Professional Documents
Culture Documents
105938 September 20, 1996 conspired and confederated with each other in
setting up, through the use of the coconut levy
funds, the financial and corporate framework and
TEODORO R. REGALA, EDGARDO J. ANGARA, AVELINO V. CRUZ,
structures that led to the establishment of UCPB,
JOSE C. CONCEPCION, ROGELIO A. VINLUAN, VICTOR P. LAZATIN
UNICOM, COCOLIFE, COCOMARK, CIC, and
and EDUARDO U. ESCUETA, petitioners,
more than twenty other coconut levy funded
vs.
corporations, including the acquisition of San
THE HONORABLE SANDIGANBAYAN, First Division, REPUBLIC OF
Miguel Corporation shares and its
THE PHILIPPINES, ACTING THROUGH THE PRESIDENTIAL
institutionalization through presidential directives of
COMMISSION ON GOOD GOVERNMENT, and RAUL S.
the coconut monopoly. Through insidious means
ROCO, respondents.
and machinations, ACCRA, being the wholly-owned
investment arm, ACCRA Investments Corporation,
G.R. No. 108113 September 20, 1996 became the holder of approximately fifteen million
shares representing roughly 3.3% of the total
outstanding capital stock of UCPB as of 31 March
PARAJA G. HAYUDINI, petitioner, 1987. This ranks ACCRA Investments Corporation
vs. number 44 among the top 100 biggest stockholders
THE SANDIGANBAYAN and THE REPUBLIC OF THE of UCPB which has approximately 1,400,000
PHILIPPINES, respondents. shareholders. On the other hand, corporate books
show the name Edgardo J. Angara as holding
approximately 3,744 shares as of February, 1984.5
Among the dependants named in the case are herein petitioners 4.5 Defendant ACCRA-lawyer Avelino V. Cruz was
Teodoro Regala, Edgardo J. Angara, Avelino V. Cruz, Jose C. one of the incorporators in 1976 of Mermaid
Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U. Escueta Marketing Corporation, which was organized for
and Paraja G. Hayudini, and herein private respondent Raul S. Roco, legitimate business purposes not related to the
who all were then partners of the law firm Angara, Abello, Concepcion, allegations of the expanded Amended Complaint.
Regala and Cruz Law Offices (hereinafter referred to as the ACCRA Law However, he has long ago transferred any material
Firm). ACCRA Law Firm performed legal services for its clients, which interest therein and therefore denies that the
included, among others, the organization and acquisition of business "shares" appearing in his name in Annex "A" of the
associations and/or organizations, with the correlative and incidental expanded Amended Complaint are his assets.6
services where its members acted as incorporators, or simply, as
stockholders. More specifically, in the performance of these services,
the members of the law firm delivered to its client documents which Petitioner Paraja Hayudini, who had separated from ACCRA law firm,
substantiate the client's equity holdings, i.e., stock certificates endorsed filed a separate answer denying the allegations in the complaint
in blank representing the shares registered in the client's name, and a implicating him in the alleged ill-gotten wealth.7
blank deed of trust or assignment covering said shares. In the course of
their dealings with their clients, the members of the law firm acquire Petitioners ACCRA lawyers subsequently filed their "COMMENT
information relative to the assets of clients as well as their personal and AND/OR OPPOSITION" dated October 8, 1991 with Counter-Motion
business circumstances. As members of the ACCRA Law Firm, that respondent PCGG similarly grant the same treatment to them
petitioners and private respondent Raul Roco admit that they assisted in (exclusion as parties-defendants) as accorded private respondent
the organization and acquisition of the companies included in Civil Case Roco.8 The Counter-Motion for dropping petitioners from the complaint
No. 0033, and in keeping with the office practice, ACCRA lawyers acted was duly set for hearing on October 18, 1991 in accordance with the
as nominees-stockholders of the said corporations involved in requirements of Rule 15 of the Rules of Court.
sequestration proceedings.2
This is what appears to be the cause for which they 1. Under the peculiar facts of
have been impleaded by the PCGG as defendants this case, the attorney-client
herein. privilege includes the identity of
the client(s).
5. The PCGG is satisfied that defendant Roco has
demonstrated his agency and that Roco has 2. The factual disclosures
apparently identified his principal, which revelation required by the PCGG are not
could show the lack of cause against him. This in limited to the identity of
turn has allowed the PCGG to exercise its power petitioners ACCRA lawyers'
both under the rules of Agency and under Section 5 alleged client(s) but extend to
of E.O. No. 14-A in relation to the Supreme Court's other privileged matters.
ruling in Republic v. Sandiganbayan (173 SCRA
72).
IV
WHEREFORE, the Counter Motion dated October Petitioners contend that the exclusion of respondent Roco as party-
8, 1991 filed by the ACCRA lawyers and joined in defendant in PCGG Case No. 33 grants him a favorable treatment, on
by Atty. Paraja G. Hayudini for the same treatment the pretext of his alleged undertaking to divulge the identity of his client,
by the PCGG as accorded to Raul S. Roco is giving him an advantage over them who are in the same footing as
DENIED for lack of merit. 12 partners in the ACCRA law firm. Petitioners further argue that even
granting that such an undertaking has been assumed by private
respondent Roco, they are prohibited from revealing the identity of their
ACCRA lawyers moved for a reconsideration of the above resolution but
principal under their sworn mandate and fiduciary duty as lawyers to
the same was denied by the respondent Sandiganbayan. Hence, the
uphold at all times the confidentiality of information obtained during such
ACCRA lawyers filed the petition for certiorari, docketed as G.R. No.
lawyer-client relationship.
105938, invoking the following grounds:
With the permission of this Hon. Court. I propose to In our jurisdiction, this privilege takes off from the old Code of Civil
establish through these ACCRA lawyers that, one, Procedure enacted by the Philippine Commission on August 7, 1901.
their so-called client is Mr. Eduardo Cojuangco. Section 383 of the Code specifically "forbids counsel, without authority
Second, it was Mr. Eduardo Cojuangco who of his client to reveal any communication made by the client to him or
furnished all the monies to these subscription his advice given thereon in the course of professional
payments of these corporations who are now the employment." 28Passed on into various provisions of the Rules of Court,
petitioners in this case. Third, that these lawyers the attorney-client privilege, as currently worded provides:
executed deeds of trust, some in the name of a
particular person, some in blank. Now, these blank
Sec. 24. Disqualification by reason of privileged
deeds are important to our claim that some of the
communication. — The following persons cannot
shares are actually being held by the nominees for
testify as to matters learned in confidence in the
the late President Marcos. Fourth, they also
following cases:
executed deeds of assignment and some of these
assignments have also blank assignees. Again, this
is important to our claim that some of the shares xxx xxx xxx
are for Mr. Conjuangco and some are for Mr.
Marcos. Fifth, that most of thes e corporations are
An attorney cannot, without the consent of his
really just paper corporations. Why do we say that?
client, be examined as to any communication made
One: There are no really fixed sets of officers, no
by the client to him, or his advice given thereon in
fixed sets of directors at the time of incorporation
the course of, or with a view to, professional
and even up to 1986, which is the crucial year. And
employment, can an attorney's secretary,
not only that, they have no permits from the
stenographer, or clerk be examined, without the
municipal authorities in Makati. Next, actually all
consent of the client and his employer, concerning
their addresses now are care of Villareal Law
any fact the knowledge of which has been acquired
Office. They really have no address on records.
in such capacity. 29
These are some of the principal things that we
would ask of these nominees stockholders, as they
called themselves. 16 Further, Rule 138 of the Rules of Court states:
It would seem that petitioners are merely standing in for their clients as Sec. 20. It is the duty of an attorney: (e) to maintain
defendants in the complaint. Petitioners are being prosecuted solely on inviolate the confidence, and at every peril to
the basis of activities and services performed in the course of their himself, to preserve the secrets of his client, and to
duties as lawyers. Quite obviously, petitioners' inclusion as co- accept no compensation in connection with his
defendants in the complaint is merely being used as leverage to compel client's business except from him or with his
them to name their clients and consequently to enable the PCGG to nail knowledge and approval.
these clients. Such being the case, respondent PCGG has no valid
cause of action as against petitioners and should exclude them from the
This duty is explicitly mandated in Canon 17 of the Code of Professional
Third Amended Complaint.
Responsibility which provides that:
II
Canon 17. A lawyer owes fidelity to the cause of his
client and he shall be mindful of the trust and
The nature of lawyer-client relationship is premised on the Roman Law confidence reposed in him.
concepts of locatio conductio operarum(contract of lease of services)
where one person lets his services and another hires them without
Canon 15 of the Canons of Professional Ethics also demands a lawyer's
reference to the object of which the services are to be performed,
fidelity to client:
wherein lawyers' services may be compensated by honorarium or for
hire, 17 and mandato (contract of agency) wherein a friend on whom
reliance could be placed makes a contract in his name, but gives up all The lawyers owes "entire devotion to the interest of
that he gained by the contract to the person who requested him. 18 But the client, warm zeal in the maintenance and
the lawyer-client relationship is more than that of the principal-agent and defense of his rights and the exertion of his utmost
lessor-lessee. learning and ability," to the end that nothing be
taken or be withheld from him, save by the rules of
law, legally applied. No fear of judicial disfavor or
public popularity should restrain him from the full U .S. v. Hodge and Zweig,35 involved the same exception, i.e. that client
discharge of his duty. In the judicial forum the client identity is privileged in those instances where a strong probability exists
is entitled to the benefit of any and every remedy that the disclosure of the client's identity would implicate the client in the
and defense that is authorized by the law of the very criminal activity for which the lawyer's legal advice was obtained.
land, and he may expect his lawyer to assert every
such remedy or defense. But it is steadfastly to be
The Hodge case involved federal grand jury proceedings inquiring into
borne in mind that the great trust of the lawyer is to
the activities of the "Sandino Gang," a gang involved in the illegal
be performed within and not without the bounds of
importation of drugs in the United States. The respondents, law
the law. The office of attorney does not permit,
partners, represented key witnesses and suspects including the leader
much less does it demand of him for any client,
of the gang, Joe Sandino.
violation of law or any manner of fraud or chicanery.
He must obey his own conscience and not that of
his client. In connection with a tax investigation in November of 1973, the IRS
issued summons to Hodge and Zweig, requiring them to produce
documents and information regarding payment received by Sandino on
Considerations favoring confidentially in lawyer-client relationships are
behalf of any other person, and vice versa. The lawyers refused to
many and serve several constitutional and policy concerns. In the
divulge the names. The Ninth Circuit of the United States Court of
constitutional sphere, the privilege gives flesh to one of the most
Appeals, upholding non-disclosure under the facts and circumstances of
sacrosanct rights available to the accused, the right to counsel. If a
the case, held:
client were made to choose between legal representation without
effective communication and disclosure and legal representation with all
his secrets revealed then he might be compelled, in some instances, to A client's identity and the nature of that client's fee
either opt to stay away from the judicial system or to lose the right to arrangements may be privileged where the person
counsel. If the price of disclosure is too high, or if it amounts to self invoking the privilege can show that a strong
incrimination, then the flow of information would be curtailed thereby probability exists that disclosure of such information
rendering the right practically nugatory. The threat this represents would implicate that client in the very criminal
against another sacrosanct individual right, the right to be presumed activity for which legal advice was sought Baird
innocent is at once self-evident. v. Koerner, 279 F. 2d at 680. While in Baird Owe
enunciated this rule as a matter of California law,
the rule also reflects federal law. Appellants contend
Encouraging full disclosure to a lawyer by one seeking legal services
that the Baird exception applies to this case.
opens the door to a whole spectrum of legal options which would
otherwise be circumscribed by limited information engendered by a fear
of disclosure. An effective lawyer-client relationship is largely dependent The Baird exception is entirely consonant with the
upon the degree of confidence which exists between lawyer and client principal policy behind the attorney-client privilege.
which in turn requires a situation which encourages a dynamic and "In order to promote freedom of consultation of legal
fruitful exchange and flow of information. It necessarily follows that in advisors by clients, the apprehension of compelled
order to attain effective representation, the lawyer must invoke the disclosure from the legal advisors must be
privilege not as a matter of option but as a matter of duty and removed; hence, the law must prohibit such
professional responsibility. disclosure except on the client's consent." 8 J.
Wigmore, supra sec. 2291, at 545. In furtherance of
this policy, the client's identity and the nature of his
The question now arises whether or not this duty may be asserted in
fee arrangements are, in exceptional cases,
refusing to disclose the name of petitioners' client(s) in the case at bar.
protected as confidential communications. 36
Under the facts and circumstances obtaining in the instant case, the
answer must be in the affirmative.
2) Where disclosure would open the client to civil liability; his identity is
privileged. For instance, the peculiar facts and circumstances
As a matter of public policy, a client's identity should not be shrouded in
of Neugass v. Terminal Cab Corporation,37 prompted the New York
mystery 30 Under this premise, the general rule in our jurisdiction as well
Supreme Court to allow a lawyer's claim to the effect that he could not
as in the United States is that a lawyer may not invoke the privilege and
reveal the name of his client because this would expose the latter to civil
refuse to divulge the name or identity of this client. 31
litigation.
The reasons advanced for the general rule are well established.
In the said case, Neugass, the plaintiff, suffered injury when the taxicab
she was riding, owned by respondent corporation, collided with a
First, the court has a right to know that the client whose privileged second taxicab, whose owner was unknown. Plaintiff brought action
information is sought to be protected is flesh and blood. both against defendant corporation and the owner of the second cab,
identified in the information only as John Doe. It turned out that when
the attorney of defendant corporation appeared on preliminary
Second, the privilege begins to exist only after the attorney-client
examination, the fact was somehow revealed that the lawyer came to
relationship has been established. The attorney-client privilege does not
know the name of the owner of the second cab when a man, a client of
attach until there is a client.
the insurance company, prior to the institution of legal action, came to
him and reported that he was involved in a car accident. It was apparent
Third, the privilege generally pertains to the subject matter of the under the circumstances that the man was the owner of the second cab.
relationship. The state supreme court held that the reports were clearly made to the
lawyer in his professional capacity. The court said:
Finally, due process considerations require that the opposing party
should, as a general rule, know his adversary. "A party suing or sued is That his employment came about through the fact
entitled to know who his opponent is." 32 He cannot be obliged to grope that the insurance company had hired him to
in the dark against unknown forces. 33 defend its policyholders seems immaterial. The
attorney is such cases is clearly the attorney for the
policyholder when the policyholder goes to him to
Notwithstanding these considerations, the general rule is however report an occurrence contemplating that it would be
qualified by some important exceptions. used in an action or claim against him. 38
1) Client identity is privileged where a strong probability exists that xxx xxx xxx
revealing the client's name would implicate that client in the very activity
for which he sought the lawyer's advice.
All communications made by a client to his counsel,
34 for the purpose of professional advice or
In Ex-Parte Enzor, a state supreme court reversed a lower court order assistance, are privileged, whether they relate to a
requiring a lawyer to divulge the name of her client on the ground that suit pending or contemplated, or to any other matter
the subject matter of the relationship was so closely related to the issue proper for such advice or aid; . . . And whenever the
of the client's identity that the privilege actually attached to both. communication made, relates to a matter so
In Enzor, the unidentified client, an election official, informed his attorney connected with the employment as attorney or
in confidence that he had been offered a bribe to violate election laws or counsel as to afford presumption that it was the
that he had accepted a bribe to that end. In her testimony, the attorney ground of the address by the client, then it is
revealed that she had advised her client to count the votes correctly, but privileged from disclosure. . .
averred that she could not remember whether her client had been, in
fact, bribed. The lawyer was cited for contempt for her refusal to reveal
his client's identity before a grand jury. Reversing the lower court's It appears . . . that the name and address of the
contempt orders, the state supreme court held that under the owner of the second cab came to the attorney in
circumstances of the case, and under the exceptions described above, this case as a confidential communication. His
even the name of the client was privileged. client is not seeking to use the courts, and his
address cannot be disclosed on that theory, nor is employed — to advise his clients what, under the
the present action pending against him as service circumstances, should be done. 43
of the summons on him has not been effected. The
objections on which the court reserved decision are
Apart from these principal exceptions, there exist other situations which
sustained. 39
could qualify as exceptions to the general rule.
The equal protection clause is a guarantee which provides a A.M. No. 936 July 25, 1975
wall of protection against uneven application of status and
regulations. In the broader sense, the guarantee operates
against uneven application of legal norms so FERMINA LEGASPI DAROY, LYDIA LEGASPI and AGRIPINO
that all persons under similar circumstances would be LEGASPI, complainants,
accorded the same treatment. 62 Those who fall within a vs.
particular class ought to be treated alike not only as to ATTORNEY RAMON CHAVES LEGASPI, respondent.
privileges granted but also as to the liabilities imposed.
How Vivencio Legaspi, who, according to the instrument, was a resident The prayer of the complainants that the respondent be ordered to pay
of Alameda, California, was able to sign it and to appear before a notary them the said amount of P4,000 plus attorney's fees and miscellaneous
was not explained. expenses incurred in the prosecution of this case amounting to more
than P1,000 cannot be granted in this disbarment proceeding. That
amount should be recovered in an ordinary action.
The incomplete document, far from being of any help to respondent
Legaspi, casts a reflection on his competency and integrity as a lawyer
and on the competency and integrity of the notary before whom it was WHEREFORE, the respondent is disbarred. The Clerk of Court is
acknowledged. As already noted, it was made to appear herein that directed to strike out his name from the Roll of Attorneys.
respondent Legaspi was an heir of Consuelo Gonzaga when, obviously,
he did not possess that status. The document does not even mention
SO ORDERED.
whether the deceased died intestate.
Section 25, Rule 138 of the Rules of Court provides that when an Delgado, Dizon and Flores for petitioner.
attorney unjustly retains in his hands money of his client after it has Vicente J. Francisco for respondents.
been demanded, he may be punished for contempt as an officer of the
court who has misbehaved in his official transactions and he is liable to TUASON, J.:
a criminal prosecution.
"The relation between an attorney and his client is highly fiduciary in its On May 14, Attorneys Ohnick, Velilla and Balonkita filed an answer on
nature and of a very delicate, exacting and confidential character, behalf of the defendant; and on June 15, Attorneys Delgado, Dizon,
requiring a high degree of fidelity and good faith" (7 Am. Jur. 2d 105). In Flores and Rodrigo registered their appearance as counsel for the
view of that special relationship, "lawyers are bound to promptly account plaintiff. On October 5, these attorneys filed an amended complaint by
for money or property received by them on behalf of their clients and including Jacob Assad as party defendant.
failure to do so constitutes professional misconduct. The fact that a
lawyer has a lien for fees on money in his hands collected for his clients
does not relieve him from the duty of promptly accounting for the funds On January 28, 1946, Attorney Francisco entered his appearance as
received." (Syllabus, In re Bamberger, 49 Phil. 962). attorney of record for the defendant in substitution for Attorney Ohnick,
Velilla and Balonkita who had withdrawn from the case.
The conversion of funds entrusted to an attorney is a gross violation of
general morality as well as professional ethics. It impairs public On May 29, Attorney Dizon, in the name of his firm, wrote Attorney
confidence in the legal profession, "It deserves severe punishment" Francisco urging him to discontinue representing the defendants on the
(Sturr vs. State Bar of California, 52 Cal. 2d 125, 338 Pac. 2d ground that their client had consulted with him about her case, on which
897).1äwphï1.ñët occasion, it was alleged, "she turned over the papers" to Attorney
Francisco, and the latter sent her a written opinion. Not receiving any
answer to this suggestion, Attorney Delgado, Dizon, Flores and Rodrigo
A member of the bar who converts the money of his client to his own on June 3, 1946, filed a formal motion with the court, wherein the case
benefit through false pretenses is guilty of deceit, malpractice and gross was and is pending, to disqualify Attorney Francisco.
misconduct in his office of lawyer. The attorney, who violates his oath of
office, betrays the confidence reposed in him by a client and practices
deceit cannot be permitted to continue as a law practitioner. Not alone Attorney Francisco's letter to plaintiff, mentioned above and identified as
has he degraded himself but as an unfaithful lawyer he has besmirched Exhibit A, is in full as follows:
the fair name of an honorable profession (In re Paraiso, 41 Phil. 24,
25; In re David, 84 Phil. 627; Manaloto vs. Reyes, Adm. Case No. 503, VICENTE J. FRANCISCO
October 29, 1965, 15 SCRA 131; See Cabigao and Yzquierdo vs. Attorney-at-Law
Fernando Rodrigo, 57 Phil. 20). 1462 Estrada, Manila
(c) That the property was sold by Mr. Hilado without your Attorney Francisco filed an affidavit of stenographer Ragodon in
knowledge on the aforesaid date of May 3, 1943. corroboration of his answer.
Upon the foregoing facts, I am of the opinion that your action The judge trying the case, Honorable Jose Gutierrez David, later
against Mr. Assad will not ordinarily prosper. Mr. Assad had promoted to the Court of Appeals, dismissed the complaint. His Honor
the right to presume that your husband had the legal right to believed that no information other than that already alleged in plaintiff's
dispose of the property as the transfer certificate of title was in complaint in the main cause was conveyed to Attorney Francisco, and
his name. Moreover, the price of P110,000 in Japanese concluded that the intercourse between the plaintiff and the respondent
military notes, as of May 3, 1943, does not quite strike me as did not attain the point of creating the relation of attorney and client.
so grossly inadequate as to warrant the annulment of the
sale. I believe, lastly, that the transaction cannot be avoided
Stripped of disputed details and collateral matters, this much is
merely because it was made during the Japanese occupation,
undoubted: That Attorney Francisco's law firm mailed to the plaintiff a
nor on the simple allegation that the real purchaser was not a
written opinion over his signature on the merits of her case; that this
citizen of the Philippines. On his last point, furthermore, I
opinion was reached on the basis of papers she had submitted at his
expect that you will have great difficulty in proving that the real
office; that Mrs. Hilado's purpose in submitting those papers was to
purchaser was other than Mr. Assad, considering that death
secure Attorney Francisco's professional services. Granting the facts to
has already sealed your husband's lips and he cannot now
be no more than these, we agree with petitioner's counsel that the
testify as to the circumstances of the sale.
relation of attorney and client between Attorney Francisco and Mrs.
Hilado ensued. The following rules accord with the ethics of the legal
For the foregoing reasons, I regret to advise you that I cannot profession and meet with our approval:
appear in the proceedings in your behalf. The records of the
case you loaned to me are herewith returned.
In order to constitute the relation (of attorney and client) a
professional one and not merely one of principal and agent,
the attorneys must be employed either to give advice upon a
legal point, to prosecute or defend an action in court of justice,
Yours very truly, or to prepare and draft, in legal form such papers as deeds,
bills, contracts and the like. (Atkinson vs. Howlett, 11 Ky. Law
Rep. (abstract), 364; cited in Vol. 88, A. L. R., p. 6.)
(Sgd.) VICENTE J. FRANCISCO
The defense that Attorney Agrava wrote the letter Exhibit A and that
Where it appeared that an attorney, representing one party in
Attorney Francisco did not take the trouble of reading it, would not take
litigation, had formerly represented the adverse party with
the case out of the interdiction. If this letter was written under the
respect to the same matter involved in the litigation, the court
circumstances explained by Attorney Francisco and he was unaware of
need not inquire as to how much knowledge the attorney
its contents, the fact remains that his firm did give Mrs. Hilado a formal
acquired from his former during that relationship, before
professional advice from which, as heretofore demonstrated, emerged
refusing to permit the attorney to represent the adverse party.
the relation of attorney and client. This letter binds and estop him in the
(Brown vs. Miller, 52 App. D. C. 330; 286, F. 994.)
same manner and to the same degree as if he personally had written it.
An information obtained from a client by a member or assistant of a law
In order that a court may prevent an attorney from appearing firm is information imparted to the firm. (6 C. J., 628; 7 C. J. S., 986.)
against a former client, it is unnecessary that the ascertain in This is not a mere fiction or an arbitrary rule; for such member or
detail the extent to which the former client's affairs might have assistant, as in our case, not only acts in the name and interest of the
a bearing on the matters involved in the subsequent litigation firm, but his information, by the nature of his connection with the firm is
on the attorney's knowledge thereof. (Boyd vs. Second available to his associates or employers. The rule is all the more to be
Judicial Dist. Court, 274 P., 7; 51 Nev., 264.) adhered to where, as in the present instance, the opinion was actually
signed by the head of the firm and carries his initials intended to convey
the impression that it was dictated by him personally. No progress could
This rule has been so strictly that it has been held an attorney, be hoped for in "the public policy that the client in consulting his legal
on terminating his employment, cannot thereafter act as adviser ought to be free from apprehension of disclosure of his
counsel against his client in the same general matter, even confidence," if the prohibition were not extended to the attorney's
though, while acting for his former client, he acquired no partners, employers or assistants.
knowledge which could operate to his client's disadvantage in
the subsequent adverse employment. (Pierce vs. Palmer
[1910], 31 R. I., 432; 77 Atl., 201, Ann. Cas., 1912S, 181.) The fact that petitioner did not object until after four months had passed
from the date Attorney Francisco first appeared for the defendants does
not operate as a waiver of her right to ask for his disqualification. In one
Communications between attorney and client are, in a great number of case, objection to the appearance of an attorney was allowed even on
litigations, a complicated affair, consisting of entangled relevant and appeal as a ground for reversal of the judgment. In that case, in which
irrelevant, secret and well known facts. In the complexity of what is said throughout the conduct of the cause in the court below the attorney had
in the course of the dealings between an attorney and a client, inquiry of been suffered so to act without objection, the court said: "We are all of
the nature suggested would lead to the revelation, in advance of the the one mind, that the right of the appellee to make his objection has not
trial, of other matters that might only further prejudice the complainant's lapsed by reason of failure to make it sooner; that professional
cause. And the theory would be productive of other un salutary results. confidence once reposed can never be divested by expiration of
To make the passing of confidential communication a condition professional employment." (Nickels vs. Griffin, 1 Wash. Terr., 374, 321
precedent; i.e., to make the employment conditioned on the scope and A. L. R. 1316.)
character of the knowledge acquired by an attorney in determining his
right to change sides, would not enhance the freedom of litigants, which
is to be sedulously fostered, to consult with lawyers upon what they The complaint that petitioner's remedy is by appeal and not by certiorari
believe are their rights in litigation. The condition would of necessity call deserves scant attention. The courts have summary jurisdiction to
for an investigation of what information the attorney has received and in protect the rights of the parties and the public from any conduct of
what way it is or it is not in conflict with his new position. Litigants would attorneys prejudicial to the administration of the justice. The summary
in consequence be wary in going to an attorney, lest by an unfortunate jurisdiction of the courts over attorneys is not confined to requiring them
turn of the proceedings, if an investigation be held, the court should to pay over money collected by them but embraces authority to compel
accept the attorney's inaccurate version of the facts that came to him. them to do whatever specific acts may be incumbent upon them in their
"Now the abstinence from seeking legal advice in a good cause is by capacity of attorneys to perform. The courts from the general principles
hypothesis an evil which is fatal to the administration of justice." (John of equity and policy, will always look into the dealings between attorneys
H. Wigmore's Evidence, 1923, Section 2285, 2290, 2291.) and clients and guard the latter from any undue consequences resulting
from a situation in which they may stand unequal. The courts acts on the
same principles whether the undertaking is to appear, or, for that matter,
Hence the necessity of setting down the existence of the bare not to appear, to answer declaration, etc. (6 C.J., 718 C.J.S., 1005.)
relationship of attorney and client as the yardstick for testing This summary remedy against attorneys flows from the facts that they
incompatibility of interests. This stern rule is designed not alone to are officers of the court where they practice, forming a part of the
prevent the dishonest practitioner from fraudulent conduct, but as well to machinery of the law for the administration of justice and as such
protect the honest lawyer from unfounded suspicion of unprofessional subject to the disciplinary authority of the courts and to its orders and
practice. (Strong vs. Int. Bldg., etc.; Ass'n, 183 Ill., 97; 47 L.R.A., 792.) It directions with respect to their relations to the court as well as to their
is founded on principles of public policy, on good taste. As has been clients. (Charest vs. Bishop, 137 Minn., 102; 162, N.W., 1062, Note 26,
said in another case, the question is not necessarily one of the rights of 7 C. J. S., 1007.) Attorney stand on the same footing as sheriffs and
the parties, but as to whether the attorney has adhered to proper other court officers in respect of matters just mentioned.
professional standard. With these thoughts in mind, it behooves
attorneys, like Caesar's wife, not only to keep inviolate the client's
confidence, but also to avoid the appearance of treachery and double- We conclude therefore that the motion for disqualification should be
dealing. Only thus can litigants be encouraged to entrust their secrets to allowed. It is so ordered, without costs.
their attorneys which is of paramount importance in the administration of
justice.
A.C. No. 6711 July 3, 2007
There is in legal practice what called "retaining fee," the purpose of Under consideration is Resolution No. XVI-2004-472 of the Board of
which stems from the realization that the attorney is disabled from acting Governors, Integrated Bar of the Philippines (IBP), relative to the
complaint for disbarment filed by herein complainant Ma. Luisa Hadjula CRIMINALLY CONVICTED of her ILLICIT, IMMORAL,
against respondent Atty. Roceles F. Madianda. ILLEGAL and UNLAWFUL ACTS.
The case started when, in an AFFIDAVIT-COMPLAINT1 bearing date On October 7, 2004, the Investigating Commissioner of the IBP
September 7, 2002 and filed with the IBP Commission on Bar Discipline, Commission on Bar Discipline came out with a Report and
complainant charged Atty. Roceles F. Madianda with violation of Article Recommendation, stating that the information related by complainant to
2092 of the Revised Penal Code and Canon Nos. 15.02 and 21.02 of the the respondent is "protected under the attorney-client privilege
Code of Professional Responsibility. communication." Prescinding from this postulate, the Investigating
Commissioner found the respondent to have violated legal ethics when
she "[revealed] information given to her during a legal consultation," and
In said affidavit-complaint, complainant alleged that she and respondent
accordingly recommended that respondent be reprimanded therefor,
used to be friends as they both worked at the Bureau of Fire Protection
thus:
(BFP) whereat respondent was the Chief Legal Officer while she was
the Chief Nurse of the Medical, Dental and Nursing Services.
Complainant claimed that, sometime in 1998, she approached WHEREFORE, premises considered, it is respectfully
respondent for some legal advice. Complainant further alleged that, in recommended that respondent Atty. Roceles Madianda be
the course of their conversation which was supposed to be kept reprimanded for revealing the secrets of the complainant.
confidential, she disclosed personal secrets and produced copies of a
marriage contract, a birth certificate and a baptismal certificate, only to
On November 4, 2004, the IBP Board of Governors issued Resolution
be informed later by the respondent that she (respondent) would refer
No. XVI-2004-472 reading as follows:
the matter to a lawyer friend. It was malicious, so complainant states, of
respondent to have refused handling her case only after she had
already heard her secrets. RESOLVED to ADOPT and APPROVE, as it is hereby
ADOPTED and APPROVED, the Report and
Recommendation of the Investigating Commissioner of the
Continuing, complainant averred that her friendship with respondent
above-entitled case, herein made part of this Resolution as
soured after her filing, in the later part of 2000, of criminal and
Annex "A"; and , finding the recommendation fully supported
disciplinary actions against the latter. What, per complainant's account,
by the evidence on record and the applicable laws and rules,
precipitated the filing was when respondent, then a member of the BFP
and considering the actuation of revealing information given to
promotion board, demanded a cellular phone in exchange for the
respondent during a legal consultation, Atty. Roceles
complainant's promotion.
Madianda is hereby REPRIMANDED.
Sometime in April 1999, he engaged the services of respondent lawyer In compliance with this Court’s Resolution dated July 31,
to prepare and file a petition for the issuance of a new certificate of title. 2000,4 respondent filed his Comment narrating his version, as follows:
After confiding with respondent the circumstances surrounding the lost
title and discussing the fees and costs, respondent prepared, finalized On December 17, 1998, he offered to redeem from complainant a 4.9
and submitted to him a petition to be filed before the Regional Trial hectare-property situated in Brgy. Gonzales, Umingan, Pangasinan
Court of Tayug, Pangasinan. When the petition was about to be filed, covered by TCT No. T-33122 which the latter acquired by purchase from
respondent went to his (complainant’s) office at Virra Mall, Greenhills his (respondent’s) son, the late Fermin C. Gonzales, Jr.. On the same
and demanded a certain amount from him other than what they had date, he paid complainant P340,000.00 and demanded the delivery of
previously agreed upon. Respondent left his office after reasoning with TCT No. T-33122 as well as the execution of the Deed of Redemption.
him. Expecting that said petition would be filed, he was shocked to find Upon request, he gave complainant additional time to locate said title or
out later that instead of filing the petition for the issuance of a new until after Christmas to deliver the same and execute the Deed of
certificate of title, respondent filed a letter-complaint dated July 26, 1999 Redemption. After the said period, he went to complainant’s office and
against him with the Office of the Provincial Prosecutor of Tayug, demanded the delivery of the title and the execution of the Deed of
Pangasinan for "Falsification of Public Documents." 1 The letter-complaint Redemption. Instead, complainant gave him photocopies of TCT No. T-
contained facts and circumstances pertaining to the transfer certificate 33122 and TCT No. T-5165. Complainant explained that he had already
of title that was the subject matter of the petition which respondent was transferred the title of the property, covered by TCT No.T-5165 to his
supposed to have filed. Portions of said letter-complaint read: children Michael and Cristina Uy and that TCT No. T-5165 was
misplaced and cannot be located despite efforts to locate it. Wanting to
The undersigned complainant accuses WILLIAM S. UY, of protect his interest over the property coupled with his desire to get hold
legal age, Filipino, married and a resident of 132-A Gilmore of TCT No. T-5165 the earliest possible time, he offered his assistance
Street corner 9th Street, New Manila, Quezon City, Michael pro bono to prepare a petition for lost title provided that all necessary
Angelo T. UY, CRISTINA EARL T. UY, minors and residents of expenses incident thereto including expenses for transportation and
the aforesaid address, Luviminda G. Tomagos, of legal age, others, estimated at P20,000.00, will be shouldered by complainant. To
married, Filipino and a resident of Carmay East, Rosales, these, complainant agreed.
Pangasinan, and F. Madayag, with office address at A12, 2/F
Vira Mall Shopping Complex, Greenhills, San Juan, Metro On April 9, 1999, he submitted to complainant a draft of the petition for
Manila, for ESTAFA THRU FALSIFICATION OF PUBLIC the lost title ready for signing and notarization. On April 14, 1999, he
DOCUMENTS, committed as follows: went to complainant’s office informing him that the petition is ready for
filing and needs funds for expenses. Complainant who was with a client
That on March 15, 1996, William S. Uy acquired by purchase asked him to wait at the anteroom where he waited for almost two hours
a parcel of land consisting of 4.001 ha. for the amount of until he found out that complainant had already left without leaving any
P100,000.00, Philippine Currency, situated at Brgy. Gonzales, instructions nor funds for the filing of the petition. Complainant’s conduct
Umingan, Pangasinan, from FERMIN C. GONZALES, as infuriated him which prompted him to give a handwritten letter telling
evidenced by a Deed of Sale executed by the latter in favor of complainant that he is withdrawing the petition he prepared and that
the former…; that in the said date, William S. Uy received the complainant should get another lawyer to file the petition.
Transfer Certificate of Title No. T-33122, covering the said
land; Respondent maintains that the lawyer-client relationship between him
and complainant was terminated when he gave the handwritten letter to
complainant; that there was no longer any professional relationship hereby SUSPENDED from the practice of law for six (6)
between the two of them when he filed the letter-complaint for months.11
falsification of public document; that the facts and allegations contained
in the letter-complaint for falsification were culled from public documents
Preliminarily, we agree with Commissioner Villanueva-Maala that the
procured from the Office of the Register of Deeds in Tayug,
manifestation of complainant Uy expressing his desire to dismiss the
Pangasinan.5
administrative complaint he filed against respondent, has no persuasive
bearing in the present case.
In a Resolution dated October 18, 2000, the Court referred the case to
the Integrated Bar of the Philippines (IBP) for investigation, report and
Sec. 5, Rule 139-B of the Rules of Court states that:
recommendation.6
….
Commissioner Rebecca Villanueva-Maala ordered both parties to
appear on April 2, 2003 before the IBP. 7 On said date, complainant did
not appear despite due notice. There was no showing that respondent No investigation shall be interrupted or terminated by reason
received the notice for that day’s hearing and so the hearing was reset of the desistance, settlement, compromise, restitution,
to May 28, 2003.8 withdrawal of the charges, or failure of the complainant to
prosecute the same.
On April 29, 2003, Commissioner Villanueva-Maala received a letter
from one Atty. Augusto M. Macam dated April 24, 2003, stating that his This is because:
client, William S. Uy, had lost interest in pursuing the complaint he filed
against Atty. Gonzales and requesting that the case against Atty.
A proceeding for suspension or disbarment is not in any
Gonzales be dismissed.9
sense a civil action where the complainant is a plaintiff and
the respondent lawyer is a defendant. Disciplinary
On June 2, 2003, Commissioner Villanueva-Maala submitted her report proceedings involve no private interest and afford no redress
and recommendation, portions of which read as follows: for private grievance. They are undertaken and prosecuted
solely for the public welfare. They are undertaken for the
purpose of preserving courts of justice from the official
The facts and evidence presented show that when
ministration of persons unfit to practice in them. The attorney
respondent agreed to handle the filing of the Verified Petition
is called to answer to the court for his conduct as an officer of
for the loss of TCT No. T-5165, complainant had confided to
the court. The complainant or the person who called the
respondent the fact of the loss and the circumstances
attention of the court to the attorney's alleged misconduct is in
attendant thereto. When respondent filed the Letter-Complaint
no sense a party, and has generally no interest in the outcome
to the Office of the Special Prosecutor in Tayug, Pangasinan,
except as all good citizens may have in the proper
he violated Canon 21 of the Code of Professional
administration of justice. Hence, if the evidence on record
Responsibility which expressly provides that "A lawyer shall
warrants, the respondent may be suspended or disbarred
preserve the confidences and secrets of his client even after
despite the desistance of complainant or his withdrawal of the
the attorney-client relation is terminated." Respondent cannot
charges.12
argue that there was no lawyer-client relationship between
them when he filed the Letter-Complaint on 26 July 1999
considering that as early as 14 April 1999, or three (3) months Now to the merits of the complaint against the respondent.
after, respondent had already terminated complainant’s
perceived lawyer-client relationship between them. The duty
Practice of law embraces any activity, in or out of court, which requires
to maintain inviolate the client’s confidences and secrets is not
the application of law, as well as legal principles, practice or procedure
temporary but permanent. It is in effect perpetual for "it
and calls for legal knowledge, training and experience. 13 While it is true
outlasts the lawyer’s employment" (Canon 37, Code of
that a lawyer may be disbarred or suspended for any misconduct,
Professional Responsibility) which means even after the
whether in his professional or private capacity, which shows him to be
relationship has been terminated, the duty to preserve the
wanting in moral character, in honesty, probity and good demeanor or
client’s confidences and secrets remains effective. Likewise
unworthy to continue as an officer of the court, 14 complainant failed to
Rule 21.02, Canon 21 of the Rules of Professional
prove any of the circumstances enumerated above that would warrant
Responsibility provides that "A lawyer shall not, to the
the disbarment or suspension of herein respondent.
disadvantage of his client, use information acquired in the
course of employment, nor shall he use the same to his own
advantage or that of a third person, unless the client with the Notwithstanding respondent’s own perception on the matter, a scrutiny
full knowledge of the circumstances consents thereto." of the records reveals that the relationship between complainant and
respondent stemmed from a personal transaction or dealings between
them rather than the practice of law by respondent. Respondent dealt
On 29 April 2003, the Commission received a letter dated 24
with complainant only because he redeemed a property which
April 2003 from Atty. Augusto M. Macam, who claims to
complainant had earlier purchased from his (complainant’s) son. It is not
represent complainant, William S. Uy, alleging that
refuted that respondent paid complainant P340,000.00 and gave him
complainant is no longer interested in pursuing this case and
ample time to produce its title and execute the Deed of Redemption.
requested that the same be dismissed. The aforesaid letter
However, despite the period given to him, complainant failed to fulfill his
hardly deserves consideration as proceedings of this nature
end of the bargain because of the alleged loss of the title which he had
cannot be "interrupted by reason of desistance, settlement,
admitted to respondent as having prematurely transferred to his
compromise, restitution, withdrawal of the charges, or failure
children, thus prompting respondent to offer his assistance so as to
of the complainant to prosecute the same. (Section 5, Rule
secure the issuance of a new title to the property, in lieu of the lost one,
139-B, Rules of Court). Moreover, in Boliver vs. Simbol, 16
with complainant assuming the expenses therefor.
SCRA 623, the Court ruled that "any person may bring to this
Court’s attention the misconduct of any lawyer, and action will
usually be taken regardless of the interest or lack of interest As a rule, an attorney-client relationship is said to exist when a lawyer
of the complainant, if the facts proven so warrant." voluntarily permits or acquiesces with the consultation of a person, who
in respect to a business or trouble of any kind, consults a lawyer with a
view of obtaining professional advice or assistance. It is not essential
IN VIEW OF THE FOREGOING, we find respondent Atty.
that the client should have employed the attorney on any previous
Fermin L. Gonzales to have violated the Code of Professional
occasion or that any retainer should have been paid, promised or
Responsibility and it is hereby recommended that he
charged for, neither is it material that the attorney consulted did not
be SUSPENDED for a period of SIX (6) MONTHS from
afterward undertake the case about which the consultation was had, for
receipt hereof, from the practice of his profession as a lawyer
as long as the advice and assistance of the attorney is sought and
and member of the Bar.10
received, in matters pertinent to his profession.15
On June 21, 2003, the Board of Governors of the Integrated Bar of the
Considering the attendant peculiar circumstances, said rule cannot
Philippines issued Resolution No. XV-2003-365, thus:
apply to the present case. Evidently, the facts alleged in the complaint
for "Estafa Through Falsification of Public Documents" filed by
RESOLVED to ADOPT and APPROVE, as it is hereby respondent against complainant were obtained by respondent due to his
ADOPTED and APPROVED, the Report and personal dealings with complainant. Respondent volunteered his service
Recommendation of the Investigating Commissioner of the to hasten the issuance of the certificate of title of the land he has
above-entitled case, herein made part of this redeemed from complainant. Respondent’s immediate objective was to
Resolution/Decision as Annex "A"; and finding the secure the title of the property that complainant had earlier bought from
recommendation fully supported by the evidence on record his son. Clearly, there was no attorney-client relationship between
and applicable laws and rules, and considering that respondent and complainant. The preparation and the proposed filing of
respondent violated Rule 21.02, Canon 21 of the Canons of the petition was only incidental to their personal transaction.
Professional Responsibility, Atty. Fermin L. Gonzales is
Canon 21 of the Code of Professional Responsibility reads: It is undeniable that the advertisement in question was a flagrant
violation by the respondent of the ethics of his profession, it being a
brazen solicitation of business from the public. Section 25 of Rule 127
Canon 21 – A LAWYER SHALL PRESERVE THE
expressly provides among other things that "the practice of soliciting
CONFIDENCE AND SECRETS OF HIS CLIENT EVEN
cases at law for the purpose of gain, either personally or thru paid
AFTER THE ATTORNEY-CLIENT RELATION IS
agents or brokers, constitutes malpractice." It is highly unethical for an
TERMINATED.
attorney to advertise his talents or skill as a merchant advertises his
wares. Law is a profession and not a trade. The lawyer degrades
Rule 21.01 – A lawyer shall not reveal the confidences or himself and his profession who stoops to and adopts the practices of
secrets of his client except: mercantilism by advertising his services or offering them to the public.
As a member of the bar, he defiles the temple of justice with mercenary
activities as the money-changers of old defiled the temple of Jehovah.
a) When authorized by the client after acquainting him of the "The most worth and effective advertisement possible, even for a young
consequences of the disclosure; lawyer, . . . is the establishment of a well-merited reputation for
professional capacity and fidelity to trust. This cannot be forced but must
b) When required by law; be the outcome of character and conduct." (Canon 27, Code of Ethics.)
c) When necessary to collect his fees or to defend himself, his In In re Tagorda, 53 Phil., the respondent attorney was suspended from
employees or associates or by judicial action. the practice of law for the period of one month for advertising his
services and soliciting work from the public by writing circular letters.
That case, however, was more serious than this because there the
The alleged "secrets" of complainant were not specified by him in his solicitations were repeatedly made and were more elaborate and
affidavit-complaint. Whatever facts alleged by respondent against insistent.
complainant were not obtained by respondent in his professional
capacity but as a redemptioner of a property originally owned by his
deceased son and therefore, when respondent filed the complaint for Considering his plea for leniency and his promise not to repeat the
estafa against herein complainant, which necessarily involved alleging misconduct, the Court is of the opinion and so decided that the
facts that would constitute estafa, respondent was not, in any way, respondent should be, as he hereby is, reprimanded.
violating Canon 21. There is no way we can equate the filing of the
affidavit-complaint against herein complainant to a misconduct that is Yulo, C.J., Moran, Horrilleno, Paras and Bocobo, JJ., concur.
wanting in moral character, in honesty, probity and good demeanor or
that renders him unworthy to continue as an officer of the court. To hold
otherwise would be precluding any lawyer from instituting a case against
anyone to protect his personal or proprietary interests.
March 23, 1929
WHEREFORE, Resolution No. XV-2003-365 dated June 21, 2003 of the
Integrated Bar of the Philippines is REVERSED and SET ASIDE and the
administrative case filed against Atty. Fermin L. Gonzales, docketed as
A.C. No. 5280, is DISMISSED for lack of merit.
In re LUIS B. TAGORDA,
SO ORDERED.
Office of the Solicitor General De la Costa and Solicitor Feria for MALCOLM, J.:
complainant.
Francisco Claravall for respondent.
OZAETA, J.:
The respondent, Luis B. Tagorda, a practising attorney and a
member of the provincial board of Isabela, admits that
The respondent, who is an attorney-at-law, is charged with malpractice previous to the last general elections he made use of a card
for having published an advertisement in the Sunday Tribune of June written in Spanish and Ilocano, which, in translation, reads as
13, 1943, which reads as follows: follows:
Marriage
license promptly secured thru our assistance & the LUIS B. TAGORDA
annoyance of delay or publicity avoided if desired, and
marriage arranged to wishes of parties. Consultation on any
Attorney
matter free for the poor. Everything confidential.
Notary Public
Attorney
In view of all the circumstances of this case, the judgment of After November 15, 1962 when the Court of Appeals rendered
the court is that the respondent Luis B. Tagorda be and is judgment sustaining Damaso Perez' position with respect to
hereby suspended from the practice as an attorney-at-law for the extent of the levy, the subsequent proceedings interposed
the period of one month from April 1, 1929, alternatingly by the petitioner spouses were obviously quixotic
maneuvers expected to be overthrown by the courts but
calculated to delay an execution long overdue.
vs.
HON. GREGORIO LANTIN, Judge of the Court of First In a determined effort to prolong the litigation, the Perez
Instance of Manila, spouses, as represented by their counsels, sought the
issuance of preliminary injunctions to restrain the execution of
the final judgment in civil case 39407 from courts which did
RICARDO P. HERMOSO and the CITY SHERIFF OF not have jurisdiction and which would, as expected, initially or
MANILA, respondents. ultimately deny their prayer. For instance, after Damaso Perez
bowed out temporarily from the scene following the rendition
of the aforementioned Court of Appeals decision, his wife,
Mercedez, Ruth Cobb-Perez, intruded into the controversy
and asked for an ex parte writ of preliminary injunction from
Crispin D. Baizas and Associates for petitioners. the Court of First Instance of Rizal in connection with civil
case 7532 which she filed with the said court, knowing fully
Isidro T. Almeda for respondents. well that the basic civil case 39407 was decided by the Court
of First Instance of Manila (Branch VII presided by the
respondent Judge Lantin), which latter court was the proper
forum for any action relative to the execution. Judge Eulogio
Mencias of the Court of First Instance of Rizal, looking to
CASTRO, J.: Acosta vs. Alvendia (L-14598, October 31, 1960), which held
that courts of first instance have no power to restrain acts
outside their territorial jurisdictions, lifted on October 4, 1963
the ex parte writ which he previously issued enjoining the
respondent sheriff from carrying out the execution sale. It is
This is a motion for partial reconsideration of this Court's clear, however, that Mrs. Perez and her counsels, the
decision of May 22, 1968, specifically directed against the movants, knew or ought to have known beforehand that the
following observation therein made: Court of First Instance of Rizal did not have jurisdiction to
issue the writ which Mrs. Perez herself sought, and,
anticipating the recall of the writ improvidently issued, on
September 3, 1963, a month before the said writ was actually
lifted, filed in the basic civil case 39407 an urgent motion to lift
We feel compelled to observe that during the protracted the writ of execution issued on August 15, 1961, alleging as
litigation below, the petitioners resorted to a series of actions justification the conjugal nature of the levied shares of stock
and petitions, at some stages alternatingly, abetted by their and the personal nature of Damaso Perez' judgment debt, the
counsel, for the sole purpose of thwarting the execution of a very same reasons advanced in civil case 7532 which was
simple money judgment which has long become final and then still pending in the Court of First Instance of Rizal.
executory. Some of the actions were filed, only to be Incidentally, Mrs. Perez failed to adduce any evidence in
abandoned or withdrawn. The petitioners and their counsel, support of her aforesaid urgent motion, as in fact neither she
far from viewing courts as sanctuaries for those who seek nor her counsels appeared during the scheduled hearing,
justice, have tried to use them to subvert the very ends of prompting the respondent judge to issue the following order:
justice.
When the urgent motion to recall or lift writ of execution was sought other, and often simultaneous, devices of thwarting
called this morning for hearing, counsel for the movant did not satisfaction of the judgment debt. (Emphasis supplied) .
appear despite the fact that he had been duly notified of the
motion for hearing. In view thereof the court assumes that he
is waiving his right to present evidence in support of his
urgent motion to recall or lift writ of execution. Said urgent
motion is therefore deemed submitted for resolution. And because of this statement, they now counter that the said
cases could not be branded as having been instituted for
delay.
The above exposition of the circumstances relative to the The movants further contend that "If there was delay, it was
protracted litigation clearly negates the avowal of the movants because petitioners' counsel happened to be more
that "in none of the various incidents in the case at bar has assertive ... a quality of the lawyers (which) is not to be
any particular counsel of petitioners acted with deliberate condemned."
aforethought to delay the enforcement of the judgment in Civil
Case No. 39407." From the chronology of antecedent events,
the fact becomes inescapable that the Perez spouses,
coached by their counsels, had sallied forth on a strategem of
"remedies" projected to foil the lawful execution of a simple A counsel's assertiveness in espousing with candour and
money judgment. It is equally obvious that they foreshadowed honesty his client's cause must be encouraged and is to be
their own reversals in the "remedies" they ventured to adopt, commended; what we do not and cannot countenance is a
such that even before, one remedy had been exhausted, they lawyer's insistence despite the patent futility of his client's
interposed another until the case reached this Court for the position, as in the case at bar.
second time. 3 Meanwhile, justice was delayed, and more
than one member of this Court are persuaded that justice was
practically waylaid.
vs.
A lawyer, when advising his client, shall give a candid and CRESENCIANO B. TRAJANO, DIRECTOR, BUREAU OF
honest opinion on the merits and probable results of the LABOR RELATIONS AND FFW ALECO I CHAPTER,
client's case, neither overstating nor understanding the respondents.
prospects of the case.
We do not therefore hesitate to rule that the respondent is not The Solicitor General for public respondent.
free from any blame for the sad fate of the complainants. He
is liable for inexcusable negligence.
SO ORDERED.
MEDIALDEA, J.:
A cursory analysis of Section 35, Presidential Decree 269, as On September 1, 1982, the Federation of Free Workers
amended, readily shows that employees of an electric (FFW) filed with the Regional Office IN, Ministry of Labor and
cooperative who are themselves members of the cooperative Employment (now Department of Labor and Employment), at
have no right to form or join a labor organization for purposes San Fernando, Pampanga, a petition for certification election.
of collective bargaining. The petition alleged, inter alia, that the FFW is a legitimate
labor organization; that the Bulacan II Electric Cooperative
Inc. BECO II) is engaged in the service and supply of electric
current and, therefore, an employer under the provisions of
the Labor Code; that the FFW seeks to be certified as the sole
In the first instance, a cooperative is established primarily for and exclusive collective bargaining representative of the
the mutual aid and protection of the members thereof. It was regular rank and file employees and workers of BECO II for
never intended to operate like an ordinary company or purposes of collective bargaining; that there are more or less
corporation. A cooperative is a non-profit organization, so that 140 regular rank and file employees and workers of BECO II;
if ever there are gains, income or benefits derived therefrom, that there is no other union existing in BECO II except the
the same are equally divided among its members. For all legal FFW and that there is no certified collective bargaining
intents and purposes, therefore, members of a cooperative agreement in said establishment; and that there has been no
are part-owners thereof. certification election conducted in BECO II during the last
twelve (12) months preceding the filing of the petition.
With respect to G.R. No. 74560, the decision dated May 15,
1986 of the respondent Director of the Bureau of Labor
Relations, affirming the Med-Arbiter's order for the holding of
a certification election, is reversed. It is clear from the records
in this case that the petitioner ALECO I has 141 rank and file
employees. Hence, there are 90 rank and file employees, CASTRO, J.:
nonmembers of the cooperative, who may validly form, join or
assist labor organizations for purposes of collective
bargaining.
SO ORDERED.
A counsel's assertiveness in espousing with candour and Upon the second cause of action, the Agos allege that on
honesty his client's cause must be encouraged and is to be January 5, 1959 the Castañedas and the sheriff, pursuant to
commended; what we do not and cannot countenance is a an alias writ of seizure, seized and took possession of certain
lawyer's insistence despite the patent futility of his client's machineries, depriving the Agos of the use thereof, to their
position, as in the case at bar. damage in the sum of P256,000 up to May 5, 1964. This
second cause of action fails to state a valid cause of action for
it fails to allege that the order of seizure is invalid or illegal.
Upon the first cause of action, it is alleged that after the filing
of the complaint, the defendants, taking advantage of the Makasiar, Esguerra, Muñoz Palma and Martin, JJ., concur.
dissolution of the preliminary injunction, in conspiracy and
with gross bad faith and evident intent to cause damage to the
plaintiffs, caused the registration of the sheriff's final deed of
sale; that, to cause more damage, the defendants sold to their
lawyer and his wife two of the parcels of land in question; that Teehankee, J., is on leave.
the purchasers acquired the properties in bad faith; that the
defendants mortgaged the two other parcels to the Rizal
Commercial Banking Corporation while the defendants' lawyer
and his wife also mortgaged the parcels bought by them to
the Rizal Commercial Bank; and that the bank also acted in
bad faith.
The amendment made pertains to the first cause of action of CARPIO, J.:
the supplemental complaint, which is, the inclusion of a
paragraph averring that, still to cause damage and prejudice
to the plaintiffs, Atty. & Mrs. Juan Quijano, in bad faith sold the
two parcels of land they had previously bought to Eloy The Case
Ocampo who acquired them also in bad faith, while Venancio
Castañeda and Nicetas Henson in bad faith sold the two other
parcels to Juan Quijano (60%) and Eloy Ocampo (40%) who
acquired them in bad faith and with knowledge that the This is a complaint for disbarment filed by the members of the Board of
properties are the subject of a pending litigation. Directors1 of the Rural Bank of Calape, Inc. (RBCI) Bohol against
respondent Atty. James Benedict Florido (respondent) for "acts
constituting grave coercion and threats when he, as counsel for the
minority stockholders of RBCI, led his clients in physically taking over
the management and operation of the bank through force, violence and
Discussion on The Causes of Action intimidation."
The Facts
The Amended Supplemental Complaint
SO ORDERED.
On 5 July 2006, respondent filed a motion for reconsideration. In its 11 A verified complaint for disbarment was filed with then Secretary of
December 2008 Resolution, the IBP denied respondent’s motion.5 National Defense Juan Ponce Enrile on January 2, 1974, by Ramona L.
Vda. de Alisbo and Norberto S. Alisbo against their former counsel,
Attorney Benito Jalandoon, Sr., charging him with deceit, malpractice,
and professional infidelity. The complaint was referred to this Court on in Civil Case No. 4963 became final on May 30, 1961 yet, and, although
February 5, 1974. a complaint for revival of said judgment was filed by Ramon Alisbo on
September 12, 1970, before the ten-year prescriptive period expired,
that complaint was null and void for Ramon Alisbo was insane, hence,
incompetent and without legal capacity to sue when he instituted the
After the complainants had submitted the required number of copies of action. The subsequent filing of an Amended Complaint on December 8,
their complaint, the respondent was ordered to file his answer thereto 1972, after the statutory limitation period had expired, was too late to
which he did on June 5, 1974. save the plaintiffs right of action. Thereafter, nothing more was done by
any of the parties in the case.
In his report to the Court, the Solicitor General made the following
3. As attorney's fees, respondent will be paid fifty per cent (50%) observations:
of the value of the property recovered.
Evident from the foregoing is the fact that in handling the case for
On April 18, 1970, respondent prepared a complaint for revival of the Ramon S. Alisbo which eventually led to its dismissal, respondent
judgment in Civil Case No. 4963 but filed it only on September 12, 1970 committed several errors, among which are:
on five (5) months later. It was docketed as Civil Case No. 9559,
entitled: "Ramon S. Alisbo, Teotimo S. Alisbo and Pacifico S. Alisbo vs.
Carlito Sales, in his own capacity and as Judicial Administrator of the
deceased Pedro Sales." The complaint was signed by respondent 1. He did not verify the real status of Ramon Alisbo before filing
alone. However, no sooner had he filed the complaint than he withdrew the case. Otherwise, his lack of capacity to sue would not have been at
it and filed in its stead (on the same day and in the same case) a issue.
second complaint dated August 31, 1970, with Ramon S. Alisbo as the
lone plaintiff, praying for the same relief. Teotimo S. Alisbo and Pacifico
S. Alisbo were excluded as plaintiffs and were impleaded as defendants 2. He postponed the motion to revive judgment and gave way
instead. Attorneys Bernardo B. Pablo and Benito Jalandoon, Sr. (herein instead to a motion to resolve pending incidents in Civil Case 4963. In
respondent) signed as counsel. doing so, he frittered away precious time.
On December 8, 1971, an amended complaint was filed wherein the 3. He dropped Ramon Alisbo's co-plaintiffs and impleaded them
plaintiffs were: Ramon S. Alisbo, assisted by his judicial guardian, as defendants.1âwphi1 Otherwise, the complaint would have been
Norberto S. Alisbo, and eight (8) others, namely: Pacifico S. Alisbo, defective only in part.
Ramona Vda. de Alisbo and Ildefonso, Evangeline, Teotimo, Jr.,
Reynaldo, Elizabeth and Teresita, all surnamed Alisbo. The amended
complaint was signed by Attorney Bernardo B. Pablo alone as counsel
of the plaintiffs. Had not respondent committed the above mistakes, Civil Case No. 9559
in all probability would not have been dismissed on the ground of
prescription. (pp. 9-10, Solicitor General's Report.)
TEEHANKEE, J.:
It is the duty of a lawyer at the time of retainer to disclose to the client all
the circumstances of his relations to the parties, and any interest in or
connection with the controversy, which might influence the client in the
selection of counsel. Appeal from a decision of the Court of First Instance of Cebu and
certified by the Court of Appeals to this Court, since the issues raised on
appeal are all questions of law.
After filing the complaint, Attorney Jalandoon sat on the case. While he
allegedly found out about Ramon Alisbo's insanity on July 17, 1971 only, An Answer to the complaint was filed in due course by Atty. Garcia on
he amended the complaint to implead Alisbo's legal guardian as plaintiff behalf of defendant. On June 1, 1956, the case was heard, without
on December 8, 1971 only, or almost five (5) months later. By that time defendant or his counsel being present, and plaintiff presented his
the prescriptive period had run out. evidence and the case, was submitted for decision. On June 6, 1956,
defendant, however, filed a motion for new trial which was granted by
the trial court on June 9, 1956.2
Plaintiff presented his oral and documentary evidence and was cross- Third Error:
examined by Atty. Garcia. 3 The record further shows that on March 19,
1958, Atty. Garcia commenced the presentation of evidence on behalf of
defendant. He presented defendant's wife, Leonarda Manit who testified
that her husband, Victor Manit "had no business of his own, because he THE LOWER COURT ERRED IN RENDERING A PREMATURE
is sickly" and that she was the one operating and managing their JUDGMENT IN AN UNFINISHED CASE WHERE THE NEW
transportation business of three trucks. 4 DEFENDANTS WERE NOT GIVEN THEIR DAY IN COURT.
On October 14, 1958, when the case was scheduled for continuation of He prayed therein that the appellate Court render judgment:
the trial, Atty. Garcia manifested that the original defendant, Victor Manit
had recently died, and the trial court on the same date directed him to
furnish plaintiff's counsel the names of the said defendant's heirs, so (a). Annulling the decision appealed from;
that plaintiff could amend the complaint accordingly. On August 11,
1959, plaintiff's counsel submitted a Motion to Admit the Amended
Complaint attached thereto, furnishing copy of said pleadings to Atty.
Garcia, who acknowledged receipt thereof as "Attorney for the (b). Remanding the case to the lower court for further proceedings by
defendant." The only amendment in the complaint consisted in serving summons on the defendants and giving them a chance to
impleading the widow and heirs of the deceased original defendant in present their evidence;
substitution for him, pursuant to Rule 3, section 17 of the Rules of Court.
At the hearing of the said motion on the same date, the trial court, after
noting that there was no opposition thereto by Atty. Garcia, admitted the
(c). Relieving the undersigned counsel from all responsibility in
Amended Complaint in its Order of August 11, 1959, wherein "(A)s
connection with this case in view of the death of his client; and
prayed for by counsel for the defendants, defendants are hereby given
fifteen (15) days' time within which to file an answer to said amended
complaint." 5 No answer to the amended complaint having been filed,
the original answer stood as defendants' answer to the amended (d). Granting such other and further reliefs and remedies in accordance
complaint, in accordance with Rule 11, section 3 of the Rules of Court. 6 with law and equity. (Appellants' Brief, p. 10)
The case was again set for hearing on January 28, 1960 with notice to We hold this "unique" appeal by the counsel of record, Atty. Jesus P.
the parties through their counsels of record. One day before the hearing, Garcia, allegedly "in his capacity as officer of the Court and as former
on January 27, 1960, Atty. Garcia filed a "Motion to Withdraw as counsel of the deceased Victor Manit" to be untenable.
Counsel", alleging that "the heirs of Victor Manit have not hired (him) to
represent them and consequently, (his) continued appearance in
representation of a dead client would be illegal" and asking the trial
court "that he be relieved as counsel in the above-entitled case for the There are two fundamental errors on which Atty. Garcia's appeal is
reasons stated herein." 7 premised. First, if he presents this appeal "in his capacity as officer of
the Court and as former counsel of the deceased Victor Manit", his
appeal should be thrown out, as not being a party to the case, much
less a party in interest, he has no legal standing whatsoever to
When the case was called on the next day, neither defendants nor Atty. prosecute this appeal. Second, in filing his Notice of Appeal and Cash
Garcia appeared, and the trial court noting "defendants' apparent lack of Appeal Bond, he represented himself as "Attorney for Victor Manit,
interest as can be gleaned from the records" considered them to have deceased", depositing the sum of P60.00 as appeal bond "to answer or
renounced their right to appear and present evidence to contest respond for the costs which the appellate court may award against the
plaintiff's claim. It did not pass upon Atty. Garcia's Motion to Withdraw as herein defendant-appellant," 9 thus representing anew to the trial Court
Counsel and proceeded to render judgment in favor of plaintiff, the that he was duly authorized to present the appeal on behalf of the estate
dispositive part of which provides as follows: of the original defendant, Victor Manit deceased, who had earlier been
substituted in the case by his heirs, the widow and three daughters of
legal age. The trial Court was perfectly correct in relying upon this
representation in accordance with Rule 138, section 21 of the Rules of
IN VIEW OF ALL THE FOREGOING, the Court pronounces judgment
Court which provides that "(A)n attorney is presumed to be properly
in favor of the plaintiff and against the defendants; and hereby
authorized to represent any case in which he appears ...." This appeal
sentences the defendants, jointly and severally, to pay the plaintiff the
must accordingly be dealt with as an appeal on behalf of said heirs as
amount of P3,000.00 as indemnity for the death of Delano Visitacion,
defendants-appellants and not in the "unique" concept with which Atty.
plus P3,000.00 in concept of moral damages, and the additional sum of
Garcia would circumscribe it.
P2,000.00 as attorney's fees, as well as the costs of this action.8
1. As to the first error assigned, no error was committed by the trial court
Atty. Garcia's Motion for Reconsideration, based on the same grounds
in continuing with the ease and handing down its decision against
hereinafter discussed having been denied by the trial court, he filed the
defendants-appellants. The contention that said defendants-appellants,
present appeal, and assigns the following errors in his "Brief for
as substituted parties-defendants by virtue of their being the heirs of the
Defendant-Appellant":
deceased original defendant pursuant to the trial court's Orders of
October 24, 1958 and August 11, 1959 in accordance with Rule 3,
section 17 of the Rules of Court 10 , should have been brought within
First Error: the Court's jurisdiction by summons is fallacious. For the record shows
that Atty. Garcia at the time acknowledged receipt of the Amended
Complaint substituting said defendants-heirs for the deceased original
defendant as "Attorney for the defendants", presented no opposition
THE LOWER COURT ERRED IN CONTINUING WITH THE CASE thereto, and furthermore prayed for and was granted by the Court a
WITHOUT THE NEW DEFENDANTS BROUGHT TO ITS period of 15 days to file an answer to the Amended Complaint. Having
JURISDICTION BY SUMMONS AND WITHOUT EVEN INFORMING been duly impleaded and having submitted to the Court's jurisdiction
SAID DEFENDANTS THAT THEY HAVE BECOME PARTIES TO THE through their counsel, Atty. Garcia, the issuance of a summons was
CASE. unnecessary. The other contention that "there is oven no record
showing that these defendants were at all informed that they had
become parties to the above-captioned case" 11 is equally fallacious.
Second Error: Nowhere in appellants' brief is there an assertion by Atty. Garcia, that,
he, as their attorney of record, and in compliance with his duty as such
and as an officer of the Court, failed or neglected to inform them of the
admission of the Amended Complaint substituting them for the
THE LOWER COURT ERRED IN IGNORING THE MOTION TO deceased original defendant.
WITHDRAW AS COUNSEL FILED BY A LAWYER WHO HAD LOST
AUTHORITY TO RE PRESENT A DEAD CLIENT.
2. Appellants claim in their second assignment of error that the trial court
erred in ignoring the Motion to Withdraw as Counsel filed by Atty.
Garcia. In the face of Atty. Garcia's previous representations and PERLAS-BERNABE, J.:
appearance as counsel of record for the substituted defendants, his last
hour motion to withdraw as counsel and disclaimer that said defendants
have hired him to represent them — which he filed one day before the
For the Court's resolution is a Complaint-Affidavit[1] filed on February
date set for resumption of the hearing — came too late and was
11, 2005 by complainant Cleo B. Dongga-as (complainant), before the
properly ignored by the Court. The Court could not accept this turn-
Integrated Bar of the Philippines (IBP) – Commission on Bar Discipline
about on his mere "say-so." His motion was not verified. Aside from the
(CBD), against respondents Atty. Rose Beatrix Cruz-Angeles (Atty.
fact that his said motion carried no notice, in violation of the requirement
Cruz-Angeles), Atty. Wylie M. Paler (Atty. Paler), and Atty. Angeles
of Rule 15, section 4 of the Rules of Court, and could therefore be
Grandea (Atty. Grandea; collectively, respondents) of the Angeles,
treated as a "mere scrap of paper", 12 the said motion was likewise
Grandea & Paler Law Office (law firm), charging them of various
fatally defective in that it carried no notice to his clients on record, the
violations of the Code of Professional Responsibility (CPR) for, inter alia,
defendants-appellants, as required by Rule 138, section 26 of the Rules
refusing to return the money given by complainant in exchange for legal
of Court. Furthermore, it is well settled that "(A)n attorney seeking to
services which respondents failed to perform.
withdraw must make an application to the court, for the relation does not
terminate formally until there is a withdrawal of record; at least so far as
the opposite party is concerned, the relation otherwise continues until
the end of the litigation." 13 The trial court's ignoring of the last-hour The Facts
motion and its handing down of its decision on the day of the hearing,
upon the failure of defendants and their counsel to appear, in spite of
their having been duly notified thereof, was in effect a denial of
counsel's application for withdrawal. Atty. Garcia's unexplained failure to Complainant alleged that sometime in May 2004, he engaged the law
appear was unexcusable. He had no right to presume that the Court firm of respondents to handle the annulment of his marriage with his
would grant his withdrawal. If he had then appeared and insisted on his wife, Mutya Filipinas Puno-Dongga-as (Mutya). In his meeting with
withdrawal, the trial court could then have had the opportunity to order Attys. Cruz-Angeles and Paler, complainant was told that: (a) the case
the appearance of defendants-appellants and verify from them the truth would cost him P300,000.00, with the first P100,000.00 payable
of his assertion that they had not "hired him to represent them." immediately and the remaining P200,000.00 payable after the final
hearing of the case; (b) respondents will start working on the case upon
receipt of PI00,000.00, which will cover the acceptance fee,
psychologist fee, and filing fees; and (c) the time-frame for the resolution
3. The trial court, therefore, did not render a "premature judgment in an of the case will be around three (3) to four (4) months from filing.
unfinished case where the defendants were not given their day in court", Accordingly, complainant paid respondents P100,000.00 which was duly
as claimed in the last error assigned by appellants. As stated earlier, the received by Atty. Cruz-Angeles.[2]
record shows that on March 19, 1958, the original defendant's widow,
Leonarda Manit was placed by Atty. Garcia on the witness stand during
the deceased's lifetime and testified that her husband "has no business
of his own, because he is sickly" and that she was the one operating From then on, complainant constantly followed-up his case with Attys.
and managing their transportation business of three trucks since as Cruz-Angeles and Paler. However, despite his constant prodding, Attys.
early as 1952, some years before the filing of the complaint on January Cruz-Angeles and Paler could not present any petition and instead,
18, 1956. 14 In effect, the widow, Leonarda Manit had then submitted offered excuses for the delay, saying that: (a) they still had to look for a
herself to the Court's jurisdiction, asserting as she did that she was the psychologist to examine Mutya; (b) they were still looking for a "friendly"
one operating the business and that her husband had no business of his court and public prosecutor; and (c) they were still deliberating where to
own. The widow and her three children of age as heirs of the deceased file the case.[3] They promised that the petition would be filed on or
cannot therefore claim ignorance of the pendency of the case, and that before the end of June 2004, but such date passed without any petition
notwithstanding that she was the actual operator and manager of the being filed. As an excuse, they reasoned out that the petition could not
business, that she has been kept in complete ignorance of its be filed since they have yet to talk to the judge who they insinuated will
subsequent developments, after her husband's death over 10 years favorably resolve complainant's petition.[4]
ago. Almost 10 years have elapsed since they were substituted in 1959
as defendants for the deceased, and it taxes all credibility for them to
claim now in their brief that "said new defendants did not even know that Sometime in the third week of July 2004, Attys. Cruz-Angeles and Paler
they became parties in the Amended Complaint," 15 and that all this asked for an additional payment of P250,000.00 in order for them to
time not the slightest effort was made by them to find out from Atty. continue working on the case. Hoping that his petition would soon be
Garcia or from the Court for that matter what had happened to the case filed, complainant dutifully paid the said amount on July 23, 2004, which
nor did Atty. Garcia in compliance with his duty as an officer of the Court was again received by Atty. Cruz-Angeles.[5] However, to complainant's
inform them of the decision handed down by the Court Over 9 years dismay, no appreciable progress took place. When complainant inquired
ago. Having failed to appear on the day set for trial without any about the delay in the filing of the case, Atty. Cruz-Angeles attempted to
justifiable explanation to the Court nor having presented an affidavit of ease his worries by saying that the draft petition was already submitted
merits as to the existence of valid and lawful defenses, they cannot now to the judge for editing and that the petition will soon be finalized.[6]
complain of having been deprived of their day in Court.
Barredo, J., concurs in the result. Utterly frustrated with the delay in the filing of his petition for annulment,
complainant went to respondents' law office to terminate their
People vs nadera (see pdf) engagement and to demand for a refund of the aggregate amount of
P350,000.00 he earlier paid them. However, Attys. Cruz-Angeles and
Paler refused to return the said amount, and to complainant's surprise,
sent him two (2) billing statements dated October 5, 2004[8] and
October 10, 2004[9] in the amounts of P258,000.00 and P324,000.00,
respectively. Notably, the October 5, 2004 billing statement included a
fee for "consultants (prosecutors)" amounting to P45,000.00.[10] In view
of the foregoing, complainant filed the instant Complaint-Affidavit before Rule 18.03 – A lawyer shall not neglect a legal matter entrusted to him,
the IBP-CBD, docketed as CBD Case No. 05-1426. and his negligence in connection therewith shall render him liable.
Case law exhorts that, "once a lawyer takes up the cause of his client,
he is duty-bound to serve the latter with competence, and to attend to
In her defense,[11] Atty. Cruz-Angeles admitted to have received a total such client's cause with diligence, care, and devotion whether he
of P350,000.00 from complainant,[12] but denied that she was remiss in accepts it for a fee or for free. He owes fidelity to such cause and must
her duties, explaining that the delay in the filing of the petition for always be mindful of the trust and confidence reposed upon him.
annulment of marriage was due to complainant's failure to give the Therefore, a lawyer's neglect of a legal matter entrusted to him by his
current address of Mutya and provide sufficient evidence to support the client constitutes inexcusable negligence for which he must be held
petition.[13] Further, Atty. Cruz-Angeles alleged that it was Atty. Paler administratively liable,"[25] as in this case.
who was tasked to draft and finalize the petition.[14] For his part,[15]
Atty. Paler moved for the dismissal of the case for failure to state a
cause of action, arguing too that complainant filed the present
administrative complaint only to avoid payment of attorney's fees.[16] In this relation, Attys. Cruz-Angeles and Paler also violated Rules 16.01
and 16.03, Canon 16 of the CPR when they failed to return to
complainant the amount of P350,000.00 representing their legal fees,
viz. :
The IBP's Report and Recommendation
CANON 16 – A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND
PROPERTIES OF HIS CLIENT THAT MAY COME INTO HIS
POSSESSION.
In a Report and Recommendation[17] dated July 10, 2012, the IBP
Investigating Commissioner found Attys. Cruz-Angeles and Paler
administratively liable and, accordingly, recommended that they be
meted the penalty of suspension from the practice of law for four (4) Rule 16.01 – A lawyer shall account for all money or property collected
months. However, Atty. Grandea was exonerated of any liability as his or received for or from the client.
participation in the charges has not been discussed, much less proven.
[18]
Rule 16.03– A lawyer shall deliver the funds and property of his client
when due or upon demand, x x x.
The Investigating Commissioner found that complainant indeed
engaged the services of Attys. Cruz-Angeles and Paler in order to annul It bears stressing that "the relationship between a lawyer and his client
his marriage with his wife, Mutya. Despite receiving the aggregate is highly fiduciary and prescribes on a lawyer a great fidelity and good
amount of P350,000.00 from complainant, Attys. Cruz-Angeles and faith. The highly fiduciary nature of this relationship imposes upon the
Paler neglected the legal matter entrusted to them, as evidenced by lawyer the duty to account for the money or property collected or
their failure to just even draft complainant's petition for annulment received for or from his client. Thus, a lawyer's failure to return upon
despite being engaged for already five (5) long months.[19] Moreover, demand the funds held by him on behalf of his client, as in this case,
as pointed out by the Investigating Commissioner, despite their gives rise to the presumption that he has appropriated the same for his
preliminary assessment that complainant's petition would not likely own use in violation of the trust reposed in him by his client. Such act is
prosper, Attys. Cruz-Angeles and Paler still proceeded to collect an a gross violation of general morality, as well as of professional
additional P250,000.00 from complainant. Worse, they even billed him ethics."[26]
an exorbitant sum of P324,000.00.[20] Thus, the Investigating
Commissioner opined that the amounts respondents had already
collected and would still want to further collect from complainant can
Furthermore, Attys. Cruz-Angeles and Paler misrepresented to
hardly be spent for research in connection with the annulment case that
complainant that the delay in the filing of his petition for annulment was
was not filed at all. Neither can they cover just fees for Attys. Cruz-
due to the fact that they were still looking for a "friendly" court, judge,
Angeles and Paler who did nothing to serve complainant's cause.[21]
and public prosecutor who will not be too much of a hindrance in
achieving success in the annulment case. In fact, in the two (2) billing
statements dated October 5, 2004[27] and October 10, 2004,[28] Attys.
In a Resolution[22] dated September 28, 2013, the IBP Board of Cruz-Angeles and Paler made it appear that they went to various
Governors adopted and approved the aforesaid Report and locations to look for a suitable venue in filing the said petition, and even
Recommendation, with modification increasing the recommended paid various amounts to prosecutors and members of the National
penalty to two (2) years suspension from the practice of law. Atty. Cruz- Bureau of Investigation to act as their "consultants." Such
Angeles moved for reconsideration,[23] which was, however, denied in a misrepresentations and deceits on the part of Attys. Cruz-Angeles and
Resolution[24] dated June 7, 2015. Paler are violations of Rule 1.01, Canon 1 of the CPR, viz.:
CANON 1 – A lawyer shall uphold the constitution, obey the laws of the
land and promote respect for law and legal processes.
The Issue Before the Court
Facts:
Anent the proper penalty for Attys. Cruz-Angeles and Paler,
jurisprudence provides that in similar cases where lawyers neglected
their client's affairs, failed to return the latter's money and/or property In a Criminal case, a certain Norma Trajano alleged that she paid 20k to
despite demand, and at the same time committed acts of private complainant Del Rosario and the balance of 16.5k was delivered
misrepresentation and deceit against their clients, the Court imposed to Atty. Uy, the lawyer of private complainant in the said case.
upon them the penalty of suspension from the practice of law for a
period of two (2) years. In Jinon v. Jiz [34] the Court suspended the
lawyer for a period of two (2) years for his failure to return the amount
his client gave him for his legal services which he never performed. Complainant Del Rosario manifested that she did not receive the 16.5k
Also, in Agot v. Rivera, [35] the Court suspended the lawyer for a period pesos that was paid to Atty. Uy.
of two (2) years for his (a) failure to handle the legal matter entrusted to
him and to return the legal fees in connection therewith; and (b)
misrepresentation that he was an immigration lawyer, when in truth, he
Atty. Uy however argued that his client was the one that did not accept
was not. Finally, in Spouses Lopez v. Limos, [36] the Court suspended
the money since they wanted to receive the whole amount. But such an
the erring lawyer for three (3) years for her failure to file a petition for
assertion was belied when Del Rosario manifested her willingness to
adoption on behalf of complainants, return the money she received as
accept the money.
legal fees, and for her commission of deceitful acts in misrepresenting
that she had already filed such petition when nothing was actually filed,
resulting in undue prejudice to therein complainants. In this case, not
only did Attys. Cruz-Angeles and Paler fail to file complainant's petition Atty. Uy alleged that the amount was safely in his office in the same
for annulment of marriage and return what the latter paid them as legal building. As such, the proceedings were suspended in order for Uy to
fees, they likewise misrepresented that they can find a court, judge, and get the money from his office. Yet, Atty. Uy never returned hence the
prosecutor who they can easily influence to ensure a favorable administrative case against him.
resolution of such petition, to the detriment of the judiciary and the
national prosecutorial service. Under these circumstances, the Court
individually imposes upon Attys. Cruz-Angeles and Paler the penalty of
suspension from the practice of law for a period of three (3) years. In his comment, Atty. Uy contends that he kept the money in his office
because it was the wish of his client. He allegedly informed them of
such money and tried to give it to them but they insisted that he retain it
in order for them to not spend it.
Finally, the Court sustains the IBP's recommendation ordering Attys.
Cruz-Angeles and Paler to return the amount of P350,000.00 they
received from complainant as legal fees. It is well to note that "while the
Court has previously held that disciplinary proceedings should only The Office of the Bar Confidant recommended that Atty. Uy be
revolve around the determination of the respondent-lawyer's suspended for one month. It was decided that the complainant’s side of
administrative and not his civil liability, it must be clarified that this rule the story had more merit.
remains applicable only to claimed liabilities which are purely civil in
nature – for instance, when the claim involves moneys received by the
lawyer from his client in a transaction separate and distinct and not Issue: WON Uy is guilty of violating Canon 16 of the CPR
intrinsically linked to his professional engagement."[37] Hence, since
Attys. Cruz-Angeles and Paler received the aforesaid amount as part of
their legal fees, the Court finds the return thereof to be in order.
Held:
Respondent failed to promptly report and account for the 16.5k he had
received fromTrajano on behalf of his client. On 4 July 1990, the complainants agreed to the request of Atty. Jacinto
and were presented by the latter with a Real Estate Mortgage Contract
and a Transfer Certificate of Title No. 127275 in the name of
Concepcion G. Padilla. The amount of PhP 285,000.00 was given by the
If it were true that Del Rosario was informed about the payment and that
spouses to the respondent in cash (PhP 270,000.00) and a PBCom
she entrusted it to Atty. Uy, she would have known his whereabouts.
check no. 713929 for PhP 15,000.00.
That she did not know it showed falsity of the claim.
In this light, the Court must stress that it has the duty to look into
dealings between attorneys and their clients and to guard the latter from
any undue consequences resulting from a situation in which they may The complainants’ evidence also included the sworn statements of
stand unequal. Estrella Ermino Palipada, the secretary of the respondent at the Neri
Law Office, and Avegail Payos, a housemaid of Atty. Jacinto. Ms.
Palipada stated that:chanrob1es virtual 1aw library
In the present case, the records merely show that respondent did not
promptly report that he received money on behalf of his client. There is
no clear evidence of misappropriation. Under the circumstances, Atty. 1. she was the one who prepared the Real Estate Mortgage
Uy should be suspended for only one month. Contract and the Receipt of the loan upon the instruction of the
respondent;
[Adm. Case No. 5235. March 22, 2000.]
2. she was a witness to the transaction and never once saw the
FERNANDO C. CRUZ AND AMELIA CRUZ, Complainants, v. ATTY. person of Concepcion G. Padilla, the alleged mortgagor; and that
ERNESTO C. JACINTO, Respondent.
Avegail Payos, the housemaid of the respondent, in turn stated that she
was the one who simulated the signature of one Emmanuel Gimarino,
MELO, J.: the Deputy Register of Deeds of Quezon City upon the instruction of
Atty. Jacinto. This was done to make it appear that the real estate
mortgage was registered and the annotation to appear at the back of the
TCT as an encumbrance.
The defense of the respondent, on the other hand, was embodied in his
Answer with Motion to Dismiss filed with the Commission on Bar
This is a disbarment case filed by the spouses Fernando and Amelia Discipline. Therein, he alleged that the criminal information for estafa
Cruz against Atty. Ernesto C. Jacinto. This case was filed with the thru falsification filed against him had already been dismissed because
Commission on Bar Discipline last 30 January 1991. of the voluntary desistance of the complainants.
The evidence of the complainants show that sometime in June 1990, In his version of the facts, Atty. Jacinto averred that while he indeed
Atty. Ernesto Jacinto, lawyer of the couple in an unrelated case, facilitated the loan agreement between the Cruz spouses and
requested the Cruz spouses for a loan in behalf of a certain Concepcion Concepcion G. Padilla, he had no idea that the latter would give a
G. Padilla, who he claimed to be an old friend as she was allegedly in falsified Certificate of Title and use it to obtain a loan. He claimed that he
need of money. The loan requested was for PhP 285,000.00 payable himself was. a victim under the circumstances.
after 100 days for PhP 360,000 to be secured by a real estate mortgage
on a parcel of land located at Quezon City.
Respondent further alleged that he had not been remiss nor negligent in Since the practice of law is inseparably connected with the exercise of
collecting the proceeds of the loan; that in fact, he had even advanced its judicial power in administration of justice, the Court cannot be
the full payment of the loan due to the complainants from his own divested of its constitutionally ordained prerogative which includes the
savings, even if Concepcion G. Padilla had not yet paid, much less authority to discipline, suspend or disbar any unfit and unworthy
found. member of the Bar by a mere execution of affidavits of voluntary
desistance and quitclaim (par. [5], Sec. 5, 1987 Constitution).
RECOMMENDATIONS
A lawyer may he disciplined or suspended for any misconduct, whether
in his professional or private capacity, which shows him to be wanting in
moral character, in honesty, in probity and good demeanor, thus
It is every lawyer’s sworn duty to obey the laws of the and to promote rendering unworthy to continue as an officer of the court (Maligsa v.
respect for law and legal processes. The Code of Professional Cabanting, 272 SCRA 408 [1997]), and the complainants who called the
Responsibility command that he shall not engage in unlawful, dishonest, attention of the Court to the attorney’s alleged misconduct are in no
immoral or deceitful conduct. (Rule 1.01, Code of Professional sense a party, and have generally no interest in the outcome except as
Responsibility) all good citizens may have in the proper administration of justice
(Rayos-Ombac v. Rayos, 285 SCRA 93 [1998]).
In the instant case, there was a clear yet unrebutted allegation in the
complaint that the Respondent had ordered his secretary and Undeniably, respondent represented complainants in the loan
housemaid to falsify the signatures of the notary public and the Deputy transaction. By his own admission, he was the one who negotiated with
Register of Deeds respectively to make it appear that the real estate the borrower, his long-time friend and a former client. He acted not
mortgage contract was duly registered and thus binding. merely as an agent but as a lawyer of complainants, thus, the execution
of the real estate mortgage contract, as well as its registration and
annotation on the title were entrusted to him In fact, respondent even
While it may be true that the complaint for Estafa thru Falsification filed received his share in the interest earnings which complainants realized
against the Respondent had been dismissed, the dismissal was from the transaction. His refusal to recognize any wrongdoing or
because of the complainant’s voluntary desistance and not a finding of carelessness by claiming that he is likewise a victim when it was shown
innocence. It neither confirms nor denies Respondent’s non-culpability. that the title to the property, the registration of the real estate mortgage
Furthermore, it is well-settled that disciplinary proceedings are "sui contract, and the annotation thereon were all feigned, will not at all
generis", the primary object of which is not so much to punish the exonerate him.
individual attorney himself, as to safeguard the administration of justice
by protecting the court and the public from the misconduct of lawyers
and to remove from the professions persons whose disregard of their As a rule, a lawyer is not barred from dealing with his client but the
oath have proven them unfit to continue discharging the trust reposed in business transaction must be characterized with utmost honesty and
them as members of the bar. Thus, disciplinary cases may still proceed good faith. However, the measure of good faith which an attorney is
despite the dismissal of civil and/or criminal cases against a required to exercise in his dealings with his client is a much higher
lawyer.chanroblesvirtuallawlibrary standard than is required in business dealings where the parties trade at
arms length. Business transactions between an attorney and his client
are disfavored and discouraged by the policy of the law. Hence, courts
A lawyer who does any unlawful fraudulent or dishonest act may and carefully watch these transactions to be sure that no advantage is taken
should be held administratively liable therefor. In the case at bar, the by a lawyer over his client. This rule is founded on public policy for, by
Respondent should not be made an exception. While it may be shown virtue of his office, an attorney is in an easy position to take advantage
that he indeed advanced the payment due to his erstwhile clients, such of the credulity and ignorance of his client. Thus, no presumption of
will not exempt him from administrative liability. At best it can only innocence or improbability of wrongdoing is considered in an attorney’s
mitigate. Respondent is recommended to be suspended for six (6) favor (Nakpit v. Valdes, 286 SCRA 758 [1998]). Further, his fidelity to the
months from the practice of law. cause of his client requires him to be evermindful of the responsibilities
that should be expected of him.
Although it was on December 23, 1922, that Diaz and Kapunan entered
into the agreement, Diaz could only wait until January 4, 1923, following,
Attorney-General Villa-Real for the Government. to lay before this court charges against Attorney Kapunan for alleged
unprofessional conduct. Undoubtedly, before Kapunan had knowledge
Perfecto Gabriel and Rafael Palma for respondent. of the disbarment proceedings, on January 10, 1923, he presented a
motion in the Court of First Instance of Leyte asking that he be permitted
to retain the P500 in question, in part payment of his professional fees.
Later, on February 4, 1923, when Kapunan must have had knowledge of
the disbarment proceedings, he filed another motion, withdrawing his
MALCOLM, J.: former motion and asking the court to permit him to turn over the P500
to Diaz, which Judge Causing refused to do on the ground that it was a
personal matter. Nevertheless, on July 10, 1923, the clerk of the Court
of First Instance of Leyte handed the P500 to Diaz who, in turn,
This action for malpractice brought by Vicente Diaz against Attorney receipted for that amount. lawphil.net
Ruperto Kapunan, has to do with the conduct of Attorney Kapunan
during the legal proceedings which followed the business troubles of
Vicente Diaz and Secundino de Mendezona, and particularly relates to
the conduct of Attorney Kapunan in civil case No. 2098 of the Court of From correspondence, it further is evident that the family of Mendezona
First Instance of Leyte. The ultimate question on which we would was led to believe that the P500 would shortly be sent them. Without
concentrate attention concerns the agreement between Diaz and doubt, the Mendezona family would have been gratified to receive even
Kapunan at the time of the sale of the property of Mendoza, whereby the P500 pittance out of the business wreck in Leyte of the senior
Kapunan, on the promise of Diaz to pay him P1,000, agreed to desist Mendezona.
from further participation in the sale, all in alleged violation of article
1459 of the Civil Code and article 542 of the Penal Code.
During much of the time here mentioned, Kapunan was the attorney of
Mendezona. Kapunan was given extensive authority by the letter of
Omitting the irrelevant matter interjected into this case, the principal Mendezona of April 12, 1919. When Kapunan took part in the sale, it
facts of record are the following: must be assumed that he was bidding in representation of his client and
for the benefit of the client.
ATTY. CESILO A. ADAZA, respondent. This Court is in full accord with the findings and recommendation of the
IBP that respondent lawyer has sufficiently demonstrated conduct
showing his unfitness for the confidence and trust which characterize
the attorney-client relationship. His act of requiring complainants to pay
RESOLUTION
an exorbitant amount on the pretext that it was needed for the payment
of court fees which were not even substantiated by proper official
receipts, constitutes malpractice which is a serious breach of
MELO, J.: professional duty toward complainants whose trust respondent
disregarded and violated. Respondent expressly admitted having
received the money, but he persistently refused to return the same
despite repeated demands by the complainants. This conduct of the
At bar is an administrative complaint for disbarment filed by the respondent is clearly indicative of lack of integrity and moral soundness,
complainant spouses Leonito and Primrose Gonato against their former as he was clinging to something which was not his and to which he
counsel, Atty. Cesilo A. Adaza, charging him with malpractice and absolutely had no right. Respondent's shallow excuse that he applied
violation of trust. Pursuant to Rule 139-B of the Rules of Court and the said money to his attorney's fees is merely all afterthought and cannot
Resolution of the Court dated December 1, 1993, the present justify his refusal to return the same, as this was made without the
administrative case was referred to the Integrated Bar of the Philippines acquiescence of the complainants. It is settled that the conversion by a
(IBP) for investigation, report, and recommendation. lawyer of funds entrusted to him is a gross violation of professional
ethics and a betrayal of public confidence in the legal profession (Obia
vs. Catimbang, 196 SCRA 23 [1991]). Likewise, respondent offered no
It appears that sometime in February, 1993, complainants engaged the solid proof to support his denial that he delivered the two falsified
services of respondent as their counsel in Civil Case No. 92-263 entitled receipts to complainants.
"Goking vs. Yacapin, et al." filed with the Regional Trial Court of Misamis
Oriental, wherein complainants were among the defendants in said
case. Complainants alleged that respondent demanded from them the Canon 7 of the Code of Professional Responsibility mandates that "a
sum of P15,980.00 to be used in paying the docket fee and other court lawyer shall at all times uphold the integrity and dignity of the legal
fees in connection with the aforementioned case. Said amount was profession." The trust and confidence necessarily reposed by clients
loaned to complainants by a friend, Vic Manzano, who delivered the require in the lawyer a high standard and appreciation of his duty to
same to respondent, as evidenced by an acknowledgment receipt dated them. To this end, nothing should be done by any member of the legal
February 10, 1993 and signed by respondent's secretary, Mayette fraternity which might tend to lessen in any degree the confidence of the
Salceda. Thereafter, complainants asked for the official receipts public in the fidelity, honesty, and integrity of the profession. (Marcelo vs.
evidencing the amount of court fees purportedly paid by respondent. Vic Javier, Sr., 214 SCRA 1 [1992]).
Manzano told complainants that respondent only gave him photocopies
of two Republic of the Philippines receipts with numbers 9627143
(Exhibit "C") dated February 11, 1993, in the amount of P15,830.00; and
The facts and evidence obtaining in this case glaringly reveal recommended that respondent be suspended for three years from the
respondent's failure to live up to his duties as a lawyer in consonance practice of law.4
the strictures of his oath and the Code of Professional Responsibility,
particularly Canon 16 which provides that "a lawyer shall hold in trust all
moneys and properties of his client that may come into his possession."
As a member of the Bar, respondent was and is expected to always live In the Report, Commissioner Funa found that:
up to the standards embodied in said Code particularly Canons 15, 16,
17 and 20, for the relationship between an attorney and his client is
highly fiduciary in nature and demands utmost fidelity and good faith During the hearing conducted, Complainant alleged that she has
(Igual vs. Javier, 254 SCRA 416 [1996]). The Court believes that a remitted to Respondent, on various dates, amounts of money totaling to
longer period of suspension than that recommended by the IBP is called more or less P270,000.00.
for under the circumstances.1âwphi1
RESOLUTION
During the hearing conducted, Complainant reiterated her accusations
against the Respondent and expressed that she has been aggrieved
AUSTRIA-MARTINEZ, J.: and misled by Respondent. According to Complainant, this was made
possible because she was not aware of or knowledgeable on legal
matters and practices. Respondent has only offered denials to the
charges. However, the circumstances gives credibility to herein
Before this Court is a disbarment case filed against Atty. Santiago C. Complainant in the absence of any evil motive on her part.
Soriano (respondent) for gross misconduct.
Respondent's failure to return the money to complainant upon demand These canons shall apply to lawyers in government services in the
gave rise to the presumption that he misappropriated it for his own use discharge of their official tasks.
to the prejudice of, and in violation of the trust reposed in him by his
client.13 It is a gross violation of general morality and of professional
ethics and impairs public confidence in the legal profession which
deserves punishment.14 As stated by the IBP Committee that drafted the Code, "a lawyer does
not shed his professional obligations upon assuming public office. In
fact, his public office should make him more sensitive to his professional
obligations because a lawyer's disreputable conduct is more likely to be
As the Court has pronounced, when a lawyer receives money from the magnified in the public's eye. 3 Want of moral integrity is to be more
client for a particular purpose, the lawyer is bound to render an severely condemned in a lawyer who holds a responsible public office. 4
accounting to the client showing that the money was spent for a
particular purpose. And if he does not use the money for the intended
purpose, the lawyer must immediately return the money to his client.15
ACCORDINGLY, this Court REPRIMANDS respondent with a STERN
WARNING that the commission of the same or similar offense will be
dealt with more severely in the future.
The Court has been exacting in its demand for integrity and good moral
character of members of the Bar who are expected at all times to uphold
the integrity and dignity of the legal profession and refrain from any act
or omission which might lessen the trust and confidence reposed by the LET copies of this decision be spread in his records and copies be
public in the fidelity, honesty, and integrity of the legal profession. furnished the Department of Justice and the Office of the Bar Confidant.
Indeed, membership in the legal profession is a privilege.16 The
attorney-client relationship is highly fiduciary in nature. As such, it
requires utmost good faith, loyalty, fidelity and disinterestedness on the
SO ORDERED.
part of the lawyer.17
In Small v. Banares18 the respondent was suspended for two years for
violating Canon 16 of the CPR, particularly for failing to file a case for G.R. No. L-35702 May 29, 1973
which the amount of P80,000.00 was given him by his client, and for
failing to return the said amount upon demand. Considering that similar
circumstances are attendant in this case, the Court finds the Resolution
of the IBP imposing on respondent a two-year suspension to be in order. DOMINGO D. RUBIAS, plaintiff-appellant,
vs.
WHEREFORE, respondent Atty. Santiago C. Soriano is found GUILTY ISAIAS BATILLER, defendant-appellee.
of violating Canon 16 of the Code of Professional Responsibility and is
hereby SUSPENDED from the practice of law for a period of two (2)
years from notice, with a STERN WARNING that a repetition of the
same or similar acts shall be dealt with more severely. Gregorio M. Rubias for plaintiff-appellant.
Respondent is further ordered to restitute to his clients through Andrea Vicente R. Acsay for defendant-appellee.
Balce Celaje, within 30 days from notice, the amount of P5,800.00.
Respondent is directed to submit to the Court proof of payment within
fifteen days from payment of the full amount.
TEEHANKEE, J.:
by the Director of Lands, the Director of Forestry and other oppositors.
However, during the war with Japan, the record of the case was lost
In this appeal certified by the Court of Appeals to this Court as involving before it was heard, so after the war Francisco Militante petitioned this
purely legal questions, we affirm the dismissal order rendered by the court to reconstitute the record of the case. The record was
Iloilo court of first instance after pre-trial and submittal of the pertinent reconstituted on the Court of the First Instance of Iloilo and docketed as
documentary exhibits. Land Case No. R-695, GLRO Rec. No. 54852. The Court of First
Instance heard the land registration case on November 14, 1952, and
after the trial this court dismissed the application for registration. The
appellant, Francisco Militante, appealed from the decision of this Court
Such dismissal was proper, plaintiff having no cause of action, since it
to the Court of Appeals where the case was docketed as CA-GR No.
was duly established in the record that the application for registration of
13497-R..
the land in question filed by Francisco Militante, plaintiff's vendor and
predecessor interest, had been dismissed by decision of 1952 of the
land registration court as affirmed by final judgment in 1958 of the Court
of Appeals and hence, there was no title or right to the land that could 3. Pending the disposal of the appeal in CA-GR No. 13497-R
be transmitted by the purported sale to plaintiff. and more particularly on June 18, 1956, Francisco Militante sold to the
plaintiff, Domingo Rubias the land technically described in psu-99791
(Exh. "A"). The sale was duly recorded in the Office of the Register of
Deeds for the province of Iloilo as Entry No. 13609 on July 11, 1960
As late as 1964, the Iloilo court of first instance had in another case of
(Exh. "A-1").
ejectment likewise upheld by final judgment defendant's "better right to
possess the land in question . having been in the actual possession
thereof under a claim of title many years before Francisco Militante sold
the land to the plaintiff." (NOTE: As per deed of sale, Exh. A, what Militante purportedly sold to
plaintiff-appellant, his son-in-law, for the sum of P2,000.00 was "a parcel
of untitled land having an area Of 144.9072 hectares ... surveyed under
Psu 99791 ... (and) subject to the exclusions made by me, under (case)
Furthermore, even assuming that Militante had anything to sell, the
CA-i3497, Land Registration Case No. R-695, G.L.R.O. No. 54852,
deed of sale executed in 1956 by him in favor of plaintiff at a time when
Court of First Instance of the province of Iloilo. These exclusions
plaintiff was concededly his counsel of record in the land registration
referred to portions of the original area of over 171 hectares originally
case involving the very land in dispute (ultimately decided adversely
claimed by Militante as applicant, but which he expressly recognized
against Militante by the Court of Appeals' 1958 judgment affirming the
during the trial to pertain to some oppositors, such as the Bureau of
lower court's dismissal of Militante's application for registration) was
Public Works and Bureau of Forestry and several other individual
properly declared inexistent and void by the lower court, as decreed by
occupants and accordingly withdrew his application over the same. This
Article 1409 in relation to Article 1491 of the Civil Code.
is expressly made of record in Exh. A, which is the Court of Appeals'
decision of 22 September 1958 confirming the land registration court's
dismissal of Militante's application for registration.)
The appellate court, in its resolution of certification of 25 July 1972, gave
the following backgrounder of the appeal at bar:
4. On September 22,1958 the Court of appeals in CA-G.R. No.
13497-R promulgated its judgment confirming the decision of this Court
On August 31, 1964, plaintiff Domingo D. Rubias, a lawyer, filed a suit to in Land Case No. R-695, GLRO Rec. No. 54852 which dismissed the
recover the ownership and possession of certain portions of lot under application for Registration filed by Francisco Militante (Exh. "I").
Psu-99791 located in Barrio General Luna, Barotac Viejo, Iloilo which he
bought from his father-in-law, Francisco Militante in 1956 against its
present occupant defendant, Isaias Batiller, who illegally entered said
5. Domingo Rubias declared the land described in Exh. 'B' for
portions of the lot on two occasions — in 1945 and in 1959. Plaintiff
taxation purposes under Tax Dec. No. 8585 (Exh. "C") for 1957; Tax
prayed also for damages and attorneys fees. (pp. 1-7, Record on
Dec. Nos. 9533 (Exh. "C-1") and 10019 (Exh. "C-3")for the year 1961;
Appeal). In his answer with counter-claim defendant claims the
Tax Dec. No. 9868 (Exh. "C-2") for the year 1964, paying the land taxes
complaint of the plaintiff does not state a cause of action, the truth of the
under Tax Dec. No. 8585 and 9533 (Exh. "D", "D-1", "G-6").
matter being that he and his predecessors-in-interest have always been
in actual, open and continuous possession since time immemorial under
claim of ownership of the portions of the lot in question and for the
alleged malicious institution of the complaint he claims he has suffered 6. Francisco Militante immediate predecessor-in-interest of the
moral damages in the amount of P 2,000.00, as well as the sum of plaintiff, has also declared the land for taxation purposes under Tax Dec.
P500.00 for attorney's fees. ... No. 5172 in 1940 (Exh. "E") for 1945; under Tax Dec. No. T-86 (Exh. "E-
1") for 1948; under Tax Dec. No. 7122 (Exh. "2"), and paid the land
taxes for 1940 (Exhs. "G" and "G-7"), for 1945 46 (Exh. "G-1") for 1947
(Exh. "G-2"), for 1947 & 1948 (Exh. "G-3"), for 1948 (Exh. "G-4"), and
On December 9, 1964, the trial court issued a pre-trial order, after a pre-
for 1948 and 1949 (Exh. "G-5").
trial conference between the parties and their counsel which order reads
as follows..
2. Before the war with Japan, Francisco Militante filed with the 9. The land claimed by the defendant as his own was surveyed
Court of First Instance of Iloilo an application for the registration of the on June 6 and 7,1956, and a plan approved by Director of Land on
title of the land technically described in psu-99791 (Exh. "B") opposed November 15, 1956 was issued, identified as Psu 155241 (Exh. "5").
10. On April 22, 1960, the plaintiff filed forcible Entry and Detainer The appellate court further related the developments of the case, as
case against Isaias Batiller in the Justice of the Peace Court of Barotac follows:
Viejo Province of Iloilo (Exh. "4") to which the defendant Isaias Batiller
riled his answer on August 29, 1960 (Exh. "4-A"). The Municipal Court of
Barotac Viejo after trial, decided the case on May 10, 1961 in favor of
the defendant and against the plaintiff (Exh. "4-B"). The plaintiff On August 17, 1965, defendant's counsel manifested in open court that
appealed from the decision of the Municipal Court of Barotac Viejo before any trial on the merit of the case could proceed he would file a
which was docketed in this Court as Civil Case No. 5750 on June 3, motion to dismiss plaintiff's complaint which he did, alleging that plaintiff
1961, to which the defendant, Isaias Batiller, on June 13, 1961 filed his does not have cause of action against him because the property in
answer (Exh. "4-C"). And this Court after the trial. decided the case on dispute which he (plaintiff) allegedly bought from his father-in-law,
November 26, 1964, in favor of the defendant, Isaias Batiller and Francisco Militante was the subject matter of LRC No. 695 filed in the
against the plaintiff (Exh. "4-D"). CFI of Iloilo, which case was brought on appeal to this Court and
docketed as CA-G.R. No. 13497-R in which aforesaid case plaintiff was
the counsel on record of his father-in-law, Francisco Militante. Invoking
Arts. 1409 and 1491 of the Civil Code which reads:
(NOTE: As per Exh. 4-B, which is the Iloilo court of first instance
decision of 26 November 1964 dismissing plaintiff's therein complaint for
ejectment against defendant, the iloilo court expressly found "that
plaintiff's complaint is unjustified, intended to harass the defendant" and 'Art. 1409. The following contracts are inexistent and void from the
"that the defendant, Isaias Batiller, has a better right to possess the land beginning:
in question described in Psu 155241 (Exh. "3"), Isaias Batiller having
been in the actual physical possession thereof under a claim of title
many years before Francisco Militante sold the land to the plaintiff- xxx xxx xxx
hereby dismissing plaintiff's complaint and ordering the plaintiff to pay
the defendant attorney's fees ....")
B. During the trial of this case on the merit, the plaintiff will prove
by competent evidence the following:
'ART. 1491. The following persons cannot acquire any
purchase, even at a public auction, either in person of through the
mediation of another: .
1. That the land he purchased from Francisco Militante under
Exh. "A" was formerly owned and possessed by Liberato Demontaño
but that on September 6, 1919 the land was sold at public auction by
virtue of a judgment in a Civil Case entitled "Edw J. Pflieder plaintiff vs. xxx xxx xxx
Liberato Demontaño Francisco Balladeros and Gregorio Yulo,
defendants", of which Yap Pongco was the purchaser (Exh. "1-3"). The
sale was registered in the Office of the Register of Deeds of Iloilo on
(5) Justices, judges, prosecuting attorneys, clerks of superior and
August 4, 1920, under Primary Entry No. 69 (Exh. "1"), and a definite
inferior courts, and other officers and employees connected with the
Deed of Sale was executed by Constantino A. Canto, provincial Sheriff
administration of justice, the property and rights of in litigation or levied
of Iloilo, on Jan. 19, 1934 in favor of Yap Pongco (Exh. "I"), the sale
upon an execution before the court within whose jurisdiction or territory
having been registered in the Office of the Register of Deeds of Iloilo on
they exercise their respective functions; this prohibition includes the act
February 10, 1934 (Exh. "1-1").
of acquiring an assignment and shall apply to lawyers, with respect to
the property and rights which may be the object of any litigation in which
they may take part by virtue of their profession.'
2. On September 22, 1934, Yap Pongco sold this land to
Francisco Militante as evidenced by a notarial deed (Exh. "J") which
was registered in the Registry of Deeds on May 13, 1940 (Exh. "J-1").
defendant claims that plaintiff could not have acquired any interest in the
property in dispute as the contract he (plaintiff) had with Francisco
Militante was inexistent and void. (See pp. 22-31, Record on Appeal).
3. That plaintiff suffered damages alleged in his complaint. Plaintiff strongly opposed defendant's motion to dismiss claiming that
defendant can not invoke Articles 1409 and 1491 of the Civil Code as
Article 1422 of the same Code provides that 'The defense of illegality of
contracts is not available to third persons whose interests are not
C. Defendants, on the other hand will prove by competent directly affected' (See pp. 32-35 Record on Appeal).
evidence during the trial of this case the following facts:
3. That Lot No. 2, Psu 155241, the subject of Free Patent '1. The lower court erred in holding that the contract of sale
application of the defendant has been approved. between the plaintiff-appellant and his father-in-law, Francisco Militante,
Sr., now deceased, of the property covered by Plan Psu-99791, (Exh.
"A") was void, not voidable because it was made when plaintiff-appellant
was the counsel of the latter in the Land Registration case.
4. The damages suffered by the defendant, as alleged in his
counterclaim."'1
'2. The lower court erred in holding that the defendant-appellee is Manifestly, then plaintiff's complaint against defendant, to be declared
an interested person to question the validity of the contract of sale absolute owner of the land and to be restored to possession thereof with
between plaintiff-appellant and the deceased, Francisco Militante, Sr. damages was bereft of any factual or legal basis.
'3. The lower court erred in entertaining the motion to dismiss of 2. No error could be attributed either to the lower court's holding
the defendant-appellee after he had already filed his answer, and after that the purchase by a lawyer of the property in litigation from his client
the termination of the pre-trial, when the said motion to dismiss raised a is categorically prohibited by Article 1491, paragraph (5) of the
collateral question. Philippine Civil Code, reproduced supra;6 and that consequently,
plaintiff's purchase of the property in litigation from his client (assuming
that his client could sell the same since as already shown above, his
client's claim to the property was defeated and rejected) was void and
'4. The lower court erred in dismissing the complaint of the could produce no legal effect, by virtue of Article 1409, paragraph (7) of
plaintiff-appellant.' our Civil Code which provides that contracts "expressly prohibited or
declared void by law' are "inexistent and that "(T)hese contracts cannot
be ratified. Neither can the right to set up the defense of illegality be
The appellate court concluded that plaintiffs "assignment of errors gives waived."
rise to two (2) legal posers — (1) whether or not the contract of sale
between appellant and his father-in-law, the late Francisco Militante over
the property subject of Plan Psu-99791 was void because it was made The 1911 case of Wolfson vs. Estate of Martinez7 relied upon by plaintiff
when plaintiff was counsel of his father-in-law in a land registration case as holding that a sale of property in litigation to the party litigant's lawyer
involving the property in dispute; and (2) whether or not the lower court "is not void but voidable at the election of the vendor" was correctly held
was correct in entertaining defendant-appellee's motion to dismiss after by the lower court to have been superseded by the later 1929 case of
the latter had already filed his answer and after he (defendant) and Director of Lands vs. Abagat.8 In this later case of Abagat, the Court
plaintiff-appellant had agreed on some matters in a pre-trial conference. expressly cited two antecedent cases involving the same transaction of
Hence, its elevation of the appeal to this Court as involving pure purchase of property in litigation by the lawyer which was expressly
questions of law. declared invalid under Article 1459 of the Civil Code of Spain (of which
Article 1491 of our Civil Code of the Philippines is the counterpart) upon
challenge thereof not by the vendor-client but by the adverse parties
It is at once evident from the foregoing narration that the pre-trial against whom the lawyer was to enforce his rights as vendee thus
conference held by the trial court at which the parties with their counsel acquired.
agreed and stipulated on the material and relevant facts and submitted
their respective documentary exhibits as referred to in the pre-trial order,
supra,2 practically amounted to a fulldress trial which placed on record These two antecedent cases thus cited in Abagat clearly superseded
all the facts and exhibits necessary for adjudication of the case. (without so expressly stating the previous ruling in Wolfson:
The three points on which plaintiff reserved the presentation of evidence The spouses, Juan Soriano and Vicente Macaraeg, were the owners of
at the-trial dealing with the source of the alleged right and title of twelve parcels of land. Vicenta Macaraeg died in November, 1909,
Francisco Militante's predecessors, supra,3 actually are already made of leaving a large number of collateral heirs but no descendants. Litigation
record in the stipulated facts and admitted exhibits. The chain of between the surviving husband, Juan Soriano, and the heirs of Vicenta
Militante's alleged title and right to the land as supposedly traced back immediately arose, and the herein appellant Sisenando Palarca acted
to Liberato Demontaño was actually asserted by Militante (and his as Soriano's lawyer. On May 2, 1918, Soriano executed a deed for the
vendee, lawyer and son-in-law, herein plaintiff) in the land registration aforesaid twelve parcels of land in favor of Sisenando Palarca and on
case and rejected by the Iloilo land registration court which dismissed the following day, May 3, 1918, Palarca filed an application for the
Militante's application for registration of the land. Such dismissal, as registration of the land in the deed. After hearing, the Court of First
already stated, was affirmed by the final judgment in 1958 of the Court Instance declared that the deed was invalid by virtue of the provisions of
of Appeals.4 article 1459 of the Civil Code, which prohibits lawyers and solicitors from
purchasing property rights involved in any litigation in which they take
part by virtue of their profession. The application for registration was
The four points on which defendant on his part reserved the consequently denied, and upon appeal by Palarca to the Supreme
presentation of evidence at the trial dealing with his and his ancestors' Court, the judgement of the lower court was affirmed by a decision
continuous, open, public and peaceful possession in the concept of promulgated November 16,1925. (G.R. No. 24329, Palarca vs. Director
owner of the land and the Director of Lands' approval of his survey plan of Lands, not reported.)
thereof, supra,5 are likewise already duly established facts of record, in
the land registration case as well as in the ejectment case wherein the
Iloilo court of first instance recognized the superiority of defendant's right In the meantime cadastral case No. 30 of the Province of Tarlac was
to the land as against plaintiff. instituted, and on August 21, 1923, Eleuteria Macaraeg, as
administratrix of the estate of Vicente Macaraeg, filed claims for the
parcels in question. Buenaventura Lavitoria administrator of the estate
No error was therefore committed by the lower court in dismissing of Juan Soriano, did likewise and so did Sisenando Palarca. In a
plaintiff's complaint upon defendant's motion after the pre-trial. decision dated June 21, 1927, the Court of First Instance, Judge
Carballo presiding, rendered judgment in favor of Palarea and ordered
the registration of the land in his name. Upon appeal to this court by the
administration of the estates of Juan Soriano and Vicente Macaraeg, the
1. The stipulated facts and exhibits of record indisputably judgment of the court below was reversed and the land adjudicated to
established plaintiff's lack of cause of action and justified the outright the two estates as conjugal property of the deceased spouses. (G.R.
dismissal of the complaint. Plaintiff's claim of ownership to the land in No. 28226, Director of Lands vs. Abagat, promulgated May 21, 1928,
question was predicated on the sale thereof for P2,000.00 made in 1956 not reported.)9
by his father-in- law, Francisco Militante, in his favor, at a time when
Militante's application for registration thereof had already been
dismissed by the Iloilo land registration court and was pending appeal in
the Court of Appeals. In the very case of Abagat itself, the Court, again affirming the invalidity
and nullity of the lawyer's purchase of the land in litigation from his
client, ordered the issuance of a writ of possession for the return of the
land by the lawyer to the adverse parties without reimbursement of the
With the Court of Appeals' 1958 final judgment affirming the dismissal of price paid by him and other expenses, and ruled that "the appellant
Militante's application for registration, the lack of any rightful claim or title Palarca is a lawyer and is presumed to know the law. He must,
of Militante to the land was conclusively and decisively judicially therefore, from the beginning, have been well aware of the defect in his
determined. Hence, there was no right or title to the land that could be title and is, consequently, a possessor in bad faith."
transferred or sold by Militante's purported sale in 1956 in favor of
plaintiff.
Article 1491 of our Civil Code (like Article 1459 of the Spanish Civil
Code) prohibits in its six paragraphs certain persons, by reason of the Castan, quoting Manresa's own observation that.
relation of trust or their peculiar control over the property, from acquiring
such property in their trust or control either directly or indirectly and
"even at a public or judicial auction," as follows: (1) guardians; (2)
agents; (3) administrators; (4) public officers and employees; judicial "El fundamento do esta prohibicion es clarisimo. No sa trata con este
officers and employees, prosecuting attorneys, and lawyers; and (6) precepto tan solo de guitar la ocasion al fraude; persiguese, ademasel
others especially disqualified by law. proposito de rodear a las personas que intervienen en la
administrcionde justicia de todos los retigios que necesitan pora ejercer
su ministerio librandolos de toda suspecha, que aunque fuere in
fundada, redundura endescredito de la institucion." 16 arrives at the
In Wolfson which involved the sale and assignment of a money contrary and now accepted view that "Puede considerace en nuestro
judgment by the client to the lawyer, Wolfson, whose right to so derecho inexistente 'o radicalmente nulo el contrato en los siguentes
purchase the judgment was being challenged by the judgment debtor, cases: a) ...; b) cuando el contrato se ha celebrado en violacion de una
the Court, through Justice Moreland, then expressly reserved decision prescripcion 'o prohibicion legal, fundada sobre motivos de orden
on "whether or not the judgment in question actually falls within the publico (hipotesis del art. 4 del codigo) ..." 17
prohibition of the article" and held only that the sale's "voidability can not
be asserted by one not a party to the transaction or his representative,"
citing from Manresa 10 that "(C)onsidering the question from the point of
view of the civil law, the view taken by the code, we must limit ourselves It is noteworthy that Caltan's rationale for his conclusion that
to classifying as void all acts done contrary to the express prohibition of fundamental consideration of public policy render void and inexistent
the statute. Now then: As the code does not recognize such nullity by such expressly prohibited purchase (e.g. by public officers and
the mere operation of law, the nullity of the acts hereinbefore referred to employees of government property intrusted to them and by justices,
must be asserted by the person having the necessary legal capacity to judges, fiscals and lawyers of property and rights in litigation and
do so and decreed by a competent submitted to or handled by them, under Article 1491, paragraphs (4) and
(5) of our Civil Code) has been adopted in a new article of our Civil
court." 11 Code, viz, Article 1409 declaring such prohibited contracts as "inexistent
and void from the beginning." 18
... la prohibicion que el articulo 1459 del C.C. establece respecto a los As applied to the case at bar, the lower court therefore properly acted
administradores y apoderados, la cual tiene conforme a la doctrina de upon defendant-appellant's motion to dismiss on the ground of nullity of
esta Sala, contendia entre otras, en S. de 27-5-1959, un fundamento de plaintiff's alleged purchase of the land, since its juridical effects and
orden moral lugar la violacion de esta a la nulidad de pleno derecho del plaintiff's alleged cause of action founded thereon were being asserted
acto o negocio celebrado, ... y prohibicion legal, afectante orden against defendant-appellant. The principles governing the nullity of such
publico, no cabe con efecto alguno la aludida retification ... 13 prohibited contracts and judicial declaration of their nullity have been
well restated by Tolentino in his treatise on our Civil Code, as follows:
Footnotes
As gleaned from the record of the case and the report and
recommendation of the Solicitor General, the following facts are
A.M. No. 2430 August 30, 1990 uncontroverted:
MAURO P. MANANQUIL, complainant, That as early as March 21, 1961, respondent was retained as counsel of
record for Felix Leong, one of the heirs of the late Felomina Zerna, who
vs. was appointed as administrator of the Testate Estate of the Felomina
Zerna in Special No. 460 on May 22, 1961;
ATTY. CRISOSTOMO C. VILLEGAS, respondent.
That, a lease contract dated August 13, 1963 was executed between
Geminiano M. Eleccion for complainant. Felix Leong and the "Heirs of Jose Villegas" represented by
respondent's brother-in-law Marcelo Pastrano involving, among others,
sugar lands of the estate designated as Lot Nos. 1124, 1228, 2221,
2402, 3939, 3942 and 3957 of the Tanjay Cadastre;
RESOLUTION
That, the lifetime of the lease contract was FOUR (4) sugar crop years,
In a verified complaint for disbarment dated July 5, 1982, Mauro P. with a yearly rental of TEN PERCENT (10%) of the value of the sugar
Mananquil charged respondent Atty. Crisostomo C. Villegas with gross produced from the leased parcels of land;
misconduct or malpractice committed while acting as counsel of record
of one Felix Leong in the latter's capacity as administrator of the Testate
Estate of the late Felomina Zerna in Special Proceedings No. 460 That, on April 20, 1965, the formal partnership of HIJOS DE JOSE
before then Court of First Instance of Negros Occidental. The VILLEGAS was formed amongst the heirs of Jose Villegas, of which
complainant was appointed special administrator after Felix Leong died. respondent was a member;
In compliance with a resolution of this Court, respondent filed his That, on October 18, 1965, another lease contract was executed
comment to the complaint on January 20, 1983. After complainant filed between Felix Leong and the partnership HIJOS DE JOSE VILLEGAS,
his reply, the Court resolved to refer the case to the Solicitor General for containing basically the same terms and conditions as the first contract,
investigation, report and recommendation. with Marcelo Pastrano signing once again as representative of the
lessee;
In the pleadings submitted before the Court and the Office of the
Solicitor General, complainant alleges that over a period of 20 years, That, in the later part of 1980, respondent was replaced by his nephew
respondent allowed lease contracts to be executed between his client Geronimo H. Villegas as manager of the family partnership.
Felix Leong and a partnership HIJOS DE JOSE VILLEGAS, of which
respondent is one of the partners, covering several parcels of land of
the estate, i.e. Lots Nos. 1124, 1228, 2221, 2402, 3939, 3942 and 3957
Under the above circumstances, the Court finds absolutely no merit to
of the Tanjay Cadastre, under iniquitous terms and conditions.
complainant's charge, and the Solicitor General's finding, that
Moreover, complainant charges that these contracts were made without
respondent committed acts of misconduct in failing to secure the
the approval of the probate court and in violation of Articles 1491 and
approval of the court in Special Proceedings No. 460 to the various
1646 of the new Civil Code.
lease contracts executed between Felix Leong and respondent's family [Article 1491 of the new Civil Code; Emphasis supplied.]
partnership.
(1) The guardian, the property of the person or persons who may
be under his guardianship; Respondent's contentions do not provide sufficient basis to escape
disciplinary action from this Court.
(2) Agents, the property whose administration or sale may have been
intrusted to them, unless the consent of the principal have been given; It taxes this Courts imagination that respondent disclaims any
knowledge in the execution of the original lease contract between his
client and his family partnership represented by his brother-in-law. Be
that as it may, it cannot be denied that respondent himself had
(3) Executors and administrators, the property of the estate under knowledge of and allowed the subsequent renewals of the lease
administration contract. In fact, he actively participated in the lease contracts dated
January 13, 1975 and December 4, 1978 by signing on behalf of the
lessee HIJOS DE JOSE VILLEGAS.
(4) Public officers and employees, the property of the State or of
any subdivision thereof, or of any government owned or controlled
corporation, or institution, the administration of which has been intrusted Moreover, the claim that the heirs of Filomena Zerna have acquiesced
to them; this provision shall apply to judges and government experts and consented to the assailed lease contracts does not militate against
who, in any manner whatsoever, take part in the sale; respondent's liability under the rules of professional ethics. The
prohibition referred to in Articles 1491 and 1646 of the new Civil Code,
as far as lawyers are concerned, is intended to curtail any undue
influence of the lawyer upon his client on account of his fiduciary and
(5) Justices, judges, prosecuting attorneys, clerks of superior and
confidential association [Sotto v. Samson, G.R. No. L-16917, July 31,
inferior courts, and other officers and employees connected with the
1962, 5 SCRA 733]. Thus, the law makes the prohibition absolute and
administration of justice, the property or rights in litigation or levied upon
permanent [Rubias v. Batiller, supra]. And in view of Canon 1 of the new
on execution before the court within whose jurisdiction or territory they
Code of Professional Responsibility and Sections 3 & 27 of Rule 138 of
exercise their respective functions; this prohibition includes the act of
the Revised Rules of Court, whereby lawyers are duty-bound to obey
acquiring by assignment and shall apply to lawyers, with respect to the
and uphold the laws of the land, participation in the execution of the
property and rights which may be the object of any litigation in which
prohibited contracts such as those referred to in Articles 1491 and 1646
they may take part by virtue of their profession.
of the new Civil Code has been held to constitute breach of professional
ethics on the part of the lawyer for which disciplinary action may be
brought against him [See Bautista v. Gonzalez, Adm. Matter No. 1625,
(6) Any others specially disqualified by law February 12, 1990). Accordingly, the Court must reiterate the rule that
the claim of good faith is no defense to a lawyer who has failed to
adhere faithfully to the legal disqualifications imposed upon him,
designed to protect the interests of his client [See In re Ruste, 70 Phil.
xxx xxx xxx 243 (1940); Also, Severino v. Severino, 44 Phil. 343 (1923)].
Neither is there merit in respondent's reliance on the case of Tuason v.
Tuason [supra.] It cannot be inferred from the statements made by the
Court in that case that contracts of sale or lease where the vendee or On April 4, 1988, Dominga Velasco-Ordonio filed this complaint for
lessee is a partnership, of which a lawyer is a member, over a property disbarment against herein respondent on the basis of an affidavit
involved in a litigation in which he takes part by virtue of his profession, executed by her mother Antonia Ulibari on March 2, 1988 stating that
are not covered by the prohibition under Articles 1491 and 1646. affiant never conveyed the subject parcel of land to respondent as her
attorney's fees and that the deeds of absolute sale executed in favor of
her children were not known to her (and that she received no
consideration therefor).
However, the Court sustains the Solicitor General's holding that there is
no sufficient evidence on record to warrant a finding that respondent
allowed the properties of the estate of Filomena Zerna involved herein
to be leased to his family partnership at very low rental payments. At On August 10, 1989, the Investigation Commissioner submitted a report
any rate, it is a matter for the court presiding over Special Proceedings finding the charges to be true and recommending a one-year
No. 460 to determine whether or not the agreed rental payments made suspension of the respondent from the practice of law.
by respondent's family partnership is reasonable compensation for the
use and occupancy of the estate properties.
The first issue to be resolved is whether Antonia Ulibari was defrauded
into signing the Deed of Conveyance transferring to her lawyer (herein
Considering thus the nature of the acts of misconduct committed by respondent) the subject parcel of land containing 298,420 square
respondent, and the facts and circumstances of the case, the Court meters as the latter's attorney's fees. It is clear from Antonia Ulibari's
finds sufficient grounds to suspend respondent from the practice of law affidavit and deposition that she never conveyed the said land to her
for a period of three (3) months. lawyer as attorney's fees.
WHEREFORE, finding that respondent Atty. Crisostomo C. Villegas Even granting for the sake argument that Antonia Ulibari knowingly and
committed acts of gross misconduct, the Court Resolved to SUSPEND voluntarily conveyed the subject property in favor of the respondent and
respondent from the practice of law for four (4) months effective from her husband, the respondent, in causing the execution of the Deed of
the date of his receipt of this Resolution, with a warning that future Conveyance during the pendency of the appeal of the case involving the
misconduct on respondent's part will be more severely dealt with. Let said property, has violated Art. 1491 of the Civil Code which prohibits
copies of this Resolution be circulated to all courts of the country for lawyers from "acquiring by assignment property and rights which may
their information and guidance, and spread in the personal record of be the object of any litigation in which they may take part by virtue of
Atty. Villegas. their profession."
SO ORDERED. In the case at bar, the property (which includes the more than 20
hectares of land allegedly conveyed to the respondent) was already in
actual litigation first in the lower court and then in the Court of Appeals.
Whether the deed of conveyance was executed at the instance of the
client driven by financial necessity or of the lawyers is of no moment (In
re: Atty. Melchor E. Ruste, 70 Phil. 243). "In either case, an attorney
DOMINGA VELASCO ORDONIO, petitioner, occupies a vantage position to press upon or dictate his terms to a
harrased client, in breach of the rule so amply protective of the
vs. confidential relations, which must necessarily exist between attorney
and client, and of the rights of both." The act constitutes malpractice,
ATTY. JOSEPHINE PALOGAN EDUARTE, respondent.
even if the lawyer had purchased the property in litigation. (Hernandez v.
Villanueva, 40 Phil. 775; In re: Calderon, 7 Phil. 427). We agree with the
Investigating Commissioner's opinion that the prohibition applies when
RESOLUTION the lawyer has not paid money for it and the property was merely
assigned to him in consideration of legal services rendered at a time
when the property is still the subject of a pending case.
PER CURIAM: For having improperly acquired the subject property, under the foregoing
circumstances, respondent has violated not only Art. 1491 of the Civil
Code but also Rule 10 of the Canons of Professional Ethics which
provides that "the lawyer should not purchase any interest in the subject
This is a complaint for the disbarment of respondent Atty. Josephine
matter of the litigation which he is conducting."
Palogan-Eduarte originally filed with this Court on April 18, 1988. On
August 10, 1989, the Commission on Bar Discipline of the Integrated
Bar of the Philippines, to which the case was referred for investigation,
submitted a report confirming in substance the charge of violation of Art. The last issue to be resolved is whether respondent violated any law in
1491 of the Civil Code and part of the Oath of Office of a lawyer and preparing and notarizing the deeds of absolute sale in making it appear
recommending the suspension of herein respondent. that there were considerations therefor, when in truth there were none
so received by the seller. In her answer, respondent admitted that
Antonia Ulibari did not actually sell the parcels of land to her children for
the considerations stated in the deeds of sale and that she (respondent)
The evidence discloses that on July 18, 1983, Antonia Ulibari filed with
"utilized the form of deed of sale as the most convenient and
the RTC, Branch XXII, Cabagan, Isabela, Civil Case No. 391 for
appropriate document to effect the transfer of the parcels of land to
annulment of a document (known as Affidavit of Adjudication of the
Antonia Ulibari's children in accordance with her wish that said parcels
Estate of Felicisimo Velasco and Quitclaim Thereof) against her
of land be given to them.
children. The case was handled by Atty. Henedino Eduarte, herein
respondent's husband, until his appointment as RTC judge on October
26, 1984. His wife, Atty. Josephine Palogan-Eduarte, took over. On
August 22, 1985, decision in Civil Case No. 391 was rendered in favor In so doing, respondent has manifestly violated that part of her oath as a
of Antonia Ulibari. Except for Dominga Velasco-Ordonio, one of the lawyer that she shall not do any falsehood. Not only that. In preparing
children of Antonia Ulibari and complainant in the instant case, the rest the documents which do not reflect the true transaction, respondent has
of the defendants did not appeal. On June 13, 1987, while Civil Case likewise violated Rule 10.01 of the Code of Professional Responsibility
No. 391 was pending appeal in the Court of Appeals, Antonia Ulibari which provides:
conveyed some parcels of her land to her children in the form of deeds
of absolute sale, prepared and notarized by herein respondent.
Significantly, on the same day, Antonia Ulibari also conveyed 20
hectares of land to herein respondent and her husband as their Rule 10.01. A lawyer shall not do any falsehood, nor consent to
Attorney's fees for legal services rendered. All the titles of the lands the doing of any in court; nor shall be mislead or allow the court to be
subject of the deeds of absolute sale and the deed of conveyance mislead by any artifice.
however remained in the name of Antonia Ulibari.
suspension from the practice of law meted out by the IBP against the
respondent. Thus, they pray that the respondent be disbarred for
ACCORDINGLY, for having violated Article 1491 of the Civil Code, malpractice and gross misconduct under Section 27,7 Rule 138 of the
respondent is hereby ordered suspended from the practice of law for a Rules of Court.
period of six (6) months, and, for having stated falsehoods in the four (4)
deeds of absolute sale she prepared and notarized, in violation of the
lawyer's oath and Rule 10.01 of the Code of Professional Responsibility,
respondent is also ordered suspended from the practice or law for a In his defense the respondent basically offers a denial of the charges
period of another six (6) months, resulting in a total period on one year, against him.
effective from the date this judgment becomes final.
vs.
Further, he denies that he had exploited the problems of his client’s
ATTY. EDUARDO C. DE VERA, Respondent. family. He argues that the case that he and George Mercado filed
against the complainants arose from their perception of unlawful
transgressions committed by the latter for which they must be held
accountable for the public interest.
RESOLUTION
SO ORDERED.
The nature of the cases filed by the respondent, the fact of re-filing them
after being dismissed, the timing of the filing of cases, the fact that the
respondent was in conspiracy with a renegade member of the
complainants’ family, the defendants named in the cases and the foul
language used in the pleadings and motions15 all indicate that the
respondent was acting beyond the desire for justice and fairness. His A.C. No. 5108 May 26, 2005
act of filing a barrage of cases appears to be an act of revenge and hate
driven by anger and frustration against his former client who filed the
disciplinary complaint against him for infidelity in the custody of a client’s ROSA F. MERCADO, complainant,
funds.
vs.
It also appears that on April 13, 1999, respondent filed a criminal action
against complainant before the Office of the City Prosecutor, Pasig City,
entitled "Atty. Julito Vitriolo, et al. v. Rose Dela Cruz F. Mercado," and On June 21, 2003, the IBP Board of Governors approved the report of
docketed as I.S. No. PSG 99-9823, for violation of Articles 171 and 172 investigating commissioner Datiles, finding the respondent guilty of
(falsification of public document) of the Revised Penal Code.5 violating the rule on privileged communication between attorney and
Respondent alleged that complainant made false entries in the client, and recommending his suspension from the practice of law for
Certificates of Live Birth of her children, Angelica and Katelyn Anne. one (1) year.
More specifically, complainant allegedly indicated in said Certificates of
Live Birth that she is married to a certain Ferdinand Fernandez, and that
their marriage was solemnized on April 11, 1979, when in truth, she is
legally married to Ruben G. Mercado and their marriage took place on On August 6, 2003, complainant, upon receiving a copy of the IBP
April 11, 1978. report and recommendation, wrote Chief Justice Hilario Davide, Jr., a
letter of desistance. She stated that after the passage of so many years,
she has now found forgiveness for those who have wronged her.
The IBP Commission on Bar Discipline set two dates for hearing but (1) There exists an attorney-client relationship, or a prospective
complainant failed to appear in both. Investigating Commissioner attorney-client relationship, and it is by reason of this relationship that
Rosalina R. Datiles thus granted respondent's motion to file his the client made the communication.
memorandum, and the case was submitted for resolution based on the
pleadings submitted by the parties.14
Matters disclosed by a prospective client to a lawyer are protected by these facts which will determine the merit of her complaint. The Court
the rule on privileged communication even if the prospective client does cannot be involved in a guessing game as to the existence of facts
not thereafter retain the lawyer or the latter declines the employment.23 which the complainant must prove.
The reason for this is to make the prospective client free to discuss
whatever he wishes with the lawyer without fear that what he tells the
lawyer will be divulged or used against him, and for the lawyer to be
equally free to obtain information from the prospective client.24 Indeed, complainant failed to attend the hearings at the IBP. Without any
testimony from the complainant as to the specific confidential
information allegedly divulged by respondent without her consent, it is
difficult, if not impossible to determine if there was any violation of the
On the other hand, a communication from a (prospective) client to a rule on privileged communication. Such confidential information is a
lawyer for some purpose other than on account of the (prospective) crucial link in establishing a breach of the rule on privileged
attorney-client relation is not privileged. Instructive is the case of Pfleider communication between attorney and client. It is not enough to merely
v. Palanca,25 where the client and his wife leased to their attorney a assert the attorney-client privilege.37 The burden of proving that the
1,328-hectare agricultural land for a period of ten years. In their privilege applies is placed upon the party asserting the privilege.38
contract, the parties agreed, among others, that a specified portion of
the lease rentals would be paid to the client-lessors, and the remainder
would be delivered by counsel-lessee to client's listed creditors. The
client alleged that the list of creditors which he had "confidentially" IN VIEW WHEREOF, the complaint against respondent Atty. Julito D.
supplied counsel for the purpose of carrying out the terms of payment Vitriolo is hereby DISMISSED for lack of merit.
contained in the lease contract was disclosed by counsel, in violation of
their lawyer-client relation, to parties whose interests are adverse to
those of the client. As the client himself, however, states, in the SO ORDERED.
execution of the terms of the aforesaid lease contract between the
parties, he furnished counsel with the "confidential" list of his creditors.
We ruled that this indicates that client delivered the list of his creditors to
counsel not because of the professional relation then existing between Austria-Martinez, Callejo, Sr., and Chico-Nazario, JJ., concur.
them, but on account of the lease agreement. We then held that a
violation of the confidence that accompanied the delivery of that list Tinga, J., out of the country.
would partake more of a private and civil wrong than of a breach of the
fidelity owing from a lawyer to his client.
A.C. No. 927 September 28, 1970
CASTRO, J.:
(3) The legal advice must be sought from the attorney in his professional
capacity.33 At all events, the relations between the two must have attained such a
high level of mutual trust that on October 10, 1969, Pfleider and his wife
leased to Palanca a 1,328 hectare agricultural land in Hinobaan, Negros
Occidental, known as the Hacienda Asia, for a period of ten years. In
The communication made by a client to his attorney must not be their contract, the parties agreed, among others, that a specified portion
intended for mere information, but for the purpose of seeking legal of the lease rentals would be paid to Pfleider, and the remainder would
advice from his attorney as to his rights or obligations. The be delivered by Palanca to Pfleider's listed creditors.
communication must have been transmitted by a client to his attorney
for the purpose of seeking legal advice.34
The arrangement worked smoothly until October 14, 1969 when the
rupture came with the filing by Pfleider of a civil suit (civil case 9187 of
If the client seeks an accounting service,35 or business or personal the CFI of Negros Occidental) against Palanca for rescission of the
assistance,36 and not legal advice, the privilege does not attach to a contract of lease on the ground of alleged default in the payment of
communication disclosed for such purpose. rentals. In his answer to the complaint, Palanca averred full satisfaction
of his rental liabilities, and therefore contended that the lease should
continue. He also charged that he had already been dispossessed of
Applying all these rules to the case at bar, we hold that the evidence on the hacienda by Pfleider and the latter's goons at gunpoint and
record fails to substantiate complainant's allegations. We note that consequently had suffered tremendous financial losses.
complainant did not even specify the alleged communication in
confidence disclosed by respondent. All her claims were couched in
general terms and lacked specificity. She contends that respondent With this history in, perspective, we shall now consider the
violated the rule on privileged communication when he instituted a administrative charges of gross misconduct in office brought by Pfleider
criminal action against her for falsification of public documents because against Palanca. The indictment consists of four counts.
the criminal complaint disclosed facts relating to the civil case for
annulment then handled by respondent. She did not, however, spell out
First count. In regard to a criminal case for estafa filed in December
1965 by one Gregorio Uy Matiao against Pfleider, the latter instructed
Palanca to offer in settlement the sum of P10,000, payable in As Pfleider himself, however, in the execution of the terms of the
installments, to Uy Matiao for the dismissal of the case. After sometime, aforesaid lease contract between the parties, complainant furnished
Palanca reported to Pfleider that the offer has been rejected. Finally in respondent with a confidential list of his creditors." This should indicate
October 1969, Palanca supposedly informed Pfleider that he had that Pfleider delivered the list of his creditors to Palanca not because of
succeeded in negotiating the dismissal of the estafa case by leaving the the professional relation then existing between them, but on account of
sum of P5,000 with the Dumaguete City Court where the action was the lease agreement. A violation therefore of the confidence that
then pending. Sometime in December 1969, however, Pfleider was the accompanied the delivery of that list would partake more of a private
object of a warrant of arrest in connection with the same estafa case. It and civil wrong than of a breach of the fidelity owing from a lawyer to his
turned out, charged the complainant Pfleider, that Palanca had not client. Moreover, Pfleider fails to controvert Palanca's claim that there is
deposited the sum of P5,000 with the Dumaguete City Court, let alone no such thing as a "confidential" list of creditors and that the list of
communicated to Uy Matiao his earlier offer of settlement. creditors referred to by Pfleider is the same list which forms part of the
pleadings in civil case 9187 (the action for rescission of the lease
contract) now, pending between the complainant and the respondent
lawyer, and therefore is embraced within the category of public records
We have closely examined all the pleadings filed by the parties in this open to the perusal of persons properly interested therein.
case and the annexes thereto, and it is our view that the first charge is
devoid of merit. In support of his claim of alleged assurance made by
Palanca that the estafa case had already been terminated, Pfleinder
relies on certain letters written to him by Palanca. Our own reading of In sum, we are satisfied, and we so hold, that nothing in written
these letters, however, belies his claim. They contain nothing which complaint for disbarment against Palanca and in his reply to Palanca's
might reasonably induce the complainant to believe that the criminal answer supports a prima facie finding of such misconduct in office by
action against him had been finally settled by his attorney. On the Palanca as would warrant further proceedings in this case.
contrary, the letters merely report a continuing attempt on the part of
Palanca to secure a fair bargain for Pfleider. The letter-report of October
10, 1969, invoke by the complainant, states in no uncertain terms that "I
ACCORDINGLY, the complaint is hereby dismissed.
am bargaining this (referring to the estafa case) even for P8,000.00 and
I think they will agree. I'll finalize this and pay Tingyan on Tuesday. I
have already left in Dumaguete P5,000.00 to show them the color of our
money and I will bring the balance when I go there Tuesday."
(b) That on May 3, 1943, the legal title to the property was with That several days later, the stenographer in his law office, Teofilo
your husband, Mr. Serafin P. Hilado; and Ragodon, showed him a letter which had been dictated in English by Mr.
Agrava, returning the "expedients" to Mrs. Hilado; that Ragodon told him
(Attorney Francisco) upon Attorney Agrava's request that Agrava
thought it more proper to explain to Mrs. Hilado the reasons why her
(c) That the property was sold by Mr. Hilado without your case was rejected; that he forthwith signed the letter without reading it
knowledge on the aforesaid date of May 3, 1943. and without keeping it for a minute in his possession; that he never saw
Mrs. Hilado since their last meeting until she talked to him at the Manila
Hotel about a proposed extrajudicial settlement of the case;
Upon the foregoing facts, I am of the opinion that your action against Mr.
Assad will not ordinarily prosper. Mr. Assad had the right to presume
that your husband had the legal right to dispose of the property as the That in January, 1946, Assad was in his office to request him to handle
transfer certificate of title was in his name. Moreover, the price of his case stating that his American lawyer had gone to the States and left
P110,000 in Japanese military notes, as of May 3, 1943, does not quite the case in the hands of other attorneys; that he accepted the retainer
strike me as so grossly inadequate as to warrant the annulment of the and on January 28, 1946, entered his appearance.
sale. I believe, lastly, that the transaction cannot be avoided merely
because it was made during the Japanese occupation, nor on the
simple allegation that the real purchaser was not a citizen of the
Philippines. On his last point, furthermore, I expect that you will have Attorney Francisco filed an affidavit of stenographer Ragodon in
great difficulty in proving that the real purchaser was other than Mr. corroboration of his answer.
Assad, considering that death has already sealed your husband's lips
and he cannot now testify as to the circumstances of the sale.
The judge trying the case, Honorable Jose Gutierrez David, later
promoted to the Court of Appeals, dismissed the complaint. His Honor
For the foregoing reasons, I regret to advise you that I cannot appear in believed that no information other than that already alleged in plaintiff's
the proceedings in your behalf. The records of the case you loaned to complaint in the main cause was conveyed to Attorney Francisco, and
me are herewith returned. concluded that the intercourse between the plaintiff and the respondent
did not attain the point of creating the relation of attorney and client.
Section 26 (e), Rule 123 of the Rules of Court provides that "an attorney Hence the necessity of setting down the existence of the bare
cannot, without the consent of his client, be examined as to any relationship of attorney and client as the yardstick for testing
communication made by the client to him, or his advice given thereon in incompatibility of interests. This stern rule is designed not alone to
the course of professional employment;" and section 19 (e) of Rule 127 prevent the dishonest practitioner from fraudulent conduct, but as well to
imposes upon an attorney the duty "to maintain inviolate the confidence, protect the honest lawyer from unfounded suspicion of unprofessional
and at every peril to himself, to preserve the secrets of his client." There practice. (Strong vs. Int. Bldg., etc.; Ass'n, 183 Ill., 97; 47 L.R.A., 792.) It
is no law or provision in the Rules of Court prohibiting attorneys in is founded on principles of public policy, on good taste. As has been
express terms from acting on behalf of both parties to a controversy said in another case, the question is not necessarily one of the rights of
whose interests are opposed to each other, but such prohibition is the parties, but as to whether the attorney has adhered to proper
necessarily implied in the injunctions above quoted. (In re De la Rosa, professional standard. With these thoughts in mind, it behooves
27 Phil., 258.) In fact the prohibition derives validity from sources higher attorneys, like Caesar's wife, not only to keep inviolate the client's
than written laws and rules. As has been aptly said in In re Merron, 22 confidence, but also to avoid the appearance of treachery and double-
N. M., 252, L.R.A., 1917B, 378, "information so received is sacred to the dealing. Only thus can litigants be encouraged to entrust their secrets to
employment to which it pertains," and "to permit it to be used in the their attorneys which is of paramount importance in the administration of
interest of another, or, worse still, in the interest of the adverse party, is justice.
to strike at the element of confidence which lies at the basis of, and
affords the essential security in, the relation of attorney and client."
One of the tests of inconsistency of interests is whether the acceptance From the foregoing, it is evident that respondent's representation of
of a new relation would prevent the full discharge of the lawyer's duty of Valdez and Alba against Bustamante and her husband, in one case, and
undivided fidelity and loyalty to the client or invite suspicion of Valdez against Alba, in another case, is a clear case of conflict of
unfaithfulness or double-dealing in the performance of that duty. 18 interests which merits a corresponding sanction from this Court.
Respondent may have withdrawn his representation in Civil Case No.
95-105-MK upon being warned by the court, 31 but the same will not
exculpate him from the charge of representing conflicting interests in his
The stern rule against representation of conflicting interests is founded representation in Civil Case No. 2000-657-MK.
on principles of public policy and good taste. It springs from the
attorney's duty to represent his client with undivided fidelity and to
maintain inviolate the client's confidence as well as from the injunction
forbidding the examination of an attorney as to any of the privileged Respondent is reminded to be more cautious in accepting professional
communications of his client. 19 employments, to refrain from all appearances and acts of impropriety
including circumstances indicating conflict of interests, and to behave at
all times with circumspection and dedication befitting a member of the
Bar, especially observing candor, fairness and loyalty in all transactions
An attorney owes loyalty to his client not only in the case in which he with his clients. 32
has represented him but also after the relation of attorney and client has
terminated. 20 The bare attorney-client relationship with a client
precludes an attorney from accepting professional employment from the
client's adversary either in the same case 21 or in a different but related On knowingly misleading the court by submitting false documentary
action. 22 A lawyer is forbidden from representing a subsequent client evidence.
against a former client when the subject matter of the present
controversy is related, directly or indirectly, to the subject matter of the
previous litigation in which he appeared for the former client. 23
Complainant alleges that in Civil Case No. 00-7137 filed before MTC,
Branch 75 for ejectment, respondent submitted TCT No. 273020 as
evidence of Valdez's ownership despite the fact that a new TCT No.
We held in Nombrado v. Hernandez 24 that the termination of the 275500 was already issued in the name of Alba on February 2, 1995.
relation of attorney and client provides no justification for a lawyer to
represent an interest adverse to or in conflict with that of the former
client. The reason for the rule is that the client's confidence once
Records reveal that respondent filed Civil Case No. 00-7137 on
reposed cannot be divested by the expiration of the professional
November 27, 2000 and presented TCT No. 273020 as evidence of
employment. 25 Consequently, a lawyer should not, even after the
Valdez's ownership of the subject property. 33 During the hearing before
severance of the relation with his client, do anything which will
Commissioner Raval, respondent avers that when the Answer was filed
injuriously affect his former client in any matter in which he previously
in the said case, that was the time that he came to know that the title
represented him nor should he disclose or use any of the client's
was already in the name of Alba; so that when the court dismissed the
confidences acquired in the previous relation. 26
complaint, he did not do anything anymore. 34 Respondent further
avers that Valdez did not tell him the truth and things were revealed to
him only when the case for rescission was filed in 2002.
In this case, respondent's averment that his relationship with Alba has
long been severed by the act of the latter of not turning over the
proceeds collected in Civil Case No. 98-6804, in connivance with the
Upon examination of the record, it was noted that Civil Case No. 2000-
complainant, is unavailing. Termination of the attorney-client relationship
657-MK for rescission of contract and cancellation of TCT No. 275500
precludes an attorney from representing a new client whose interest is
was also filed on November 27, 2000, 35 before RTC, Branch 273,
adverse to his former client. Alba may not be his original client but the
Marikina City, thus belying the averment of respondent that he came to
fact that he filed a case entitled "Valdez and Alba v. Bustamante and her
know of Alba's title only in 2002 when the case for rescission was filed. It
husband," is a clear indication that respondent is protecting the interests
was revealed during the hearing before Commissioner Raval that Civil
of both Valdez and Alba in the said case. Respondent cannot just claim
Case Nos. 00-7137 and 2000-657-MK were filed on the same date,
that the lawyer-client relationship between him and Alba has long been
although in different courts and at different times.
severed without observing Section 26, Rule 138 of the Rules of Court
wherein the written consent of his client is required.
Hence, respondent cannot feign ignorance of the fact that the title he
submitted was already cancelled in lieu of a new title issued in the name
In Gonzales v. Cabucana, Jr., 27 citing the case of Quiambao v. Bamba,
of Alba in 1995 yet, as proof of the latter's ownership.
28 we held that:
Let copies of this Resolution be furnished all courts of the land, the
As culled from the records, Valdez entered into a retainer agreement Integrated Bar of the Philippines as well as the Office of the Bar
with respondent. As payment for his services, he was allowed to occupy Confidant for their information and guidance, and let it be entered in
the property for free and utilize the same as his office pursuant to their respondent's personal records.
retainer agreement. 42
SO ORDERED.
Respondent filed I.S. Nos. 00-4439 43 and 01-036162 44 both entitled
"Valencia v. Samala" for estafa and grave coercion, respectively, to
protect his client's rights against complainant who filed I.S. No. 00-4306
45 for estafa against Lagmay, and I.S. No. 00-4318 46 against Alvin
Valencia 47 for trespass to dwelling.
REBECCA J. PALM, Complainant, v. ATTY. FELIPE ILEDAN, JR.,
Respondent.
In his Answer,2 respondent alleged that in January 2002, Soledad Respondent filed a motion for reconsideration.6
consulted him on process and procedure in acquiring property. In April
2002, Soledad again consulted him about the legal requirements of
putting up a domestic corporation. In February 2003, Soledad engaged
In an undated Recommendation, the IBP Board of Governors First
his services as consultant for Comtech. Respondent alleged that from
Division found that respondent's motion for reconsideration did not raise
February to October 2003, neither Soledad nor Palm consulted him on
any new issue and was just a rehash of his previous arguments.
confidential or privileged matter concerning the operations of the
However, the IBP Board of Governors First Division recommended that
corporation. Respondent further alleged that he had no access to any
respondent be suspended from the practice of law for only one year.
record of Comtech.
Canon 21. A lawyer shall preserve the confidence and secrets of his
In a Report and Recommendation dated 28 March 2006,3 the IBP client even after the attorney-client relationship is terminated. (Emphasis
Commission on Bar Discipline (IBP-CBD) found respondent guilty of supplied)cralawlibrary
violation of Canon 21 of the Code of Professional Responsibility and of
representing interest in conflict with that of Comtech as his former client.
We agree with the IBP that in the course of complainant's consultations,
respondent obtained the information about the need to amend the
The IBP-CBD ruled that there was no doubt that respondent was corporate by-laws to allow board members outside the Philippines to
Comtech's retained counsel from February 2003 to November 2003. participate in board meetings through teleconferencing. Respondent
The IBP-CBD found that in the course of the meetings for the intended himself admitted this in his Answer.
WHEREFORE, we DISMISS the complaint against Atty. Felipe Iledan,
Jr. for lack of merit.
However, what transpired on 10 January 2004 was not a board meeting
but a stockholders' meeting. Respondent attended the meeting as proxy
for Harrison. The physical presence of a stockholder is not necessary in
a stockholders' meeting because a member may vote by proxy unless SO ORDERED.
otherwise provided in the articles of incorporation or by-laws.8 Hence,
there was no need for Steven and Deanna Palm to participate through
teleconferencing as they could just have sent their proxies to the
meeting. Orcino v Gaspar AC 3773
03
In addition, although the information about the necessity to amend the Thursday
corporate by-laws may have been given to respondent, it could not be
Apr 2014
considered a confidential information. The amendment, repeal or
adoption of new by-laws may be effected by "the board of directors or Posted by reylangarcia in Uncategorized ≈ Leave a comment
trustees, by a majority vote thereof, and the owners of at least a majority
of the outstanding capital stock, or at least a majority of members of a TagsAC 3773, Legal Ethics, Orcino v Gaspar, Orcino v Gaspar AC 3773,
non-stock corporation."9 It means the stockholders are aware of the Orcino v Gaspar case digest
proposed amendments to the by-laws. While the power may be
delegated to the board of directors or trustees, there is nothing in the TOPIC: Legal Ethics, termination of attorney-client relationship
records to show that a delegation was made in the present case.
Further, whenever any amendment or adoption of new by-laws is made,
copies of the amendments or the new by-laws are filed with the
FACTS:
Securities and Exchange Commission (SEC) and attached to the
original articles of incorporation and by-laws.10 The documents are
public records and could not be considered confidential.ςηαñrοblεš
νιr†υαl lαω lιbrαrÿ Orcino engaged the services of Atty. Gaspar to prosecute a criminal
case she intended to file against several suspects in the slaying of her
husband. Orcino bound herself to pay respondent legal fees
ofP20,000.00 — P10,000.00 to be paid upon signing of the contract and
It is settled that the mere relation of attorney and client does not raise a
the balance to be paid on or before the conclusion of the case. She was
presumption of confidentiality.11 The client must intend the
also to pay P500.00 per appearance of respondent before the court and
communication to be confidential.12 Since the proposed amendments
fiscal. This agreement was embodied in a contract executed on
must be approved by at least a majority of the stockholders, and copies
February 22, 1991. Orcino complied with the contract and Atty. Gaspar
of the amended by-laws must be filed with the SEC, the information
entered into his duties. Atty. Gaspar, however failed to attend the
could not have been intended to be confidential. Thus, the disclosure
hearing scheduled in August 1991. It was at this hearing that the court,
made by respondent during the stockholders' meeting could not be
over complainant’s objections, granted bail to all the accused. Orcino
considered a violation of his client's secrets and confidence within the
immediately went to respondent’s residence and confronted him with his
contemplation of Canon 21 of the Code of Professional Responsibility.
absence. Gaspar explained that he did not receive formal notice of the
hearing. She asked for the records of the case saying that she could
refer them to another lawyer. Gaspar then gave her the records. Orcino
Representing Interest in Conflict With the Interest of a Former Client never returned the records nor did she see Gaspar. On September 18,
1991, Atty. Gaspar filed before the trial court a Motion to Withdraw as
Counsel without the consent of Orcino. The court issued an order
directing Gaspar to secure complainant’s consent to the motion and his
The IBP found respondent guilty of representing an interest in conflict appearance as private prosecutor shall continue until he has secured
with that of a former client, in violation of Rule 15.03, Canon 15 of the this consent. Oricno refused to sign her conformity. Atty. Gaspar did not
Code of Professional Responsibility which provides: appear at the hearings nor did he contact Orcino, thus she was
compelled to engage the services of another lawyer.
We do not agree with the IBP. Whether or not Atty. Gaspar had the right to terminate the attorney-client
relation
9. That on the very day of and after the hearing of the motion to dismiss,
REGINO B. ARO, petitioner, or on October 24, 1964, before receipt of a copy of the said order
(Annex 'G'), there was a conversation which took place between herein
vs. petitioner and the attorney of the defendants, Atty. Rustico de los Reyes,
Jr., in the civil case and one who was then acting as a sort of
THE HON. ARSENIO NAÑAWA, Presiding Judge of Branch IV, Court of spokesman for the defendants (Ex-Mayor Cordova of Sta. Maria,
First Instance of Laguna, LUIS MAGTIBAY, PABLO MAGTIBAY, Laguna) for the amicable settlement of the case between the plaintiffs
AURELLO MARTINEZ, GREGORIO LONTOK, MARIA MENDOZA, and the defendants to the effect that a certain property of the spouses
MAXIMO PORTO and ROSARlO ANDAYA, respondents. Lucio Magtibay (deceased) and respondent Aurelia Martinez, worth
P3,000.00, would be given to the plaintiffs in full settlement of their
claim, as share in the properties left by their deceased uncle Lucio
Regino B. Aro in his own behalf as petitioner. Magtibay, it having been agreed by herein petitioner and Atty. de los
Reyes and the spokesman of the defendants that for the purpose of said
Enrique C. Villanueva for respondents. amicable settlement, the plaintiffs or one of them and herein petitioner
would go to Sta. Maria, Laguna, on October 23, 1964.
BARREDO, J.:
10. That having given notice to the plaintiffs (now respondents Luis
Magtibay and Pablo Magtibay) at their given address in Calauag,
Quezon to come to Candelaria for the purpose of going to Sta. Maria,
Original petition: (1) for certiorari to annul the order of the Court of First Laguna on October 23, 1964, petitioner had waited for said plaintiffs to
Instance of Laguna, dated November 21, 1964, dismissing its Civil Case go to his office on or before said date for the engagement mentioned,
No. SC-525 "without prejudice to the right of Atty. Regino B. Aro but due to their (plaintiffs') failure to come to Candelaria, petitioner had
(petitioner herein) to file a separate action against both the plaintiffs and to send a telegram to Ex-Mayor Cordova notifying him of his
defendants (private respondents herein) with respect to his alleged (petitioner's) and plaintiffs' not being able to go to Sta. Maria because of
attorney's fees", as well as its order dated January 9, 1965, denying the failure of any of the plaintiffs to come to Candelria, ....
petitioner's motion for reconsideration thereof for lack of merit and (2) for
mandamus to compel respondent Judge to take cognizance of
petitioner's opposition and countermotion or petition dated November 3,
1964 and to resolve the same on the merits. 11. That it was only on October 28, 1964, when herein petitioner
received a copy of the order dated October 24, 1964 (Annex "G") and to
his surprise he also received on the said day a second motion to
dismiss dated October 26, 1964; together with Annex "A" of said motion,
There appears to be no dispute as to the following facts alleged in the which is entitled KASULATAN NG PAGHAHATIAN NA LABAS SA
petition: HUKUMAN AT PAGPAPALABI, dated October 23, 1964 at Sta. Cruz,
Laguna and signed by the plaintiffs and defendant Aurelia Martinez (the
three being now respondents in this case), it having been made to
appear in said Annex "A" of the second motion to dismiss, among
2. That the services of herein petitioner, as practising attorney, was
others, that the plaintiffs and defendant Aurelia Martinez had made an
engaged by respondents Luis Magtibay and Pablo Magtibay for the
extrajudicial partition of the properties of the deceased Lucio Magtibay
prosecution of their claim, as heirs, in the estate of their deceased uncle
and the said Aurelia Martinez adjudicating to the plaintiffs one-fourth (¼)
Lucio Magtibay, consisting of properties which were in the possession of
share in the properties of the spouses and three-fourth (3/4) share of the 16. That by the express terms of the agreement, Annex "A" of this
defendant Aurelia Martinez, but making it appear also that said plaintiffs petition, plaintiffs in Civil Case No. SC-525 had expressly ceded to
waived their share in favor of Aurelia Martinez, ..., thru which fraudulent herein petitioner one-half (½) [later verbally reduced to one-third (1/3) or
waiver, herein petitioner was deprived of his contingent fees, agreed P1,000.00] or whatever share they would get from the estate of their
upon, as evidenced by Annex "A" of this petition.6 deceased uncle Lucio Magtibay, and the defendants in said Civil Case
had full knowledge of said right of herein petitioner in the properties in
controversy from and after the time they were served with summons and
copies of the complaint in said civil case — because of the allegations
xxx xxx xxx contained in par. 10 thereof. 7 [Emphasis by the Court]
14. That petitioner filed by registered mail, on November 4, 1964, his 18. That on December 5, 1964, herein petitioner filed his motion for
"OPPOSITION TO THE SECOND MOTION TO DISMISS AND reconsideration dated December 4, 1664 asking for the reconsideration
COUNTER-MOTION OR PETITION TO SET ASIDE DEED OF of the order dated November 21, 1964, ....
EXTRAJUDICIAL PARTITION AND WAIVER DATED OCTOBER 23,
1964 AND TO RECORD ATTORNEY'S LIEN", dated November 3, 1964,
wherein he (petitioner) prayed, among others, invoking the provisions of
Section 5(d) and Section 6, Rule 135 of the Revised Rules of Court, for 19. That the motion for reconsideration was denied by the court, thru the
the protection of the rights of herein petitioner as an officer of the Court, respondent Judge, as per the order dated January 9, 1965, ....
to wit:
Upon these facts, petitioner tries to make out before this Court a case of
(a) to deny the second motion to dismiss and get aside and annul the certiorari for grave abuse of discretion on the part of respondent Judge
deed of extrajudicial partition and waiver dated October 23, 1964; in dismissing the case on the basis of the compromise agreement of the
parties, entered into at the back of petitioner notwithstanding the
reservation made in his favor to file an action against both parties "with
respect to his alleged attorney's fees", as well as a case of mandamus
(b) to fix the compensation of herein counsel in the proportion of one- "to order and command the said respondent judge" to take cognizance
third (1/3) of the shares of plaintiffs, if in land, or in the amount of of and resolve his opposition and counter-motion for the court to fix the
P1,000.00, if in cash, and to record the same and expenses advanced compensation he should be paid. Unable to find any local precedent to
by him for the plaintiffs in the sum of P22.15 as lien in favor of herein support his position, he cites American authorities thus:
claimant-petitioner over the properties in litigation, particularly over the
one-fourth (1/4) share of the plaintiffs in all the properties of the
spouses;
In the American jurisdiction, it would seem that, even without the specific
provisions of the rules of court cited above, courts had always
intervened, in the mere exercise of their inherent powers, to protect
xxx xxx xxx attorneys against collusive agreements or fraudulent settlements
entered into by the parties in a case to cheat attorneys out of their costs
or of their fees. Thus, it was held or had been stated in:
(d) as an alternative to prayer (a) above, to grant the second motion to
dismiss, subjecting, however, the properties in litigation and subject-
matters of the extrajudicial partition and waiver to the lien for attorney's (a) Coughlin vs. N.Y. Cont. & H.R.R. Co., 71 N.Y. 443, 27 Am. Rep. 75.
fees and expenses in favor of herein claimant-petitioner, after fixing said
attorney's fees as prayed for in (b) above.
... But since the time of Lord Mansfield, it has been the practice of courts
to intervene to protect attorneys against settlement made to cheat them
xxx xxx xxx out of their costs. If an attorney has commenced an action, and his
client settles it with the opposite party before judgment, collusively, to
deprive him of his costs, the court will permit the attorney to go on with
15. That on the day f finally set for the hearing of the second motion to the suit for the purpose of collecting his costs. Swain v. Senate, 5 Bos. &
dismiss, as well as of the counter-motion or petition, or on November Pul. 99; Cole v. Bennett, 6 Price, 15; Moore v. Cook, 13 Id. 473; Talcott
21, 1964, because of the inquiries or interpellation made by respondent v. Bronson, 4 Paige, 501; Rusquin v. The Knickerbocker Stage Col., 12
Judge to herein petitioner as to whether there is a Philippine precedent Abb. Pr 324; Ward v. Syme, 9 How. Pr. 16; McDonald v. Napier, 14 Ga.
which allows or directs the protection by the Court of the rights of any of 89.
its officers (lawyer) against any collusion perpetrated by the parties in a
case to defraud or cheat an attorney of his compensation agreed upon
by him and his clients, and his answer that insofar as his researches There are many cases where this had been allowed to be done. It is
were concerned, he could not find any, although there are a number of impossible to ascertain precisely when this practice commenced, nor
cases to that effect in American jurisdiction, the respondent Judge had how originated, nor upon what principle it was based. It was not upon
opined in open court that the claim for and the fixing of the attorney's the principle of a lien, because an attorney has no lien upon the cause
fees should better be done in a separate action and, in spite of of as it upon the action before judgment for his costs; nor was it upon
petitioner's memorandum citing American authorities to the effect that, principle that his services had produced the money paid his client upon
the settlement, because that could not be known, and in fact no money
may have been paid upon the settlement. So far as I can perceive, it
Though a party may without the consent of his attorney money make a was based upon no principle. It was a mere arbitrary exercise of power
bona fide adjustment with the adverse party and dismiss an action or by the courts; not arbitrary in the sense that it was unjust or improper,
suit before a judgment or a decree has been rendered thereon, if it but in the sense that it was not based upon any right or principle
appears, however, that such settlement was collosive and recognized in other cases. The parties being in court, and a suit
consummated pursuant to the intent of both parties to defraud the commenced and pending, for the purpose of protecting attorneys who
attorney, the court in which the action was pending may interfere to were their officers and subject to their control, the courts invented this
protect him as one of its officers, by setting aside the order of practice and assumed this extraordinary power to defeat attempts to
dismissal, .... (Jackson vs. Stearns, 48 Ore. 25, 84 Pac. 798). cheat the attorneys out of their costs. The attorney's fees were fixed in
definite sums, easily determined by taxation and this power was
exercised to secure them their fees. (pp. 76-77)
After trial, the petitioner then being plaintiff's attorney of record, the
Court of First Instance, under date of December 24, 1921, rendered
(c) Jackson v. Stearns, et al., 43 Ore 25, 84 Pac. 798. judgment in favor of Justo Porcuna and Rosa H. de Porcuna ordering
the defendant Eulalia Magsombol to return to them 602 pieces of cloth
or in default thereof to pay to them the sum of P3,250. On January 14,
1922, Eulalia Magsombol filed her exception to the judgment and on the
... Though a party may, without the consent of his attorney, make a bona following day presented a motion for a new trial, which was denied on
fide adjustment with the adverse party, and dismiss an action or suit the 21st of the same month. She thereupon gave notice of appeal and
before a judgment or a decree has been rendered therein, if it appears, presented a bill of exceptions which was approved on February 20,
however, that such settlement was collusive and consummated 1922. On March 2, 1922, and before the transmission of the bill of
pursuant to the intent of both parties to defraud the attorney, the court in exceptions to this court, the plaintiffs presented the following motion in
which the action or suit was pending may interfere to protect him, as the Court of First Instance:
one of its officers, by setting aside the order of dismissal and permitting
him to proceed in the cause in the name of his client to final
determination to ascertain what sum of money, or interest in the subject-
matter, if any, is due him for his services when fully performed. Jones v. The plaintiffs, without any further intervention of their attorney, now
Morgage 99 Am. Dec. 458; Randall v. Van Wagenen (N.Y.) 22 N.E. 361, appear before this Honorable Court and respectfully aver:
12 Am. St. Rep. 828. (p. 800)
That, through Mr. Miguel Olgado they already settled this case with the
Before a court will set aside an order dismissing a suit or an action, herein defendant.
made upon stipulation of the parties, without the consent of plaintiff's
attorney, and allow the latter to proceed with the cause in the name of
his client, to determine the amount of fees due him, it must appear that
the defendant participated in the fraudulent intent to deprive the attorney That the basis of the compromise is that we, the plaintiffs, finally agree
of his compensation. Courtney v. McGavock, 25 Wis. 619. When no that we should be paid the amount of eight hundred pesos (P800) in two
adequate consideration is given by the defendant for the settlement and installments; P300 to be paid on this same date, and the remaining five
discharge of an action or a suit, the insufficiency of the inducement to hundred pesos (P500) at the end of March, 1922.
the contract affords evidence of his bad faith. Young v. Dearborn, 27
N.E. 324. It will be remembered that the complaint alleges that the value
of the real property in question is $3,000.00, and that Stearns executed That we, the plaintiffs, recognize not to have any further rights in this
to Wilson a deed to the premises for a nominal consideration. This is a case than to the aforesaid amount of eight hundred pesos (P800) and
sufficient averment of the defendant's intent to deprive the plaintiff of his that this is the total amount the defendant Eulalia Magsombol should
compensation thereby imputing to Wilson bad faith. (p. 800) pay us, and we have no right whatever to any other amount than the
aforementioned.
(d) Desaman v. Butler Bros., 188 Minn. 198, 136 N.W. 747.
That we have not sold to any other person our rights as plaintiffs in this
case.
We have recently held that a client has always the right to settle his
cause of action and stop litigation at any stage of the proceeding,
subject, however, to the right of the attorney to receive compensation for Wherefore, the plaintiffs respectfully request the dismissal of this case,
services rendered. Burho v. Camichael 135 N.W. 386. It is therefore without any pronouncement as to costs, and that the appeal interposed
contended by defendant that a litigant retains the unrestricted right to by the defendant be further dismissed.
determine for what amount the cause of action may be settled, and,
having so done, the lien of his attorney for services is measured by the
amount determined on and actually settled for. Conceding, without
deciding, that this may be true of any time prior to the rendition of a Batangas, Batangas, P.I., March 2, 1922.
verdict in the action which the attorney has been employed to bring, we
are of opinion that after verdict fixing the amount of a plaintiff's cause of
action a secret and collusive compromise between parties litigant does
not affect the amount of the attorney's lien...; but therein is also clearly
indicated by Mr. Justice Brown that, if there be fraud and collusion to (Sgd) ROSA H. PORCUNA
deprive the attorney of his lien, the settlement will not be permitted to
accomplish such result. (p. 748) Plaintiff
This is a petition for a writ of certiorari, the petitioner alleging that the The defendant, through her attorney, Jose Mayo Librea, having signified
respondent Judge of the Court of First Instance exceeded his her assent to the motion, the Court of First Instance on the same day,
jurisdiction in dismissing a pending action at the instance of the parties March 2, dismissed the action without notice to counsel for the plaintiffs.
but without the intervention of the attorney for the plaintiff in the case,
the herein petitioner.
The petitioner alleges that he did not discover the dismissal of the action
until April 4, 1922. After an unsuccessful effort to obtain a
It appears from the record that on July 31, 1921, the respondent Justo reconsideration of the order of dismissal from the trial court, he filed the
Porcuna, for himself and on behalf of his wife, the respondent Rosa H. present petition for a writ of certiorari. By resolution dated October 24,
1922, this court denied the petition and upon motion of the petitioner we judgment favorable to Mrs. Harden acknowledging, inter alia, her rights
shall now briefly state our reasons for such denial. to the assets of the conjugal partnership, which turned out to be
P4,000,000, and awarding her a monthly support of P2,500, practically
as prayed for in Atty. Recto's pleadings, while the case was already
pending on appeal before this Court, Mrs. Harden and her husband, Mr.
The burden of the petitioner's contention is (1) that he, as attorney of Fred Harden, entered into a compromise of their case, without the
record, was entitled to notice of his client's motion to dismiss the case, knowledge of Atty. Recto, whereby said spouses "purportedly agreed to
and (2) that after the approval of the bill of exceptions the lower court settle their differences in consideration of the sum of P5,000 paid by Mr.
had lost jurisdiction of the case and had no power to dismiss it. A Harden to Mrs. Harden, and a monthly pension of $500 to be paid by
moment's reflection should make it clear that neither of these him to her; (2) Mr. Harden created a trust fund of $20,000 from which
propositions is tenable. said monthly pension of $500 would be taken; and (3) Mr. and Mrs.
Harden had mutually released and forever discharged each other from
all actions, debts, duties, accounts, demands and claims to the conjugal
Both at the common law and under section 32 of the Code of Civil partnership, in consideration of the sum of $1." (p. 435)
Procedure a client may dismiss his lawyer at any time or at any stage of
the proceedings and there is nothing to prevent a litigant from appearing
before the court to conduct his own litigation. (Sec. 34, Code of Civil Whereupon Atty. Recto filed a motion with this Court praying that:
Procedure.) The client has also an undoubted right to compromise a suit
without the intervention of his lawyer.
In the present instance the clients did nothing that they did not have a
perfect right to do. By appearing personally and presenting a motion
they impliedly dismissed their lawyer. The petitioner's contingent c) After due hearing, the undersigned be declared entitled to the sum of
interests in the judgment rendered did not appear of record. Neither as a P400,000 as his fees for services rendered in behalf of the plaintiff in
party in interest nor as and attorney was he therefore entitled to notice this case, under paragraph 3 of the contract, Annex "A" and to that end
of the motion. a charging lien therefore be established upon the properties above-
mentioned;
As to the second proposition that the court below could not dismiss the
case after the bill of exceptions had been approved, it is very true that d) And the receiver be ordered to pay to the undersigned the full amount
upon such approval the lower court loses its jurisdiction over all of the fees to which the latter is found to be entitled.
contentious matters connected with the issues in the case. But there is
nothing to prevent all of the parties by agreement to withdraw the bill of
exceptions with the consent of said court and resubmit the case to the
jurisdiction of the court. That was all that was done in this case. A valid This motion was objected to by Mr. Hardens counsel, who in turn,
agreement between the parties to a case is the law of the case in moved for the dismissal of the case, to which Atty. Recto objected.
everything covered by the agreement. (Civil Code, art. 1091; Compania Under these circumstances, this Court acceded to Atty. Recto's prayer
General de Tabacos vs. Obed, 13 Phil. 391.) The petitioner might have that the case be not dismissed, that the receivership be maintained
protected his interests by entering an attorney's lien under section 37 of except as to certain properties not material to mention here, and that the
the Code of Civil Procedure. case be remanded to the lower court so that his fees may be
determined and ordered paid. Upon the remand of the case to the lower
court, a commissioner was appointed to hear the matter of the amount
of the fees in question, and after the commissioner had submitted a
The petition for a writ of certiorari was therefore properly denied. So report recommending the payment to Atty. Recto of the 20,70 attorney's
ordered. fees stipulated in the contract for his services, equivalent to
P369,410.04, the court rendered judgment as follows:
Withal, there is another Philippine case which Us to sustain petitioner. In On appeal from this judgment to this Court, the same was affirmed, the
the case of Recto vs. Harden, 100 Phil. 440, Atty. Claro M. Recto found decision stating pertinently in part:
himself practically in the same situation as petitioner herein. After Atty.
Recto had rendered services to Mrs. Esperanza P. de Harden in a
protracted suit against her husband for the purposes of securing an The last objection is based upon principles of equity, but, pursuant
increase of her and her daughter's monthly support, (the spouses were thereto, one who seeks equity must come with clean hands (Bastida et
separated), to P10,000.00 and of protecting and preserving her rights in al. vs. Dy Buncio & Co., 93 Phil. 195; 30 C.J.S. 475), and appellants
the properties of the conjugal partnership, which suit lasted from 1941 to have not done so, for the circumstances surrounding the case show, to
1949, and after the Court of First Instance of Manila had rendered a our satisfaction, that their aforementioned agreements, ostensibly for
the settlement of the differences between husband and wife, were made to waive the portion of their such acknowledged rights in favor of their
for the purpose of circumventing or defeating the rights of herein opponent to the extent that such waiver would prejudice the stipulated
appellee, under his above-quoted contract of services with Mrs. Harden. contingent interest of their lawyer and their aunt-in-law had no right to
Indeed, having secured a judgment in her favor, acknowledging her accept such waiver unqualified. The Civil Code enjoins that:
rights to the assets of the conjugal partnership, which turned out to be
worth almost P4,000,000 in addition to litis expensae in the sum of
P175,000, it is inconceivable that Mrs. Harden would have waived such
rights, as well as the benefits of all orders and judgments in her favor, in ART. 19. Every person must, in the exercise of his rights and in the
consideration of the paltry sum of $5,000 allegedly paid to her by Mr. performance of his duties, act with justice, give everyone his due, and
Harden and the additional sum of $20,000 to be paid by him in observe honesty and good faith.
installments, at the rate of $500 a month. In fact, no explanation has
been given for this moat unusual avowed settlement between Mr. and
Mrs. Harden. One can not even consider the possibility of a Under the circumstance extant in the record, it is clear that the
reconciliation between the spouses, the same being inconsistent with compromise agreement in question falls short of the moral requirements
the monetary consideration for said alleged settlement. What is more, of this quoted article of the Civil Code. If for this reason alone, it should
the records show that the relations between said spouses — which were not be allowed to prejudice the rights of petitioner. Accordingly, as all of
bad indeed, not only in July, 1941, when Mrs. Harden engaged the these circumstances were presented to respondent judge before he
services of the appellee, but, even, before, for Mr. and Mrs. Harden issued the challenged order of dismissal and all the parties were heard
were separated since 1938 — had worsened considerably thereafter, as thereon, it was incumbent upon His Honor, in equity and to avoid
evidenced by an action for divorce filed by Mr. Harden in New Jersey, in multiplicity of suits, particularly, because the amount claimed by
July 1948, upon the ground of repeated acts of infidelity allegedly petitioner is only P1,000.00, to have directly passed upon petitioner's
committed by Mrs. Harden in 1940 and 1941. claim, and not having done so, it would appear that the court a quo
abused its discretion gravely enough to warrant the writ of certiorari
herein prayed for in so far as the questioned orders prejudiced
On the same considerations of equity, and for the better protection of petitioner's right to the fees for the professional services which appear to
lawyers, who, trusting in the good faith of their clients, render have been creditably rendered by him. Respondents allege that the
professional services on contingent basis, and so that it may not be said judgment of dismissal in question is already final because no appeal
that this Court, sanctions in any way the questionable practice of clients was taken therefrom, but since We hold that the same was rendered
of compromising their cases at the back of their counsel with the with enough grave abuse of discretion to warrant the certiorari prayed
consequence that the stipulated contingent fees of the lawyer are either for, such alleged finality could not have materialized; obviously,
unreasonably reduced or even completely rendered without basis, as in petitioner could not have appealed, not being a party in the case.
this case — wherein the clients waived the whole of their rights in favor
of their opponent after the latter had acknowledged, in effect, the
correctness of said clients' contention — We have decided to grant the IN VIEW OF THE FOREGOING, the orders of the respondent court
herein petition, in so far as the rights of petitioner have been prejudiced dated November 21, 1964 and January 9, 1965 in Civil Case No. SC-
by the questioned compromise agreement. While We here reaffirm the 525 are hereby set aside in so far as they prejudice the payment of
rule that "the client has an undoubted right to compromise a suit without petitioner's claim of attorney's fees in the form of either one-third of the
the intervention of his lawyer", 8 We hold that when such compromise is ¼ share acknowledged as his clients in the compromise in question or
entered into in fraud of the lawyer, with intent to deprive him of the fees P1,000.00, which should constitute as a lien on the said share, in spite
justly due him, the compromise must be subject to the said fees, and of the waiver thereof in favor of respondent Aurelia Martinez. It is
that when it is evident that the said fraud is committed in confabulation unnecessary to consider the petition for mandamus. Costs against,
with the adverse party who had knowledge of the lawyer's contingent private respondents.
interest or such interest appears of record and who would benefit under
such compromise, the better practice is to settle the matter of the
attorney's fees in the same proceeding, after hearing all the affected
parties and without prejudice to the finality of the compromise in so far Reyes, J.B.L., Dizon,: Makalintal, Zaldivar, Sanchez, Fernando and
as it does not adversely affect the rights of the lawyer. Surely, "the client Teehankee, JJ., concur.
cannot, by setting, compromising or dismissing his suit during its
pendency, deprive the attorney of his compensation for the agreed Concepcion, C.J. and Castro, J., are on leave.
amount, unless the lawyer consents to such settlement, compromise or
Capistrano, J., took no part.
dismissal", (Legal and Judicial Ethics by Martin, 1967 Rev. Ed p. 121)
for the, attorney is or "Shall be entitled to have and recover from his
client - a reasonable compensation (not more) for his services, with a
view to the importance of the subject-matter of the controversy, the Footnotes
extent of the services rendered, and the professional standing of the
attorney", (Sec. 24, Rule 138, on Attorney and Admission to Bar) albeit,
under Canon 12 of the Canons of Professional Ethics, "in fixing fees, it
should not be forgotten that the profession is a branch of the A.M. No. 219 September 29, 1962
administration of justice and not a mere money-getting trade."
Complainant here alleges that the appearances of respondents were With respect to the preparation by Atty. Patalinghug of the revocations of
unethical and improper for the reason that they had nursed the desire to power of attorney as complained of by petitioner, the Solicitor General
replace the petitioner as attorney for the estate and the administratrix found that the same does not appear to be prompted by malice or
and, taking advantage of her goodwill, intrigued against the preparation intended to hurt petitioner's feelings, but purely to safeguard the interest
of the final inventory and accounting and prodded Mrs. Barrera not to of the administratrix. Evidently, petitioner's pride was hurt by the
consent to petitioner's decision to close the administration proceedings; issuance of these documents, and felt that he had been pictured as a
that before their appearance, they brought petitioner's client to their law dishonest lawyer; for he filed a case before the City Fiscal of Cebu
office and there made her sign four documents captioned "Revocation of against Atty. Patalinghug and the widow for libel and falsification. It was
Power of Attorney" and sent the same by mail to several corporations shown, however, that the case was dismissed.
and establishments where the Estate of Macario Barrera is owner of
certificates of stocks and which documents purported to disauthorize the
petitioner from further collecting and receiving the dividends of the No sufficient evidence having been submitted to sustain the charges,
estate from said corporations, when in fact and in truth the respondents these are hereby dismissed and the case closed.
fully knew that no power of attorney or authority was given to the
petitioner by his client, the respondents motive being to embarrass
petitioner to the officials, lawyers and employees of said corporations,
picturing him as a dishonest lawyer and no longer trusted by his client
— all with the purpose of straining the relationship of the petitioner and
his client, Nieves Rillas Vda. de Barrera; and that Atty. Patalinghug
entered his appearance without notice to petitioner.