber Co.
v. Philippine National Bank, 22 SCRA 359 [1968]).

In the case at bench, petitioner took over the case after the termination of the pre-trial and
the pleadings she filed consisted only of a motion for summary judgment and an opposition
to the motion for reconsideration filed by the defendants in Civil Case No. Q-89-4287. There
was no full-blown trial held, for the defendants in said civil case admitted their indebtedness.
The only issue left to be determined was the manner of payment. Hence, there was no need
to exert any unusual effort or special skill in its preparation. Under the circumstances, we
find the amount granted by the trial court excessive and the award granted by the Court of
Appeals reasonable.

WHEREFORE, the petition is DENIED.

SO ORDERED.

6. A.M. No. 1437 April 25, 1989

HILARIA TANHUECO, complainant,

vs.
JUSTINIANO G. DE DUMO, respondent.

A.M. No. 1683 April 25, 1989

HILARIA TANHUECO, complainant,

vs.
JUSTINIANO G. DE DUMO, respondent.

R E S O L U T I ON

PER CURIAM:

28
On 24 February 1975, complainant Hilaria Tanhueco filed before the Court a Petition for Disbarment (docketed as Administrative Case No. 1437)
against respondent Justiniano G. de Dumo for having violated the Canons of Professional Ethics by his (a) refusal to remit to her money collected by
him from debtors of the complainant; and (b) refusal to return documents entrusted to him as counsel of complainant in certain collection cases.

In his Answer and Counter-Petition 1 filed on 3 April 1975, respondent denied the charges. Complainant filed a Rejoinder [should be Reply] to
Answer with Counter-Petition, on 18 April 1975. By a Resolution 2 dated 16 June 1975, the Court referred this case to the Solicitor General
for investigation, report and recommendation.

A year later, on 25 June 1976, one Jose Florencio N. Tanhueco claiming to be the nephew and representative of the complainant, addressed a sworn
letter complaint to Mrs. Imelda R. Marcos against the respondent for (a) refusal to remit the money collected by respondent from debtors of
complainant's aunt, Mrs. Hilaria Tanhueco Vda. de David; (b) refusal to return documents entrusted to him in his capacity as counsel in certain cases;
and (c) abandonment of cases in respect of which his professional services had been engaged. On 24 August 1976, the letter complaint was forwarded
by the then Public Information Assistance Staff, Department of Public Information, to this Court for appropriate action (and docketed as Administrative
Case No. 1683). After respondent had filed his Answer, the Court, by a Resolution 3 dated 9 December 1976, referred this case to then Acting
Judicial Consultant Ricardo C. Puno for study, report and recommendation.

Since Administrative Case No. 1683 and Administrative Case No. 1437 involved the same parties and the same subject matter, Hon. Ricardo C. Puno
referred the former case to the Office of the Solicitor General for consolidation with the latter one.

The Office of the Solicitor General held two (2) hearings, one on 3 December 1975 and another on 18 April 1988. In the first hearing, respondent de
Dumo was absent although he had been notified thereof. At the end of the first hearing, continuation of the hearing of the case was set for 14 January
1976. The records show that the second hearing took place on 18 April 1988 but do not indicate the reason for the 12-year interregnum. By then,
complainant Tanhueco had died. There was no appearance at the second hearing by complainant Jose Florencio Tanhueco but respondent de Dumo
was then present.

The report of the Solicitor General, dated June 15, 1988 in Administrative Case No. 1437 summarized the evidence for the complainant in the following
manner:

EVIDENCE FOR COMPLAINANT

Complainant Hilaria Tanhueco testified that she secured the legal services of respondent to collect indebtedness from her
different debtors. Although she offered to execute a document evidencing their lawyer-client relationship, respondent told her
that it was not necessary. She nonetheless offered to give him 15% of what he may be able to collect from the debtors (pp. 4-7.
tsn, Dec. 3, 1975).

Complainant also declared that respondent borrowed from her P2,000.00, Pl,300.00, and P3,000.00 on three separate
occasions, but she could not remember when she gave those amounts. Respondent did not pay those loans (pp. 8-9, tsn, Id.).

She confirmed that respondent filed cases against her debtors and that one of them, Constancia Maosca paid P12,500.00 to
respondent. Informed of such payment by Maosca herself, complainant confronted respondent but the latter denied having
received payment from any of her debtors. Complainant then brought the matter to the attention of Malacaang which referred
her to Camp Crame. Notwithstanding subsequent demands of complainant for the money, respondent had refused to give her
the amount (pp. 11 -15, tsn, Id.).

The Solicitor General then summed up the evidence for the respondent in the following terms:

EVIDENCE FOR RESPONDENT

Respondent Atty. Justiniano G. de Dumo testified that complainant indeed secured his legal services to collect from her debtors,
with the agreement that he gets 50% of what he may be able to collect. He thus filed collection cases against Tipace Maosca
Morena, Jr., and others, and was able to obtain favorable judgment in the cases against Maosca, Tipace, and Leonila
Mendoza. The initial payments made by these judgment-debtors were all given to complainant. With respect to Maosca
respondent obtained a judgment for P19,000.00 although the debt was only P12,000.00 (pp. 3-9, tsn, April 18, 1988).

Respondent also declared that complainant, who was then already old and sickly, was influenced by her debtors, who were also
her friends into distrusting him. Ultimately, because complainant filed a complaint against him with Malacaang which referred
the matter to Camp Crame, he terminated his relationship with complainant and demanded his attorney's fees equivalent to
50% of what he had collected. Complainant refused to pay him, hence, he did not also turn over to her the P12,000.00 initial
payment of Maosca which he considered, or applied, as part payment of his attorney's fee (pp. 9-19, tsn., Id.). Respondent
estimated his attorney's fee due from complainant in the amount of P17,000.00 (p. 20, tsn, Id.)

29
 Respondent denied having borrowed the amounts of P2,000.00, P1,300.00, P3,000.00 and P1,000.00, pointing out that
complainant did not even have money to pay him so that he handled the cases for her on contingent basis (p. 17, tsn, Id.) He
also denied having received documentary evidence from complainant. What evidence he had were all gathered by him on his
initiative (pp. 4-7, tsn, Id.).

The Solicitor General then set out the following:

FINDINGS

There is in the case at bar clear admissions by both complainant and respondent of an attorney-client relationship between
them, specifically in the collection of debts owing complainant. Respondent also admitted, in his answer to the complaint and in
his testimony, having received P12,000.00 from indebtor Constancia Manosca without turning over the amount to his client,
complainant herein, and applying it instead as part of his attorney's fees. It has been held that the money collected by a lawyer
in pursuance of a judgement in favor of his client held in trust (Aya v. Bigonia,57 Phil.8;Daroy v..Legaspi 65 SCRA 304), and that
the attorney should promptly account for all funds and property received or held by him for the client's benefit (Daroy v.
Legaspi, supra; In re Bamberger, 49 Phil. 962). The circumstance that an attorney has a lien for his attorney's fees on the
money in his hands collected for his client does not relieve him from the obligation to make a prompt accounting (Domingo l v.
Doming[o] G.R. No. 30573, Oct. 29, 1971; Daroy v. Legaspi, supra). Undoubtedly, respondent's failure to account for the
P12,000.00, representing payment of the judgement debt of Maosca constitutes unprofessional conduct and subjects him to
disciplinary action. Nonetheless, it has likewise been recognized that a lawyer is as much entitled to judicial protection against
injustice, imposition or fraud on the part of his client; and that the attorney is entitled to be paid his just fees. The attorney should
be protected against any attempt on the part of his client to escape payment of his just compensation (Fernandez v. Bello, 107
Phil. 1140; Albano v. Coloma, G.R. Adm. Case No. 528, Oct. 11, 1967). This countervailing rule mitigates the actions of
respondent.

As regards the charges that respondent received documents evidencing the debts to complainant and had refused to return
them to the latter, and that respondent also borrowed some amounts from her, there [is] no competent, conclusive evidence to
support them. Perforce, such allegations have no factual basis. (Emphasis supplied)

The Solicitor General then recommended that:

For failure to turn over the amount of P12,000.00 to the complainant, and applying it as his attorney's fees, respondent Atty.
Justiniano G. de Dumo be severely reprimanded and admonished that repetition of the same or similar offense will be dealt with
more severely.

We find the findings of fact of the Solicitor General supported by the evidence of record. We are, however, unable to accept his recommendation.

Moneys collected by an attorney on a judgment rendered in favor of his client, constitute trust funds and must, be immediately paid over to the
client. 4 Canon 11 of the Canons of Professional Ethics 5 then in force, provides as follows:

11. Dealing with trust property.

The lawyer should refrain from any action whereby for his personal benefit or gain he abuses or takes advantage of the
confidence reposed in him by his client.

Money of the client or collected for the client or other trust property coming into the possession of the lawyer should be reported
and accounted for promptly and should not under any circumstance be comingled with his own or be used by him. (Emphasis
supplied)

When respondent withheld and refused to deliver the money received by him for his client, the deceased complainant Hilaria Tanhueco, he breached
the trust reposed upon him.The claim of the respondent that complainant had failed to pay his attorney's fees, is not an excuse for respondent's failure
to deliver any amount to the complainants. 6 It is of course true that under Section 37 of Rule 138 of the Revised Rules of Court, an attorney
has-

a lien upon the funds, documents and papers of his client which have lawfully come into his possession and may retain the
same until his lawful fees and disbursements have been paid, and may apply such funds to the satisfaction thereof. He shall
also have a lien to the same extent upon all judgments for the payment of money and executions issued in pursuance of such
judgments, which he has secured in a litigation of his client, from and after the time when he shall have caused a statement of
his claim of such lien to be entered upon the records of the court rendering such judgment, or issuing such execution, and shall
have caused written notice thereof to be delivered to his client and to the adverse party; and he shall have the same right and
power over such judgments and executions as his client would have to enforce his lien and secure the payment of his just fees
and disbursements.

30
The fact that a lawyer has a lien for fees on moneys in his hands collected for his client, does not relieve him from his duty promptly to account for the
moneys received; his failure to do so constitutes professional misconduct. 7

In the present case, what respondent could have properly done was to make an account with his client, the complainant, deduct his attorney's fees due
in respect of the amount actually collected by him, and turn over the remaining balance to the complainant. The Court notes that the services of
respondent de Dumo were engaged by the complainant on a number of cases and that these were on differing stages of completion. Respondent was
not entitled to hold on to the entire amount of P12,000.00 collected by him until all his fees for the other cases had also been paid and received by him.
There was not enough evidence in the record to show how much money, if any, respondent had in fact previously (i.e., other than the P12,000.00 from
Maosca) collected for and turned over to complainant (thereby waiving his lien thereon) without deducting therefrom his claimed contingent fees in
respect of such collections.

The relationship of attorney and client has always been rightly regarded as one of special trust and confidence. An attorney must exercise the utmost
good faith and fairness in all his relationships vis-a-vis his client. Respondent fell far short of this standard when he failed to render an accounting for
the amount actually received by him and when he refused to turn over any portion of such amount received by him on behalf of his client upon the
pretext that his attorney's fees had not all been paid. Respondent had in fact placed his private and personal interest above that of his client.
Respondent's act constitutes a breach of his lawyer's oath and a mere reprimand is not an adequate sanction.

There is another aspect to this case which the Court cannot gloss over. Respondent claimed that he charged complainant, his client, a contingent fee
of fifty percent (50%) of the amount collected by him, plus interest and whatever attorney's fees may be awarded by the trial court chargeable to the
other party. In this jurisdiction, contingent fees are not per se prohibited by law. 8 But when it is shown that a contract for a contingent fee are obtained
by undue influence exercised by the attorney upon his client or by any fraud or imposition, or that the compensation is clearly excessive, the Court
must and will protect the aggrieved party. 9

From the Answer of respondent de Dumo it appears that in three (3) collection cases filed by him for the complainant and which were decided in favor
of the complainant, the awards totalled P31,390.00. Respondent asserted that he was entitled to attorney's fees amounting to Pl8,840. 00 out of the
aggregate total of P31,390.00:

7. That the understanding between Hilaria Tanhueco and me was a fifty- fifty on collected principal and interests. The lawyer
has the right to charge attorney's fees to the other party-defendant and that Hilaria Tanhueco shall not interfere nor be included
in the computation.

That of the cases filed, the following made payments:

a. Hilaria Tanhueco vs. Constancia Maosca

Amount Collectible (principal)........................................ P12,000.00

Interest added from May 1972 o Nov/73 at 1% a month.... P

2,280.00

Attorney's fees charged to the defendant and not to be included in the computation................ P 4,720.00

TOTAL and Amount specified in the Compromise Agreement and Subject of the Decision.
P19,000.00

b. Hilaria Tanhueco vs. Melchor Tipace et al.

Principal amount collectible...................... P7,100.00

Interest at 1 % per month starting June/71 to Sept./74........................ 2,840.00

Attorney's fees charged to the defendant and not included in the computation.......................... 1,450.00

TOTAL P ll,390.00.

c. Hilaria Tanhueco vs. Estimo

Principal Amount collectible......

............... Pl,000.00

31
SUMMATION OF THE THREE CASES FILED AND AMOUNTS RECEIVABLE

BY THE UNDERSIGNED INCLUDING ATTORNEY'S FEES:

MAOSCA CASE:

Attorney's fees to be paid by Maosca and not to be included in the

computation................... P 4,840.00

Fifty per cent on the principal amount collectible plus

interests......................................... . P 7,080.00

TOTAL AMOUNT RECEIVABLE P11,920.00

TIPACES CASE:

Attorney's fees to be paid by Tipace and not to be included in the

computation............................. Pl,450.00

Fifty per cent on the principal amount collectible from Tipace plus
interests.................................. 4,970.00

TOTAL AMOUNT
RECEIVABLE.............
P6,420.00

8. The total amount which I ought to receive as attorney's fees under paragraph
seven, sub-paragraph a, b and c is:

Pll,920. 00

P6,420.00

P500. 00

P18,840. 00 TOTAL 10

We note that respondent attorney claimed as his contingent fee the following:

1) fifty percent (50%) of the sum of principal and interest

collectible from different debtors; and

2) attorney's fees charged to the defendant (presumably

under promissory notes or written agreements) and "not
to be included in the computation."

Under this scheme, respondent was actually collecting as attorney's fees sixty
percent (60%) or more than half of the total amount due from defendant debtors;
indeed, he was appropriating for himself more than what he was, according to
him, to turn over to his client.

We believe and so hold that the contingent fee here claimed was, under the facts
obtaining in this case, grossly excessive and unconscionable. 11 Such a fee
structure, when considered in conjunction with the circumstances of this
case, also shows that an unfair advantage was taken of the client and legal
fraud and imposition perpetrated upon her.

The complainant was an old and sickly woman and, in respondent's own words,
"penniless." She was at the time she filed her complaint in 1976, already

32
seventy-six (76) years old. In her circumstances, and given her understandable
desire to realize upon debts owed to her before death overtook her, she would
easily succumb to the demands of respondent attorney regarding his attorney's
fees. It must be stressed that the mere fact that an agreement had been reached
between attorney and client fixing the amount of the attorney's fees, does not
insulate such agreement from review and modification by the Court where the
fees clearly appear to be excessive or unreasonable. In Mambulao Lumber
Company v. Philippine National Bank, et al., 12 this Court stressed:

The principle that courts should reduce stipulated

attorney's fees whenever it is found under the
circumstances of the case that the same is unreasonable,
is now deeply rooted in this jurisdiction to entertain any
serious objection to it. Thus, this Court has explained:

But the principle that it may be lawfully stipulated that the

legal expenses involved in the collection of a debt shall be
defrayed by the debtor does not imply that such
stipulations must be enforced in accordance with the
terms, no matter how injurious or oppressive they may be.
The lawful purpose to be accomplished by such a
stipulation is to permit the creditor to receive the amount
due him under his contract without a deduction of the
expenses caused by the delinquency of the debtor. It
should not be permitted for him to convert such a
stipulation into a source of speculative profit at the
expense of the debtor.

xxx xxx xxx

Since then this Court has invariably fixed counsel fees on

a quantum meruit basis whenever the fees stipulated
appear excessive, unconscionable, or unreasonable,
because a lawyer is primarily a court officer charged with
the duty of assisting the court in administering impartial
justice between the parties, and hence, the fees should
be subject to judicial control. Nor should it be ignored
that sound public policy demands that courts disregard
stipulations for counsel fees, whenever they appear to be
a source of speculative profit at the expense of the debtor
or mortgagor (See, Gorospe, et al. v. Gochangco, supra).
And it is not material that the present action is between
attorney and client. As courts have power to fix the fee as
between attorney and client, it must necessarily have the
right to say whether a stipulation like this, inserted in a
mortgage contract, is valid (Bachrach vs.
Golingco, supra).

xxx xxx xxx 13

This Court has power to guard a client, 14 especially an aged and necessitous
client, 15 against such a contract. We hold that on a quantum meruit basis,
no circumstances of special difficulty attending the collection cases having
been shown by respondent, respondent attorney's fees should be reduced
from sixty percent (60%) to ten percent (15%) of the total amount (including
attorney's fees stipulated as chargeable to the debtors) collected by him on
behalf of his client.

With respect to charges of refusal to return documents entrusted to respondent

lawyer and abandonment of cases in which his services had been engaged, we
accept the findings of the Solicitor General that the evidence of record is not
sufficient to prove these allegations.

WHEREFORE, the Court Resolved that:

33
 1. respondent is guilty of violation of the attorneys' oath
and of serious professional misconduct and shall be
SUSPENDED from the practice law for six (6) months and
WARNED that repetition of the same or similar offense
will be more severely dealt with;

2. the attorney's fees that respondent is entitled to in

respect of the collection cases here involved shall be an
amount equivalent to fifteen percent (15%) of the total
amount collected by respondent from the debtors in those
cases;

3. respondent shall return forthwith to the estate of

complainant Hilaria Tanhueco the P12,000.00 respondent
received on behalf of his client less attorney's fees due to
him in respect of that amount (P l2,000.00 less fifteen
percent [15%] thereof) or a net amount of P10,200.00;
and

4. respondent shall return to the estate of complainant

Hilaria Tanhueco any documents and papers received by
him from the deceased complainant in connection with
the collection cases for which he was retained. If he has
in fact made any other collections from deceased
complainant's debtors, he shall promptly account therefor
to complainant's estate and shall be entitled to receive in
respect thereof the fifteen percent (15%) attorney's fees
provided for herein.

Let a copy of this Resolution be furnished each to the Bar Confidant and spread
on the personal record of respondent attorney, and to the Integrated Bar of the
Philippines.

7. A.M. No. MTJ-07-1683 September 11, 2013

OFFICE OF THE COURT ADMINISTRATOR, COMPLAINANT,

vs.
HON. SANTIAGO E. SORIANO, FORMER ACTING PRESIDING JUDGE, MUNICIPAL TRIAL COURT
IN CITIES, SAN FERNANDO CITY, LA UNION, AND PRESIDING JUDGE, MUNICIPAL TRIAL COURT,
NAGUILIAN, LA UNION, RESPONDENT.

DECISION

CARPIO, J.:

The Case

This administrative case arose from the judicial audit conducted from 22 March 2004 to 5
April 2004 in the Municipal Trial Court (MTC) of Naguilian, La Union, and the Municipal Trial
Court in Cities (MTCC), Branch 2 of San Fernando City, La Union, where retired Judge
Santiago E. Soriano (Judge Soriano) was then the Presiding Judge and Acting Presiding Judge,
respectively.

The Facts

In connection with the judicial audit and inventory of pending cases in the MTCC, Branch 2,
San Fernando City, La Union and in the MTC, Naguilian, La Union, the Office of the Court
Administrator (OCA)1 directed Judge Soriano to decide the enumerated cases submitted for
34
decision which were already beyond the reglementary period to decide. The judicial audit
team found that in the MTCC, Branch 2, San Fernando City, La Union, out of the 59 cases
submitted for decision, 57 cases were already beyond the reglementary period to decide. A
similar finding was made in the MTC, Naguilian, La Union wherein out of 41 cases submitted
for decision, 39 cases were already beyond the reglementary period to decide.

MTCC, Branch 2, San Fernando City, La Union

In a letter dated 1 September 2004, Judge Soriano, as Acting Presiding Judge of MTCC, San
Fernando, La Union, submitted to the OCA a tabulated report of the status of cases, in
compliance with the directive in the Memorandum dated 2 July 2004.

The OCA issued another Memorandum dated 7 January 2005 addressed to Judge Soriano,
noting that 51 cases still remain unresolved. The OCA then directed Judge Soriano to decide
the remaining unresolved cases and to resolve the pending motions or incidents in the other
cases.

Judge Soriano submitted another tabulated report of the cases in his letter dated 28 April
2005. He requested for an extension of 60 days to decide and resolve the remaining cases
and unresolved motions, which the OCA granted.

MTC, Naguilian, La Union

In a November 2004 Memorandum, then Court Administrator Presbitero J. Velasco, Jr.2

directed Judge Soriano, as Presiding Judge of MTC, Naguilian, La Union, to decide the cases
submitted for decision which were already beyond the reglementary period to decide, and to
take appropriate action on cases which have not been acted upon, including those with
pending motions. In another November 2004 Memorandum, then Court Administrator
Velasco directed Ms. Rosie M. Novencido, OIC Clerk of Court of MTC, Naguilian, La Union, to
explain why the records of the listed cases could not be located.

Ms. Novencido explained in a letter sent to the OCA that before she was designated OIC
Clerk of Court on 5 August 2002, there was no inventory of records. She stated that the
cases listed were filed long before she was designated as OIC and that despite diligent
efforts by the entire staff, they could not locate the records of the listed cases.

On 25 July 2006, Judge Soriano compulsorily retired from service. In his letter dated 28 July
2006, Judge Soriano submitted an inventory of pending cases and the cases submitted for
decision at the MTC, Naguilian, La Union.

In a Resolution dated 1 August 2007, the Court resolved to:

1. TREAT the Report of the Judicial Audit Team as an administrative complaint, and to RE-
DOCKET the same as a regular administrative matter against respondent Judge;

2. DEEM AS SATISFACTORY the explanation of Ms. Rosie M. Novencido, then OIC Clerk of
Court, MTC, Naguilian, La Union, and consider the matter under consideration CLOSED and
TERMINATED insofar as Ms. Novencido is concerned;

3. DIRECT Hon. Asuncion F. Mandia, Acting Presiding Judge, MTC, Naguilian, La Union, and
the Clerk of Court thereof to inform the Court, thru the Office of DCA Perez, of the STATUS of
the following cases, to wit: Crim. Case Nos. 2345-B, 2169, 2188, 2203, 2211, 2217, 2218,
2240, 2251, 2257, 2345, 2365, 2366, 2526, 2590, 2768, 2801, 2849, 3367, 3378 and 3988,
found during the audit conducted of the MTC, Naguilian, La Union (from 22 March to 5 April

35
2004) as "cannot be located" and to cause the reconstitution of the missing records, if any,
and submit proof of the reconstitution thereof, all within sixty (60) days from notice; and

4. REQUIRE Judge Santiago E. Soriano to comment on the Report of the Judicial Audit Team
within ten (10) days from notice.3

In his letter dated 4 October 2007, Judge Soriano stated that he had already decided most of
the cases enumerated in the Resolution, except those cases which were missing during the
term of Clerk of Court Teresita Bravo. Judge Soriano requested for one month to verify the
cases still undecided, which the Court granted in a Resolution dated 5 December 2007.

Meanwhile, in a letter dated 15 November 2007, incumbent Presiding Judge Romeo M. Atillo,
Jr., of MTC, Naguilian, La Union, informed the Court that aside from Criminal Case No. 2211,
reconstitution was no longer possible for the other missing records.

On 9 November 2009, Judge Soriano wrote a letter to the Deputy Court Administrator,
requesting for the release of his retirement benefits. Judge Soriano stated that the Court
could withhold a portion of his retirement benefits to answer for whatever administrative
penalty he might incur in the administrative matter against him.

The Court, in a Resolution dated 24 March 2010, allowed the release of Judge Sorianos
retirement benefits provided that the amount of P40,000 be withheld pending resolution of
this administrative matter. The Court also directed Judge Soriano to show cause why he
should not be held in contempt of court for his failure to submit his report on the undecided
cases as directed in the Resolutions dated 5 December 2007 and 6 October 2008.

Judge Soriano apologized to the Court through his letter dated 21 May 2010, explaining that
he neglected to submit the report on the undecided cases because he knew that his branch
clerk of court already submitted to the OCA copies of the decided cases.

The Court, in a Resolution dated 21 July 2010, noted Judge Sorianos explanation and
required him to submit the report on the undecided cases within ten days from notice.

Judge Soriano requested for an extension of 15 days to submit the required report, which the
Court granted. Judge Soriano eventually submitted to the Court the required report, with the
request that the contempt charge against him be dismissed and the P40,000 deducted from
his retirement benefits be returned.

In a Resolution dated 14 September 2011, the Court resolved to:

1. DIRECT the OCA to: (a) VERIFY the present status of the cases left undecided, the
incidents or motions left unresolved, and the dormant cases left unacted upon, all by Judge
Santiago E. Soriano at the MTC, Naguilian and MTCC, San Fernando City, both in the province
of La Union; and (b) SUBMIT to the Court a report thereon within fifteen (15) days from
receipt of the information required; and

2. NOTE the letter dated 15 November 2007 of Judge Romeo M. Atillo, Jr., MTC, Naguilian, La
Union, and DIRECT Judge Atillo to SUBMIT within fifteen (15) days from notice a written
report to the Court, through the OCA, on any further development regarding the reported
missing case records.4

Meanwhile, in a letter dated 3 September 2012, Judge Soriano prayed for the early
resolution of this administrative matter and requested that his monthly pension be released,
considering that he should have received his monthly pension beginning 25 July 2011, five
years after he compulsorily retired on 25 July 2006 at the age of 70 years old.
36
The OCAs Report and Recommendation

In its Memorandum dated 3 January 2013, the OCA stated its findings as reported in its
Memorandum dated 9 July 2012, thus:

Municipal Trial Court, Naguilian, La Union

1. Of the sixteen (16) undecided cases listed above, four (4) cases, namely, Criminal Case
No. 4289, Civil Case Nos. 286 and 287, and LRC No. 002-02, were actually decided by Judge
Santiago E. Soriano before he retired compulsorily on July 25, 2006, but all beyond the
mandated period; four (4) cases namely, Criminal Case Nos. 3300, 3361, 3927 and 4274,
remain undecided up to the present and the respective records thereof are missing and
could no longer be found; two (2) cases, namely, Criminal Case Nos. 3663 and 3664, were
decided jointly by Acting Presiding Judge Asuncion F. Mandia; five (5) cases, namely, Criminal
Case Nos. 2834, 4001, 4002, 4149 and 4154, were decided by Judge Romeo M. Atillo, Jr.; and
Criminal Case No. 3922 was reported to have been decided on July 11, 2006, but no copy of
the decision was attached to the letter-report;

2. Of the five (5) cases with unresolved incidents or motions listed above, the incidents in
four (4) cases, namely, Criminal Case Nos. 3347 and 3351, SP No. 01-03 and Civil Case No.
192, were resolved by Judge Soriano before his compulsory retirement; and the incident, i.e.,
motion for new trial, in Civil Case No. 282 remains unresolved up to the present; and

3. The records of two (2) of the dormant cases listed above, namely, Criminal Case No. 4117
and Civil Case No. 210, are missing and could no longer be found. All the other dormant
cases have already been disposed of by Judge Atillo, Jr.

Municipal Trial Court in Cities, Branch 2, San Fernando City, La Union

1. Of the twenty-seven (27) undecided cases listed above, two (2) cases, namely, Criminal
Case No. 31268 and Civil Case No. 3864, were actually decided by Judge Soriano before his
compulsory retirement but beyond the mandated period, and the remaining cases were
decided or disposed of by Judge Corpuz;

2. With respect to the two (2) cases with unresolved incidents or motions listed above, Civil
Case No. 3851 was decided by Judge Corpuz on October 28, 2008, but it was not reported
whether the subject motion for reconsideration of the July 10, 2003 Order declaring
defendant in default, which was submitted for resolution on September 24, 2003, was
resolved; and the motion for reconsideration of the June 26, 2003 Order in LRC No. N-95-04,
which was submitted for resolution on January 21, 2004, was ordered denied by Judge
Corpuz on September 15, 2006; and

3. With respect to the two (2) dormant cases listed above, namely, Civil Case No. 3487 and
LRC No. N-95-67, both were dismissed by Judge Corpuz on September 29, 2005 and October
11, 2006, respectively.

xxxx

The result of the verification of the status of the cases earlier found to have been left
undecided by retired Judge Soriano at the MTC, Naguilian and MTCC, Branch 2, San Fernando
City, both in the province of La union, showing that he failed to decide a total of thirty-six
(36) cases submitted for decision , which were already all due for decision at the time he
compulsorily retired on July 25, 2006, confirms our findings against retired Judge Soriano in
our March 11, 2011 Memorandum. Worse, the records in four (4) of said cases could no
37
longer be accounted for and were confirmed by Judge Atillo to be missing and beyond
recovery. The thirty-two (32) other cases were decided by the judges who succeeded retired
Judge Soriano in the MTC, Naguilian and MTCC, Branch 2, San Fernando City, both in the
Province of La Union.5

The OCA also noted that Judge Soriano decided 12 cases on 25 July 2006, which was the day
his compulsory retirement took effect. The OCA stressed that when Judge Soriano reached
the compulsory retirement age of 70 on 25 July 2006, he is considered automatically retired
on that date and could no longer exercise the powers and functions of his office, particularly
promulgation of decisions.

On Judge Sorianos request for the release of his monthly pension beginning 25 July 2011,
the OCA found no legal impediment thereto. The OCA stated that when Judge Soriano retired
from the Judiciary on 25 July 2006, he had rendered a total of 41 years, 7 months, and 24
days in government service, thus, entitling him to receive gratuity benefits granted under
Republic Act No. 9106 (RA 910), as amended by Republic Act No. 99467 (RA 9946).

In conclusion, the OCA recommended that:

1. Ret. Judge Santiago E. Soriano, formerly of the Municipal Trial Court, Naguilian, La Union
as its Presiding Judge and of the Municipal Trial Court in Cities as its Acting Presiding Judge,
be found GUILTY of Gross Inefficiency and Gross Ignorance of the Law and be FINED in the
amount of Php40,000.00, to be taken from the amount earlier withheld from his retirement
benefits; and

2. the annuity payable monthly to retired Judge Soriano under R.A. 910, as amended,
beginning on July 25, 2011, be RELEASED immediately.8

The Ruling of the Court

The Court agrees with the findings and recommendation of the OCA.

Section 5, Canon 6 of the New Code of Judicial Conduct for the Philippine Judiciary mandates
judges to "perform all judicial duties, including the delivery of reserved decisions, efficiently,
fairly and with reasonable promptness." Similarly, Rule 3.05, Canon 3 of the Code of Judicial
Conduct exhorts judges to dispose of the courts business promptly and to decide cases
within the required periods. Section 15(1), Article VIII of the Constitution provides that all
cases and matters must be decided or resolved by the lower courts within three months
from the date of submission of the last pleading.

In this case, the judicial audit team found that out of the 59 cases submitted for decision in
the MTCC, Branch 2, San Fernando City, La Union, 57 cases were already beyond the
reglementary period to decide. A similar finding was made in the MTC, Naguilian, La Union
wherein out of 41 cases submitted for decision, 39 cases were already beyond the
reglementary period to decide. The OCA then directed Judge Soriano to decide the remaining
unresolved cases and to resolve the pending motions or incidents in the other cases.
However, Judge Soriano still failed to decide a total of thirty-six (36) cases submitted for
decision in the MTC and MTCC combined, which were already all due for decision at the time
he compulsorily retired on 25 July 2006.

Clearly, Judge Soriano has been remiss in the performance of his judicial duties. Judge
Sorianos unreasonable delay in deciding cases and resolving incidents and motions, and his
failure to decide the remaining cases before his compulsory retirement constitutes gross
inefficiency which cannot be tolerated. As held in numerous cases, inexcusable failure to

38
decide cases within the reglementary period constitutes gross inefficiency, warranting the
imposition of an administrative sanction on the defaulting judge.9

Undue delay in rendering a decision or order is classified as a less serious charge under
Section 9, Rule 140 of the Rules of Court.10 It is punishable by (1) suspension from office
without salary and other benefits for not less than one month nor more than three months,
or (2) a fine of more than P10,000 but not exceeding P20,000.11

Judge Sorianos inefficiency in managing his caseload was compounded by gross negligence
as evinced by the loss of the records of at least four cases which could no longer be located
or reconstituted despite diligent efforts by his successor. Judge Soriano was responsible for
managing his court efficiently to ensure the prompt delivery of court services,12 especially
the speedy disposition of cases.13 Under Rule 3.08, Canon 3 of the Code of Judicial Conduct,
a judge is mandated to diligently discharge administrative responsibilities and maintain
professional competence in court management. Furthermore, a judge should organize and
supervise the court personnel to ensure the prompt and efficient dispatch of business, and
require at all times the observance of high standards of public service and fidelity.14 Judge
Soriano failed in this respect.

Furthermore, the Court finds Judge Soriano guilty of gross ignorance of the law. As found by
the OCA, Judge Soriano decided 12 cases on 25 July 2006, which was the day his compulsory
retirement took effect. Section 11, Article VIII of the Constitution15 states that judges shall
hold office during good behavior until they reach the age of 70 years or become
incapacitated to discharge the duties of their office. Thus, Judge Soriano was automatically
retired from service effective 25 July 2006, and he could no longer exercise on that day the
functions and duties of his office, including the authority to decide and promulgate cases.16

Gross ignorance of the law is classified as a serious charge under Section 8(9), Rule 140 of
the Rules of Court and is punishable by a fine of more than P20,000 but not exceeding
P40,000.17

For gross inefficiency and gross ignorance of the law, the Court finds sufficient the OCAs
recommended fine of P40,000, which will be taken from the amount previously withheld
from Judge Sorianos retirement benefits.

On Judge Sorianos request for the release of his monthly pension beginning 25 July 2011,
the Court agrees with the OCA that it should be released immediately. This is in accordance
with RA 910, as amended by RA 9946, which provides that:

SEC. 3. Upon retirement, a Justice of the Supreme Court or of the Court of Appeals, the
Sandiganbayan or of the Court of Tax Appeals, or a Judge of the regional trial court,
metropolitan trial court, municipal trial court in cities, municipal trial court, municipal circuit
trial court, sharia district court, sharia circuit court, or any other court hereafter established
shall be automatically entitled to a lump sum of five (5) years gratuity computed on the
basis of the highest monthly salary plus the highest monthly aggregate of transportation,
representation and other allowances such as personal economic relief allowance (PERA) and
additional compensation allowance he/she was receiving on the date of his/her retirement
and thereafter upon survival after the expiration of five (5) years, to further annuity payable
monthly during the residue of his/her natural life pursuant to Section 1 hereof x x x.

WHEREFORE, the Court finds retired Judge Santiago E. Soriano guilty of gross inefficiency
and gross ignorance of the law, and fines him P40,000 to be taken from the amount withheld
from his retirement benefits. The Court orders the immediate release of the annuity payable
monthly to Judge Soriano under Republic Act No. 910, as amended by Republic Act No. 9946,
beginning 25 July 2011.
39
SO ORDERED.

8. G.R. No. 124704 February 22, 2001

PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
LORETO CUADRO y OBEDOZA alias "PIJOK", accused-appellant.

QUISUMBING, J.:

On appeal is the decision dated November 15, 1995 of the Regional Trial Court, Lingayen,
Pangasinan, Branch 37, in Criminal Cases Nos. L-4711 to L-4716, acquitting appellant of one
(1) count of rape but convicting him to five (5) counts of rape and sentencing him in each
count to reclusion perpetua as well as to indemnify the victim the amount of P 30,000.00,
and to pay the costs.1wphi1.nt

Appellant is accused of raping Venus D. Addato, who was a 12 years-old, Grade III pupil at
the time of the incident. Her mother is the live-in partner ("common-law wife") of appellant.

The version of the prosecution, as summarized by the trial court, is as follows:

"Venus Addato claimed on the witness stand that during her stay at Brgy. Puelay, Villasis,
Pangasinan, in the house of her step-father, Loreto Cuadro, mother, brother, half-sisters and
half-brothers, sometime in the month of May, 1992, her step-father, Loreto Cuadro, on five
(5) occasions, at intervals of one day after each incident, had sexual intercourse with her by
inserting his penis in her vagina. Venus narrated further that each time she was raped by
her stepfather, it was in their house, after lunch when her brothers and sisters were playing
in the houses of their neighbors, her mother was selling corn at Carmen, Rosales,
Pangasinan, and it was only two of them inside the house. (TSN, 15 December, 1992, pp. 6-
7)

Going into detail, Venus testified that the first time she was raped by her stepfather, he
armed himself with a kitchen knife. It was in their house after lunch, her mother was not
home as she was selling corn in Carmen, and her brother and sisters were in the neighboring
houses, playing. Her stepfather first inserted his penis into her mouth. Then, he inserted his
penis into her vagina. He told her that if she would report the incident to her mother, he
would kill her. She did not resist because she was afraid he might kill her as he was drunk.
(TSN, supra, pp. 6-7).

The second incident took place after an interval of one day, again in their house, when she
had no companion, her step father raped her. He did not have the knife, he did not say
anything or warn her. The third time her step-father raped her was also one day later, after
lunch, she did not resist because she was afraid he might kill her as he again had the
kitchen knife, 6 to 8 inches long, which he got from the kitchen. The fourth time she was
raped by her step-father, a day later, after lunch, in the house, he was not armed, he did not
say anything thereafter, he did not warn her that he would be killed if she reported the
matter to her mother. On the fifth occasion that her stepfather raped her, he was not armed,
he did not warn her. (TSN, supra, pp. 8-10).

Cherry Diaz, wife of a brother of Venus Addato's mother, with whom Venus lived with her
grandmother in Tubor, Malasiqui, during school days, testified that sometime in June 1992
she observed Venus to be restless, so she asked her what was wrong with her, and,
trembling, Venus said the she was afraid because the accused might kill her. She confined
that she was sexually abused by her stepfather Loreto Cuadro, five (5) times, once every
40
other day. Cherry Diaz forthwith reported the matter to her mother-in-law, Alberta Diaz,
Venus' grand-mother who investigated Venus about the report."1

The defense, on the other hand, present the following version:

"The accused, Loreto Cuadro, 46 years old, put up the defense of denial, admitting that he is
a live-in-partner of Lolita Diaz (Addato-Cuadro), that they live in their house in Puelay,
Villasis, Pangasinan, with their five (5) children, the oldest being 10 years old and the
youngest 2 years old, and a stepson 14-year old Rex Addato, son of Lolita with her husband,
that Venus Addato is his step-daughter, being another child of Lolita, and that Venus was
then living with her grandmother, Alberta Diaz in Brgy. Tubor, Malasiqui, Pangasinan where
she goes to school. Further, he claimed that in the month of May 1992 he and Lolita were
engaged in gold panning in the Agno River near the Carmen, Rosales bridge, going to the
river at 6:00 A.M. and going back home at 2:00 P.M., taking their lunch in the river.

Accused Loreto Cuadro denied, on direct examination and cross-examination, that Venus
Addato ever visited or stayed in his house at Puelay, Villasis in the month of May, 1992 (TSN,
28 April 1993, p. 5; ibid, p. 10). And, he vehemently denied that he raped Venus or did
anything to her (ibid., pp. 6-7).

The accused's defense of alibi was corroborated by his live-in partner Lolita, step-son Rex
and his 'Cabo' in his job as jueteng collector, to the effect that said accused and his live-in-
partner were gold panning during the month of May 1992, they left their house at 6:00
o'clock in the morning, stay at the river gold-panning continuously up to 2:00 o'clock in the
afternoon when they went home, with the accused never having gone home before 2:00
P.M., and thereafter the accused went around collecting jueteng bets in the neighborhood.
Rex Addato added that he was also a jueteng collector but he collected bets right at the yard
infront of their house where the bettors went to place their bets and did not notice his sister,
Venus, being abused by their step-father.

Adding her two-cents worth, Lolita Diaz (Addato-Cuadro), claimed that she cooked the
family's breakfast and lunch in the morning before leaving for the river to pan gold, when
she and her husband (accused) returned home from the river at 2:00 PM, she washed the
clothes of the family in their house because Venus was very lazy, that she never sold corn at
the Carmen bus terminal, and there was no way for the accused to have raped her daughter.

Not to be outdone, Rosendo Oliveras, neighbor and 'Cabo' of the accused in jueteng who
claimed to be roaming around the premises of the house of the accused, as jueteng 'cabo',
collecting bets from jueteng collectors from 9:00 o'clock in the morning to 12:00 noon when
the numbers are drawn, that the house of the accused, which is a little nipa hut, was then
under repair in the month of May and that persons inside the house could be seen from the
outside, that usually between 12:00 noon and 5:00 PM, the children of Lolita were watching
television in his house with Venus Addato watching over her half-brothers and half-sisters,
that Venus could not have been raped by her step-father because she was only 12 years old
and no blood came out from her private part. (TSN, 8 March 1993, pp. 9, 15-16, 18.)"2

On July 6, 1992, the victim, accompanied by her aunt Cherry Diaz, filed against appellant a
Criminal Complaint3 for rape with Municipal Circuit Court of Villasis, Pangasinan. On July 20,
1992, after conducting preliminary investigation, the circuit judge issued a Resolution4
finding a prima facie case for rape and forwarded the records to the Provincial Prosecutor of
Lingayen, Pangasinan.

On October 14, 1992, appellant was charged with six (6) counts of rape under six (6)
Informations5 which are similarly worded as follows:

41
INFORMATION

"The undersigned upon verified complaint of Venus D. Addato, a minor of 12 years, hereby
accuses LORETO CUADRO y OBEDOZA of the crime of RAPE, committed as follows:

The on or sometime on May, 1992 in barangay Puelay, municipality of Villasis, province of

Pangasinan, Philippines and within the jurisdiction of this Honorable Court, above-named
accused, [being the step father of the complainant], armed with a bolo, by means of force
and intimidation, did then and there, wilfully, unlawfully and feloniously have sexual
intercourse with Venus D. Addato against her will, to her damage and prejudice.

CONTRARY to Article 335 of the Revised Penal Code.

Lingayen, Pangasinan, October 13, 1992."

Upon arraignment, appellant entered a plea of not guilty.6

During trial, the prosecution presented as witness (1) Venus D. Addato, the victim, (2) cherry
Diaz, sister-in-law of the victim's mother, to whom the victim confided about the rapes
perpetuated by appellant,7 (3) Alberta Diaz, grandmother of the victim, who conferred with
the victim about the rapes upon the request of Cherry Diaz,8 (4) Lutgarda Diaz, a social
worker, whose testimony was dispensed with when the defense admitted that her testimony
was merely corroborative of the testimonies of Cherry Diaz and Alberta Diaz,9 and (5) Dr.
Noel U. Obedoza, resident physician at the Urdaneta District Hospital in Asingan,
Pangasinan. Dr. Obedoza testified that he did not find any recent hymen ruptured with old
healed lacerations at 7, 11 and 3 o'clock, and that her vaginal orifice easily admitted a
forefinger. Considering the victim's age, Dr. Obedoza opined that it was possible that the
victim had sexual intercourse more than once.10

For the defense, the following witnesses testified: (1) appellant, (2) Lolita Diaz, the victim's
mother and common-law wife of appellant, (3) Rex Addato, brother of the victim and (4)
Rosendo Oliveras, appellant's neighbor.

Appellant denied the rape charges. He and his witnesses claimed that it was highly
improbable, if not impossible, for him to have raped the victim considering that in the month
of May 1992, appellant and his common-law wife panned gold in the Agno Valley River from
6:00 A.M. Until around 2:00 P.M., and thereafter, appellant would continue with his work as a
jueteng bet collector. Further, the house where the alleged rape took place always had many
visitors who would place their jueteng bets with appellant or his son, Rex Addato. The
defense insisted that Alberta Diaz, the victim's grandmother, helped the victim file this rape
case in order to force appellant and his common-law wife to separate.11

On rebuttal, Alberta Diaz testified that she had no ill-will towards appellant except for the
fact that her granddaughter.12

On sur-rebuttal, appellant insisted that his mother-in-law, Alberta Diaz, used to borrow
money from him, and when she could no longer borrow money, she wanted appellant to
separate from her daughter so that the latter could marry a richer man.13

On November 15, 1995, the trial court rendered its decision14 disposing thus -

"WHEREFORE, the accused, Loreto Cuadro y Obedoza, alias 'Pijok', is hereby found guilty
beyond reasonable doubt, of the crime of Rape, in five (5) counts, defined and penalized
under Article 335 of the Revised Penal Code, under Criminal Cases Nos. L-4711, L-4712, L-
4713, L-4714 and L-4715, and he is hereby sentenced to suffer the penalty of five (5)
42
imprisonments of reclusion perpetua, to indemnify the offended party, Venus Addato in the
amount of P 30,000.00, and to pay costs.

The Accused is hereby acquitted of the crime charged under the Information filed in Criminal
Case No. L-4716.

SO ORDERED."

Hence, the present appeal. Appellant contends that the trial court erred in - 15

I. GIVING FULL FAITH AND CREDENCE TO THE TESTIMONY OF COMPLAINING WITNESS AND
IN NOT ACQUITTING ACCUSED-APPELLANT ON GROUND OF REASONABLE DOUBT.

II. ORDERING ACCUSED-APPELLANT TO INDEMNIFY THE OFFENDED PARTY IN THE AMOUNT

OF P 30,000.00 AND TO PAY THE COSTS.

In his brief,16 appellant contends that the trial court erred in not giving weight to his
defense of denial and alibi considering that it was corroborated by the testimony of his
common-law wife as well as of his step-son and fellow jueteng collector. Appellant argues
that these testimonies raised reasonable doubt at the very least, and should have entitled
him to an acquittal.

The Office of the Solicitor General, for the State, argues that the trial court correctly relied
on the testimony of the victim, which was delivered in a clear and firm manner, in contrast
to the self-serving testimonies of the appellant and his witness. Appellant's bare denials,
furthermore, cannot prevail over the positive declarations of the prosecutions witnesses and
the physical evidence of rape. Lastly, the OSG recommends that the civil indemnity be
increased from P30,000.00 to P50,000.00 for each count of rape.

The main issues, therefore, pertain to the credibility of witnesses and the sufficiency of
evidence to convict appellant.

In the assessment of credibility of witnesses, we have laid down the following parameters:17

"First the appellate court will not disturb the factual findings of the lower court unless there
is a showing that it had overlooked, misunderstood, or misapplied some fact or circumstance
of weight and substance that would have affected the result of the case;

Second, the finding of the trial court pertaining to the credibility of witnesses are entitled to
great respect since it had the opportunity to examine their demeanor as they testify on the
witness stand; and

Third, a witness who testified in a categorical, straightforward, spontaneous and frank

manner and remained consistent on cross examination is a credible witness."

In this case, the victim's actuation's after the rape and her testimony during trial bear the
earmarks of a credible witness. As held in People v. Lamarroza,18 the conduct of the victim
immediately following the alleged assault is of utmost importance in establishing the truth
or falsify of the charge. The aunt of the victim, Cherry Diaz, testified that when the victim
told her about the rapes, the victim was trembling and crying, and did not want to report the
matter to the authorities because appellant threatened to kill her.19 Further, the young
victim consistently narrated her ordeal to her other close relatives, namely her aunt, Cherry
Diaz; and her grandmother, Alberta Diaz. She willingly executed a sworn statement narrating
the rapes. She recounted her story candidly during the trial. She remained steadfast when
she was subjected to rigid cross-examination by the defense. All throughout, the victim
43
maintained that appellant had repeatedly raped her in the month of May, 1992. Indeed no
person would subject herself to the humiliation of a rape trial, with the attendant
embarrassment of a medical examination and stigma of a sexual assault, unless the
accusation be true.20 In rape cases, the accused may be convicted solely on the testimony
of the victim, provided such testimony is credible, natural, convincing and consistent with
human nature and the normal course of things.21

Appellant attempts to discredit the testimony of the grandmother of the victim by claiming
that she merely wanted him to separate from the victim's mother. As can be gleaned from
the record, appellant and his mother-in-law are clearly not in the best of terms.
Nevertheless, it would go against the grain of human nature for a grandmother to subject
her granddaughter to the to the humiliation of a rape trial, and expose the indecencies
committed against her, for the alleged purpose of separating the victim's mother from the
latter's common-law husband. Appellant's version on this point simply taxes our credulity.

Further, the medical findings Dr. Obedoza are indicative of rape. It is not indispensable that
marks of external bodily injuries should appear on the victim of rape.22 Considering that in
the commission of the first, second and third rapes, appellant threatened the victim with a
knife, it is logical that no external injuries would appear on her body. What is more telling is
that the victim, at her young age, sustained lacerations in her genitalia. We have ruled that
lacerations, whether healed or fresh, are the best physical evidence of forcible defloration.23

Appellant's defense of alibi, albeit supported by the testimonies of his common-law wife, her
son, and his fellow jueteng collector, cannot prevail over the positive testimony of the
victim. Alibi is an inherently weak defense whose value loses a lot when time and distance
do not make the imputed offense impossible of commission.24 As to appellant's claim that
the presence of people who would drop by the house to place jueteng bets would deter the
commission of the rapes, suffice it to say that there is no rule that rape can only be
committed in seclusion.25

Appellant was charged with the crime of rape committed in May 1992 through force or
intimidation under Article 335, first paragraph of the Revised Penal Code. The victim testified
that the first time appellant raped her, he first inserted his penis into her mouth before
inserting it in her vagina.26 The first rape was done with threats against the victim. The
second and third were committed similarly. Appellant threatened the victim with a knife in
these 3 instances.27 We have held that intimidation includes the moral kind such as the fear
caused by threatening the girl with a knife or pistol.28 as to the fourth and fifth rapes,
appellant did not use a knife to force the victim into submission.29 However, the apparent
submission of the victim herein does not indicate consent. She had already been repeatedly
abused by a person who had ascendant authority over her. On three occasions of those
rapes, she had cowered with her fear for her life. As common-law husband of her mother,
appellant clearly had moral dominance and influence over the victim. He easily intimidated
and forced her to submit to his bestial desires. Considering the masculine strength of
appellant, with or without a knife, the victim obviously knew that resistance would be futile.
Physical resistance need not be established in rape when threats and intimidation are
employed and the victim submits herself to the rapist because of fear.30 Intimidation must
be viewed in the light of the victim's perception and judgement at the time of the
commission of the crime and not by any hard and fast rule.31

At the time of the commission of the rape in 1992, the penalty for the crime of rape was
reclusion perpetua to death. Under Art.335 of the Revised Penal Code, the use of a deadly
weapon, like a bolo,32 in committing the rape is a circumstance which could have increased
the penalty to death. However, in view of the Constitutional proscription33 against the
imposition of capital punishment at the time, the use of a deadly weapon as an aggravating

44
circumstance would not alter the imposable penalty in this case, which is reclusion perpetua
only for each count of rape.

As to damages. Pursuant to jurisprudence, the award of indemnity should be increased to

P50,000.00 for each. In addition, we award the amount of P50,000.00 as moral damages for
each count of rape without need of additional proof. 34 Moral damages is separate and
distinct from the civil indemnity awarded to rape victims.34 Moral, damages is separate and
distinct from the civil indemnity awarded to rape victims.35

WHEREFORE, the appeal decision of the trial court convicting appellant, Loreto Cuadro y
Obedoza, of five (5) counts of rape is hereby sentenced to reclusion perpetua, and to pay
the victim, Venus D. Addato, the amount of P50,000.00 as civil indemnity and P50,000.00 as
moral damages, and the costs.
SO ORDERED.

9. A.C. No. 5534 January 17, 2005

JAYNE Y. YU, complainant,

vs.
RENATO LAZARO BONDAL, respondent.

DECISION
CARPIO MORALES, J.:

Atty. Renato Lazaro Bondal (respondent) stands charged in a complaint1 filed by Jayne Y. Yu
(complainant) for gross negligence and violation of Canon 162 and Rule 16.033 of the Code
of Professional Responsibility arising from his alleged failure to attend to the five cases she
referred to him and to return, despite demand, the amount of P51,716.54 she has paid him.

By complainants allegation, the following spawned the filing of the present administrative
complaint:

On March 30, 2000, she engaged the services of respondent as counsel in the following
cases: (1) "Jayne Yu. v. Swire Realty and Development Corp," for Rescission with Damages
filed before the Housing and Land Use Regulatory Board, (2) I.S. No. 00-22089-90, "Jayne Yu
v. Lourdes Fresnoza Boon," for Estafa, (3) I.S. No. 2000-G-22087-88, "Jayne Yu v. Julie Teh,"
for violation of Batas Pambansa Blg. 22, (4) I.S. No. 2000-D-11826, "Jayne Yu v. Mona Lisa
San Juan" for violation of Batas Pambansa Blg. 22, and (5) I.S. No. 2000-D-11827, "Jayne Yu
v. Elizabeth Chan Ong," also for violation of Batas Pambansa Blg. 22.4

In the Retainer Agreement5 dated March 30, 2000, complainant agreed to pay respondent
the amount of P200,000.00 as Acceptance Fee for the five cases, with an Appearance Fee of
P1,500.00 pesos per hearing; and in the event that damages are recovered, she would pay
respondent 10% thereof as success fee.

Complainant later issued two checks, BPI Family Bank No. 94944 and BPI Family Bank No.
94968, dated February 20, 2001 and April 5, 2001 in the amount of P30,000.00 and
P21,716.54, respectively.6

Despite receipt of above-said amounts, respondent failed to file a case against Swire Realty
and Development Corp;7 due to respondents negligence, the case for estafa against
Lourdes Fresnoza Boon was dismissed by the Office of the City Prosecutor of Makati City and
was not timely appealed to the Department of Justice;8 respondent negligently failed to
inform complainant, before she left for abroad, to leave the necessary documents for
purposes of the preliminary investigation of the case filed against Julie Teh before the Office
45
of the City Prosecutor of Makati City, which case was eventually dismissed by Resolution
dated August 14, 2000;9 and respondent compelled her to settle the two cases for violation
of B.P. Blg. 22 against Mona Lisa San Juan and Elizabeth Chan Ong under unfair and
unreasonable terms.101a\^/phi1.net

Respondent thus demanded from respondent, by letter11 of June 14, 2001, for the return of
all the records she had entrusted him bearing on the subject cases.

Through complainants counsel (Chavez Laureta and Associates Law Office) which sent a
letter12 to respondent, she reiterated her demand for the return of the records of the cases.

Respondent did return but only the records bearing on the estafa case against Lourdes
Fresnoza Boon and the B.P. Blg. 22 case against Mona Lisa San Juan.

Complainant through counsel thus demanded, by letter13 of August 8, 2001, the return of
the rest of the files, particularly that dealing with Swire Realty and Development Corporation
and Julie Teh. In the same letter, complainant also demanded the refund of the amounts
covered by the above-said two BPI Family Bank Checks amounting to P51,716.54, they being
intended to represent payment of filing fees for the case against Swire Realty and
Development Corporation which respondent failed to file.

As respondent failed and continues to refuse to comply with complainants valid demands in
evident bad faith and to her prejudice, she filed the present complaint charging him with
flagrant violation of Canon 16 and Canon 16.03 of the Code of Professional Responsibility.

By Resolution14 of February 4, 2002, this Court directed respondent to file his Comment.
Respondent, through his counsel, the Escobido and Pulgar Law Offices, filed a motion for
extension for thirty days or up to April 9, 2002, which was granted by Resolution of May 27,
2002. No copy was, however, furnished respondents counsel.15

As respondent failed to file his Comment on the present complaint, this Court, by Resolution
of July 21, 2003, considered the filing of respondents comment deemed waived and allowed
complainant to present her evidence before the Office of the Bar Confidant.16

At the hearing before the Officer of the Bar Confidant, complainant echoed her allegations in
the complaint.

As to the other cases referred by complainant to respondent, complainant testified that the
case against Julie Enriquez-Teh was dismissed because respondent failed to present the
original checks subject of the case;17 that the estafa case against Ms. Lourdes Boon was
dismissed and was never appealed;18 and that she was prodded by respondent to settle the
two cases for B.P. Blg. 22 even if she was not satisfied with the terms thereof, respondent
having assured her that he would waive his 10% "success fee" in the case against Swire
Development.19

And complainant submitted the following documentary evidence: (1) Retainer Agreement
between her and Atty. Renato Lazaro Bondal;20 (2) BPI Family Bank Check No. 94944 dated
February 20, 2001 for P30,000.00 payable to cash;21 (3) BPI Family Bank Check No. 94968
dated April 5, 2001 for P21,716.54 payable to cash;22 (4) Resolution of the City Prosecutor
of Makati dated August 18, 2000 on a case between Jayne Yu and Lourdes Fresnoza Boon;23
(5) Resolution of the City Prosecutor of Makati on a case between her and Julie Enriquez-
Teh;24 (5) her letter to respondent dated June 14, 2001 requesting the return of pertinent
records of the cases referred to him;25 (6) letter of Francisco I. Chavez to respondent dated
July 18, 2001 reiterating the request for the return of the records and an accounting of the
amount of P51,716.54;26 (7) letter of Francisco I. Chavez to respondent dated August 8,
46
2001 confirming the receipt of two folders relative to the cases she filed against Lourdes
Fresnoza Boon and Mona Lisa San Juan, requesting Atty. Bondal to return the files bearing on
Swire Realty and Development Corporation and Julie Teh, and demanding the refund of the
amount of P51,716.54.27

The Office of the Bar Confidant, by Report and Recommendation,28 recommends the
dismissal of the complaint for failure of complainant to substantiate it.

From the records of the case, it is culled that except for the case against Swire Development
Corporation, the other 4 cases referred by complainant to respondent were filed in court but
were dismissed or terminated for causes not attributable to respondent.

The case for estafa against Lourdes Fresnoza Boon in I.S. No. 00-22089-90 was dismissed by
the Makati Prosecutors Office by Resolution dated August 18, 2000 due to lack of probable
cause and, in any event, the issues raised therein were in the nature of intra-corporate
disputes which are properly cognizable by another forum, viz:

After careful examination and evaluation of the evidence adduced both by complainant and
respondent, undersigned Investigating Prosecutor finds no probable cause to hold
respondent for the offense charged of Estafa. Apparently, there was no deceit and/or
unfaithfulness or abuse of confidence employed by respondent when complainant agreed to
invest her money in the restaurant business under the name and style of La Gondola, Inc.
which is owned by respondent. xxx In the present case, though, complainant alleged that
respondent immediately upon receipt of the P4,800,000.00 representing her investment in
the restaurant business, executed earlier in favor of Philippine Commercial and International
Bank whereby La Gondola assumed the loans and credit accommodations obtained by Lucre
Export/Import Inc., using the funds of La Gondola, Inc.; respondent being the President and
majority owner of the latter corporation. However, outside of the mere allegation of
complainant that respondent allegedly assumed the loans and credit accommodations
extended to the other company using the funds of La Gondola, Inc., no concrete and real
evidence were presented and/or proven to this effect by complainant. xxx

Moreover, it is apparent that the issues being raised by complainant appears to be intra-
corporate disputes which could be very well settled in another forum.29 (Underscoring
supplied)

Notably, a similar complaint for the same offense, docketed as I.S. No. 99-H-2780, had been
previously filed by complainant against Ms. Boon which case was dismissed for insufficiency
of evidence.30 As thus observed by the Office of the Bar Confidant, the filing of an appeal
from the prosecutors resolution would have been inutile since the facts and issues raised in
the estafa case had already been twice passed upon by the Office of the City Prosecutor,
hence, it would likely be dismissed.31

No fault or negligence can also be attributed to respondent in the dismissal of I.S. No. 2000-
G-22087-88 against Julie Teh. By Resolution of August 14, 2000 of the Makati Prosecutors
Office, it is clear that it was dismissed, in the main, on the ground that the offense charged
did not actually exist and complainant failed to appear and present the original checks, viz:

After a careful evaluation of the evidence on record, the undersigned recommends for the
dismissal of the present complaints on the following grounds:

1. Despite reasonable opportunity given to her, complainant failed to appear and present
the original copies of the subject checks and other documents attached to the complaint.

47
2. The subject checks were presented after the 90-day period hence there is no more
presumption of knowledge of the insufficiency of funds. Accordingly, the burden is shifted
upon the complainant to prove that at the time the checks were issued, the drawer knew
that he had insufficient funds. There is no allegation much less proof to that effect. The
result is that the element of knowledge of insufficiency of funds or credit is not present,
therefore the crime does not exist.32

On the alleged failure of respondent to appear during the hearing of I.S. No. 2000-G-22087-
88 and his failure to present the original of the checks subject thereof, they being then in the
possession of complainant who was abroad at that time:33 Such failure to present the
original of the checks cannot solely be attributed to respondent, for she herself was guilty of
neglect.34

As for the alleged compulsion in the settlement of her two complaints for violation of B.P.
Blg. 22 in accordance with the terms dictated by the therein respondents Mona Lisa San Juan
and Elizabeth Chan Ong, upon the promise of respondent that he would waive the 10%
success fee in the complaint to be filed against Swire Development: Assuming the
truthfulness of her allegation that respondent compelled her to settle, what the terms were
as alleged to have been dictated by Ms. San Juan and Ms. Chan Ong, and the manner and/or
extent of prejudice she suffered, complainant did not establish. Moreover, she failed to show
that the promise by respondent that he would waive the 10% success fee was for the
purpose of defrauding her or of such nature as to constitute undue influence, thereby
depriving her of reasonable freedom of choice.

Subsequent to the amicable settlement, it appears that complainant never raised any
objection to the terms of the compromise. As an accepted rule, when a client, upon
becoming aware of the compromise and the judgment thereon, fails to promptly repudiate
the action of his attorney, he will not afterwards be heard to complain about it.35

As for complainants claim that the amount of P51,716.54, which was the only amount on
record that complainant paid for respondents legal services, was intended for the filing fees
in the complaint against Swire Development Corporation, the same was not substantiated as
in fact the retainer agreement does not so confirm.

We would like to thank you for retaining our law firm in the handling and representation of
your case. In regard to the five cases you referred to us, our aggregate Acceptance fee is
P200,000 Pesos with an Appearance fee of P1,500.00 Pesos per hearing. As regards the
damages to be recovered, we will get 10% thereof by way of Success Fee.36 (Underscoring
supplied)

If, admittedly, the only payment given to complainant by respondent is the amount of
P51,716.54, then complainant still owes respondent more, as respondent rendered his legal
services in 4 out of the 5 cases. An acceptance fee is not a contingent fee, but is an absolute
fee arrangement which entitles a lawyer to get paid for his efforts regardless of the outcome
of the litigation. That complainant was dissatisfied with the outcome of the four cases does
not render void the above retainer agreement for respondent appears to have represented
the interest of complainant. Litigants need to be reminded that lawyers are not demi-gods or
"magicians" who can always win their cases for their clients no matter the utter lack of merit
of the same or how passionate the litigants may feel about their cause.371awphi1.nt

In sum, this Court finds well taken the finding of the Office of the Bar Confidant that
complainant failed to establish the guilt of respondent by clear, convincing and satisfactory
proof. The charges against him must thus be dismissed.38

48
However, since respondent had been advised by complainant through counsel Chavez
Laureta and Associates, by letter of July 18, 2001, that she intended to terminate his
services, as of said date, he was obliged, under Rule 22.02 of the Code of Professional
Responsibility, viz:

Rule 22.02 A lawyer who withdraws or is discharged shall, subject to a retainer lien,
immediately turn over all papers and property to which the client is entitled, and shall
cooperate with his successor in the orderly transfer of the matter, including all information
necessary for the proper handling of the matter,

to immediately turn over all papers and property which complainant entrusted to his
successor.

WHEREFORE, the complaint is hereby DISMISSED. Respondent is, however, hereby directed
to RETURN all the records in his possession relative to the cases he handled for complainant.

10. G.R. No. 120592 March 14, 1997

TRADERS ROYAL BANK EMPLOYEES UNION-INDEPENDENT, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION and EMMANUEL NOEL A. CRUZ,
respondents.

REGALADO, J.:

Petitioner Traders Royal Bank Employees Union and private respondent Atty. Emmanuel Noel
A. Cruz, head of the E.N.A. Cruz and Associates law firm, entered into a retainer agreement
on February 26, 1987 whereby the former obligated itself to pay the latter a monthly
retainer fee of P3,000.00 in consideration of the law firm's undertaking to render the
services enumerated in their contract. 1 Parenthetically, said retainer agreement was
terminated by the union on April 4, 1990. 2

During the existence of that agreement, petitioner union referred to private respondent the
claims of its members for holiday, mid-year and year-end bonuses against their employer,
Traders Royal Bank (TRB). After the appropriate complaint was filed by private respondent,
the case was certified by the Secretary of Labor to the National Labor Relations Commission
(NLRC) on March 24, 1987 and docketed as NLRC-NCR Certified Case No. 0466. 3

On September 2, 1988, the NLRC rendered a decision in the foregoing case in favor of the
employees, awarding them holiday pay differential, mid-year bonus differential, and year-
end bonus differential. 4 The NLRC, acting on a motion for the issuance of a writ of execution
filed by private respondent as counsel for petitioner union, raffled the case to Labor Arbiter
Oswald Lorenzo. 5

However, pending the hearing of the application for the writ of execution, TRB challenged
the decision of the NLRC before the Supreme Court. The Court, in its decision promulgated
on August 30, 1990, 6 modified the decision of the NLRC by deleting the award of mid-year
and year-end bonus differentials while affirming the award of holiday pay differential. 7

The bank voluntarily complied with such final judgment and determined the holiday pay
differential to be in the amount of P175,794.32. Petitioner never contested the amount thus
found by TRB. 8 The latter duly paid its concerned employees their respective entitlement in
said sum through their payroll. 9

49
After private respondent received the above decision of the Supreme Court on September
18, 1990, 10 he notified the petitioner union, the TRB management and the NLRC of his right
to exercise and enforce his attorney's lien over the award of holiday pay differential through
a letter dated October 8, 1990. 11

Thereafter, on July 2, 1991, private respondent filed a motion before Labor Arbiter Lorenzo
for the determination of his attorney's fees, praying that ten percent (10%) of the total
award for holiday pay differential computed by TRB at P175,794.32, or the amount of
P17,579.43, be declared as his attorney's fees, and that petitioner union be ordered to pay
and remit said amount to him. 12

The TRB management manifested before the labor arbiter that they did not wish to oppose
or comment on private respondent's motion as the claim was directed against the union, 13
while petitioner union filed a comment and opposition to said motion on July 15, 1991. 14
After considering the position of the parties, the labor arbiter issued an order 15 on
November 26, 1991 granting the motion of private respondent, as follows:

WHEREFORE, premises considered, it is hereby ordered that the TRADERS ROYAL BANK
EMPLOYEES UNION with offices at Kanlaon Towers, Roxas Boulevard is hereby ordered (sic) to
pay without delay the attorney's fees due the movant law firm, E.N.A. CRUZ and
ASSOCIATES the amount of P17,574.43 or ten (10%) per cent of the P175,794.32 awarded
by the Supreme Court to the members of the former.

This constrained petitioner to file an appeal with the NLRC on December 27, 1991, seeking a
reversal of that order. 16

On October 19, 1994, the First Division of the NLRC promulgated a resolution affirming the
order of the labor arbiter. 17 The motion for reconsideration filed by petitioner was denied by
the NLRC in a resolution dated May 23, 1995, 18 hence the petition at bar.

Petitioner maintains that the NLRC committed grave abuse of discretion amounting to lack of
jurisdiction in upholding the award of attorney's fees in the amount of P17,574.43, or ten
percent (10%) of the P175,794.32 granted as holiday pay differential to its members, in
violation of the retainer agreement; and that the challenged resolution of the NLRC is null
and void, 19 for the reasons hereunder stated.

Although petitioner union concedes that the NLRC has jurisdiction to decide claims for
attorney's fees, it contends that the award for attorney's fees should have been incorporated
in the main case and not after the Supreme Court had already reviewed and passed upon
the decision of the NLRC. Since the claim for attorney's fees by private respondent was
neither taken up nor approved by the Supreme Court, no attorney's fees should have been
allowed by the NLRC.

Thus, petitioner posits that the NLRC acted without jurisdiction in making the award of
attorney's fees, as said act constituted a modification of a final and executory judgment of
the Supreme Court which did not award attorney's fees. It then cited decisions of the Court
declaring that a decision which has become final and executory can no longer be altered or
modified even by the court which rendered the same.

On the other hand, private respondent maintains that his motion to determine attorney's
fees was just an incident of the main case where petitioner was awarded its money claims.
The grant of attorney's fees was the consequence of his exercise of his attorney's lien. Such
lien resulted from and corresponds to the services he rendered in the action wherein the
favorable judgment was obtained. To include the award of the attorney's fees in the main
case presupposes that the fees will be paid by TRB to the adverse party. All that the non-
50
inclusion of attorney's fees in the award means is that the Supreme Court did not order TRB
to pay the opposing party attorney's fees in the concept of damages. He is not therefore
precluded from filing his motion to have his own professional fees adjudicated.

In view of the substance of the arguments submitted by petitioner and private respondent
on this score, it appears necessary to explain and consequently clarify the nature of the
attorney's fees subject of this petition, in order to dissipate the apparent confusion between
and the conflicting views of the parties.

There are two commonly accepted concepts of attorney's fees, the so-called ordinary and
extraordinary. 20 In its ordinary concept, an attorney's fee is the reasonable compensation
paid to a lawyer by his client for the legal services he has rendered to the latter. The basis of
this compensation is the fact of his employment by and his agreement with the client.

In its extraordinary concept, an attorney's fee is an indemnity for damages ordered by the
court to be paid by the losing party in a litigation. The basis of this is any of the cases
provided by law where such award can be made, such as those authorized in Article 2208,
Civil Code, and is payable not to the lawyer but to the client, unless they have agreed that
the award shall pertain to the lawyer as additional compensation or as part thereof.

It is the first type of attorney's fees which private respondent demanded before the labor
arbiter. Also, the present controversy stems from petitioner's apparent misperception that
the NLRC has jurisdiction over claims for attorney's fees only before its judgment is reviewed
and ruled upon by the Supreme Court, and that thereafter the former may no longer
entertain claims for attorney's fees.

It will be noted that no claim for attorney's fees was filed by private respondent before the
NLRC when it acted on the money claims of petitioner, nor before the Supreme Court when it
reviewed the decision of the NLRC. It was only after the High Tribunal modified the judgment
of the NLRC awarding the differentials that private respondent filed his claim before the
NLRC for a percentage thereof as attorney's fees.

It would obviously have been impossible, if not improper, for the NLRC in the first instance
and for the Supreme Court thereafter to make an award for attorney's fees when no claim
therefor was pending before them. Courts generally rule only on issues and claims presented
to them for adjudication. Accordingly, when the labor arbiter ordered the payment of
attorney's fees, he did not in any way modify the judgment of the Supreme Court.

As an adjunctive episode of the action for the recovery of bonus differentials in NLRC-NCR
Certified Case No. 0466, private respondent's present claim for attorney's fees may be filed
before the NLRC even though or, better stated, especially after its earlier decision had been
reviewed and partially affirmed. It is well settled that a claim for attorney's fees may be
asserted either in the very action in which the services of a lawyer had been rendered or in a
separate action. 21

With respect to the first situation, the remedy for recovering attorney's fees as an incident of
the main action may be availed of only when something is due to the client. 22 Attorney's
fees cannot be determined until after the main litigation has been decided and the subject of
the recovery is at the disposition of the court. The issue over attorney's fees only arises
when something has been recovered from which the fee is to be paid. 23

While a claim for attorney's fees may be filed before the judgment is rendered, the
determination as to the propriety of the fees or as to the amount thereof will have to be held
in abeyance until the main case from which the lawyer's claim for attorney's fees may arise
has become final. Otherwise, the determination to be made by the courts will be premature.
51
24 Of course, a petition for attorney's fees may be filed before the judgment in favor of the
client is satisfied or the proceeds thereof delivered to the client. 25

It is apparent from the foregoing discussion that a lawyer has two options as to when to file
his claim for professional fees. Hence, private respondent was well within his rights when he
made his claim and waited for the finality of the judgment for holiday pay differential,
instead of filing it ahead of the award's complete resolution. To declare that a lawyer may
file a claim for fees in the same action only before the judgment is reviewed by a higher
tribunal would deprive him of his aforestated options and render ineffective the foregoing
pronouncements of this Court.

Assailing the rulings of the labor arbiter and the NLRC, petitioner union insists that it is not
guilty of unjust enrichment because all attorney's fees due to private respondent were
covered by the retainer fee of P3,000.00 which it has been regularly paying to private
respondent under their retainer agreement. To be entitled to the additional attorney's fees
as provided in Part D (Special Billings) of the agreement, it avers that there must be a
separate mutual agreement between the union and the law firm prior to the performance of
the additional services by the latter. Since there was no agreement as to the payment of the
additional attorney's fees, then it is considered waived.

En contra, private respondent contends that a retainer fee is not the attorney's fees
contemplated for and commensurate to the services he rendered to petitioner. He asserts
that although there was no express agreement as to the amount of his fees for services
rendered in the case for recovery of differential pay, Article 111 of the Labor Code supplants
this omission by providing for an award of ten percent (10%) of a money judgment in a labor
case as attorney's fees.

It is elementary that an attorney is entitled to have and receive a just and reasonable
compensation for services performed at the special instance and request of his client. As
long as the lawyer was in good faith and honestly trying to represent and serve the interests
of the client, he should have a reasonable compensation for such services. 26 It will thus be
appropriate, at this juncture, to determine if private respondent is entitled to an additional
remuneration under the retainer agreement 27 entered into by him and petitioner.

The parties subscribed therein to the following stipulations:

xxx xxx xxx

The Law Firm shall handle cases and extend legal services under the parameters of the
following terms and conditions:

A. GENERAL SERVICES

1. Assurance that an Associate of the Law Firm shall be designated and be available on
a day-to-day basis depending on the Union's needs;

2. Legal consultation, advice and render opinion on any actual and/or anticipatory
situation confronting any matter within the client's normal course of business;

3. Proper documentation and notarization of any or all transactions entered into by the
Union in its day-to-day course of business;

4. Review all contracts, deeds, agreements or any other legal document to which the
union is a party signatory thereto but prepared or caused to be prepared by any other third
party;
52
5. Represent the Union in any case wherein the Union is a party litigant in any court of
law or quasi-judicial body subject to certain fees as qualified hereinafter;

6. Lia(i)se with and/or follow-up any pending application or any papers with any
government agency and/or any private institution which is directly related to any legal
matter referred to the Law Firm.

B. SPECIAL LEGAL SERVICES

1. Documentation of any contract and other legal instrument/documents arising and/or

required by your Union which do not fall under the category of its ordinary course of
business activity but requires a special, exhaustive or detailed study and preparation;

2. Conduct or undertake researches and/or studies on special projects of the Union;

3. Render active and actual participation or assistance in conference table negotiations

with TRB management or any other third person(s), juridical or natural, wherein the
presence of counsel is not for mere consultation except CBA negotiations which shall be
subject to a specific agreement (pursuant to PD 1391 and in relation to BP 130 & 227);

4. Preparation of Position Paper(s), Memoranda or any other pleading for and in behalf
of the Union;

5. Prosecution or defense of any case instituted by or against the Union; and,

6. Represent any member of the Union in any proceeding provided that the particular
member must give his/her assent and that prior consent be granted by the principal officers.
Further, the member must conform to the rules and policies of the Law Firm.

C. FEE STRUCTURE

In consideration of our commitment to render the services enumerated above when required
or necessary, your Union shall pay a monthly retainer fee of THREE THOUSAND PESOS (PHP
3,000.00), payable in advance on or before the fifth day of every month.

An Appearance Fee which shall be negotiable on a case-to-case basis.

Any and all Attorney's Fees collected from the adverse party by virtue of a successful
litigation shall belong exclusively to the Law Firm.

It is further understood that the foregoing shall be without prejudice to our claim for
reimbursement of all out-of-pocket expenses covering filing fees, transportation, publication
costs, expenses covering reproduction or authentication of documents related to any matter
referred to the Law Firm or that which redound to the benefit of the Union.

D. SPECIAL BILLINGS

In the event that the Union avails of the services duly enumerated in Title B, the Union shall
pay the Law Firm an amount mutually agreed upon PRIOR to the performance of such
services. The sum agreed upon shall be based on actual time and effort spent by the counsel
in relation to the importance and magnitude of the matter referred to by the Union.
However, charges may be WAIVED by the Law Firm if it finds that time and efforts expended
on the particular services are inconsequential but such right of waiver is duly reserved for
the Law Firm.
53
xxx xxx xxx

The provisions of the above contract are clear and need no further interpretation; all that is
required to be done in the instant controversy is its application. The P3,000.00 which
petitioner pays monthly to private respondent does not cover the services the latter actually
rendered before the labor arbiter and the NLRC in behalf of the former. As stipulated in Part
C of the agreement, the monthly fee is intended merely as a consideration for the law firm's
commitment to render the services enumerated in Part A (General Services) and Part B
(Special Legal Services) of the retainer agreement.

The difference between a compensation for a commitment to render legal services and a
remuneration for legal services actually rendered can better be appreciated with a
discussion of the two kinds of retainer fees a client may pay his lawyer. These are a general
retainer, or a retaining fee, and a special
retainer. 28

A general retainer, or retaining fee, is the fee paid to a lawyer to secure his future services
as general counsel for any ordinary legal problem that may arise in the routinary business of
the client and referred to him for legal action. The future services of the lawyer are secured
and committed to the retaining client. For this, the client pays the lawyer a fixed retainer fee
which could be monthly or otherwise, depending upon their arrangement. The fees are paid
whether or not there are cases referred to the lawyer. The reason for the remuneration is
that the lawyer is deprived of the opportunity of rendering services for a fee to the opposing
party or other parties. In fine, it is a compensation for lost opportunities.

A special retainer is a fee for a specific case handled or special service rendered by the
lawyer for a client. A client may have several cases demanding special or individual
attention. If for every case there is a separate and independent contract for attorney's fees,
each fee is considered a special retainer.

As to the first kind of fee, the Court has had the occasion to expound on its concept in Hilado
vs. David 29 in this wise:

There is in legal practice what is called a "retaining fee," the purpose of which stems from
the realization that the attorney is disabled from acting as counsel for the other side after he
has given professional advice to the opposite party, even if he should decline to perform the
contemplated services on behalf of the latter. It is to prevent undue hardship on the attorney
resulting from the rigid observance of the rule that a separate and independent fee for
consultation and advice was conceived and authorized. "A retaining fee is a preliminary fee
given to an attorney or counsel to insure and secure his future services, and induce him to
act for the client. It is intended to remunerate counsel for being deprived, by being retained
by one party, of the opportunity of rendering services to the other and of receiving pay from
him, and the payment of such fee, in the absence of an express understanding to the
contrary, is neither made nor received in payment of the services contemplated; its
payment has no relation to the obligation of the client to pay his attorney for the services for
which he has retained him to perform." (Emphasis supplied).

Evidently, the P3,000.00 monthly fee provided in the retainer agreement between the union
and the law firm refers to a general retainer, or a retaining fee, as said monthly fee covers
only the law firm's pledge, or as expressly stated therein, its "commitment to render the
legal services enumerated." The fee is not payment for private respondent's execution or
performance of the services listed in the contract, subject to some particular qualifications
or permutations stated there.

54
Generally speaking, where the employment of an attorney is under an express valid contract
fixing the compensation for the attorney, such contract is conclusive as to the amount of
compensation. 30 We cannot, however, apply the foregoing rule in the instant petition and
treat the fixed fee of P3,000.00 as full and sufficient consideration for private respondent's
services, as petitioner would have it.

We have already shown that the P3,000.00 is independent and different from the
compensation which private respondent should receive in payment for his services. While
petitioner and private respondent were able to fix a fee for the latter's promise to extend
services, they were not able to come into agreement as to the law firm's actual performance
of services in favor of the union. Hence, the retainer agreement cannot control the measure
of remuneration for private respondent's services.

We, therefore, cannot favorably consider the suggestion of petitioner that private
respondent had already waived his right to charge additional fees because of their failure to
come to an agreement as to its payment.

Firstly, there is no showing that private respondent unequivocally opted to waive the
additional charges in consonance with Part D of the agreement. Secondly, the prompt
actions taken by private respondent, i.e., serving notice of charging lien and filing of motion
to determine attorney's fees, belie any intention on his part to renounce his right to
compensation for prosecuting the labor case instituted by the union. And, lastly, to adopt
such theory of petitioner may frustrate private respondent's right to attorney's fees, as the
former may simply and unreasonably refuse to enter into any special agreement with the
latter and conveniently claim later that the law firm had relinquished its right because of the
absence of the same.

The fact that petitioner and private respondent failed to reach a meeting of the minds with
regard to the payment of professional fees for special services will not absolve the former of
civil liability for the corresponding remuneration therefor in favor of the latter.

Obligations do not emanate only from contracts. 31 One of the sources of extra-contractual
obligations found in our Civil Code is the quasi-contract premised on the Roman maxim that
nemo cum alterius detrimento locupletari protest. As embodied in our law, 32 certain lawful,
voluntary and unilateral acts give rise to the juridical relation of quasi-contract to the end
that no one shall be unjustly enriched or benefited at the expense of another.

A quasi-contract between the parties in the case at bar arose from private respondent's
lawful, voluntary and unilateral prosecution of petitioner's cause without awaiting the latter's
consent and approval. Petitioner cannot deny that it did benefit from private respondent's
efforts as the law firm was able to obtain an award of holiday pay differential in favor of the
union. It cannot even hide behind the cloak of the monthly retainer of P3,000.00 paid to
private respondent because, as demonstrated earlier, private respondent's actual rendition
of legal services is not compensable merely by said amount.

Private respondent is entitled to an additional remuneration for pursuing legal action in the
interest of petitioner before the labor arbiter and the NLRC, on top of the P3,000.00 retainer
fee he received monthly from petitioner. The law firm's services are decidedly worth more
than such basic fee in the retainer agreement. Thus, in Part C thereof on "Fee Structure," it is
even provided that all attorney's fees collected from the adverse party by virtue of a
successful litigation shall belong exclusively to private respondent, aside from petitioner's
liability for appearance fees and reimbursement of the items of costs and expenses
enumerated therein.

55
A quasi-contract is based on the presumed will or intent of the obligor dictated by equity and
by the principles of absolute justice. Some of these principles are: (1) It is presumed that a
person agrees to that which will benefit him; (2) Nobody wants to enrich himself unjustly at
the expense of another; and (3) We must do unto others what we want them to do unto us
under the same circumstances. 33

As early as 1903, we allowed the payment of reasonable professional fees to an interpreter,

notwithstanding the lack of understanding with his client as to his remuneration, on the
basis of quasi-contract. 34 Hence, it is not necessary that the parties agree on a definite fee
for the special services rendered by private respondent in order that petitioner may be
obligated to pay compensation to the former. Equity and fair play dictate that petitioner
should pay the same after it accepted, availed itself of, and benefited from private
respondent's services.

We are not unaware of the old ruling that a person who had no knowledge of, nor consented
to, or protested against the lawyer's representation may not be held liable for attorney's
fees even though he benefited from the lawyer's services. 35 But this doctrine may not be
applied in the present case as petitioner did not object to private respondent's appearance
before the NLRC in the case for differentials.

Viewed from another aspect, since it is claimed that petitioner obtained respondent's legal
services and assistance regarding its claims against the bank, only they did not enter into a
special contract regarding the compensation therefor, there is at least the innominate
contract of facio ut des (I do that you may give). 36 This rule of law, likewise founded on the
principle against unjust enrichment, would also warrant payment for the services of private
respondent which proved beneficial to petitioner's members. In any case, whether there is
an agreement or not, the courts can fix a reasonable compensation which lawyers should
receive for their professional services. 37 However, the value of private respondent's legal
services should not be established on the basis of Article 111 of the Labor Code alone. Said
article provides:

Art. 111. Attorney's fees. (a) In cases of unlawful withholding of wages the culpable
party may be assessed attorney's fees equivalent to ten percent of the amount of the wages
recovered.

xxx xxx xxx

The implementing provision 38 of the foregoing article further states:

Sec. 11. Attorney's fees. Attorney's fees in any judicial or administrative proceedings
for the recovery of wages shall not exceed 10% of the amount awarded. The fees may be
deducted from the total amount due the winning party.

In the first place, the fees mentioned here are the extraordinary attorney's fees recoverable
as indemnity for damages sustained by and payable to the prevailing part. In the second
place, the ten percent (10%) attorney's fees provided for in Article 111 of the Labor Code
and Section 11, Rule VIII, Book III of the Implementing Rules is the maximum of the award
that may thus be granted. 39 Article 111 thus fixes only the limit on the amount of
attorney's fees the victorious party may recover in any judicial or administrative proceedings
and it does not even prevent the NLRC from fixing an amount lower than the ten percent
(10%) ceiling prescribed by the article when circumstances warrant it. 40

The measure of compensation for private respondent's services as against his client should
properly be addressed by the rule of quantum meruit long adopted in this jurisdiction.
Quantum meruit, meaning "as much as he deserves," is used as the basis for determining
56
the lawyer's professional fees in the absence of a contract, 41 but recoverable by him from
his client.

Where a lawyer is employed without a price for his services being agreed upon, the courts
shall fix the amount on quantum meruit basis. In such a case, he would be entitled to
receive what he merits for his services. 42

It is essential for the proper operation of the principle that there is an acceptance of the
benefits by one sought to be charged for the services rendered under circumstances as
reasonably to notify him that the lawyer performing the task was expecting to be paid
compensation therefor. The doctrine of quantum meruit is a device to prevent undue
enrichment based on the equitable postulate that it is unjust for a person to retain benefit
without paying for it. 43

Over the years and through numerous decisions, this Court has laid down guidelines in
ascertaining the real worth of a lawyer's services. These factors are now codified in Rule
20.01, Canon 20 of the Code of Professional Responsibility and should be considered in fixing
a reasonable compensation for services rendered by a lawyer on the basis of quantum
meruit. These are: (a) the time spent and the extent of services rendered or required; (b) the
novelty and difficulty of the questions involved; (c) the importance of the subject matter; (d)
the skill demanded; (e) the probability of losing other employment as a result of acceptance
of the proffered case; (f) the customary charges for similar services and the schedule of fees
of the IBP chapter to which the lawyer belongs; (g) the amount involved in the controversy
and the benefits resulting to the client from the services; (h) the contingency or certainty of
compensation; (i) the character of the employment, whether occasional or established; and
(j) the professional standing of the lawyer.

Here, then, is the flaw we find in the award for attorney's fees in favor of private respondent.
Instead of adopting the above guidelines, the labor arbiter forthwith but erroneously set the
amount of attorney's fees on the basis of Article 111 of the Labor Code. He completely relied
on the operation of Article 111 when he fixed the amount of attorney's fees at P17,574.43.
44 Observe the conclusion stated in his order. 45

xxx xxx xxx

FIRST. Art. 111 of the Labor Code, as amended, clearly declares movant's right to a ten
(10%) per cent of the award due its client. In addition, this right to ten (10%) per cent
attorney's fees is supplemented by Sec. 111, Rule VIII, Book III of the Omnibus Rules
Implementing the Labor Code, as amended.

xxx xxx xxx

As already stated, Article 111 of the Labor Code regulates the amount recoverable as
attorney's fees in the nature of damages sustained by and awarded to the prevailing party. It
may not be used therefore, as the lone standard in fixing the exact amount payable to the
lawyer by his client for the legal services he rendered. Also, while it limits the maximum
allowable amount of attorney's fees, it does not direct the instantaneous and automatic
award of attorney's fees in such maximum limit.

It, therefore, behooves the adjudicator in questions and circumstances similar to those in the
case at bar, involving a conflict between lawyer and client, to observe the above guidelines
in cases calling for the operation of the principles of quasi-contract and quantum meruit, and
to conduct a hearing for the proper determination of attorney's fees. The criteria found in
the Code of Professional Responsibility are to be considered, and not disregarded, in

57
assessing the proper amount. Here, the records do not reveal that the parties were duly
heard by the labor arbiter on the matter and for the resolution of private respondent's fees.

It is axiomatic that the reasonableness of attorney's fees is a question of fact. 46 Ordinarily,

therefore, we would have remanded this case for further reception of evidence as to the
extent and value of the services rendered by private respondent to petitioner. However, so
as not to needlessly prolong the resolution of a comparatively simple controversy, we deem
it just and equitable to fix in the present recourse a reasonable amount of attorney's fees in
favor of private respondent. For that purpose, we have duly taken into account the accepted
guidelines therefor and so much of the pertinent data as are extant in the records of this
case which are assistive in that regard. On such premises and in the exercise of our sound
discretion, we hold that the amount of P10,000.00 is a reasonable and fair compensation for
the legal services rendered by private respondent to petitioner before the labor arbiter and
the NLRC.

WHEREFORE, the impugned resolution of respondent National Labor Relations Commission

affirming the order of the labor arbiter is MODIFIED, and petitioner is hereby ORDERED to
pay the amount of TEN THOUSAND PESOS (P10,000.00) as attorney's fees to private
respondent for the latter's legal services rendered to the former.

SO ORDERED.

11. Quirante vs. IAC [G.R. No. 73886 January 31, 1989]

06
AUG
Ponente: REGALADO, J.

FACTS:

In the case of Dr. Casasolas claim against its erring building contractor, the trial court ruled
in favor of the former who eventually died.Here, petitioner Atty. Quirante filed a motion in
the trial court for the confirmation of his attorneys fees. According to him, there was an oral
agreement between him and the late Dr. Casasola with regard to his attorneys fees, as
confirmed in writing by the latters surviving spouse and two daughters to be computed as
follows:

In case of recovery of the P120,000.00 surety bond, the attorneys fees of the undersigned
counsel (Atty. Quirante) shall be P30,000.00;
In case the Honorable Court awards damages in excess of the P120,000.00 bond, it shall be
divided equally between the Heirs of Dr. Casasola, Atty. John C. Quirante and Atty. Dante
Cruz.
The trial court granted the motion for confirmationdespite an opposition thereto.In the
petition for review on certiorari, the respondent court (IAC) ruled that the confirmation of
attorneys fees is premature.

ISSUE:

Whether or not Atty. Quirante is entitled of the attorneys fees.

HELD:

NO. Ruling of respondent court affirmed.

RATIO:
58
Since the main case from which the petitioners claims for their fees may arise has not yet
become final, the determination of the propriety of said fees and the amount thereof should
be held in abeyance.

The orderly administration of justice dictates that such issue be likewise determined by the
court a quo inasmuch as it also necessarily involves the same contingencies in determining
the propriety and assessing the extent of recovery of attorneys fees. The alleged
confirmation to attorneys fees should not adversely affect the non-signatories in the
petition, since it is also premised on the eventual grant of damages to the Casasola family.

12. VALENTIN C. MIRANDA,Complainant,

- versus-
ATTY. MACARIO D. CARPIO,Respondent.
A. C. No. 6281
DECISION

PERALTA, J.:

This is a disbarment case against Atty. Macario D. Carpio filed by Valentin C. Miranda.[1]

The facts, as culled from the records, are as follows:

Complainant Valentin C. Miranda is one of the owners of a parcel of land consisting of 1,890
square meters located at Barangay Lupang Uno, Las Pias, Metro Manila. In 1994,
complainant initiated Land Registration Commission (LRC) Case No. M-226 for the
registration of the aforesaid property. The case was filed before the Regional Trial Court of
Las Pias City, Branch 275. During the course of the proceedings, complainant engaged the
services of respondent Atty. Carpio as counsel in the said case when his original counsel,
Atty. Samuel Marquez, figured in a vehicular accident.
In complainant's Affidavit,[2] complainant and respondent agreed that complainant was to
pay respondent Twenty Thousand Pesos (PhP20,000.00) as acceptance fee and Two
Thousand Pesos (PhP2,000.00) as appearance fee. Complainant paid respondent the
amounts due him, as evidenced by receipts duly signed by the latter. During the last hearing
of the case, respondent demanded the additional amount of Ten Thousand Pesos
(PhP10,000.00) for the preparation of a memorandum, which he said would further
strengthen complainant's position in the case, plus twenty percent (20%) of the total area of
the subject property as additional fees for his services.

Complainant did not accede to respondent's demand for it was contrary to their agreement.
Moreover, complainant co-owned the subject property with his siblings, and he could not
have agreed to the amount being demanded by respondent without the knowledge and
approval of his co-heirs. As a result of complainant's refusal to satisfy respondent's
demands, the latter became furious and their relationship became sore.
On January 12, 1998, a Decision was rendered in LRC Case No. M-226, granting the petition
for registration, which Decision was declared final and executory in an Order dated June 5,
1998. On March 24, 2000, the Land Registration Authority (LRA) sent complainant a copy of
the letter addressed to the Register of Deeds (RD) of Las Pias City, which transmitted the
decree of registration and the original and owner's duplicate of the title of the property.
On April 3, 2000, complainant went to the RD to get the owner's duplicate of the Original
Certificate of Title (OCT) bearing No. 0-94. He was surprised to discover that the same had
already been claimed by and released to respondent on March 29, 2000. On May 4, 2000,
complainant talked to respondent on the phone and asked him to turn over the owner's
duplicate of the OCT, which he had claimed without complainant's knowledge, consent and

59
authority. Respondent insisted that complainant first pay him the PhP10,000.00 and the 20%
share in the property equivalent to 378 square meters, in exchange for which, respondent
would deliver the owner's duplicate of the OCT. Once again, complainant refused the
demand, for not having been agreed upon.
In a letter[3] dated May 24, 2000, complainant reiterated his demand for the return of the
owner's duplicate of the OCT. On June 11, 2000, complainant made the same demand on
respondent over the telephone. Respondent reiterated his previous demand and angrily told
complainant to comply, and threatened to have the OCT cancelled if the latter refused to
pay him.

On June 26, 2000, complainant learned that on April 6, 2000, respondent registered an
adverse claim on the subject OCT wherein he claimed that the agreement on the payment of
his legal services was 20% of the property and/or actual market value. To date, respondent
has not returned the owner's duplicate of OCT No. 0-94 to complainant and his co-heirs
despite repeated demands to effect the same.
In seeking the disbarment or the imposition of the appropriate penalty upon respondent,
complainant invokes the following provisions of the Code of Professional Responsibility:
Canon 20. A lawyer shall charge only fair and reasonable fees.
Canon 16. A lawyer shall hold in trust all moneys and properties of his client that may come
into his possession.
Canon 16.03. A lawyer shall deliver the funds and properties of his client when due or upon
demand. x x x
In defense of his actions, respondent relied on his alleged retaining lien over the owner's
duplicate of OCT No. 0-94. Respondent admitted that he did not turn over to complainant the
owner's duplicate of OCT No. 0-94 because of complainant's refusal, notwithstanding
repeated demands, to complete payment of his agreed professional fee consisting of 20% of
the total area of the property covered by the title, i.e., 378 square meters out of 1,890
square meters, or its equivalent market value at the rate of PhP7,000.00 per square meter,
thus, yielding a sum of PhP2,646,000.00 for the entire 378-square-meter portion and that he
was ready and willing to turn over the owner's duplicate of OCT No. 0-94, should
complainant pay him completely the aforesaid professional fee.

Respondent admitted the receipt of the amount of PhP32,000.00, however, he alleged that
the amount earlier paid to him will be deducted from the 20% of the current value of the
subject lot. He alleged that the agreement was not reduced into writing, because the parties
believed each other based on their mutual trust. He denied that he demanded the payment
of PhP10,000.00 for the preparation of a memorandum, since he considered the same
unnecessary.

In addition to the alleged agreement between him and complainant for the payment of the
20% professional fees, respondent invoked the principle of quantum meruit to justify the
amount being demanded by him.

In its Report and Recommendation[4] dated June 9, 2005, the Integrated Bar of the
Philippines-Commission on Bar Discipline (IBP-CBD) recommended that respondent be
suspended from the practice of law for a period of six (6) months for unjustly withholding
from complainant the owner's duplicate of OCT No. 0-94 in the exercise of his so-called
attorney's lien. In Resolution No. XVII-2005-173,[5] dated December 17, 2005, the IBP Board
of Governors adopted and approved the Report and Recommendation of the IBP-CBD.

Respondent filed a motion for reconsideration of the resolution of the IBP Board of Governors
adopting the report and recommendation of the IBP-CBD. Pending the resolution of his
motion for reconsideration, respondent filed a petition for review[6] with this Court. The
Court, in a Resolution[7] dated August 16, 2006, directed that the case be remanded to the

60
IBP for proper disposition, pursuant to this Court's resolution in Noriel J. Ramientas v. Atty.
Jocelyn P. Reyala.[8]

In Notice of Resolution No. XVIII-2008-672, dated December 11, 2008, the IBP Board of
Governors affirmed Resolution No. XVII-2005-173, dated December 17, 2005, with
modification that respondent is ordered to return the complainant's owner's duplicate of OCT
No. 0-94 within fifteen days from receipt of notice. Hence, the present petition.
The Court sustains the resolution of the IBP Board of Governors, which affirmed with
modification the findings and recommendations of the IBP-CBD. Respondent's claim for his
unpaid professional fees that would legally give him the right to retain the property of his
client until he receives what is allegedly due him has been paid has no basis and, thus, is
invalid.

Section 37, Rule 138 of the Rules of Court specifically provides:

Section 37. Attorneys liens. An attorney shall have a lien upon the funds, documents and
papers of his client, which have lawfully come into his possession and may retain the same
until his lawful fees and disbursements have been paid, and may apply such funds to the
satisfaction thereof. He shall also have a lien to the same extent upon all judgments for the
payment of money, and executions issued in pursuance of such judgments, which he has
secured in a litigation of his client, from and after the time when he shall have caused a
statement of his claim of such lien to be entered upon the records of the court rendering
such judgment, or issuing such execution, and shall have caused written notice thereof to be
delivered to his client and to the adverse party; and he shall have the same right and power
over such judgments and executions as his client would have to enforce his lien and secure
the payment of his just fees and disbursements.

An attorney's retaining lien is fully recognized if the presence of the following elements
concur: (1) lawyer-client relationship; (2) lawful possession of the client's funds, documents
and papers; and (3) unsatisfied claim for attorney's fees.[9] Further, the attorney's retaining
lien is a general lien for the balance of the account between the attorney and his client, and
applies to the documents and funds of the client which may come into the attorney's
possession in the course of his employment.[10]

In the present case, complainant claims that there is no such agreement for the payment of
professional fee consisting of 20% of the total area of the subject property and submits that
their agreement was only for the payment of the acceptance fee and the appearance fees.
As correctly found by the IBP-CBD, there was no proof of any agreement between the
complainant and the respondent that the latter is entitled to an additional professional fee
consisting of 20% of the total area covered by OCT No. 0-94. The agreement between the
parties only shows that respondent will be paid the acceptance fee and the appearance fees,
which the respondent has duly received. Clearly, there is no unsatisfied claim for attorney's
fees that would entitle respondent to retain his client's property. Hence, respondent could
not validly withhold the title of his client absence a clear and justifiable claim.

Respondent's unjustified act of holding on to complainant's title with the obvious aim of
forcing complainant to agree to the amount of attorney's fees sought is an alarming abuse
by respondent of the exercise of an attorney's retaining lien, which by no means is an
absolute right, and cannot at all justify inordinate delay in the delivery of money and
property to his client when due or upon demand.[11]

Atty. Carpio failed to live up to his duties as a lawyer by unlawfully withholding and failing to
deliver the title of the complainant, despite repeated demands, in the guise of an alleged
61
entitlement to additional professional fees. He has breached Rule 1.01 of Canon 1 and Rule
16.03 of Canon 16 of the Code of Professional Responsibility, which read:

CANON 1 - A LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS OF THE LAND
AND PROMOTE RESPECT FOR LAW AND LEGAL PROCESS.

Rule 1.01 - A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.

CANON 16 - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT
THAT MAY COME INTO HIS POSSESSION.

Rule 16.03 - A lawyer shall deliver the funds and property of his client when due or upon
demand. However, he shall have a lien over the funds and may apply so much thereof as
may be necessary to satisfy his lawful fees and disbursements, giving notice promptly
thereafter to his client. He shall also have a lien to the same extent on all judgments and
executions he has secured for his client as provided for in the Rules of Court.

Further, in collecting from complainant exorbitant fees, respondent violated Canon 20 of the
Code of Professional Responsibility, which mandates that a lawyer shall charge only fair and
reasonable fees. It is highly improper for a lawyer to impose additional professional fees
upon his client which were never mentioned nor agreed upon at the time of the engagement
of his services. At the outset, respondent should have informed the complainant of all the
fees or possible fees that he would charge before handling the case and not towards the
near conclusion of the case. This is essential in order for the complainant to determine if he
has the financial capacity to pay respondent before engaging his services.
Respondent's further submission that he is entitled to the payment of additional professional
fees on the basis of the principle of quantum meruit has no merit. "Quantum meruit,
meaning `as much as he deserved' is used as a basis for determining the lawyer's
professional fees in the absence of a contract but recoverable by him from his client."[12]
The principle of quantum meruit applies if a lawyer is employed without a price agreed upon
for his services. In such a case, he would be entitled to receive what he merits for his
services, as much as he has earned.[13] In the present case, the parties had already entered
into an agreement as to the attorney's fees of the respondent, and thus, the principle of
quantum meruit does not fully find application because the respondent is already
compensated by such agreement.

The Court notes that respondent did not inform complainant that he will be the one to
secure the owner's duplicate of the OCT from the RD and failed to immediately inform
complainant that the title was already in his possession. Complainant, on April 3, 2000, went
to the RD of Las Pias City to get the owner's duplicate of OCT No. 0-94, only to be surprised
that the said title had already been claimed by, and released to, respondent on March 29,
2000. A lawyer must conduct himself, especially in his dealings with his clients, with
integrity in a manner that is beyond reproach. His relationship with his clients should be
characterized by the highest degree of good faith and fairness.[14] By keeping secret with
the client his acquisition of the title, respondent was not fair in his dealing with his client.
Respondent could have easily informed the complainant immediately of his receipt of the
owner's duplicate of the OCT on March 29, 2000, in order to save his client the time and
effort in going to the RD to get the title.
Respondent's inexcusable act of withholding the property belonging to his client and
imposing unwarranted fees in exchange for the release of said title deserve the imposition of
disciplinary sanction. Hence, the ruling of the IBP Board of Governors, adopting and
approving with modification the report and recommendation of the IBP-CBD that respondent
be suspended from the practice of law for a period of six (6) months and that respondent be

62
ordered to return the complainant's owner's duplicate of OCT No. 0-94 is hereby affirmed.
However, the fifteen-day period from notice given to respondent within which to return the
title should be modified and, instead, respondent should return the same immediately upon
receipt of the Court's decision.

WHEREFORE, Atty. Macario D. Carpio is SUSPENDED from the practice of law for a period of
six (6) months, effective upon receipt of this Decision. He is ordered to RETURN to the
complainant the owner's duplicate of OCT No. 0-94 immediately upon receipt of this
decision. He is WARNED that a repetition of the same or similar act shall be dealt with more
severely.

Let a copy of this Decision be furnished to the Office of the Bar Confidant, to be appended to
the personal record of Atty. Macario D. Carpio as a member of the Bar; the Integrated Bar of
the Philippines; and the Office of the Court Administrator for circulation to all courts in the
country for their information and guidance.

SO ORDERED.

63