Liuanan v. Melo A.M. No.

2361 1 of 4

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
A.M. No. 2361 February 9, 1989
LEONILA J. LICUANAN, complainant,
vs.
ATTY. MANUEL L. MELO, respondent.
PER CURIAM:
An affidavit-complaint, dated November 11, 1981, was filed by Leonila J. Licuanan with the Office of the Court
Administrator on 5 February 1982 against respondent, Atty. Manuel L. Melo, for breach of professional ethics,
alleging that respondent, who was her counsel in an ejectment case filed against her tenant, failed to remit to her
the rentals collected by respondent on different dates over a twelve-month period, much less did he report to her
the receipt of said amounts. It was only after approximately a year from actual receipt that respondent turned over
his collections to complainant after the latter, through another counsel, acquired knowledge of the payment and had
demanded the same.
In his Comment on the complaint, respondent admitted having received the payment of rentals from complainant's
tenant, Aida Pineda, as alleged in the complaint, but explained that he kept this matter from the complainant for the
purpose of surprising her with his success in collecting the rentals.
We forwarded the case to the Office of the Solicitor General, for investigation, report and recommendation.
Hearings were conducted and the parties presented their respective evidence.
After investigation, the Solicitor General submitted the following Findings and Recommendation:
Findings:
The issue to be resolved is whether there was unreasonable delay on the part of the respondent in
accounting for the funds collected by him for his former client, the complainant herein, for which
unprofessional conduct respondent should be disciplined.
A lawyer, under his oath, pledges himself not to delay any man for money or malice and is bound to
conduct himself with all good fidelity to his clients. Under paragraph 11 of the Canons of Legal
Ethics, he is obligated to report promptly the money of client that has come to his possession and
should not commingle it with his private property or use it for his personal purpose without his
client's consent viz:
Money of the client or other trust property coming into the possession of the lawyer
should be reported promptly, and except with the client's know and consent should
not be commingled with his private or be used by him.
And paragraph 32 of the Canons of Legal Ethics further requires a lawyer to maintain a reputation
for honesty and fidelity to private trust:
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... But above all, a lawyer will find his highest honor in a deserved reputation for
fidelity to private trust and to public duty, as an honest man and as a patriotic and
loyal citizen.
In the instant case, respondent failed to observe his oath of office. It is undisputed that the relation of
attorney and client existed between Licuanan and Melo at the time the incident in question took
place. The records disclose that on August 8, 1979, respondent, as Licuanan's attorney, obtained
judgment in Licuanan's favor against Aida Pineda whereby the latter was directed by the City Court
of Manila to pay Licuanan all her monthly rentals from October, 1978 and succeeding months
thereafter.
When several months had elapsed without them hearing a word from Pineda, respondent decided to
send her a letter on February 4, 1980, demanding that she pay the monthly rental of her apartment
otherwise he will be constrained to take the necessary legal action against her to protect the interest
of his client (Exhibit "A", p. 8, record). On February 11, 1980, Pineda yielded to the demand of
Melo. She went to respondent's office and paid him P3,060.00 for which respondent gave her a
receipt for the said amount representing her rental payments for October, 1978 to February, 1980 at
the rate of P180.00 per month (Exh. "B", p. 9, Ibid.) At the end of March 31,1980, Pineda again
went back to respondent and paid the rentals of her apartment for the months of March and April,
1980 in the sum of P360.00 (Exh. "C" p. 10, Ibid.). Not only that, respondent again received from
Pineda on June 30, 1980 rental payments covering the months of May, June and July, 1980 in the
total sum of P540.00 (Exh. "D" p. 11, Ibid.). And, on September 29, 1980, he received and issued
Pineda a receipt for P540.00 covering rental payments for the months of August, September and
October, 1980. (Exh. "E", Ibid.). After four months had elapsed, or on January 23, 1981, he collected
again from Pineda the total sum of P720.00 covering the months of October, November, December,
1980 and January 1981 (Exh. "F", p. 12, Ibid.).
During the entire twelve-month period that respondent had been receiving the said rental payments
of Pineda, he did not bother to inform or report to complainant about the said payments and instead
unnecessarily retained the money. He allowed the money to accumulate for a year and kept
complainant in the dark as to the progress of the case. He did not even attempt to tell her about the
money that had come into his possession notwithstanding the fact that complainant used to call him
and inquire regarding the case (pp. 14-15, tsn., Sept. 10, 1985).
It was only when Atty. Ponciano B. Jacinto, the new counsel retained by complainant, wrote
respondent a letter on May 4, 1981, advising him to surrender the money to complainant that he
accounted for it (Exh. "H", p. 15, Ibid.). But this was rather late because as early as April 27, 1981,
complainant, not knowing that respondent had been receiving the rental payments of Pineda,
instituted an administrative case against her (Aida Pineda) before the Chief of the Philippine
Tuberculosis Society accusing her of "moral turpitude" arising from her alleged failure to pay the
rent of her apartment as ordered by the City Court of Manila in Civil Case No. 037276 and claiming
that she has ignored and refused to pay her just obligation (Exh. "G", p. 14, Ibid.).
This led therefore Pineda to bring an action against her (Licuanan) for damages before the then
Court of First Instance of Manila, for she allegedly suffered mental anguish, besmirched reputation,
Liuanan v. Melo A.M. No. 2361 3 of 4

wounded feelings and social humiliation arising from the unfounded administrative case Licuanan
filed against her (Aida Pineda), since as borne out by the records, she had been paying her obligation
religiously to the lawyer of Licuanan, herein respondent (pp. 48-52, record). Clearly, this
unfortunate incident would not have happened had respondent been only true to his oath as a lawyer,
i.e., to be honest and candid towards his client.
Thus, we find it hard to believe respondent's defense that he kept the money of complainant for a
year merely because he wanted to surprise her with his success in collecting the rental payments
from Pineda. On the contrary, it is very much discernible that he did not surrender immediately the
money to complainant because he was using it for his own benefit. Common sense dictates that by
unnecessarily withholding the money of complainant for such length of time, respondent deprived
her of the use of the same. It is therefore too credulous to believe his explanation, which is flimsy
and incredible Respondent's actuation casts doubt on his honesty and integrity. He must know that
the "highly fiduciary" and "confidential relation" of attorney and client requires that the attorney
should promptly account for all funds and property received or held by him for the client's benefit,
and failure to do so constitutes professional misconduct, as succinctly held by the Honorable
Supreme Court in the case of Fermina Legaspi Daroy, et al., vs. Atty. Ramon Chaves Legaspi, Adm.
Case No. 936, July 25, 1975, 65 SCRA 304, to wit:
A lawyer, under his oath, pledges himself not to delay any man for money or malice
and is bound to conduct himself with all good fidelity to his clients. He is obligated to
report promptly the money of his clients that has come into his possession. He should
not commingle it with his private property or use it for his personal purposes without
his client's consent. He should maintain a reputation for honesty and fidelity to
private trust (Pars. 11 and 32, Canons of Legal Ethics).
Money collected by a lawyer in pursuance of a judgment in favor of his clients is held
in trust and must be immediately turned over to them (Aya vs. Bigonia, 57 Phil. 8,
11).
xxx xxx xxx
A lawyer may be disbarred for any deceit, malpractice or other gross misconduct in his office as
attorney or for any violation of the lawyer's oath (Ibid, sec. 27).
The relation between an attorney and his client is highly fiduciary in its nature and of a very
delicate, exacting and confidential in character, requiring a high degree of fidelity and good faith (7
Am. Jur. 2d 105). In view of that special relationship, 'lawyers are bound to promptly account for
money or property received by them on behalf of their clients and 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 received.
(Emphasis supplied).
In fine, we are convinced that respondent is guilty of breach of trust reposed in him by his client.
Not only has he degraded himself but as an unfaithful lawyer he has besmirched the fair name of an
honorable profession (In re Paraiso, 41 Phil. 24, 25; In re David, 84 Phil. 627; Manaloto vs. Reyes,
Liuanan v. Melo A.M. No. 2361 4 of 4

Adm. Case No. 503, October 29, 1965, 15 SCRA 131). By his deceitful conduct, he placed his client
in jeopardy by becoming a defendant in a damage suit; thus, instead of being a help to his client, he
became the cause of her misery. He, therefore, deserves a severe punishment for it. (Aya vs.
Bigornia, 57 Phil. 8, 11; In re Bamberger, April 17, 1924, 49 Phil. 962; Daroy, et al., vs. Atty. Ramon
Chaves Legaspi, supra.)
Clearly, respondent is guilty of professional misconduct in the discharge of his duty as a lawyer.
RECOMMENDATION
WHEREFORE, we respectfully recommend that respondent be suspended from the practice of law
for a period of not less than one (1) year, and that he be strongly admonished to strictly and
faithfully observe his duties to his clients. (pp. 78-85, Rollo)
We find the foregoing findings well considered and adopt the same but differ with the recommendation.
The actuations of respondent in retaining for his personal benefit over a one-year period, the amount of P5,220.00
received by him on behalf of his client, the complainant herein, depriving her of its use, and withholding
information on the same despite inquiries made by her, is glaringly a breach of the Lawyer's Oath to which he
swore observance, and an evident transgression of the Canons of Professional Ethics particularly:
11. DEALING WITH TRUST PROPERTY
The lawyer should refrain from any action whereby for his personal benefit or gain he abuses or
takes advantage of the confidence reposed in him by his client.
Money of the client or collected for the client of other trust property coming into the possession of
the lawyer should be reported and accounted for promptly, and should not under any circumstance
be commingled with his own or be used by him.
Indeed, by his professional misconduct, respondent has breached the trust reposed in him by his client. He has
shown himself unfit for the confidence and trust which should characterize an attorney-client relationship and the
practice of law. By reason thereof complainant was compelled to file a groundless suit against her tenant for non-
payment of rentals thereby exposing her to jeopardy by becoming a defendant in a damage suit filed by said tenant
against her By force of circumstances, complainant was further compelled to engage the services of another
counsel in order to recover the amount rightfully due her but which respondent had unjustifiedly withheld from her.
Respondent's unprofessional actuations considered, we are constrained to find him guilty of deceit, malpractice and
gross misconduct in office. He has displayed lack of honesty and good moral character. He has violated his oath not
to delay any man for money or malice, besmirched the name of an honorable profession and has proven himself
unworthy of the trust reposed in him by law as an officer of the Court. He deserves the severest punishment.
WHEREFORE, consistent with the crying need to maintain the high traditions and standards of the legal
profession and to preserve undiminished public faith in attorneys-at-law, the Court Resolved to DISBAR
respondent, Atty. Manuel L. Melo, from the practice of law. His name is hereby ordered stricken from the Roll of
Attorneys.
Copies of this Resolution shall be circulated to all Courts of the country and spread on the personal record of
respondent Atty. Manuel L. Melo.