VIRAY V SANICAS

This is a verified Complaint for Disbarment/Gross Immoral Conduct1 filed with this Court on September 18, 2006 by
complainant Rolando Viray (complainant) against respondent Atty. Eugenio T. Sanicas (respondent).

Factual Antecedents

Complainant alleges that he engaged the services of respondent relative to a labor case2 he filed against Ester Lopez and
Teodoro Lopez III (spouses Lopez). On February 26, 2001, the Labor Arbiter ruled in favor of complainant and disposed of
the case as follows:
ChanRoblesVi rt ualawlib ra ry

WHEREFORE, premises considered, judgment is hereby rendered ordering respondents Ester Lopez and Teodoro Lopez III to
pay complainant Rolando Viray of the following, to wit:
1. Backwages……………….……..P146,726.67
2. Separation Pay………………….…24,000.00
3. Service Incentive Leave Pay……….1,538.46
4. Attorney’s Fees………………...….17,226.51
or a total amount of One Hundred Eighty Nine Thousand Four Hundred Ninety One Pesos & 64/100 (P189,491.60) [sic] to be
deposited with the Cashier of this Office, within ten (10) days from receipt hereof.

All other claims are hereby denied for lack of merit.

SO ORDERED.3

Subsequently, an Alias Writ of Execution4 was issued relative to aforesaid decision. During the implementation of said writ,
however, complainant discovered that respondent had already collected the total amount of P95,000.00 from spouses
Lopez. Respondent received said amount in the following manner: ChanRoblesVirt ualawli bra ry

Date Voucher No. Amount Purpose

02/05/2004 7802 P 20,000.00 Attorney’s fees
02/13/2004 7833 10,000.00 Partial payment for judgment
02/26/2004 7848 10,000.00 Partial payment for judgment
03/12/2004 7894 20,000.00 Partial payment for judgment
04/02/2004 7932 5,000.00 Partial payment for judgment
04/06/2004 7941 5,000.00 Partial payment for judgment
04/13/2004 7944 5,000.00 Partial payment for judgment
04/16/2004 7954 10,000.00 Partial payment for judgment
04/30/2004 7977 10,000.00 Partial payment for judgment
Total Amount: P 95,000.00
Complainant also discovered that respondent misrepresented to spouses Lopez that he is authorized to receive payments on
his behalf, when in truth and in fact he is not. Consequently, complainant made several verbal demands to the respondent
to remit to him the amount of P95,000.00, less his attorney’s fees of P20,000.00. But respondent did not budge. Thus,
complainant lodged a complaint before the Office of the Punong Barangay of Brgy. Felisa, Bacolod City. Respondent,
however, ignored the summons to attend a conference before the barangay to resolve the issues.

In his Comment,5 respondent admits that he received P95,000.00 from spouses Lopez on installments, but denies that he
was not authorized to accept it. He explains that complainant agreed to pay him additional attorney’s fees equivalent to
25% of the total monetary award, on top of the attorney’s fees that may be awarded by the labor tribunal, and to refund all
expenses respondent incurred relative to the case. Thus, from the total award of P189,491.60, the sum of P17,226.57
representing respondent’s professional fees has to be deducted, leaving a balance of P172,275.13.6 Then from said amount,
complainant proposed that he will get P100,000.00 and the balance of P72,275.13 shall belong to respondent as and for his
additional 25% attorney’s fees and reimbursement for all expenses he incurred while handling the case. However, after
receiving the amount of P95,000.00 and deducting therefrom the amounts of P20,000.007 attorney’s fees, P17,000.00
earlier given to complainant, and P2,000.00 paid to the sheriff, what was left to respondent was only
P56,000.00. Respondent whines that this amount is way below the promised 25% attorney’s fees and refund of expenses in
the total amount of P72,275.13.

Respondent asserts that, in any event, complainant will still be receiving a sum greater than what he expects to receive. He
avers that complainant is still entitled to receive from spouses Lopez the sum of P93,491.60. Adding the P17,000.00
respondent previously remitted to complainant, the latter will get a total amount of P110,491.60. This amount, according to
respondent, exceeds the amount of P100,000.00 complainant agreed to and expected to receive.

IBP’s Report and Recommendation

On February 26, 2007,8 we referred this case to the Integrated Bar of the Philippines (IBP) for investigation, report and
recommendation. On January 31, 2011, the Investigating Commissioner issued his Report and Recommendation9 with the
following recommendation:

In view of the foregoing, it is respectfully recommended that the respondent be meted the penalty of two (2) years
suspension. Respondent is also ordered to return, in restitution all the amounts in his possession which are due to
complainant, less his rightful attorney’s fees.10

On October 28, 2011, the IBP Board of Governors adopted Resolution No. XX-2011-139,11 which approved the Report and
Recommendation of the Investigating Commissioner suspending respondent from the practice of law for two years, but with
the modification that respondent should restitute the sum of P85,500.0012 to the complainant.

Issue

The essential issue in this case is whether the respondent is guilty of gross misconduct for his failure to promptly account to
his client the funds received in the course of his professional engagement and return the same upon demand.

The Court’s Ruling

“The Code of Professional Responsibility demands the utmost degree of fidelity and good faith in dealing with the moneys
entrusted to lawyers because of their fiduciary relationship.”13 Specifically, Rule 16.01 of the Code imposes upon the lawyer
the duty to “account for all money or property collected or received for or from the client.” Rule 16.03 thereof, on the other
hand, mandates that “[a] lawyer shall deliver the funds x x x of his client when due or upon demand.”

In this case, respondent on nine separate occasions from February 5, 2004 to April 30, 2004 received payments for
attorney’s fees and partial payments for monetary awards on behalf of complainant from spouses Lopez. But despite the
number of times over close to three months he had been receiving payment, respondent neither informed the complainant of
such fact nor rendered an accounting thereon. It was only when an Alias Writ of Execution was issued and being
implemented when complainant discovered that spouses Lopez had already given respondent the total amount of P95,000.00
as partial payment for the monetary awards granted to him by the labor tribunal.

To make matters worse, respondent withheld and refused to deliver to the complainant said amount, which he merely
received on behalf of his client, even after demand. Complainant brought the matter before the barangay, but respondent
simply ignored the same. Such failure and inordinate refusal on the part of the respondent to render an accounting and
return the money after demand raises the presumption that he converted it to his own use.14 His unjustified withholding of
the funds also warrants the imposition of disciplinary action against him.15 cralawred

Respondent justifies his action by asserting that complainant authorized him to receive payment. He implies that he is also
authorized to apply the sum of money he received from spouses Lopez to his additional 25% attorney’s fees and
reimbursement for all expenses he incurred for the case, in the total amount of P72,275.13. However, after deducting from
the amount of P95,000.00 the amounts of P20,000.00, P17,000.00, and P2,000.00, what was left to respondent, to his
dismay was only P56,000.00.

The Court is not impressed. As aptly observed by the Investigating Commissioner, other than his self-serving statements,
there is nothing in the records which would support respondent’s claim that he was authorized to receive the
payments. Neither is there proof that complainant agreed to pay him additional 25% attorney’s fees and reimburse him for
all expenses he allegedly incurred in connection with the case. Respondent did not present any document, retainer’s
agreement, or itemized breakdown of the amount to be reimbursed to support his claim. In any event, even assuming that
respondent was authorized to receive payments, the same does not exempt him from his duty of promptly informing his
client of the amounts he received in the course of his professional employment. “The fiduciary nature of the relationship
between counsel and client imposes on a lawyer the duty to account for the money or property collected or received for or
from the client. He is obliged to render a prompt accounting of all the property and money he has collected for his
client.” 16 “The fact that a lawyer has a lien for his attorney’s fees on the money in his hands collected for his client does not
relieve him from the obligation to make a prompt accounting.”17 Moreover, a lawyer has no right “to unilaterally appropriate
his client’s money for himself by the mere fact alone that the client owes him attorney’s fees.”18 cralawred

In sum, “[r]espondent’s failure to immediately account for and return the money when due and upon demand violated the
trust reposed in him, demonstrated his lack of integrity and moral soundness, and warrants the imposition of disciplinary
action.”19 cralawred

The Penalty

“The penalty for gross misconduct consisting in the failure or refusal despite demand of a lawyer to account for and to return
money or property belonging to a client has been suspension from the practice of law for two years.”20 Thus, the IBP Board
of Governors did not err in recommending the imposable penalty. Considering, however, that this is respondent’s first
offense and he is already a nonagenarian,21 the Court, in the exercise of its compassionate judicial discretion, finds that a
penalty of one year suspension is sufficient.

WHEREFORE, the Court finds respondent Atty. Eugenio T. Sanicas GUILTY of gross misconduct and
accordingly SUSPENDS him from the practice of law for one (1) year upon the finality of this Resolution, with a warning that
a repetition of the same or similar act or offense shall be dealt with more severely.

Atty. Sanicas is ordered to return to complainant, within 90 days from finality of this Resolution, the net amount of
P85,500.00 with interest at the rate of 6% per annum from finality of this Resolution until the full amount is
returned. Failure to comply with the foregoing directive will warrant the imposition of a more severe penalty.

Let copies of this Resolution be furnished the Office of the Bar Confidant and noted in Atty. Sanicas’ record as a member of
the Bar.