Canon 14

Canon 14
A LAWYER SHALL NOT REFUSE HIS SERVICES TO THE NEEDY.
Rule 14.01 - A lawyer shall not decline to represent a person solely on

account of the latter's race, sex. creed or status of life, or because of his
own opinion regarding the guilt of said person.
Rule 14.02 - A lawyer shall not decline, except for serious and sufficient
cause, an appointment as counsel de officio or as amicus curiae, or a
request from the Integrated Bar of the Philippines or any of its chapters
for rendition of free legal aid.
Rule 14.03 - A lawyer may not refuse to accept representation of an

indigent client unless:chanroblesvirtuallawlibrary
(a) he is not in a position to carry out the work effectively or competently;
(b) he labors under a conflict of interest between him and the prospective
client or between a present client and the prospective client.
Rule 14.04 - A lawyer who accepts the cause of a person unable to pay his
professional fees shall observe the same standard of conduct governing
his relations with paying clients.
B.M. No. 2012 February 10, 2009
PROPOSED RULE ON MANDATORY LEGAL AID SERVICE FOR PRACTICING

LAWYERS
RESOLUTION
Acting on the Memorandum dated January 27, 2009 of Justice Renato C.

Corona re: Comment of the Integrated Bar of the Philippines on our
Suggested Revisions to the Proposed Rule of Mandatory Legal Aid Service
for Practicing Lawyers, the Court Resolved to APPROVE the same.
This Resolution shall take effect on July 1, 2009 following publication of the
said Rule and its implementing regulations in at least two (2) newpapers
of general circulation.
February 10, 2009
REYNATO S. PUNO
Chief Justice
LEONARDO A. QUISUMBING CONSUELO YNARES-SANTIAGO
Associate Justice Associate Justice
ANTONIO T. CARPIO MA. ALICIA AUSTRIA-MARTINEZ
RENATO C. CORONA CONCHITA CARPIO MORALES
ADOLFO S. AZCUNA DANTE O. TINGA
MINITA V. CHICO-NAZARIO PRESBITERO J. VELASCO, JR.
ANTONIO EDUARDO B. NACHURA TERESITA J. LEONARDO-DE CASTRO
ARTURO D. BRION DIOSDADO M. PERALTA
RULE ON MANDATORY LEGAL AID SERVICE
SECTION 1. Title. - This Rule shall be known as "The Rule on Mandatory

Legal Aid Service."
SECTION 2. Purpose. - This Rule seeks to enhance the duty of lawyers to

society as agents of social change and to the courts as officers thereof by
helping improve access to justice by the less privileged members of
society and expedite the resolution of cases involving them. Mandatory
free legal service by members of the bar and their active support thereof
will aid the efficient and effective administration of justice especially in
cases involving indigent and pauper litigants.
SECTION 3. Scope. - This Rule shall govern the mandatory requirement for
practicing lawyers to render free legal aid services in all cases (whether,
civil, criminal or administrative) involving indigent and pauper litigants
where the assistance of a lawyer is needed. It shall also govern the duty
of other members of the legal profession to support the legal aid program
of the Integrated Bar of the Philippines.
SECTION 4. Definition of Terms. - For purposes of this Rule:
(a) Practicing lawyers are members of the Philippine Bar who

appear for and in behalf of parties in courts of law and quasi-judicial
agencies, including but not limited to the National Labor Relations
Commission, National Conciliation and Mediation Board, Department
of Labor and Employment Regional Offices, Department of Agrarian
Reform Adjudication Board and National Commission for Indigenous
Peoples. The term "practicing lawyers" shall exclude:
(i) Government employees and incumbent elective officials not

allowed by law to practice;
(ii) Lawyers who by law are not allowed to appear in court;
(iii) Supervising lawyers of students enrolled in law student

practice in duly accredited legal clinics of law schools and
lawyers of non-governmental organizations (NGOs) and
peoples’ organizations (POs) like the Free Legal Assistance
Group who by the nature of their work already render free
legal aid to indigent and pauper litigants and
(iv) Lawyers not covered under subparagraphs (i) to (iii)

including those who are employed in the private sector but do
not appear for and in behalf of parties in courts of law and
quasi-judicial agencies.
(b) Indigent and pauper litigants are those defined under Rule 141,
Section 19 of the Rules of Court and Algura v. The Local Government
Unit of the City of Naga (G.R. No.150135, 30 October 2006, 506 SCRA
81);
(c) Legal aid cases are those actions, disputes, and controversies
that are criminal, civil and administrative in nature in whatever stage
wherein indigent and pauper litigants need legal representation;
(d) Free legal aid services refer to appearance in court or quasi-

judicial body for and in behalf of an indigent or pauper litigant and
the preparation of pleadings or motions. It shall also cover
assistance by a practicing lawyer to indigent or poor litigants in
court-annexed mediation and in other modes of alternative dispute
resolution (ADR). Services rendered when a practicing lawyer is
appointed counsel de oficio shall also be considered as free legal aid
services and credited as compliance under this Rule;
(e) Integrated Bar of the Philippines (IBP) is the official national

organization of lawyers in the country;
(f) National Committee on Legal Aid (NCLA) is the committee of the

IBP which is specifically tasked with handling legal aid cases;
(g) Committee on Bar Discipline (CBD) is the committee of the IBP

which is specifically tasked with disciplining members of the Bar;
(h) IBP Chapters are those chapters of the Integrated Bar of the
Philippines located in the different geographical areas of the country
as defined in Rule 139-A and
(i) Clerk of Court is the Clerk of Court of the court where the
practicing lawyer rendered free legal aid services. In the case of
quasi-judicial bodies, it refers to an officer holding an equivalent or
similar position.
The term shall also include an officer holding a similar position in

agencies exercising quasi-judicial functions, or a responsible officer
of an accredited PO or NGO, or an accredited mediator who
conducted the court-annexed mediation proceeding.
SECTION 5. Requirements. -
(a) Every practicing lawyer is required to render a minimum of sixty

(60) hours of free legal aid services to indigent litigants in a year.
Said 60 hours shall be spread within a period of twelve (12) months,
with a minimum of five (5) hours of free legal aid services each
month. However, where it is necessary for the practicing lawyer to
render legal aid service for more than five (5) hours in one month,
the excess hours may be credited to the said lawyer for the
succeeding periods.
For this purpose, a practicing lawyer shall coordinate with the Clerk
of Court for cases where he may render free legal aid service. He
may also coordinate with the IBP Legal Aid Chairperson of the IBP
Chapter to inquire about cases where he may render free legal aid
service. In this connection, the IBP Legal Aid Chairperson of the IBP
Chapter shall regularly and actively coordinate with the Clerk of
Court.
The practicing lawyer shall report compliance with the requirement

within ten (10) days of the last month of each quarter of the year.
(b) A practicing lawyer shall be required to secure and obtain a

certificate from the Clerk of Court attesting to the number of hours
spent rendering free legal aid services in a case.
The certificate shall contain the following information:

(i) The case or cases where the legal aid service was
rendered, the party or parties in the said case(s) for whom the
service was rendered, the docket number of the said case(s)
and the date(s) the service was rendered.
(ii) The number of hours actually spent attending a hearing or

conducting trial on a particular case in the court or quasi-
judicial body.
(iii) The number of hours actually spent attending mediation,

conciliation or any other mode of ADR on a particular case.
(iv) A motion (except a motion for extension of time to file a

pleading or for postponement of hearing or conference) or
pleading filed on a particular case shall be considered as one
(1) hour of service.
The Clerk of Court shall issue the certificate in triplicate, one

(1) copy to be retained by the practicing lawyer, one (1) copy to
be retained by the Clerk of Court and one (1) copy to be
attached to the lawyer's compliance report.
(c) Said compliance report shall be submitted to the Legal Aid

Chairperson of the IBP Chapter within the court’s jurisdiction. The
Legal Aid Chairperson shall then be tasked with immediately
verifying the contents of the certificate with the issuing Clerk of
Court by comparing the copy of the certificate attached to the
compliance report with the copy retained by the Clerk of Court.
(d) The IBP Chapter shall, after verification, issue a compliance

certificate to the concerned lawyer. The IBP Chapter shall also
submit the compliance reports to the IBP’s NCLA for recording and
documentation. The submission shall be made within forty-five (45)
days after the mandatory submission of compliance reports by the
practicing lawyers.
(e) Practicing lawyers shall indicate in all pleadings filed before the
courts or quasi-judicial bodies the number and date of issue of their
certificate of compliance for the immediately preceding compliance
period. Failure to disclose the required information would cause the
dismissal of the case and the expunction of the pleadings from the
records.
(f) Before the end of a particular year, lawyers covered by the

category under Section 4(a)(i) and (ii), shall fill up a form prepared
by the NCLA which states that, during that year, they are employed
with the government or incumbent elective officials not allowed by
law to practice or lawyers who by law are not allowed to appear in
court.
The form shall be sworn to and submitted to the IBP Chapter or IBP
National Office together with the payment of an annual contribution
of Two Thousand Pesos (P2,000). Said contribution shall accrue to a
special fund of the IBP for the support of its legal aid program.
(g) Before the end of a particular year, lawyers covered by the

category under Section 4(a)(iii) shall secure a certification from the
director of the legal clinic or of the concerned NGO or PO to the
effect that, during that year, they have served as supervising
lawyers in a legal clinic or actively participated in the NGO’s or PO’s
free legal aid activities. The certification shall be submitted to the
IBP Chapter or IBP National Office.
(h) Before the end of a particular year, lawyers covered by the

category under Section 4(a)(iv) shall fill up a form prepared by the
NCLA which states that, during that year, they are neither practicing
lawyers nor covered by Section (4)(a)(i) to (iii). The form shall be
sworn to and submitted to the IBP Chapter or IBP National Office
together with the payment of an annual contribution of Four
Thousand Pesos (P4,000) by way of support for the efforts of
practicing lawyers who render mandatory free legal aid services.
Said contribution shall accrue to a special fund of the IBP for the
support of its legal aid program.
(i) Failure to pay the annual contribution shall subject the lawyer to
a penalty of Two Thousand Pesos (P2,000) for that year which
amount shall also accrue to the special fund for the legal aid
program of the IBP.
SECTION 6. NCLA. -
(a) The NCLA shall coordinate with the various legal aid committees
of the IBP local chapters for the proper handling and accounting of
legal aid cases which practicing lawyers can represent.
(b) The NCLA shall monitor the activities of the Chapter of the Legal
Aid Office with respect to the coordination with Clerks of Court on
legal aid cases and the collation of certificates submitted by
practicing lawyers.
(c) The NCLA shall act as the national repository of records in

compliance with this Rule.
(d) The NCLA shall prepare the following forms: certificate to be

issued by the Clerk of Court and forms mentioned in Section 5(e) and
(g).
(e) The NCLA shall hold in trust, manage and utilize the contributions
and penalties that will be paid by lawyers pursuant to this Rule to
effectively carry out the provisions of this Rule. For this purpose, it
shall annually submit an accounting to the IBP Board of Governors.
The accounting shall be included by the IBP in its report to the

Supreme Court in connection with its request for the release of the
subsidy for its legal aid program.
SECTION 7. Penalties. -
(a) At the end of every calendar year, any practicing lawyer who fails
to meet the minimum prescribed 60 hours of legal aid service each
year shall be required by the IBP, through the NCLA, to explain why
he was unable to render the minimum prescribed number of hours.
If no explanation has been given or if the NCLA finds the explanation
unsatisfactory, the NCLA shall make a report and recommendation
to the IBP Board of Governors that the erring lawyer be declared a
member of the IBP who is not in good standing. Upon approval of the
NCLA’s recommendation, the IBP Board of Governors shall declare
the erring lawyer as a member not in good standing. Notice thereof
shall be furnished the erring lawyer and the IBP Chapter which
submitted the lawyer’s compliance report or the IBP Chapter where
the lawyer is registered, in case he did not submit a compliance
report. The notice to the lawyer shall include a directive to pay Four
Thousand Pesos (P4,000) penalty which shall accrue to the special
fund for the legal aid program of the IBP.
(b) The "not in good standing" declaration shall be effective for a

period of three (3) months from the receipt of the erring lawyer of
the notice from the IBP Board of Governors. During the said period,
the lawyer cannot appear in court or any quasi-judicial body as
counsel. Provided, however, that the "not in good standing" status
shall subsist even after the lapse of the three-month period until
and unless the penalty shall have been paid.
(c) Any lawyer who fails to comply with his duties under this Rule for
at least three (3) consecutive years shall be the subject of
disciplinary proceedings to be instituted motu proprio by the CBD.
The said proceedings shall afford the erring lawyer due process in
accordance with the rules of the CBD and Rule 139-B of the Rules of
Court. If found administratively liable, the penalty of suspension in
the practice of law for one (1) year shall be imposed upon him.
(d) Any lawyer who falsifies a certificate or any form required to be

submitted under this Rule or any contents thereof shall be
administratively charged with falsification and dishonesty and shall
be subject to disciplinary action by the CBD. This is without prejudice
to the filing of criminal charges against the lawyer.
(e) The falsification of a certificate or any contents thereof by any

Clerk of Court or by any Chairperson of the Legal Aid Committee of
the IBP local chapter where the case is pending or by the Director of
a legal clinic or responsible officer of an NGO or PO shall be a
ground for an administrative case against the said Clerk of Court or
Chairperson. This is without prejudice to the filing of the criminal and
administrative charges against the malfeasor.
SECTION 8. Credit for Mandatory Continuing Legal Education (MCLE). - A

lawyer who renders mandatory legal aid service for the required number
of hours in a year for the three year-period covered by a compliance
period under the Rules on MCLE shall be credited the following: two (2)
credit units for legal ethics, two (2) credit units for trial and pretrial skills,
two (2) credit units for alternative dispute resolution, four (4) credit units
for legal writing and oral advocacy, four (4) credit units for substantive
and procedural laws and jurisprudence and six (6) credit units for such
subjects as may be prescribed by the MCLE Committee under Section 2(9),
Rule 2 of the Rules on MCLE.
A lawyer who renders mandatory legal aid service for the required
number of hours in a year for at least two consecutive years within the
three year-period covered by a compliance period under the Rules on
MCLE shall be credited the following: one (1) credit unit for legal ethics,
one (1) credit unit for trial and pretrial skills, one (1) credit unit for
alternative dispute resolution, two (2) credit units for legal writing and
oral advocacy, two (2) credit units for substantive and procedural laws
and jurisprudence and three (3) credit units for such subjects as may be
prescribed by the MCLE Committee under Section 2(g), Rule 2 of the Rules
on MCLE.
SECTION 9. Implementing Rules. - The IBP, through the NCLA, is hereby

given authority to recommend implementing regulations in determining
who are "practicing lawyers," what constitute "legal aid cases" and what
administrative procedures and financial safeguards which may be
necessary and proper in the implementation of this rule may be
prescribed. It shall coordinate with the various legal chapters in the
crafting of the proposed implementing regulations and, upon approval by
the IBP Board of Governors, the said implementing regulations shall be
transmitted to the Supreme Court for final approval.
SECTION 10. Effectivity. - This Rule and its implementing rules shall take
effect on July 1,2009 after they have been published in two (2) newspapers
of general circulation.
Counsel De Officio
Attorney appointed by the court.
To defend an indigent defendant in a criminal action.
To represent a destitute party.
Amicus curiae
An experienced and impartial attorney invited by the court to appear and

help in the disposition of issues submitted to it.
It implies friendly intervention of counsel to call the attention of the court

to some matters of law or facts which might otherwise escape its notice
and in regard to which it might go wrong.
Appears in court not to represent any particular party but only to assist
the court.
Amicus par excellence
Bar associates who appear in court as amici curiae or friends of the court.
Acts merely as a consultant to guide the court in a doubtful question or
issue pending before it.
Legarda vs Court of Appeals, GR No. 94457, March 18, 1991
Nothing is more settled than the rule that the mistake of a counsel binds
the client. It is only in case of gross or palpable negligence of counsel
when the courts must step in and accord relief to a client who suffered
thereby.
The present case is a typical example of such rare exception.
Petitioner Victoria Legarda was the owner of a parcel of land and the
improvements thereon located at 123 West Avenue, Quezon City. On
January 11, 1985 respondent New Cathay House, Inc. filed a complaint
against the petitioner for specific performance with preliminary injunction
and damages in the Regional Trial Court (RTC) for Quezon City alleging,
among others, that petitioner entered into a lease agreement with the
private respondent through its representative, Roberto V. Cabrera, Jr., of
the aforestated property of petitioner effective January 1, 1985 until
December 31, 1989 or for a period of five (5) years; that the rental is
P25,000.00 per month with 5% escalation per year; that on November 23,
1984, private respondent deposited the amount of P72,000.00 with
petitioner as down payment of rentals; that respondent drew up the
written contract and sent it to petitioner, that petitioner failed and refused
to execute and sign the same despite demands of respondent; and that the
respondent suffered damages due to the delay in the renovation and
opening of its restaurant business. The private respondent prayed that
pending the resolution of the case a restraining order be issued against
petitioner or her agents enjoining them from stopping the renovation and
use of the premises by private respondent. It was also prayed that after
due hearing the petitioner be ordered to execute the lease contract; to pay
actual compensatory, exemplary and other damages in such amount as
may be proved during the trial including P30,000.00 attorney's fees plus
P300.00 per appearance of counsel, and to pay the expenses of litigation.1
Petitioner engaged the services of counsel to handle her case. Said

counsel filed his appearance with an urgent motion for extension of time
to file the answer within ten (10) days from February 26, 1985.2 However,
said counsel failed to file the answer within the extended period prayed
for. Counsel for private respondent filed an ex-parte motion to declare
petitioner in default. This was granted by the trial court on March 25, 1985
and private respondent was allowed to present evidence ex-parte.
Thereafter, on March 25, 1985, the trial court rendered its decision, the
dispositive part of which reads as follows:
WHEREFORE, judgment is hereby rendered ordering defendant

Victoria G. Legarda to execute and sign Exhibit "D":, the lease
contract for the premises at 123 West Avenue, Quezon City.
Accordingly, the preliminary injunction earlier issued on January 31,
1985 is hereby made permanent.
Judgment is likewise rendered ordering defendant to pay exemplary

damages in the sum of P100,000.00 to serve as example and
deterrent for others, and actual and compensatory damages as
follows:
1. For loss and destroyed goodwill and reputation in the amount of

P100,000.00;
2. The sum of P61,704.40 as adjustments in the costs of labor and

materials for the renovation of the premises;
3. The sum of P50,000.00 as unearned income for the delay of

plaintiff 's operations from January 1, 1985 up to February 25, 1985 or
a period of almost two (2) months;
4. The sum of P16,635.57 and P50,424.40 as additional compensatory

damages incurred by plaintiff for the extension of the lease of its
premises at Makati and salaries of idle employees, respectively;
5. The sum of P10,000.00 as and by way of attorney's fees; and
6. The costs of suit.3
Copy of said decision was duly served on counsel for the petitioner but he
did not take any action. Thus, the judgment became final and executory. On
May 8, 1985, upon motion of private respondent, a writ of execution of the
judgment was issued by the trial court.4
At public auction, the sheriff sold the aforestated property of petitioner to

Roberto V. Cabrera, Jr. for the sum of P376,500.00 to satisfy the judgment.
The sheriff issued a certificate of sale dated June 8, 1985 covering the said
property.5 After the one year redemption period expired without the
petitioner redeeming the property, ownership was consolidated in the
name of Roberto V. Cabrera, Jr. The sheriff issued a final deed of sale on
July 8, 1986 in his favor. Cabrera registered the same in the office of the
Register of Deeds on July 11, 1986.
Upon learning of this unfortunate turn of events, petitioner prevailed upon

her counsel, to seek the appropriate relief. On November 6, 1986 said
counsel filed in the Court of Appeals a petition for annulment of judgment
calling attention to the unjust enrichment of private respondent in
securing the transfer in its name of the property valued at P 2.5 million
without justification; that when the complaint was filed in court by private
respondent against the petitioner, the parties came to an agreement to
settle their differences, the private respondent assuring petitioner that the
complaint it filed shall be withdrawn so petitioner advised her lawyer that
there was no longer any need to file an answer to the complaint; that on
February 22, 1985, private respondent nevertheless filed an ex-
parte motion to declare the petitioner in default; that petitioner was
deprived of the right to present her defense through false pretenses,
misrepresentation and fraud practiced upon her by private respondent
warranting the annulment of the judgment; that the documentary evidence
presented by private respondent, which served as the basis of the
decision, is falsified and tampered with; that as an example, the voucher
filed by petitioner, contains typewritten entries to the effect that the term
of the lease is for five (5) years to which petitioner never agreed, and that
the option to buy the property was given to the private respondent; that
the fact that the property worth P2 million was sold at public auction at a
shockingly and questionably low price of P376,500.00 is by itself a
sufficient basis for annulling the sale for being grossly inadequate to
shock the conscience and understanding of men, giving rise to a
presumption of fraud.6 Thus, it was prayed that a preliminary mandatory
injunction issue ordering the private respondent to surrender the property
to petitioner and to enjoin the former from further harassing and
threatening the peaceful possession of petitioner; and that after hearing,
the decision of the trial court in Civil Case No. Q-43811 and the sheriffs
certificate of sale7 be likewise annulled; that private respondent be
adjudged to pay petitioner no less than P500,000.00 actual and moral
damages, as well as exemplary damages and attorney's fees in the
amount of P50,000.00, plus the costs of the suit.8
On February 2, 1987 an amended petition was filed by counsel for

petitioner in the Court of Appeals raising the additional issue that the
decision is not supported by the allegations in the pleadings or by the
evidence submitted.9
In due course, a decision was rendered by the Court of Appeals on

November 29, 1989.10 The appellate court made the following observations:
On the other hand, petitioner's above allegation of fraud supposedly

practiced upon her by Roberto V. Cabrera, Jr. is so improbable as to
inspire belief. For the Coronel Law Office had already entered its
appearance as petitioner's counsel by then, so that if it were true
that Cabrera had already agreed to the conditions imposed by
petitioner, said law office would have asked plaintiff to file the
proper motion to dismiss or withdraw complaint with the Court, and
if plaintiff had refused to do so, it would have filed defendant's
answer anyway so that she would not be declared in default. Or said
law office would have prepared a compromise agreement
embodying the conditions imposed by their client in the lease
contract in question which plaintiff had allegedly already accepted,
so that the same could have been submitted to the Court and
judgment on a compromise could be entered. All these, any
conscientious lawyer of lesser stature than the Coronel Law Office,
headed by no less than a former law dean, Dean Antonio Coronel, or
even a new member of the bar, would normally have done under the
circumstances to protect the interests of their client, instead of
leaving it to the initiative of plaintiff to withdraw its complaint
against defendant, as it had allegedly promised the latter. Thus, it is
our belief that this case is one of-pure and simple negligence on the
part of defendant's counsel who simply failed to file the answer in
behalf of defendant, But counsel's negligence does not stop
here. For after it had been furnished with copy of the decision by
default against defendant, it should then have appealed therefrom or
file a petition from relief from the order declaring their client in
default or from the judgment by default. [sic] Again, counsel
negligently failed to do either. Hence, defendant is bound by the acts
of her counsel in this case and cannot be heard to complain that the
result might have been different if it had proceeded differently
(Pulido vs. C.A., 122 SCRA 63; Ayllon vs. Sevilla, 156 SCRA 257, among
other cases). And the rationale of this rule is obvious and clear. For
"if such grounds were to be admitted as reasons for opening cases,
there would never be an end to a suit so long as new counsel could
be employed who could allege and show that the prior counsel had
not been sufficiently diligent, or experienced, or learned" (Fernandez
vs. Tan Tiong Tick, 1 SCRA 1138).11
Despite these findings, the appellate court nevertheless dismissed the

petition for annulment of judgment with costs against the petitioner. A
copy of the said judgment appears to have been served on counsel for the
petitioner. However, said counsel did not file a motion for reconsideration
or appeal therefrom, so it became final.
It was only in March 1990 when the secretary of counsel for petitioner
informed the latter of the adverse decision against her only after
persistent telephone inquiries of the petitioner.
Hence, petitioner secured the services of another lawyer who filed this
petition for certiorari under Rule 65 of the Rules of Court wherein it is
prayed that the judgment of the Regional Trial Court of Quezon City in Civil
Case No. Q-43811, the decision of the Court of Appeals in CA-G.R. No.
10487 and the sheriff's sale at public auction of the property in question be
annulled, as the same are attributable to the gross negligence and
inefficiency of petitioner's counsel, whose blunder cannot bind the
petitioner who was deprived of due process thereby. It is further prayed
that private respondent Cathay House, Inc. be ordered to reconvey to
petitioner the property covered by TCT No. 270814, which was sold at
public auction to Roberto V. Cabrera, Jr. and in whose favor its ownership
was consolidated, and thereafter ownership appears to have been
transferred to private respondent.
The petition is impressed with merit.
Petitioner's counsel is a well-known practicing lawyer and dean of a law

school. It is to be expected that he would extend the highest quality of
service as a lawyer to the petitioner. Unfortunately, counsel appears to
have abandoned the cause of petitioner. After agreeing to defend the
petitioner in the civil case filed against her by private respondent, said
counsel did nothing more than enter his appearance and seek for an
extension of time to file the answer. Nevertheless, he failed to file the
answer. Hence, petitioner was declared in default on motion of private
respondent's counsel. After the evidence of private respondent was
received ex-parte, a judgment was rendered by the trial court.
Said counsel for petitioner received a copy of the judgment but took no
steps to have the same set aside or to appeal therefrom. Thus, the
judgment became final and executory. The property of petitioner was sold
at public auction to satisfy the judgment in favor of private respondent.
The property was sold to Roberto V. Cabrera, Jr., representative of private
respondent, and a certificate of sale was issued in his favor. The
redemption period expired after one year so a final deed of sale was
issued by the sheriff in favor of Cabrera, who in turn appears to have
transferred the same to private respondent.
During all the time, the petitioner was abroad. When, upon her return, she
learned, to her great shock, what happened to her case and property, she
nevertheless did not lose faith in her counsel. She still asked Atty. Coronel
to take such appropriate action possible under the circumstances.
As above related, said counsel filed a petition for annulment of judgment

and its amendment in the Court of Appeals.1âwphi1 But that was all he did.
After an adverse judgment was rendered against petitioner, of which
counsel was duly notified, said counsel did not inform the petitioner about
it. He did not even ask for a reconsideration thereof, or file a petition for
review before this Court. Thus, the judgment became final. It was only
upon repeated telephone inquiries of petitioner that she learned from the
secretary of her counsel of the judgment that had unfortunately become
final.
A lawyer owes entire devotion to the interest of his client, warmth and
zeal in the maintenance and defense of his rights and the exertion of his
utmost learning and ability, to the end that nothing can be taken or
withheld from his client except in accordance with the law. He should
present every remedy or defense authorized by the law in support of his
client's cause, regardless of his own personal views. In the full discharge
of his duties to his client, the lawyer should not be afraid of the possibility
that he may displease the judge or the general public.12
Judged by the actuations of said counsel in this case, he has miserably

failed in his duty to exercise his utmost learning and ability in maintaining
his client's cause.13 It is not only a case of simple negligence as found by
the appellate court, but of reckless and gross negligence, so much so that
his client was deprived of her property without due process of law.
In People's Homesite & Housing Corp. vs. Tiongco and Escasa,14 this Court
ruled as follows:
Procedural technicality should not be made a bar to the vindication

of a legitimate grievance. When such technicality deserts from being
an aid to justice, the courts are justified in excepting from its
operation a particular case. Where there was something fishy and
suspicious about the actuations of the former counsel of petitioner
in the case at bar, in that he did not given any significance at all to
the processes of the court, which has proven prejudicial to the rights
of said clients, under a lame and flimsy explanation that the court's
processes just escaped his attention, it is held that said lawyer
deprived his clients of their day in court, thus entitling said clients to
petition for relief from judgment despite the lapse of the
reglementary period for filing said period for filing said petition.
In Escudero vs. Judge Dulay,15 this Court, in holding that the counsel's
blunder in procedure is an exception to the rule that the client is bound by
the mistakes of counsel, made the following disquisition:
Petitioners contend, through their new counsel, that the judgments

rendered against them by the respondent court are null and void,
because they were therein deprived of their day in court and
divested of their property without due process of law, through the
gross ignorance, mistake and negligence of their previous counsel.
They acknowledge that, while as a rule, clients are bound by the
mistake of their counsel, the rule should not be applied
automatically to their case, as their trial counsel's blunder in
procedure and gross ignorance of existing jurisprudence changed
their cause of action and violated their substantial rights.
We are impressed with petitioner's contentions.
Ordinarily, a special civil action under Rule 65 of the Rules of Court

will not be a substitute or cure for failure to file a timely petition for
review on certiorari (appeal) under Rule 45 of the Rules. Where,
however, the application of the rule will result in a manifest failure
or miscarriage of justice, the rule may be relaxed.
xxx xxx xxx
While this Court is cognizant of the rule that, generally, a client will
suffer the consequences of the negligence, mistake or lack of
competence of his counsel, in the interest of justice and equity,
exceptions may be made to such rule, in accordance with the facts
and circumstances of each case. Adherence to the general rule
would, in the instant case, result in the outright deprivation of their
property through a technicality.
In its questioned decision dated November 19, 1989 the Court of Appeals
found, in no uncertain terms, the negligence of the then counsel for
petitioner when he failed to file the proper motion to dismiss or to draw a
compromise agreement if it was true that they agreed on a settlement of
the case; or in simply filing an answer; and that after having been
furnished a copy of the decision by the court he failed to appeal therefrom
or to file a petition for relief from the order declaring petitioner in default.
In all these instances the appellate court found said counsel negligent but
his acts were held to bind his client, petitioner herein, nevertheless.
The Court disagrees and finds that the negligence of counsel in this case
appears to be so gross and inexcusable. This was compounded by the fact,
that after petitioner gave said counsel another chance to make up for his
omissions by asking him to file a petition for annulment of the judgment in
the appellate court, again counsel abandoned the case of petitioner in that
after he received a copy of the adverse judgment of the appellate court, he
did not do anything to save the situation or inform his client of the
judgment. He allowed the judgment to lapse and become final. Such
reckless and gross negligence should not be allowed to bind the
petitioner. Petitioner was thereby effectively deprived of her day in court.
Thus, We have before Us a case where to enforce an alleged lease
agreement of the property of petitioner, private respondent went to court,
and that because of the gross negligence of the counsel for the petitioner,
she lost the case as well as the title and ownership of the property, which
is worth millions. The mere lessee then now became the owner of the
property. Its true owner then, the petitioner, now is consigned to penury
all because her lawyer appear to have abandoned her case not once but
repeatedly.
The Court cannot allow such a grave injustice to prevail. It cannot tolerate
such unjust enrichment of the private respondent at the expense of the
petitioner. The situation is aggravated by the fact that said counsel is a
well-known practicing lawyer and the dean of a law school as the Court at
the beginning of this discourse observed. His competence should be
beyond cavil. Thus, there appears to be no cogent excuse for his repeated
negligence and inaction. His lack of devotion to duty is so gross and
palpable that this Court must come to the aid of his distraught client, the
petitioner herein.
As member of the Philippine Bar he owes complete fidelity to the cause of

his client. He should give adequate attention, care and time to his cases.
This is the reason why a practicing lawyer should accept only so many
cases he can afford to handle. And once he agrees to handle a case, he
should undertake the task with dedication and care. If he should do any
less, then he is not true to his oath as a lawyer.
WHEREFORE, the petition is GRANTED and the questioned decision of the

Regional Trial Court of Quezon City dated March 25, 1985 in Civil Case No.
Q-43811; the decision of the Court of Appeals dated November 29, 1989 in
CA-G.R. No. SP-10487; the Sheriff 's Certificate of Sale dated June 27, 1985
of the property in question; and the subsequent final deed of sale covering
the same property, are all hereby declared null and void. Private
respondent New Cathay House, Inc. is directed to reconvey said property
to the petitioner, and the Register of Deeds is ordered to cancel the
registration of said property in the name of private respondent and to
issue a new one in the name of petitioner. Costs against private
respondent. Said counsel for petitioner is hereby required to show cause
within ten (10) days from notice why he should not be held administratively
liable for his acts and omissions hereinabove described in this decision.
Cheng vs Agravante, AC No. 6183 March 23, 2004
This is an administrative case for disbarment filed with the Integrated Bar
of Philippines’ (IBP) Commission on Bar Discipline.
The following facts have been established by the evidence.
Respondent Atty. Alexander M. Agravante served as counsel for The

Rogemson Co., Inc. (hereinafter, Rogemson) in a case filed against it
before the National Labor Relations Commission’s (NLRC) Regional
Arbitration Branch No. XI in Davao City by its former employee, a certain
Beaver Martin B. Barril. On June 18, 1998, Labor Arbiter Newton R. Sancho
rendered a decision in favor of the complainant, and ordered Rogemson to
pay Barril separation pay and backwages.1 A copy of said decision was
received by respondent’s law office on September 8, 1998. However,
respondent filed a Memorandum of Appeal with the NLRC only on
September 22, 1998. Consequently, the NLRC dismissed Rogemson’s
appeal in a Resolution dated May 27, 1999, and made the following incisive
observation:
In the case at bar, respondents through counsel were duly served with a
copy of the decision (Vol. 1, pp. 67-70) of Labor Arbiter Newton R. Sancho,
dated 18 June 1998, declaring complainant illegally dismissed from
employment and awarding him with separation pay and backwages in the
total sum of P130,000.00 on September 8, 1998, Tuesday, said date being
indicated in the mailed decision’s registry return receipt which is attached
to the records (Vol. 1, p. 75). Consequently, respondents had ten (10)
calendar days but not later than September 18, 1998, Friday to perfect their
appeal therefrom. However, the records similarly bear that this present
appeal was filed belatedly by way of mail on 22 September 1998. It is
necessary to state these facts candidly given the inaccurate certification
by respondent’s counsel that he received the decision being assailed on
September 10, 1998. (Vol. 2, p. 7)
The complainants terminated the services of Atty. Agravante. Through

their new lawyers, complainants wrote Atty. Agravante, demanding that
they be compensated for the pecuniary damages they had suffered as a
result of his negligence.2
When it appeared that Atty. Agravante had no intention of responding to
their letter, Edison G. Cheng, General Manager of Rogemson, filed an
affidavit-complaint with the IBP Commission on Bar Discipline.3 The case
was then assigned to Commissioner Caesar R. Dulay for investigation.
Allan P. Abelgas, Rogemson’s Regional Sales Manager for Cebu, testified

that he only learned of the decision of the Labor Arbiter when a secretary
of Atty. Agravante informed him that a bond was required in filing an
appeal to the NLRC. Abelgas was then about to take an emergency leave
of absence, so he delegated the task of securing the bond to his sister
Sheila A. Balandra, another Rogemson employee.4
Balandra testified that on September 18, 1998, she called up Cheng in

Manila by phone, who then authorized her to procure the bond. Balandra
then called the office of Atty. Agravante to ask if she can submit the bond
on Monday, September 21, 1998. She was told to stay on the line while the
secretary consulted with one of the other lawyers in the office. When the
secretary came back, she informed Balandra that she could submit the
bond on Monday, September 21, 1998 as long as it reached the law office
before 5:00 p.m.5
On September 21, 1998, Balandra arrived at the office of Atty. Agravante

with the bond at 4:00 p.m. She learned that Atty. Agravante had just
returned from out of town and had just opened the envelope containing
the adverse decision.6
Not surprisingly, Agravante tells a different story. He neither admitted nor

denied receiving the decision of the Labor Arbiter on September 8, 1998.
Instead, he alleges that he was out of town on said date and only returned
to his office on September 10, 1998. Upon arriving at the office, his
secretary handed to him all the correspondence addressed to him,
including the envelope containing the Labor Arbiter’s decision. He alleges
that there were several markings on this particular envelope, one of
which was the date "September 10, 1998," and he allegedly assumed that
this was the date of receipt by his office.7 He then informed Abelgas of the
result of the case and the period within which to file a Memorandum of
Appeal.8 The instruction for Rogemson to proceed with the appeal came a
full six (6) days later. He offered the services of his law office for
procuring the appeal bond, but he was informed that Rogemson would
take care of it. He alleges that Rogemson furnished them with the bond
only in the morning of September 22, 1998, although the bond documents
were notarized on September 21, 1998.9
On July 23, 2003, Commissioner Dulay submitted his Report

recommending that respondent be suspended from the practice of law for
two (2) months with an admonition that a similar offense would be dealt
with more severely.10
On August 30, 2003, the Board of Governors of the IBP passed Resolution
No. XVI-2003-97, approving the Report and Recommendation of the
Investigating Commissioner.
The investigating commissioner found that Balandra’s testimony that she

furnished Agravante’s law office with the appeal bond on September 21,
1998 and not on September 22, 1998, was not sufficiently rebutted by
Agravante, who did not even cross-examine her. More importantly, the
fact that the Memorandum of Appeal was filed four (4) days beyond the
reglementary period for filing the same, which resulted in its dismissal by
the NLRC, shows that Agravante was guilty of negligence.11
With regard to the date of receipt of the Labor Arbiter’s decision, the
registry return card indicated that respondent received the same on
September 8, 1998.12 Thus, Commissioner Dulay concluded that Agravante
misled the NLRC when he certified in his Memorandum of Appeal that he
received the adverse decision of the Labor Arbiter on September 10, 1998.13
Before lawyers are admitted to the bar, they must first solemnly swear to
do no falsehood nor consent to the doing of any in court.14 This oath, to
which all lawyers subscribe in solemn agreement to dedicate themselves
to the pursuit of justice, is not a mere ceremony or formality for practicing
law to be forgotten afterwards, nor is it mere words, drift and hollow, but
a sacred trust that every lawyer must uphold and keep inviolable at all
times.15 This duty is expressed in general terms in the Code of
Professional Responsibility, thus:
CANON 10--- A lawyer owes candor, fairness and good faith to the court.
It is codified further in the following rule of the Code of Professional
Responsibility:
Rule 10.01 ---A lawyer shall not do any falsehood, nor consent to the doing
of any in court; nor shall he mislead or allow the court to be misled by any
artifice.
In the case at bar, Agravante lied when he said he received the Labor
Arbiter’s decision on September 10, 1998 in order to make it appear that
his Memorandum of Appeal was filed on time.
It cannot be stressed enough how important it is for a lawyer as an officer

of the court to observe honesty at all times, especially before the
courts.16 A lawyer must be a disciple of truth,17 and Agravante has clearly
failed to live up to this duty.
Moreover, the Code of Professional Responsibility states that:
CANON 18 --- A lawyer shall serve his client with competence and
diligence.
xxxxxxxxx
Rule 18.03 --- A lawyer shall not neglect a legal matter entrusted to him
and his negligence in connection therewith shall render him liable.
A lawyer owes entire devotion in protecting the interest of his client,

warmth and zeal in the defense of his rights. He must use all his learning
and ability to the end that nothing can be taken or withheld from his client
except in accordance with the law. He must present every remedy or
defense within the authority of the law in support of his client’s cause,
regardless of his own personal views. In the full discharge of his duties to
his client, the lawyer should not be afraid of the possibility that he may
displease the judge or the general public.18
In this case, respondent’s filing of the Memorandum of Appeal four (4)

days after the deadline proves that his efforts fell short of the diligence
required of a lawyer. His failure to perfect an appeal within the prescribed
period constitutes negligence and malpractice proscribed by the Code of
Professional Responsibility, which provide that a lawyer shall not neglect
a legal matter entrusted to him and his negligence in connection therewith
shall render him liable.19
Agravante’s insistence that it was not his place to file an appeal without
express instructions from his client to do so is not persuasive. He could
easily withdraw the appeal if his client should later decide not to pursue
the same.20
Furthermore, the belated filing of the Memorandum of Appeal cannot in

any way mitigate respondent’s liability; on the contrary, it shows ignorance
on his part. As a lawyer, he ought to know that his Memorandum of
Appeal, having been filed beyond the reglementary period, would surely be
struck down for late filing.21
In sum, respondent utterly failed to perform his duties and responsibilities

faithfully and well as to protect the rights and interests of his client.22
A word regarding the imposable penalty. In the case of Perea v.

Almadro,23 the respondent therein was similarly punished for negligence
in the discharge of his duty as well as misrepresentation committed
before the court. In said case, the respondent lawyer failed to file a
demurrer to the evidence after asking for leave to file the same. He
compounded this transgression by spinning concocting stories about the
loss of the file of his draft, which somehow led him to believe that the
pleading had already been filed. Finding him guilty of serious neglect of his
duties as a lawyer and of open disrespect for the court and the authority it
represents, as embodied in Canon 18, Rules 18.03 and 18.04 and Canon 10,
Rule 10.01 of the Code of Professional Responsibility, the Court suspended
the respondent therein from the practice of law for one (1) year and
imposed a fine in the amount of Ten Thousand (P10,000.00) Pesos, with
warning that any similar acts of dishonesty would be dealt with more
severely.24 Evidently, this case seems to be on all fours with the case at
bar, so we are thus constrained to increase the penalty recommended by
the IBP.
WHEREFORE, in view of the foregoing, respondent Atty. Alexander M.

Agravante is SUSPENDED from the practice of law for a period of one (1)
year and is FINED in the amount of Ten Thousand Pesos (P10,000.00). He is
STERNLY WARNED that a repetition of the same or similar offense will be
dealt with more severely.
No costs.
SO ORDERED.
RA No. 9999
AN ACT PROVIDING A MECHANISM FOR FREE LEGAL ASSISTANCE AND

FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippine

Congress Assembled:
Section 1. Short Title. - This Act shall be known as the "Free Legal
Assistance Act of 2010".
Section 2. Declaration of Policy. - It is the declared policy of the State to

value the dignity of every human person and guarantee the rights of every
individual, particularly those who cannot afford the services of legal
counsel.
Furthermore, it is the policy of the State to promote a just and dynamic

social order that will ensure the prosperity and independence of the
nation and free the people from poverty through policies and programs
that provide adequate social services and improve the quality of life for all.
In addition, the State shall guarantee free legal assistance to the poor and
ensure that every person who cannot afford the services of a counsel is
provided with a competent and independent counsel preferably of his/her
own choice, if upon determination it appears that the party cannot afford
the services of a counsel, and that services of a counsel are necessary to
secure the ends of justice and protect of the party.
Section 3. Definition of Terms. - As provided for in this Act, the term legal
services to be performed by a lawyer refers to any activity which requires
the application of law, legal procedure, knowledge, training and
experiences which shall include, among others, legal advice and counsel,
and the preparation of instruments and contracts, including appearance
before the administrative and quasi-judicial offices, bodies and tribunals
handling cases in court, and other similar services as may be defined by
the Supreme Court.
Section 4. Requirements for Availment. - For purposes of availing of the

benefits and services as envisioned in this Act, a lawyer or professional
partnership shall secure a certification from the Public Attorney's Office
(PAO), the Department of Justice (DOJ) or accredited association of the
Supreme Court indicating that the said legal services to be provided are
within the services defined by the Supreme Court, and that the agencies
cannot provide the legal services to be provided by the private counsel.
For purpose of determining the number of hours actually provided by the

lawyer and/or professional firm in the provision of legal services, the
association and/or organization duly accredited by the Supreme Court
shall issue the necessary certification that said legal services were
actually undertaken.
The certification issued by, among others, the PAO, the DOJ and other
accredited association by the Supreme Court shall be submitted to the
Bureau of Internal Revenue (BIR) for purposes of availing the tax
deductions as provided for in this Act and to the DOJ for purposes of
monitoring.
Section 5. Incentives to Lawyers. - For purposes of this Act, a lawyer or

professional partnerships rendering actual free legal services, as defined
by the Supreme Court, shall be entitled to an allowable deduction from the
gross income, the amount that could have been collected for the actual
free legal services rendered or up to ten percent (10%) of the gross
income derived from the actual performance of the legal profession,
whichever is lower: Provided, That the actual free legal services herein
contemplated shall be exclusive of the minimum sixty (60)-hour
mandatory legal aid services rendered to indigent litigants as required
under the Rule on Mandatory Legal Aid Services for Practicing Lawyers,
under BAR Matter No. 2012, issued by the Supreme Court.
Section 6. Information, Education and Communication (IEC) Campaign. -
The DOJ, in cooperation with the Philippine Information Agency (PIA), is
hereby mandated to conduct an annual IEC campaign in order to inform
the lawyers of the procedures and guidelines in availing tax deductions
and inform the general public that a free legal assistance to those who
cannot afford counsel is being provided by the State.1avvph!1
Section 7. Reportorial Requirement. - For purposes of determining the

effectiveness and social impact of the provisions of this Act, the DOJ shall
submit an annual report to both Houses of Congress indicating therewith
the number of parties who benefited from this Act.
The report shall state in detail, among others, the geographic location,
demographic characteristics and socioeconomic profile of the
beneficiaries of this Act.
Section 8. Implementing Rules and Regulations (IRR). - Within ninety (90)

days from the date effectivity of this Act, the BIR shall formulate the
necessary revenue regulations for the proper implementation of the tax
component as envisioned in this Act.
The Supreme Court shall formulate the necessary implementing rules and
regulations with respect to the legal services covered under this Act and
the process of accreditation of organizations and/or associations which
will provide free legal assistance.
Section 9. Separability Clause. - If any provision of this Act is declared

unconstitutional or invalid, the other provisions not affected by such
declaration shall remain in full force and effect.
Section 10. Repealing Clause. - Any law, decree, ordinance or

administrative circular not consistent with any provision of this Act is
hereby amended, repealed or modified accordingly.
Section 11. Effectivity Clause. - This Act shall take effect fifteen (15) days
after its complete publication in the Official Gazette or in two (2)
newspapers of general circulation.
Approved,
Canon 15
A LAWYER SHALL OBSERVE CANDOR, FAIRNESS AND LOYALTY IN ALL

HIS DEALINGS AND TRANSACTIONS WITH HIS CLIENTS.
Rule 15.01. - A lawyer, in conferring with a prospective client, shall

ascertain as soon as practicable whether the matter would involve a
conflict with another client or his own interest, and if so, shall forthwith
inform the prospective client.
Rule 15.02.- A lawyer shall be bound by the rule on privilege

communication in respect of matters disclosed to him by a prospective
client.
Rule 15.03. - A lawyer shall not represent conflicting interests except by

written consent of all concerned given after a full disclosure of the facts.
Rule 15.04. - A lawyer may, with the written consent of all concerned, act
as mediator, conciliator or arbitrator in settling disputes.
Rule 15.05. - A lawyer when advising his client, shall give a candid and
honest opinion on the merits and probable results of the client's case,
neither overstating nor understating the prospects of the case.
Rule 15.06. - A lawyer shall not state or imply that he is able to influence
any public official, tribunal or legislative body.
Rule 15.07. - A lawyer shall impress upon his client compliance with the
laws and the principles of fairness.
Rule 15.08. - A lawyer who is engaged in another profession or occupation

concurrently with the practice of law shall make clear to his client
whether he is acting as a lawyer or in another capacity.
Celedonio vs Estrabillo, AC No. 10553, July 5, 2017
For Our resolution is complainant Filipinas O. Celedonio's disbarment

complaint1 against respondent Atty. Jaime F. Estrabillo, charging the latter with the
violation of Canon 1, Rule 1.01 and 1.02, Canon 9, Rule 1.09, Canon 10, Rule 10.01,
Canon 15, Rules 15.03 and 15.04, Canon 17, and Canon 19, Rule 19.01 and 19.02 of the
Code of Professional Responsibility (CPR).
The Facts
The instant disbarment case stemmed from a criminal case of Estafa filed by Alfrito
D. Mah (Mah) against complainant's husband in 2006, the latter being accused of
embezzling a substantial amount from Mah's company. In the said case, respondent
was Mah's legal counsel.2
Complainant averred that she tried talking to Mr. Mah's wife, being one of the
sponsors in their wedding, to drop the criminal case against her husband, but Mrs.
Mah responded that the matter is already in the hands of their lawyer. Thus,
complainant and her husband met several times with the respondent to negotiate
the withdrawal of the criminal case. Respondent assured the complainant and her
husband that he will talk to his client for the possibility of settling the case and
delaying the prosecution thereof in the meantime.3
In the process of negotiating, respondent advised the complainant and her husband
to execute a deed of sale over their house and lot covered by Transfer Certificate of
Title (TCT) No. 502969-R, which will be used as a collateral for the settlement of the
case. Respondent explained to them that the said deed of sale will merely be a
security while complainant and her husband are paying the embezzled money in
installments and he assured the spouses that the said deed of sale will not be
registered nor annotated in the title. The criminal case against complainant's
husband was then dismissed.4
Being the only one who shoulders the family expenses, complainant, at some point,
decided to sell the subject house and lot.5 However, on December 8, 2008,
complainant received summons from the court regarding a complaint for specific
performance with prayer for the issuance of a writ of preliminary injunction (WPI)
and temporary restraining order (TRO) filed by Spouses Mah, subject of which was
TCT No. 502969-R.6 Apparently, the deed of sale that complainant and her husband
executed as a security for the settlement of the criminal case was dated May 5,
2008 and notarized by the respondent. The said complaint averred that herein
complainant and her husband have an obligation to deliver the subject property to
Spouses Mah. Complainant found out that the respondent requested the Register of
Deeds (RD) of Pampanga to register and annotate the said deed of sale on the title
on November 27, 2008.7
This prompted the complainant to confront the respondent as this was contrary to
what they have agreed upon. The respondent merely advised complainant to again
negotiate with his client and assured her that he would back her up. However,
complainant's efforts to negotiate were again proven futile.8
In the meantime, complainant has a deadline for the filing of a responsive pleading
in the said civil case. Also, the hearing for the application for issuance of a TRO was
already scheduled. When the complainant went back to the respondent for this
matter, the respondent offered to and indeed prepared a Motion for Extension of
Time and Urgent Motion to Postpone for the complainant dated December 22, 2008
and January 8, 2009, respectively. Complainant alleged that it was respondent's
secretary upon respondent's instruction, who drafted the said motions and that she
was required to pay the corresponding fees therefor. In view of the said motion for
postponement, complainant did not appear in the January 9, 2009 hearing.9
It turned out, however, that the said hearing still proceeded. The respondent even
appeared therein and manifested that he filed a notice of lis pendens and adverse
claim with the RD of Pampanga. Complainant also found out that respondent filed a
Motion to Declare Defendants in Default in the said case dated February 4, 2009,
which was granted by the court on February 27, 2009. On March 31, 2009, a decision
was rendered in the said case in favor of respondent's clients. The decision became
final and executory and, thereafter, a writ of execution was issued.10
Realizing that respondent employed deceit and was double-dealing with her and
her husband to their prejudice, complainant filed the instant administrative
complaint, praying for the respondent's disbarment.
In his Answer to the instant administrative complaint, respondent denied

complainant's accusations. Despite admitting that he told the complainant that he
would help her out in negotiating with his client, he averred that he never
compromised his relationship with the latter as counsel. Respondent explained that
he suggested a deed of second mortgage be made on the subject property, as the
same was still mortgaged with the bank, for the purpose of settling the criminal
case with his client. He admitted preparing such deed of second mortgage but the
same was not signed by his client as the latter preferred a deed of sale with a
promissory note. The complainant and her husband then executed the preferred
deed of sale. Consequently, Mr. Mah executed an affidavit of desistance relative to
the estafa case against complainant's husband.11
As to the civil case, respondent averred that upon learning that the complainant
was selling the subject property, he filed an adverse claim on the said property to
protect his client's rights.12
Respondent, further, denied that he was serving conflicting interests when he

instructed his secretary to draft the motions for extension of time and
postponement for the complainant. He averred that he informed his clients about it
and denied demanding payment therefor from the complainant.13
Report and Recommendation of the Integrated Bar of the Philippines Commission

on Bar Discipline
Aside from respondent's act of instructing his secretary to prepare and file motions
for the complainant in the civil case filed by his client, the Integrated Bar of the
Philippines (IBP)-Commission on Bar Discipline (CBD) found no proof as to the
other allegations in the complaint imputing deceit and other violations of the CPR
against respondent.14 On May 22, 2012, the IBP-CBD recommended
thus:chanRoblesvirtualLawlibrary
WHEREFORE, in view of the foregoing, it is respectfully recommended that

respondent Atty. Jaime E. Estrabillo be suspended from the practice of law for six
(6) months.15
Resolutions of the IBP Board of Governors
On March 20, 2013, the IBP issued Resolution No. XX-2013-187, which
reads:chanRoblesvirtualLawlibrary
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED and

APPROVED, with modification, the Report and Recommendation of the Investigating
Commissioner in the above-entitled case, herein made part of this Resolution as
Annex "A", and finding the recommendation fully supported by the evidence on
record and the applicable laws and rules and for Respondent's violation of Rule
15.03 and Canon 17 of the Code of Professional Responsibility, it being not
intentional, Atty. Jaime E. Estrabillo is hereby REPRIMANDED.16
Both the complainant and the respondent filed their. respective motions for
reconsideration (MR) of the above-quoted resolution.17
Acting on the said MRs, the IBP Board of Governors issued Resolution No. XXI-
2014-116 on March 21, 2014, which reads:chanRoblesvirtualLawlibrary
RESOLVED to DENY respective Motions for Reconsideration of Complainant and

Respondent, there being no cogent reason to reverse the findings of the
Commission and they being a mere reiteration of the matters which had already
been threshed out and taken into consideration. Further, the Board RESOLVED
to AFFIRM with modification, Resolution No. XX-2013-187 dated March 20, 2013 and
accordingly ADOPTED and APPROVED the Report and Recommendation of the
Investigating Commissioner SUSPENDING Atty. Jaime E. Estrabillo from the
practice of law to [sic] six (6) months.18
This Court is now called to issue its verdict on the matter.
Issue
Should the respondent be administratively disciplined based on the allegations in

the complaint?
Our Ruling
We answer in the affirmative.
Rule 15.03 - A lawyer shall not represent conflicting interests except by written
consent of all concerned given after a full disclosure of the facts.
CANON 17 - A LAWYER OWES FIDELITY TO THE CAUSE OF HIS CLIENT AND HE

SHALL BE MINDFUL OF THE TRUST AND CONFIDENCE REPOSED IN HIM.
Respondent admitted that he instructed his secretary to draft and file motions for
the complainant in the civil case filed by his client against the latter. Such act is a
clear violation of the above-stated rules. The respondent, however, explained that it
was merely a humanitarian act on his part in helping the complainant on the
matter, to give the latter an opportunity to settle their accountability to his
client.19 Respondent insisted that there was no intention on his part to violate the
trust reposed upon him by his client. In fact, according to the respondent, it was his
client's interest that he had in mind when he prepared the motions as this would
extend the chance of getting a settlement with the complainant, which is the end
favored by his client.
Such explanation cannot, in any way, absolve him from liability.
The rules are clear. The relationship between a lawyer and his/her client should
ideally be imbued with the highest level of trust and confidence.20 The legal
profession dictates that it is not a mere duty, but an obligation, of a lawyer to
'accord the highest degree of fidelity, zeal and fervor in the protection of the client's
interest.21 Thus, part of the lawyer's duty in this regard is to avoid representing
conflicting interests.22 Jurisprudence is to the effect that a lawyer's act which
invites suspicion of unfaithfulness or double-dealing in the performance of his duty
already evinces inconsistency of interests.23 In broad terms, lawyers are deemed to
represent conflicting interests when, in behalf of one client, it is their duty to
contend for that which duty to another client requires them to oppose.24
There is, thus, no denying that respondent's preparation and filing of motions on
behalf of the complainant, the adverse party in the case filed by him for his client,
conflicts his client's interest. Indeed, a motion for extension to file an answer would
not be favorable to his client's cause as the same would merely delay the judgment
sought by his client in filing the case. Moreso, the motion for postponement of the
TRO hearing would definitely run counter with the interest of his client as such
remedy was precisely sought, supposedly with urgency, to protect his client's right
over the subject property before complainant could proceed with the sale of the
same.
Moreover, Rule 15.03 above-cited expressly requires a written consent of all

parties concerned after full disclosure of the facts if ever, for whatever reason, a
lawyer will be involved in conflicting interests. Corollary to this, Rule 15.04 of the
CPR substantially states that if a lawyer would act as a mediator, or a negotiator
for that matter, a written consent of all concerned is also required. Notably, there
is no record of any written consent from any of the parties involved in this case.
Considering the foregoing, We sustain the findings of the IBP that respondent
violated Rule 15.03 and Canon 17 of the CPR.
In addition, this Court cannot shun the fact that due to respondent's acts,
complainant lost her day in court. Admittedly, the complainant cannot impute fault
entirely to the respondent for losing the opportunity to present her defense in the
civil case, as no prudent man will leave the fate of his or her case entirely to his or
her lawyer, much less to his or her opponent's lawyer. However, We also cannot
blame the complainant for relying upon the motions prepared by the respondent for
her, thinking that in view of the said motions, she was given more time file an
answer and more importantly, that there was no more hearing on the scheduled
date for her to attend. As it turned out, respondent even appeared on the date of
the hearing that was supposedly sought to be postponed. This is a clear case of an
unfair act on the part of the respondent. Respondent may not have an obligation to
apprise the complainant of the hearing as the latter is not his client, but his
knowledge of the motion for postponement, drafted by his secretary upon his
instruction, calls for his fair judgment as a defender of justice and officer of the
court, to inform the complainant that the hearing was not postponed.
This exactly demonstrates why dealing with conflicting interests in the legal
profession is prohibited it is not only because the relation of attorney and client is
one of trust and confidence of the highest degree, but also because of the
principles of public policy and good taste.25
As to the other matters raised in the complaint such as the allegations that the
respondent deceived the complainant to execute the subject deed of sale, among
others, We are one with the IBP-CBD that such imputations were not supported by
sufficient evidence to warrant consideration.
Anent the penalty, considering that this is respondent's first infraction, and that
there is no clear showing that his malpractice was deliberately done in bad faith or
with deceit, We hold that respondent's suspension from the practice of law for six
(6) months, as recommended by the IBP-CBD and adopted by the IBP Board of
Governors, is warranted.
ACCORDINGLY, the Court resolves to SUSPEND Atty. Jaime F. Estrabillo from the
practice 'of raw for six (6) months to commence immediately from the receipt of
this Decision, with a WARNING that a repetition of the same or similar offense will
warrant a more severe penalty. Let copies of this Decision be furnished all courts,
the Office of the Bar Confidant, and the Integrated Bar of the Philippines for their
information and guidance. The Office of the Bar Confidant is directed to append a
copy of this Decision to respondent's record as member of the Bar.
SO ORDERED.
Aninon vs Sabitsana Jr AC No. 5098, April 11, 2012
We resolve this disbarment complaint against Atty. Clemencio Sabitsana,

Jr. who is charged of: (1) violating the lawyer’s duty to preserve
confidential information received from his client;1 and (2) violating the
prohibition on representing conflicting interests.2
In her complaint, Josefina M. Aniñon (complainant) related that she

previously engaged the legal services of Atty. Sabitsana in the preparation
and execution in her favor of a Deed of Sale over a parcel of land owned
by her late common-law husband, Brigido Caneja, Jr. Atty. Sabitsana
allegedly violated her confidence when he subsequently filed a civil case
against her for the annulment of the Deed of Sale in behalf of Zenaida L.
Cañete, the legal wife of Brigido Caneja, Jr. The complainant accused Atty.
Sabitsana of using the confidential information he obtained from her in
filing the civil case.
Atty. Sabitsana admitted having advised the complainant in the

preparation and execution of the Deed of Sale. However, he denied having
received any confidential information. Atty. Sabitsana asserted that the
present disbarment complaint was instigated by one Atty. Gabino
Velasquez, Jr., the notary of the disbarment complaint who lost a court
case against him (Atty. Sabitsana) and had instigated the complaint for
this reason.
The Findings of the IBP Investigating Commissioner
In our Resolution dated November 22, 1999, we referred the disbarment

complaint to the Commission on Bar Discipline of the Integrated Bar of the
Philippines (IBP) for investigation, report and recommendation. In his
Report and Recommendation dated November 28, 2003, IBP Commissioner
Pedro A. Magpayo Jr. found Atty. Sabitsana administratively liable for
representing conflicting interests. The IBP Commissioner opined:
In Bautista vs. Barrios, it was held that a lawyer may not handle a case to
nullify a contract which he prepared and thereby take up inconsistent
positions. Granting that Zenaida L. Cañete, respondent’s present client in
Civil Case No. B-1060 did not initially learn about the sale executed by
Bontes in favor of complainant thru the confidences and information
divulged by complainant to respondent in the course of the preparation of
the said deed of sale, respondent nonetheless has a duty to decline his
current employment as counsel of Zenaida Cañete in view of the rule
prohibiting representation of conflicting interests.
In re De la Rosa clearly suggests that a lawyer may not represent

conflicting interests in the absence of the written consent of all parties
concerned given after a full disclosure of the facts. In the present case, no
such written consent was secured by respondent before accepting
employment as Mrs. Cañete’s counsel-of-record. x x x
xxx
Complainant and respondent’s present client, being contending claimants

to the same property, the conflict of interest is obviously present. There is
said to be inconsistency of interest when on behalf of one client, it is the
attorney’s duty to contend for that which his duty to another client
requires him to oppose. In brief, if he argues for one client this argument
will be opposed by him when he argues for the other client. Such is the
case with which we are now confronted, respondent being asked by one
client to nullify what he had formerly notarized as a true and valid sale
between Bontes and the complainant. (footnotes omitted)3
The IBP Commissioner recommended that Atty. Sabitsana be suspended

from the practice of law for a period of one (1) year.4
The Findings of the IBP Board of Governors
In a resolution dated February 27, 2004, the IBP Board of Governors

resolved to adopt and approve the Report and Recommendation of the IBP
Commissioner after finding it to be fully supported by the evidence on
record, the applicable laws and rules.5 The IBP Board of Governors agreed
with the IBP Commissioner’s recommended penalty.
Atty. Sabitsana moved to reconsider the above resolution, but the IBP
Board of Governors denied his motion in a resolution dated July 30, 2004.
The Issue
The issue in this case is whether Atty. Sabitsana is guilty of misconduct for
representing conflicting interests.
The Court’s Ruling
After a careful study of the records, we agree with the findings and
recommendations of the IBP Commissioner and the IBP Board of
Governors.
The relationship between a lawyer and his/her client should ideally be

imbued with the highest level of trust and confidence. This is the standard
of confidentiality that must prevail to promote a full disclosure of the
client’s most confidential information to his/her lawyer for an unhampered
exchange of information between them. Needless to state, a client can
only entrust confidential information to his/her lawyer based on an
expectation from the lawyer of utmost secrecy and discretion; the lawyer,
for his part, is duty-bound to observe candor, fairness and loyalty in all
dealings and transactions with the client.6 Part of the lawyer’s duty in this
regard is to avoid representing conflicting interests, a matter covered by
Rule 15.03, Canon 15 of the Code of Professional Responsibility quoted
below:
Rule 15.03. -A lawyer shall not represent conflicting interests except by

"The proscription against representation of conflicting interests applies to

a situation where the opposing parties are present clients in the same
action or in an unrelated action."7 The prohibition also applies even if the
"lawyer would not be called upon to contend for one client that which the
lawyer has to oppose for the other client, or that there would be no
occasion to use the confidential information acquired from one to the
disadvantage of the other as the two actions are wholly unrelated."8 To be
held accountable under this rule, it is "enough that the opposing parties in
one case, one of whom would lose the suit, are present clients and the
nature or conditions of the lawyer’s respective retainers with each of
them would affect the performance of the duty of undivided fidelity to both
clients."9
Jurisprudence has provided three tests in determining whether a violation
of the above rule is present in a given case.
One test is whether a lawyer is duty-bound to fight for an issue or claim in

behalf of one client and, at the same time, to oppose that claim for the
other
client.http://sc.judiciary.gov.ph/jurisprudence/2005/aug2005/ac_6708.htm
- _ftn Thus, if a lawyer’s argument for one client has to be opposed by that
same lawyer in arguing for the other client, there is a violation of the rule.
Another test of inconsistency of interests is whether the acceptance of a

new relation would prevent the full discharge of the lawyer’s duty of
undivided fidelity and loyalty to the client or invite suspicion of
unfaithfulness or double-dealing in the performance of that
duty.http://sc.judiciary.gov.ph/jurisprudence/2005/aug2005/ac_6708.htm -
_ftn Still another test is whether the lawyer would be called upon in the
new relation to use against a former client any confidential information
acquired through their connection or previous
employment. http://sc.judiciary.gov.ph/jurisprudence/2005/aug2005/ac_6
10
708.htm - _ftn [emphasis ours]
On the basis of the attendant facts of the case, we find substantial

evidence to support Atty. Sabitsana’s violation of the above rule, as
established by the following circumstances on record:
One, his legal services were initially engaged by the complainant to

protect her interest over a certain property. The records show that
upon the legal advice of Atty. Sabitsana, the Deed of Sale over the
property was prepared and executed in the complainant’s favor.
Two, Atty. Sabitsana met with Zenaida Cañete to discuss the latter’s
legal interest over the property subject of the Deed of Sale. At that
point, Atty. Sabitsana already had knowledge that Zenaida Cañete’s
interest clashed with the complainant’s interests.
Three, despite the knowledge of the clashing interests between his

two clients, Atty. Sabitsana accepted the engagement from Zenaida
Cañete.
Four, Atty. Sabitsana’s actual knowledge of the conflicting interests
between his two clients was demonstrated by his own actions: first,
he filed a case against the complainant in behalf of Zenaida Cañete;
second, he impleaded the complainant as the defendant in the case;
and third, the case he filed was for the annulment of the Deed of
Sale that he had previously prepared and executed for the
complainant.
By his acts, not only did Atty. Sabitsana agree to represent one client
against another client in the same action; he also accepted a new
engagement that entailed him to contend and oppose the interest of his
other client in a property in which his legal services had been previously
retained.
To be sure, Rule 15.03, Canon 15 of the Code of Professional Responsibility

provides an exception to the above prohibition. However, we find no
reason to apply the exception due to Atty. Sabitsana’s failure to comply
with the requirements set forth under the rule. Atty. Sabitsana did not
make a full disclosure of facts to the complainant and to Zenaida Cañete
before he accepted the new engagement with Zenaida Cañete. The records
likewise show that although Atty. Sabitsana wrote a letter to the
complainant informing her of Zenaida Cañete’s adverse claim to the
property covered by the Deed of Sale and, urging her to settle the adverse
claim; Atty. Sabitsana however did not disclose to the complainant that he
was also being engaged as counsel by Zenaida Cañete.11 Moreover, the
records show that Atty. Sabitsana failed to obtain the written consent of
his two clients, as required by Rule 15.03, Canon 15 of the Code of
Professional Responsibility.
Accordingly, we find * as the IBP Board of Governors did * Atty.

Sabitsana guilty of misconduct for representing conflicting interests. We
likewise agree with the penalty of suspension for one (1) year from the
practice of law recommended by the IBP Board of Governors. This penalty
is consistent with existing jurisprudence on the administrative offense of
representing conflicting interests.12
We note that Atty. Sabitsana takes exception to the IBP recommendation

on the ground that the charge in the complaint was only for his alleged
disclosure of confidential information, not for representation of conflicting
interests. To Atty. Sabitsana, finding him liable for the latter offense is a
violation of his due process rights since he only answered the designated
charge.
We find no violation of Atty. Sabitsana’s due process rights. Although there

was indeed a specific charge in the complaint, we are not unmindful that
the complaint itself contained allegations of acts sufficient to constitute a
violation of the rule on the prohibition against representing conflicting
interests. As stated in paragraph 8 of the complaint:
Atty. Sabitsana, Jr. accepted the commission as a Lawyer of ZENAIDA

CANEJA, now Zenaida Cañete, to recover lands from Complainant,
including this land where lawyer Atty. Sabitsana, Jr. has advised his client
[complainant] to execute the second sale[.]
Interestingly, Atty. Sabitsana even admitted these allegations in his

answer.13 He also averred in his Answer that:
6b. Because the defendant-to-be in the complaint (Civil Case No. B-1060)
that he would file on behalf of Zenaida Caneja-Cañete was his former
client (herein complainant), respondent asked [the] permission of Mrs.
Cañete (which she granted) that he would first write a letter (Annex "4") to
the complainant proposing to settle the case amicably between them but
complainant ignored it. Neither did she object to respondent’s handling the
case in behalf of Mrs. Cañete on the ground she is now invoking in her
instant complaint. So respondent felt free to file the complaint against
her.14 1âwphi1
We have consistently held that the essence of due process is simply the
opportunity to be informed of the charge against oneself and to be heard
or, as applied to administrative proceedings, the opportunity to explain
one’s side or the opportunity to seek a reconsideration of the action or
ruling complained of.15 These opportunities were all afforded to Atty.
Sabitsana, as shown by the above circumstances.
All told, disciplinary proceedings against lawyers are sui generis.16 In the
exercise of its disciplinary powers, the Court merely calls upon a member
of the Bar to account for his actuations as an officer of the Court with the
end in view of preserving the purity of the legal profession. We likewise
aim to ensure the proper and honest administration of justice by purging
the profession of members who, by their misconduct, have proven
themselves no longer worthy to be entrusted with the duties and
responsibilities of an attorney.17 This is all that we did in this case.
Significantly, we did this to a degree very much lesser than what the
powers of this Court allows it to do in terms of the imposable penalty. In
this sense, we have already been lenient towards respondent lawyer.
WHEREFORE, premises considered, the Court resolves to ADOPT the

findings and recommendations of the Commission on Bar Discipline of the
Integrated Bar of the Philippines. Atty. Clemencio C. Sabitsana, Jr. is found
GUILTY of misconduct for representing conflicting interests in violation of
Rule 15.03, Canon 15 of the Code of Professional Responsibility. He is
hereby SUSPENDED for one (1) year from the practice of law.
Atty. Sabitsana is DIRECTED to inform the Court of the date of his receipt
of this Decision so that we can determine the reckoning point when his
suspension shall take effect.
SO ORDERED.
Mercado vs Vitriolo, AC No. 5108, May 26, 2005
Rosa F. Mercado filed the instant administrative complaint against Atty.

Julito D. Vitriolo, seeking his disbarment from the practice of law. The
complainant alleged that respondent maliciously instituted a criminal case
for falsification of public document against her, a former client, based on
confidential information gained from their attorney-client relationship.
Let us first hearken to the facts.
Complainant is a Senior Education Program Specialist of the Standards

Development Division, Office of Programs and Standards while respondent
is a Deputy Executive Director IV of the Commission on Higher Education
(CHED).1
Complainant's husband filed Civil Case No. 40537 entitled "Ruben G.

Mercado v. Rosa C. Francisco," for annulment of their marriage with the
Regional Trial Court (RTC) of Pasig City. This annulment case had been
dismissed by the trial court, and the dismissal became final and executory
on July 15, 1992.2
In August 1992, Atty. Anastacio P. de Leon, counsel of complainant, died.

On February 7, 1994, respondent entered his appearance before the trial
court as collaborating counsel for complainant.3
On March 16, 1994, respondent filed his Notice of Substitution of

Counsel,4 informing the RTC of Pasig City that he has been appointed as
counsel for the complainant, in substitution of Atty. de Leon.
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
docketed as I.S. No. PSG 99-9823, for violation of Articles 171 and 172
(falsification of public document) of the Revised Penal Code.5 Respondent
alleged that complainant made false entries in the Certificates of Live
Birth of her children, Angelica and Katelyn Anne. 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 April 11, 1978.
Complainant denied the accusations of respondent against her. She denied

using any other name than "Rosa F. Mercado." She also insisted that she
has gotten married only once, on April 11, 1978, to Ruben G. Mercado.
In addition, complainant Mercado cited other charges against respondent

that are pending before or decided upon by other tribunals + (1) libel suit
before the Office of the City Prosecutor, Pasig City;6 (2) administrative case
for dishonesty, grave misconduct, conduct prejudicial to the best interest
of the service, pursuit of private business, vocation or profession without
the permission required by Civil Service rules and regulations, and
violations of the "Anti-Graft and Corrupt Practices Act," before the then
Presidential Commission Against Graft and Corruption;7 (3) complaint for
dishonesty, grave misconduct, and conduct prejudicial to the best interest
of the service before the Office of the Ombudsman, where he was found
guilty of misconduct and meted out the penalty of one month suspension
without pay;8 and, (4) the Information for violation of Section 7(b)(2) of
Republic Act No. 6713, as amended, otherwise known as the Code of
Conduct and Ethical Standards for Public Officials and Employees before
the Sandiganbayan.9
Complainant Mercado alleged that said criminal complaint for falsification

of public document (I.S. No. PSG 99-9823) disclosed confidential facts and
information relating to the civil case for annulment, then handled by
respondent Vitriolo as her counsel. This prompted complainant Mercado to
bring this action against respondent. She claims that, in filing the criminal
case for falsification, respondent is guilty of breaching their privileged and
confidential lawyer-client relationship, and should be disbarred.
Respondent filed his Comment/Motion to Dismiss on November 3, 1999

where he alleged that the complaint for disbarment was all hearsay,
misleading and irrelevant because all the allegations leveled against him
are subject of separate fact-finding bodies. Respondent claimed that the
pending cases against him are not grounds for disbarment, and that he is
presumed to be innocent until proven otherwise.10 He also states that the
decision of the Ombudsman finding him guilty of misconduct and imposing
upon him the penalty of suspension for one month without pay is on
appeal with the Court of Appeals. He adds that he was found guilty, only of
simple misconduct, which he committed in good faith.11
In addition, respondent maintains that his filing of the criminal complaint

for falsification of public documents against complainant does not violate
the rule on privileged communication between attorney and client because
the bases of the falsification case are two certificates of live birth which
are public documents and in no way connected with the confidence taken
during the engagement of respondent as counsel. According to
respondent, the complainant confided to him as then counsel only matters
of facts relating to the annulment case. Nothing was said about the
alleged falsification of the entries in the birth certificates of her two
daughters. The birth certificates are filed in the Records Division of CHED
and are accessible to anyone.12
In a Resolution dated February 9, 2000, this Court referred the

administrative case to the Integrated Bar of the Philippines (IBP) for
investigation, report and recommendation.13
The IBP Commission on Bar Discipline set two dates for hearing but
complainant failed to appear in both. Investigating Commissioner Rosalina
R. Datiles thus granted respondent's motion to file his memorandum, and
the case was submitted for resolution based on the pleadings submitted
by the parties.14
On June 21, 2003, the IBP Board of Governors approved the report of
investigating commissioner Datiles, finding the respondent guilty of
violating the rule on privileged communication between attorney and
client, and recommending his suspension from the practice of law for one
(1) year.
On August 6, 2003, complainant, upon receiving a copy of the IBP 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.
At the outset, we stress that we shall not inquire into the merits of the
various criminal and administrative cases filed against respondent. It is
the duty of the tribunals where these cases are pending to determine the
guilt or innocence of the respondent.
We also emphasize that the Court is not bound by any withdrawal of the
complaint or desistance by the complainant. The letter of complainant to
the Chief Justice imparting forgiveness upon respondent is
inconsequential in disbarment proceedings.
We now resolve whether respondent violated the rule on privileged

communication between attorney and client when he filed a criminal case
for falsification of public document against his former client.
A brief discussion of the nature of the relationship between attorney and

client and the rule on attorney-client privilege that is designed to protect
such relation is in order.
In engaging the services of an attorney, the client reposes on him special

powers of trust and confidence. Their relationship is strictly personal and
highly confidential and fiduciary. The relation is of such delicate, exacting
and confidential nature that is required by necessity and public
interest.15 Only by such confidentiality and protection will a person be
encouraged to repose his confidence in an attorney. The hypothesis is that
abstinence from seeking legal advice in a good cause is an evil which is
fatal to the administration of justice.16 Thus, the preservation and
protection of that relation will encourage a client to entrust his legal
problems to an attorney, which is of paramount importance to the
administration of justice.17 One rule adopted to serve this purpose is the
attorney-client privilege: an attorney is to keep inviolate his client's
secrets or confidence and not to abuse them.18 Thus, the duty of a lawyer
to preserve his client's secrets and confidence outlasts the termination of
the attorney-client relationship,19 and continues even after the client's
death.20 It is the glory of the legal profession that its fidelity to its client
can be depended on, and that a man may safely go to a lawyer and
converse with him upon his rights or supposed rights in any litigation with
absolute assurance that the lawyer's tongue is tied from ever disclosing
it.21 With full disclosure of the facts of the case by the client to his attorney,
adequate legal representation will result in the ascertainment and
enforcement of rights or the prosecution or defense of the client's cause.
Now, we go to the rule on attorney-client privilege. Dean Wigmore cites
the factors essential to establish the existence of the privilege, viz:
(1) Where legal advice of any kind is sought (2) from a professional
legal adviser in his capacity as such, (3) the communications relating
to that purpose, (4) made in confidence (5) by the client, (6) are at
his instance permanently protected (7) from disclosure by himself or
by the legal advisor, (8) except the protection be waived.22
In fine, the factors are as follows:
(1) There exists an attorney-client relationship, or a prospective attorney-

client relationship, and it is by reason of this relationship that the client
made the communication.
Matters disclosed by a prospective client to a lawyer are protected by the

rule on privileged communication even if the prospective client does not
thereafter retain the lawyer or the latter declines the employment.23 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
On the other hand, a communication from a (prospective) client to a

lawyer for some purpose other than on account of the (prospective)
attorney-client relation is not privileged. Instructive is the case of Pfleider
v. Palanca,25 where the client and his wife leased to their attorney a 1,328-
hectare agricultural land for a period of ten years. In their 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" supplied counsel for the
purpose of carrying out the terms of payment 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 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 them, but on account of the
lease agreement. We then held that a violation of the confidence that
accompanied the delivery of that list would partake more of a private and
civil wrong than of a breach of the fidelity owing from a lawyer to his
client.
(2) The client made the communication in confidence.
The mere relation of attorney and client does not raise a presumption of
confidentiality.26 The client must intend the communication to be
confidential.27
A confidential communication refers to information transmitted by

voluntary act of disclosure between attorney and client in confidence and
by means which, so far as the client is aware, discloses the information to
no third person other than one reasonably necessary for the transmission
of the information or the accomplishment of the purpose for which it was
given.28
Our jurisprudence on the matter rests on quiescent ground. Thus, a

compromise agreement prepared by a lawyer pursuant to the instruction
of his client and delivered to the opposing party,29 an offer and counter-
offer for settlement,30 or a document given by a client to his counsel not in
his professional capacity,31 are not privileged communications, the
element of confidentiality not being present.32
(3) The legal advice must be sought from the attorney in his professional
capacity.33
The communication made by a client to his attorney must not be intended

for mere information, but for the purpose of seeking legal advice from his
attorney as to his rights or obligations. The communication must have
been transmitted by a client to his attorney for the purpose of seeking
legal advice.34
If the client seeks an accounting service,35 or business or personal

assistance,36 and not legal advice, the privilege does not attach to a
communication disclosed for such purpose.
Applying all these rules to the case at bar, we hold that the evidence on
record fails to substantiate complainant's allegations. We note that
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 violated the rule on
privileged communication when he instituted a criminal action against her
for falsification of public documents because the criminal complaint
disclosed facts relating to the civil case for annulment then handled by
respondent. She did not, however, spell out these facts which will
determine the merit of her complaint. The Court cannot be involved in a
guessing game as to the existence of facts which the complainant must
prove.
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 rule on privileged
communication. Such confidential information is a crucial link in
establishing a breach of the rule on privileged communication between
attorney and client. It is not enough to merely assert the attorney-client
privilege.37 The burden of proving that the privilege applies is placed upon
the party asserting the privilege.38
IN VIEW WHEREOF, the complaint against respondent Atty. Julito D.

Vitriolo is hereby DISMISSED for lack of merit.
SO ORDERED.
Sabitsana vs Muertegui, GR No. 181359, August 5, 2013
A lawyer may not, for his own personal interest and benefit, gamble on his
client's word, believing it at one time and disbelieving it the next. He owes
his client his undivided loyalty.
Assailed in this Petition for Review on Certiorari1 are the January 25, 2007
Decision2 of the Court of Appeals (CA) which denied the appeal in CA-G.R.
CV No. 79250, and its January 11, 2008 Resolution3 denying petitioner’s
Motion for Reconsideration.4
Factual Antecedents
On September 2, 1981, Alberto Garcia (Garcia) executed an unnotarized

Deed of Sale5 in favor of respondent Juanito Muertegui6 (Juanito) over a
7,500-square meter parcel of unregistered land (the lot) located in
Dalutan Island, Talahid, Almeira, Biliran, Leyte del Norte covered by Tax
Declaration (TD) No. 1996 issued in 1985 in Garcia’s name.7
Juanito’s father Domingo Muertegui, Sr. (Domingo Sr.) and brother

Domingo Jr. took actual possession of the lot and planted thereon coconut
and ipil-ipil trees. They also paid the real property taxes on the lot for the
years 1980 up to 1998.
On October 17, 1991, Garcia sold the lot to the Muertegui family lawyer,
petitioner Atty. Clemencio C. Sabitsana, Jr. (Atty. Sabitsana), through a
notarized deed of absolute sale.8 The sale was registered with the
Register of Deeds on February 6, 1992.9 TD No. 1996 was cancelled and a
new one, TD No. 5327,10 was issued in Atty. Sabitsana’s name. Although
Domingo Jr. and Sr. paid the real estate taxes, Atty. Sabitsana also paid
real property taxes in 1992, 1993, and 1999. In 1996, he introduced concrete
improvements on the property, which shortly thereafter were destroyed
by a typhoon.
When Domingo Sr. passed away, his heirs applied for registration and
coverage of the lot under the Public Land Act or Commonwealth Act No.
141. Atty. Sabitsana, in a letter11 dated August 24, 1998 addressed to the
Department of Environment and Natural Resources’ CENRO/PENRO office
in Naval, Biliran, opposed the application, claiming that he was the true
owner of the lot. He asked that the application for registration be held in
abeyance until the issue of conflicting ownership has been resolved.
On April 11, 2000, Juanito, through his attorney-in-fact Domingo Jr., filed
Civil Case No. B-109712 for quieting of title and preliminary injunction,
against herein petitioners Atty. Sabitsana and his wife, Rosario, claiming
that they bought the lot in bad faith and are exercising acts of possession
and ownership over the same, which acts thus constitute a cloud over his
title. The Complaint13 prayed, among others, that the Sabitsana Deed of
Sale, the August 24, 1998 letter, and TD No. 5327 be declared null and void
and of no effect; that petitioners be ordered to respect and recognize
Juanito’s title over the lot; and that moral and exemplary damages,
attorney’s fees, and litigation expenses be awarded to him.
In their Answer with Counterclaim,14 petitioners asserted mainly that the

sale to Juanito is null and void absent the marital consent of Garcia’s wife,
Soledad Corto (Soledad); that they acquired the property in good faith and
for value; and that the Complaint is barred by prescription and laches.
They likewise insisted that the Regional Trial Court (RTC) of Naval, Biliran
did not have jurisdiction over the case, which involved title to or interest in
a parcel of land the assessed value of which is merely ₱1,230.00.
The evidence and testimonies of the respondent’s witnesses during trial

reveal that petitioner Atty. Sabitsana was the Muertegui family’s lawyer at
the time Garcia sold the lot to Juanito, and that as such, he was consulted
by the family before the sale was executed; that after the sale to Juanito,
Domingo Sr. entered into actual, public, adverse and continuous
possession of the lot, and planted the same to coconut and ipil-ipil; and
that after Domingo Sr.’s death, his wife Caseldita, succeeded him in the
possession and exercise of rights over the lot.
On the other hand, Atty. Sabitsana testified that before purchasing the lot,
he was told by a member of the Muertegui family, Carmen Muertegui
Davies (Carmen), that the Muertegui family had bought the lot, but she
could not show the document of sale; that he then conducted an
investigation with the offices of the municipal and provincial assessors;
that he failed to find any document, record, or other proof of the sale by
Garcia to Juanito, and instead discovered that the lot was still in the name
of Garcia; that given the foregoing revelations, he concluded that the
Muerteguis were merely bluffing, and that they probably did not want him
to buy the property because they were interested in buying it for
themselves considering that it was adjacent to a lot which they owned;
that he then proceeded to purchase the lot from Garcia; that after
purchasing the lot, he wrote Caseldita in October 1991 to inform her of the
sale; that he then took possession of the lot and gathered ipil-ipil for
firewood and harvested coconuts and calamansi from the lot; and that he
constructed a rip-rap on the property sometime in 1996 and 1997.
Ruling of the Regional Trial Court
On October 28, 2002, the trial court issued its Decision15 which decrees as
follows:
WHEREFORE, in view of the foregoing considerations, this Court finds in

favor of the plaintiff and against the defendants, hereby declaring the Deed
of Sale dated 2 September 1981 as valid and preferred while the Deed of
Absolute Sale dated 17 October 1991 and Tax Declaration No. 5327 in the
name of Atty. Clemencio C. Sabitsana, Jr. are VOID and of no legal effect.
The Provincial Assessor and the Municipal Assessor of Naval are directed
to cancel Tax Declaration No. 5327 as void and done in bad faith.
Further, Atty. Clemencio C. Sabitsana, Jr. is ordered to pay plaintiff Juanito

Muertigui, represented by his attorney-in-fact Domingo Muertigui, Jr. the
amounts of:
a) ₱30,000.00 as attorney’s fees;
b) ₱10,000.00 as litigation expenses; and
c) Costs.
SO ORDERED.16
The trial court held that petitioners are not buyers in good faith. Petitioner
Atty. Sabitsana was the Muertegui family’s lawyer, and was informed
beforehand by Carmen that her family had purchased the lot; thus, he
knew of the sale to Juanito. After conducting an investigation, he found out
that the sale was not registered. With this information in mind, Atty.
Sabitsana went on to purchase the same lot and raced to register the sale
ahead of the Muerteguis, expecting that his purchase and prior
registration would prevail over that of his clients, the Muerteguis. Applying
Article 1544 of the Civil Code,17 the trial court declared that even though
petitioners were first to register their sale, the same was not done in good
faith. And because petitioners’ registration was not in good faith,
preference should be given to the sale in favor of Juanito, as he was the
first to take possession of the lot in good faith, and the sale to petitioners
must be declared null and void for it casts a cloud upon the Muertegui
title.
Petitioners filed a Motion for Reconsideration18 but the trial court

denied19 the same.
Ruling of the Court of Appeals
Petitioners appealed to the CA20 asserting that the sale to Juanito was null
and void for lack of marital consent; that the sale to them is valid; that the
lower court erred in applying Article 1544 of the Civil Code; that the
Complaint should have been barred by prescription, laches and estoppel;
that respondent had no cause of action; that respondent was not entitled
to an award of attorney’s fees and litigation expenses; and that they
should be the ones awarded attorney’s fees and litigation expenses.
The CA, through its questioned January 25, 2007 Decision,21 denied the
appeal and affirmed the trial court’s Decision in toto. It held that even
though the lot admittedly was conjugal property, the absence of Soledad’s
signature and consent to the deed did not render the sale to Juanito
absolutely null and void, but merely voidable. Since Garcia and his wife
were married prior to the effectivity of the Family Code, Article 173 of the
Civil Code22 should apply; and under the said provision, the disposition of
conjugal property without the wife’s consent is not void, but merely
voidable. In the absence of a decree annulling the deed of sale in favor of
Juanito, the same remains valid.
The CA added that the fact that the Deed of Sale in favor of Juanito was
not notarized could not affect its validity. As against the notarized deed of
sale in favor of petitioners, the CA held that the sale in favor of Juanito
still prevails. Applying Article 1544 of the Civil Code, the CA said that the
determining factor is petitioners’ good faith, or the lack of it. It held that
even though petitioners were first to register the sale in their favor, they
did not do so in good faith, for they already knew beforehand of Garcia’s
prior sale to Juanito. By virtue of Atty. Sabitsana’s professional and
confidential relationship with the Muertegui family, petitioners came to
know about the prior sale to the Muerteguis and the latter’s possession of
the lot, and yet they pushed through with the second sale. Far from acting
in good faith, petitioner Atty. Sabitsana used his legal knowledge to take
advantage of his clients by registering his purchase ahead of them.
Finally, the CA declared that Juanito, as the rightful owner of the lot,
possessed the requisite cause of action to institute the suit for quieting of
title and obtain judgment in his favor, and is entitled as well to an award
for attorney’s fees and litigation expenses, which the trial court correctly
held to be just and equitable under the circumstances.
The dispositive portion of the CA Decision reads:
WHEREFORE, premises considered, the instant appeal is DENIED and the

Decision dated October 28, 2002 of the Regional Trial Court, 8th Judicial
Region, Branch 16, Naval, Biliran, is hereby AFFIRMED. Costs against
defendants-appellants.
SO ORDERED.23
Issues
Petitioners now raise the following issues for resolution:
I. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE

REGIONAL TRIAL COURT DID NOT HAVE JURISDICTION OVER THE
CASE IN VIEW OF THE FACT THAT THE ASSESSED VALUE OF THE
SUBJECT LAND WAS ONLY ₱1,230.00 (AND STATED MARKET VALUE
OF ONLY ₱3,450.00).
II. THE COURT OF APPEALS ERRED IN APPLYING ART. 1544 OF THE

CIVIL CODE INSTEAD OF THE PROPERTY REGISTRATION DECREE
(P.D. NO. 1529) CONSIDERING THAT THE SUBJECT LAND WAS
UNREGISTERED.
III. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE
COMPLAINT WAS ALREADY BARRED [BY] LACHES AND THE
STATUTE OF LIMITATIONS.
IV. THE COURT OF APPEALS ERRED IN AFFIRMING THE DECISION OF

THE REGIONAL TRIAL COURT ORDERING THE PETITIONERS TO PAY
ATTORNEY’S FEES AND LITIGATION EXPENSES TO THE
RESPONDENT.24
Petitioners’ Arguments
Petitioners assert that the RTC of Naval, Biliran did not have jurisdiction
over the case. They argue that since the assessed value of the lot was a
mere ₱1,230.00, jurisdiction over the case lies with the first level courts,
pursuant to Republic Act No. 7691,25 which expanded their exclusive
original jurisdiction to include "all civil actions which involve title to, or
possession of, real property, or any interest therein where the assessed
value of the property or interest therein does not exceed Twenty thousand
pesos (₱20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty thousand pesos (₱50,000.00)
exclusive of interest, damages of whatever kind, attorney’s fees, litigation
expenses and costs."26 Petitioners thus conclude that the Decision in Civil
Case No. B-1097 is null and void for lack of jurisdiction.
Petitioners next insist that the lot, being unregistered land, is beyond the
coverage of Article 1544 of the Civil Code, and instead, the provisions of
Presidential Decree (PD) No. 1529 should apply. This being the case, the
Deed of Sale in favor of Juanito is valid only as between him and the seller
Garcia, pursuant to Section 113 of PD 1529;27 it cannot affect petitioners
who are not parties thereto.
On the issue of estoppel, laches and prescription, petitioners insist that

from the time they informed the Muerteguis in writing about their
purchase of the lot, or in October 1991, the latter did not notify them of their
prior purchase of the lot, nor did respondent interpose any objection to the
sale in their favor. It was only in 1998 that Domingo Jr. showed to
petitioners the unnotarized deed of sale. According to petitioners, this
seven-year period of silence and inaction on the Muerteguis’ part should
be taken against them and construed as neglect on their part to assert
their rights for an unreasonable length of time. As such, their action to
quiet title should be deemed barred by laches and estoppel.
Lastly, petitioners take exception to the award of attorney’s fees and

litigation expenses, claiming that since there was no bad faith on their
part, such award may not be considered just and equitable under the
circumstances. Still, an award of attorney’s fees should remain the
exception rather than the rule; and in awarding the same, there must have
been an express finding of facts and law justifying such award, a
requirement that is absent in this case.
Petitioners thus pray for the reversal of the questioned CA Decision and
Resolution; the dismissal of the Complaint in Civil Case No. B-1097; the
deletion of the award of attorney’s fees and litigation expenses in
respondent’s favor; and a declaration that they are the true and rightful
owners of the lot.
Respondent’s Arguments
Respondent, on the other hand, counters that a suit for quieting of title is
one whose subject matter is incapable of pecuniary estimation, and thus
falls within the jurisdiction of the RTC. He likewise insists that Article 1544
applies to the case because there is a clear case of double sale of the
same property to different buyers, and the bottom line thereof lies in
petitioners’ lack of good faith in entering into the subsequent sale. On the
issue of laches/estoppel, respondent echoes the CA’s view that he was
persistent in the exercise of his rights over the lot, having previously filed
a complaint for recovery of the lot, which unfortunately was dismissed
based on technicality.
On the issue of attorney’s fees and litigation expenses, respondent finds

refuge in Article 2208 of the Civil Code,28 citing three instances which
fortify the award in his favor + petitioners’ acts compelled him to litigate
and incur expenses to protect his interests; their gross and evident bad
faith in refusing to recognize his ownership and possession over the lot;
and the justness and equitableness of his case.
Our Ruling
The Petition must be denied.
The Regional Trial Court has jurisdiction over the suit for quieting of title.
On the question of jurisdiction, it is clear under the Rules that an action for
quieting of title may be instituted in the RTCs, regardless of the assessed
value of the real property in dispute. Under Rule 63 of the Rules of
Court,29 an action to quiet title to real property or remove clouds
therefrom may be brought in the appropriate RTC.
It must be remembered that the suit for quieting of title was prompted by
petitioners’ August 24, 1998 letter-opposition to respondent’s application
for registration. Thus, in order to prevent30 a cloud from being cast upon
his application for a title, respondent filed Civil Case No. B-1097 to obtain a
declaration of his rights. In this sense, the action is one for declaratory
relief, which properly falls within the jurisdiction of the RTC pursuant to
Rule 63 of the Rules.
Article 1544 of the Civil Code does not apply to sales involving
unregistered land.
Both the trial court and the CA are, however, wrong in applying Article
1544 of the Civil Code. Both courts seem to have forgotten that the
provision does not apply to sales involving unregistered land. Suffice it to
state that the issue of the buyer’s good or bad faith is relevant only where
the subject of the sale is registered land, and the purchaser is buying the
same from the registered owner whose title to the land is clean. In such
case, the purchaser who relies on the clean title of the registered owner
is protected if he is a purchaser in good faith for value.31
Act No. 3344 applies to sale of unregistered lands.
What applies in this case is Act No. 3344,32 as amended, which provides
for the system of recording of transactions over unregistered real estate.
Act No. 3344 expressly declares that any registration made shall be
without prejudice to a third party with a better right. The question to be
resolved therefore is: who between petitioners and respondent has a
better right to the disputed lot?
Respondent has a better right to the lot.
The sale to respondent Juanito was executed on September 2, 1981 via an

unnotarized deed of sale, while the sale to petitioners was made via a
notarized document only on October 17, 1991, or ten years thereafter. Thus,
Juanito who was the first buyer has a better right to the lot, while the
subsequent sale to petitioners is null and void, because when it was made,
the seller Garcia was no longer the owner of the lot. Nemo dat quod non
habet.
The fact that the sale to Juanito was not notarized does not alter anything,
since the sale between him and Garcia remains valid nonetheless.
Notarization, or the requirement of a public document under the Civil
Code,33 is only for convenience, and not for validity or enforceability.34 And
because it remained valid as between Juanito and Garcia, the latter no
longer had the right to sell the lot to petitioners, for his ownership thereof
had ceased.
Nor can petitioners’ registration of their purchase have any effect on

Juanito’s rights. The mere registration of a sale in one’s favor does not
give him any right over the land if the vendor was no longer the owner of
the land, having previously sold the same to another even if the earlier
sale was unrecorded.35 Neither could it validate the purchase thereof by
petitioners, which is null and void. Registration does not vest title; it is
merely the evidence of such title. Our land registration laws do not give
the holder any better title than what he actually has.36
Specifically, we held in Radiowealth Finance Co. v. Palileo37 that:
Under Act No. 3344, registration of instruments affecting unregistered

lands is ‘without prejudice to a third party with a better right.’ The
aforequoted phrase has been held by this Court to mean that the mere
registration of a sale in one’s favor does not give him any right over the
land if the vendor was not anymore the owner of the land having
previously sold the same to somebody else even if the earlier sale was
unrecorded.
Petitioners’ defense of prescription, laches and estoppel are unavailing

since their claim is based on a null and void deed of sale. The fact that the
Muerteguis failed to interpose any objection to the sale in petitioners’
favor does not change anything, nor could it give rise to a right in their
favor; their purchase remains void and ineffective as far as the Muerteguis
are concerned.
The award of attorney’s fees and litigation expenses is proper because of

petitioners’ bad faith.
Petitioners’ actual and prior knowledge of the first sale to Juanito makes
them purchasers in bad faith. It also appears that petitioner Atty.
Sabitsana was remiss in his duties as counsel to the Muertegui family.
Instead of advising the Muerteguis to register their purchase as soon as
possible to forestall any legal complications that accompany unregistered
sales of real property, he did exactly the opposite: taking advantage of the
situation and the information he gathered from his inquiries and
investigation, he bought the very same lot and immediately caused the
registration thereof ahead of his clients, thinking that his purchase and
prior registration would prevail. The Court cannot tolerate this mercenary
attitude. Instead of protecting his client’s interest, Atty. Sabitsana
practically preyed on him.
Petitioner Atty. Sabitsana took advantage of confidential information

disclosed to him by his client, using the same to defeat him and beat him
to the draw, so to speak. He rushed the sale and registration thereof
ahead of his client. He may not be afforded the excuse that he nonetheless
proceeded to buy the lot because he believed or assumed that the
Muerteguis were simply bluffing when Carmen told him that they had
already bought the same; this is too convenient an excuse to be believed.
As the Muertegui family lawyer, he had no right to take a position, using
information disclosed to him in confidence by his client, that would place
him in possible conflict with his duty. He may not, for his own personal
interest and benefit, gamble on his client’s word, believing it at one time
and disbelieving it the next. He owed the Muerteguis his undivided loyalty.
He had the duty to protect the client, at all hazards and costs even to
himself.38
Petitioner Atty. Sabitsana is enjoined to "look at any representation

situation from the point of view that there are possible conflicts, and
further to think in terms of impaired loyalty, that is, to evaluate if his
representation in any way will impair his loyalty to a client."39
Moreover, as the Muertegui family’s lawyer, Atty. Sabitsana was under

obligation to safeguard his client's property, and not jeopardize it. Such is
his duty as an attorney, and pursuant to his general agency.40
Even granting that Atty. Sabitsana has ceased to act as the Muertegui
family's lawyer, he still owed them his loyalty.1âwphi1 The termination of
attorney-client relation provides no justification for a lawyer to represent
an interest adverse to or in conflict with that of the former client on a
matter involving confidential information which the lawyer acquired when
he was counsel. The client's confidence once reposed should not be
divested by mere expiration of professional employment.41 This is
underscored by the fact that Atty. Sabitsana obtained information from
Carmen which he used to his advantage and to the detriment of his client.
from the foregoing disquisition, it can be seen that petitioners are guilty of
bad faith in pursuing the sale of the lot despite being apprised of the prior
sale in respondent's favor. Moreover, petitioner Atty. Sabitsana has
exhibited a lack of loyalty toward his clients, the Muerteguis, and by his
acts, jeopardized their interests instead of protecting them. Over and
above the trial court's and the CA's findings, this provides further
justification for the award of attorney's fees, litigation expenses and costs
in favor of the respondent.
Thus said, judgment must be rendered in favor of respondent to prevent

the petitioners' void sale from casting a cloud upon his valid title.
WHEREFORE, premises considered, the Petition is DENIED. The January

25, 2007 Decision and the January 11, 2008 Resolution of the Court of
Appeals in CA-G.R. CV No. 79250 are AFFIRMED. Costs against petitioners.
SO ORDERED.
International Harvester vs MacLeod, Inc vs CA, GR No. LL-
44346, May 31, 1979
SYNOPSIS
By way of counterclaim to petitioner’s complaint, respondent sought to

recover a commission of 2% of petitioner’s total volume of sales. The
counterclaim was based on an oral agreement between petitioner’s
Manager and respondent, whereby the latter would use his personal
influence with President Garcia to convince the latter to improve or, at
least, maintain petitioner’s dollar allocation. Respondent’s evidence is to
the effect that due to the rigid import controls imposed by the
Government, petitioner’s dollar allocation had been reduced, resulting in a
tremendous decrease in its volume of sales; that when petitioner failed to
obtain a reconsideration of the Monetary Board’s policy decision of
slashing the dollar allocations of alien importers under the "Filipino First
Policy" petitioner sought respondent’s aid, promising to give the latter 2%
of petitioner’s volume of sales during President Garcia’s term, should he
succeed in his mission of securing an exception to the policy decision.
Respondent claimed that petitioner’s volume of sales increased because
of his intervention.
The lower court sustained respondent’s counterclaim and ordered

petitioner to pay respondent P1,838,096.09 representing the 2%
commission. The Court of Appeals affirmed the decision with modification.
On petition for review, the Supreme Court nullified the agreement,
modified the decision by eliminating the award of P1,838,096.09 and
affirmed the decision in all other respects.
SYLLABUS
1. CONTRACTS; VALIDITY; INFLUENCE PEDDLING; ANTI-GRAFT AND

CORRUPT PRACTICES ACT. * Any agreement entered into because of the
actual or supposed influence administrative or executive officers in the
discharge of their duties, which contemplates the use of personal
influence and personal solicitation rather than any appeal to the judgment
of the officer on the merits of the object sought is contrary to public policy,
and is null and void, and therefore, unenforceable before Court of justice.
It was to give statutory imprimatur to public policy that Republic Act 3019,
the Anti-Graft and Corrupt Practices Act was enacted on August 1, 1960.
2. ID.; ID.; ID.; DOLLAR ALLOCATIONS; PUBLIC INTEREST DEMANDS

UNIFORM APPLICATION OF FOREIGN EXCHANGE RESTRICTIONS. * Public
interest demand that applications for foreign exchange be considered,
acted upon or disposed of strictly on the basis of the merits and demerits
of each case, without the intervention of intermediaries, and the
exigencies of public welfare require that proceedings for the
determination of such applications be deducted in the most impersonal
and impartial manner to forestall favoritism or the commission of other
irregularities in relation thereto or, at least to minimize the opportunities
therefor or the possibility thereof.
DECISION
MELENCIO-HERRERA, J.:
This is a Petition for Review of the Decision of the Court of Appeals *

affirming with modification the judgment, in respondent Tansiong Lim’s
favor, of the Court of First Instance of Bohol in an action for sum of money
filed by petitioner against Lim.
The facts of the case are as follows:chanrob1es virtual 1aw library
On November 24, 1964, petitioner International Harvester Macleod, Inc. and

private respondent Tansiong Lim entered into a dealership agreement
(Exhs. "A", "B" and "C") whereby the latter was appointed dealer of the
former in the island province of Bohol for the sale and service of
International trucks and equipment and farm tractors. The dealership
agreements had for their consideration discounts and terms laid down in
petitioner’s Schedule of Discounts and Terms of Dealership Applying to
Goods Covered by Dealer Sales and Service Agreements (Exh. "D").
On September 14, 1965, petitioner filed a Complaint with prayer for
Preliminary Writ of Attachment with the Court of First Instance of Bohol
for the recovery of the sum of P76,806.88 allegedly due it from respondent
Lim under their dealership agreement and which the latter had refused to
pay in spite of repeated oral and written demands. It was then prayed that
a Writ of Preliminary Attachment be issued against respondent Lim’s
properties as security for the satisfaction of any judgment that may be
recovered; and that respondent Lim be ordered to pay the sum of
P76,806.88, with interest from August 1, 1965 until fully paid, the sum of
P19,000.00 as and for attorney’s fees and the costs of suit.
On September 28, 1965, respondent Lim filed his Answer averring that he
had asked for a liquidation of his accounts with petitioner, which the latter
neglected to give him; that without such liquidation, he could not
determine his indebtedness, if any; and that in the remote possibility that
petitioner’s demand is correct, he, nevertheless, has no obligation to pay
the same for the reason that the former has monetary obligations to him
which were much more than its claim. By way of counterclaim, respondent
Lim alleged that as a consequence of the rigid import controls imposed by
the Government, petitioner’s dollar allocations had been reduced resulting
in a tremendous decrease of its volume of sales in 1958; that in order to
remedy the situation as it was expected that further reduction of its dollar
allocations would be made the following year, petitioner’s President, Mr.
Paul Wood, asked him, prior to February 25, 1959, to bring to the attention
of then President Carlos P. Garcia the detrimental effects of the import
control on petitioner’s business and on the entire nation; that on February
28, 1959, Mr. Wood delivered to him the letter dated February 25, 1959,
giving him authority to meet President Garcia, together with a copy of
General Letter No. 77 addressed to all employees of petitioner; that on the
same date, Mr. Wood verbally promised to give him two percent of
petitioner’s volume of sales for the duration of the term of President
Garcia, should its business improve as a result of his mission; that as a
result of his intervention, petitioner’s volume of sales increased in the
ensuing fiscal years; and that, consequently, he is entitled to receive 2% of
petitioner’s total volume of sales from March 1, 1959 to December 31, 1961,
when President Garcia’s term of office expired. He then prayed for the
dismissal of the Complaint, the payment of his share of 2% of petitioner’s
total volume of sales from March 1, 1959 to December 31, 1961, upon a
determination of said amount, as well as the sums of P20,000.00 as moral
damages and P5,000.00 as attorney’s fees.chanrobles virtual lawlibrary
It appears that in a letter dated September 24, 1965, petitioner advised

respondent Lim of the termination of their dealership agreement effective
October 1, 1965. Consequently, respondent Lim filed a Supplemental
Counterclaim against petitioner for the amount of P170,000.00 by way of
damages by reason of the illegal termination of their dealership
agreement.
In Its Answer to respondent Lim’s counterclaims, petitioner denied

knowledge of his agreement with Mr. Paul Wood regarding the payment of
2% of the total volume of its sales contending that the increase in its
volume of sales was not due to respondent Lim’s intervention as he had
nothing to do with the management of its business; that not being a
stockholder, he is not entitled to any percentage of its volume of sales;
and that it has all the right to terminate their dealership agreement for
violation thereof by respondent Lim.
On March 21, 1966, after the pre-trial, the trial Court issued a Resolution
denying petitioner’s Motion for dismissal of the Complaint without
prejudice, as well as respondent’s Motion to Dismiss for petitioner’s non-
appearance, and ordered respondent Lim to pay petitioner, within ninety
(90) days from notice, the sum of P63,453.67, with interest at the legal
rate. In an Order dated December 7, 1966, the Court a quo set aside the
Resolution of March 21, 1966 and dismissed the Complaint and
counterclaim with prejudice. However, in an Order dated May 26, 1967, the
Resolution of March 21, 1966 was reinstated.
Thereafter, trial was held with respect to the other issues, including
respondent Lim’s counterclaim regarding the payment of his commission
of 2% of petitioner’s total volume of sales, pursuant to his agreement with
Mr. Paul Wood.
On October 11, 1971, the trial Court rendered judgment,

decreeing:jgc:chanrobles.com.ph
"In the light of all the foregoing, the Court renders judgment in the entire
case as follows:jgc:chanrobles.com.ph
"DEFENDANT TANSIONG LIM SHALL PAY:chanrob1es virtual 1aw library
(a) To the Clerk of Court the docketing fee on defendant’s permissive

counterclaim, once determined how much;
(b) Inasmuch as the amount of P63,453.67 that resulted from the pre-trial
is not yet executed, defendant Tansiong Lim is ordered, as part of this
judgment, to pay the sum of P63,453.67 until it is fully satisfied and this
amount shall be a lien on the judgment against International Harvester
Macleod, Inc.; and
(c) Tansiong Lim’s contract as dealer of plaintiff is declared terminated

upon finality of this decision.
"PLAINTIFF INTERNATIONAL HARVESTER MACLEOD, INC.:chanrob1es

virtual 1aw library
(a) Shall pay to defendant Tansiong Lim P1,838,096.09 representing two

per cent (2%) of plaintiff’s total volume of sales (which was
P91,904,804.50), corresponding to the period from March 1959 to
December 31, 1961, with legal interest at the rate of 6% per annum from
October 1, 1965, until it is fully satisfied; and
(b) Shall pay to defendant Tansiong Lim P10,000.00 for the spare parts
which were in Tansiong Lim’s store and which are no longer usable due to
natural occurrences, with legal interest of 6% per annum from December
6, 1965 until it is fully satisfied.
"Without pronouncement as to costs."cralaw virtua1aw library
On appeal, respondent Court affirmed the above-quoted judgment with

modification by requiring the payment of interest at the legal rate on the
sum of P63,453.67 until the same shall have been fully satisfied; and by
eliminating that portion requiring petitioner International Harvester
Macleod, Inc. to pay private respondent Tansiong Lim the sum of
P10,000.00 for spare parts.
Its Motion for Reconsideration of the Decision of the appellate Court

having been denied, petitioner filed the present Petition, which was given
course, raising the following questions of law:chanrob1es virtual 1aw
library
"I
WHETHER OR NOT A CONFIDENTIAL ORAL AGREEMENT SUPPOSEDLY

ENTERED INTO BY RESPONDENT LIM AND PETITIONER’S FORMER
PRESIDENT, MR. PAUL WOOD (NOW DECEASED) WHEREUNDER
RESPONDENT LIM WAS ALLEGEDLY PROMISED A 2% COMMISSION ON
ALL OF PETITIONER’S SALES FOR AS LONG AS THE NOW LATE
PRESIDENT CARLOS P. GARCIA IS THE INCUMBENT PRESIDENT OF THE
REPUBLIC OF THE PHILIPPINES, IN THE EVENT RESPONDENT LIM, WHO
CLAIMS CLOSE ASSOCIATION AND INFLUENCE OVER PRESIDENT GARCIA,
SUCCEEDS IN PREVENTING A REDUCTION OR AT LEAST SHOULD BE ABLE
TO MAINTAIN PETITIONER’S DOLLAR ALLOCATIONS IS CONTRARY TO
PUBLIC POLICY, GOOD CUSTOMS, PUBLIC ORDER, PUBLIC MORALS AND
LAW AS IN FACT SIMILARLY FOUND BY THIS HONORABLE COURT IN TEE
VS. TACLOBAN ELECTRIC COMPANY (105, Phil. 168) AND SY SUAN VS.
REGALA (105 PHIL. 1024) WHERE THE NOTORIOUS CONTRACTS
COMMONLY KNOWN AS ‘10% CONTRACTS’ WERE CONDEMNED AS
INIMICAL TO PUBLIC INTEREST.
"II
WHETHER OR NOT SUCH AGREEMENT, WHICH IS CONTINGENT UPON

SUCCESS, IS OF A NATURE THAT TENDS TO MISCHIEF AND TO INJURE
PUBLIC CONFIDENCE IN THE ADMINISTRATION OF JUSTICE AND HENCE,
AS GENERALLY HELD BY THE AUTHORITIES, WOULD BE CONTRARY TO
PUBLIC POLICY, GOOD CUSTOMS, PUBLIC ORDER, PUBLIC MORALS AND
LAW.
"III
WHETHER OR NOT A COURT CAN CONSIDER AS EVIDENCE DEPOSITIONS
WHICH WERE INCOMPLETE SINCE THE EXHIBITS REFERRED TO THEREIN
WERE NOT ATTACHED; WERE NEITHER MARKED AS EXHIBITS NOR WERE
FORMALLY OFFERED IN EVIDENCE NOR WERE OPENED IN COURT THE
PRESENCE OF THE PARTIES.
"IV
WHETHER OR NOT A DEPOSITION OF A WITNESS IS ADMISSIBLE IN

EVIDENCE WHEN THE DEPONENT IS AVAILABLE TO TESTIFY AND IN FACT
TESTIFIED IN OPEN COURT.
"V
WHETHER OR NOT THE CONCLUSION OF THE COURT OF APPEALS

REGARDING THE EXISTENCE OF AN ORAL AGREEMENT INVOLVING THE
PAYMENT OF P1.8 MILLION AS A COMMISSION IS CORRECT, PROPER OR
JUSTIFIED IN THE LIGHT OF THE PLEADINGS OF THE PARTIES AND THE
ADMITTED OR PROVEN FACTS OF THE CASE AND ESPECIALLY SO WHEN
IT IS CONSIDERED (A) THAT THE CLAIM FOR P1.8 MILLION WAS
INTERPOSED FOR THE FIRST TIME SIX (6) YEARS AFTER THE AGREEMENT
WAS MADE AND ONLY THE FORM OF A COUNTERCLAIM AND (B) WHEN
THE CONCLUSION AS TO THE EXISTENCE OF THE ORAL AGREEMENT WAS
BASED SOLELY ON DEPOSITIONS WHICH ARE INADMISSIBLE."cralaw
virtua1aw library
In sustaining the validity of the agreement with respect to the payment of

the 2% commission, respondent Court found no similarity between the
case at bar and the cases cited by petitioner, Tee v. Tacloban Electric & Ice
Plant Co., Inc. and Sy Suan v. Regala, 1 wherein this Court ruled that
contracts providing for a 10% commission for securing import licenses or
dollar allocations are null and void as being against public policy. Said
respondent Court:jgc:chanrobles.com.ph
". . . We find nothing against public policy in the agreement in question.

Appellee Tansiong Lim was requested only to present the case of
appellant, with the aid of certain documents, to the President, taking into
account his accessibility to President Garcia whom he saw almost every
Sunday. It is not Tansiong Lim’s influence with President Garcia that
induced his choice for the mission of making an appeal to the President
against reduction of appellant’s dollar allocation, for in arming him with
documents to support the appeal, appellant did not rely on influence but
on the merits of its case. If instead of Tansiong Lim, it was a high official of
appellant who had gone to see President Garcia for the same mission and
succeeded in presenting the appellant’s case and obtaining the relief
sought, there would seem to be nothing immoral or illegal in the act. As to
the payment of the commission, it was but natural for Tansiong Lim, who
is a mere dealer, not an official of the appellant company, to deserve and
be entitled to some compensation.
"Neither was there anything inherently immoral in making the appeal to

President Garcia with the objective of showing how detrimental is it for
the economy for appellant’s allocation to be reduced, affecting as it does
also the well-being and livelihood of hundreds of employees and workers
of appellant. The President has made a decision, and it is only to
reconsider the decision to appellant’s favor that the latter sought
appellee’s service for a fee. This is not following up a dollar quota
application. It is to ask for a reconsideration of a policy decision laid down
by the President. It is not suggested that the President was going to be
shared in the 2% commission of Tansiong Lim as to taint the whole
proceedings, within the contemplation of the agreement, with impropriety
that will make the agreement itself void as against public morals or policy.
The matter taken up with President Garcia comes within the legitimate
exercise of his presidential prerogatives. No hint is given that his decision
or action would be influenced by Tansiong Lim’s closeness to him as a
friend, much less by money consideration. Hence, the agreement is
neither void as against public policy in general, nor as against the spirit of
the Anti-Graft Law, which incidentally, was not yet in force when the
agreement was forged."cralaw virtua1aw library
We find it difficult to uphold the above-observations of respondent Court.
It is true that protests against the policy of the Monetary Board reducing
dollar allocations were filed by alien importers and that the protests filed
by American importers, which included petitioner, were denied by
President Garcia, as may be gleaned from the following statements
appearing in the February 23, 1959 issue of the Official Gazette, reading
thus:chanrobles law library : red
"February 20, PRESIDENT GARCIA announced today he will give the

Central Bank time to act on protests against the reduction of dollar
allocations for the current quarter of all alien importers, except American
importers." (Emphasis supplied)
"The President received at Malacañang British Ambassador George

Clutton, who verbally transmitted to him the protests of some members of
the local diplomatic corps against the ‘Filipino First Policy’ in the grant of
dollar allocations. The President also received officials and members of
the International Chamber of Commerce who presented a resolution
protesting against the policy adopted by the Monetary Board on January 5,
1959." 2
The evidence for respondent Lim then is to the effect that as a

consequence of rigid import controls imposed by the Government, the
dollar allocation of petitioner had been reduced, resulting in a tremendous
decrease in its volume of sales in 1958, and that in a meeting he had with
petitioner’s President and General Manager, Mr. Paul Wood, on February
25, 1959, the latter promised to give him a commission of 2% of petitioner’s
total volume of sales should he succeed in having petitioner’s dollar
allocation improved or, at least, maintained, for the duration of the term of
then President Carlos P. Garcia. Thus, as respondent Court itself stated in
its Decision, respondent Lim’s counterclaim was based on an oral
agreement he had with Mr. Paul Wood whereby he (Lim) would use his
personal influence and association with President Garcia to improve or, at
least, maintain petitioner’s dollar allocation. Respondent Lim himself
admits that the fact that he was a close friend of President Garcia might
have been one of the considerations taken into account by petitioner in
entreating him to undertake the job of bringing the matter of its disastrous
condition to the attention of the President. 3
There is also evidence to show that Mr. Paul Wood had wanted to see
respondent Lim as early as October, 1958 (Exhibit "42"). However, the
meeting between the two did not materialize until sometime in the third
week of February, 1959, when Mr. N. L. Valeriano, who was also one of
petitioner’s dealers, conveyed to respondent Lim Mr. Wood’s urgent desire
to have a conference with him on February 25, 1959. The conference on
February 25, 1959 must have been prompted by President Garcia’s denial,
on February 20, 1959, of the protests filed by American importers against
the reduction of their dollar allocations.
It must be conceded that Mr. Paul Wood armed respondent Lim with some
documents to support his appeal to the President to improve or, at least,
maintain petitioner’s dollar allocations, to wit: Exhibit "24", which is a
letter of Mr. Wood to respondent Lim expressing his wish that President
Garcia would read petitioner’s General Letter No. 77 (Exhibit "26")
addressed to its dealers informing them of the reduction of its dollar
allocations for the first quarter of 1959 by 30.9%, resulting in its inability to
meet service parts requirements of dealers and customers; Exhibit "25",
which is petitioner’s Memorandum to its employees informing them of the
reduction of employment and sales as a consequence of its reduced dollar
allocations; and Exhibit "27", which is a brochure showing that petitioner’s
retail business is handled solely by Filipino dealers whose employees are
all Filipinos. Evidently, said documents, on their face, tend to support
petitioner’s appeal for the maintenance or improvement of the latter’s
dollar allocations. In other words, having failed in its attempt to obtain a
reconsideration of the policy of the Monetary Board reducing the dollar
allocations of American importers, petitioner then sought the aid of
respondent Lim, who could see President Garcia "anytime", 4 for the
purpose of using Lim’s influence to convince the latter to improve, or, at
least maintain petitioner’s dollar allocation.
We find as untenable the finding that the circumstances obtaining herein

are dissimilar to the factual setting in Sy Suan v. Regala, supra, wherein it
was succinctly stated:jgc:chanrobles.com.ph
". . . (S)uch intervention would not render an unmeritorious application

deserving, nor undeserving applications meritorious, but would serve no
other purpose than to influence, or possibly corrupt, in unmeritorious
cases, the judgment of the public official or officials performing an act or
service connected with the issuance of import license or quota allocation
* an eventuality which the law precisely sought to avoid."cralaw
virtua1aw library
As announced by then President Garcia, the protests of American

importers against the reduction of their dollar allocations were not to be
entertained. The approach by respondent to President Garcia could not but
be for any other purpose but to influence him through personal
connections to make an exception in petitioner’s case. Clearly, an
agreement to this effect should be declared as against public policy. Any
agreement entered into because of the actual or supposed influence which
the party has, engaging him to influence administrative or executive
officers in the discharge of their duties, which contemplates the use of
personal influence and personal solicitation rather than any appeal to the
judgment of the officer on the merits of the object sought, is contrary to
public policy. 5
Nor can we agree with the appellate Court’s observation that the cases of
Tee v. Tacloban Electric & Ice Plant Co., Inc. and Sy Suan v. Regala are not
applicable to the case at bar as it does not involve following up of dollar
allocations. The fact that respondent Lim’s mission, for which he was
promised a 2% commission, involved an appeal to President Garcia for a
reconsideration of a policy decision reducing petitioner’s dollar allocations
does not make the present case essentially different from the above-cited
cases. The doctrines enunciated in said two cases that public interest
demands that applications for foreign exchange be considered, acted upon
or disposed of strictly on the basis of the merits and demerits of each
case, without the intervention of intermediaries, and that the exigencies of
public welfare require that proceedings for the determination of such
applications be conducted in the most impersonal and impartial manner to
forestall favoritism or the commission of other irregularities in relation
thereto or, at least to minimize the opportunities therefor or the possibility
thereof, are equally applicable to the case at bar. In fact, even with more
reason considering that reconsideration of the policy decision slashing the
dollar allocations of alien importers, affecting as it did public interest, had
to be applied uniformly without exception. That private respondent’s
"influence" with President Garcia was the only causative factor that
improved petitioner’s business in subsequent years has not been
satisfactorily and convincingly proven.
Consequently, it is our considered opinion that the agreement between

respondent Lim and petitioner is null and void, for being against public
policy, and, therefore, unenforceable before a Court of justice. It was to
give statutory imprimatur to such public policy that Republic Act No. 3019,
the Anti-Graft and Corrupt Practices Act, was enacted on August 17, 1960,
incorporating the following provision:chanrobles law library
"SEC. 4. Prohibition on private individuals. * (a) It shall be unlawful for

any person having family or close personal relation with any public official
to capitalize or exploit or take advantage of such family or close personal
relation by directly or indirectly requesting or receiving any present, gift
or material or pecuniary advantage from any other person having some
business, transaction, application, request or contract with the
government, in which such public official has to intervene. Family relation
shall include the spouse or relatives by consanguinity or affinity in the
third civil degree. The word ‘close personal relation’ shall include close
personal friendship, social and fraternal connections, and professional
employment all giving rise to intimacy which assures free access to such
public officer."cralaw virtua1aw library
The foregoing conclusion renders a determination of the other issues

raised by petitioner unnecessary.
WHEREFORE, the decision of the Court of Appeals is modified by

eliminating the award in favor of respondent Lim in the amount of
P1,838,096.09, representing 2% of petitioner’s total volume of sales
corresponding to the period from March, 1959 to December 31, 1961, but
affirmed in all other respects.
No pronouncement as to costs.
SO ORDERED.
Canon 16
A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS

CLIENT THAT MAY COME INTO HIS PROFESSION.
Rule 16.01 - A lawyer shall account for all money or property collected or
received for or from the client.
Rule 16.02 - A lawyer shall keep the funds of each client separate and
apart from his own and those of others kept by him.
Rule 16.03 - A lawyer shall deliver the funds and property of his client
when due or upon demand. However, he shall have a lien over the funds
and may apply so much thereof as may be necessary to satisfy his lawful
fees and disbursements, giving notice promptly thereafter to his client. He
shall also have a lien to the same extent on all judgments and executions
he has secured for his client as provided for in the Rules of Court.
Rule 16.04 - A lawyer shall not borrow money from his client unless the
client's interest are fully protected by the nature of the case or by
independent advice. Neither shall a lawyer lend money to a client except,
when in the interest of justice, he has to advance necessary expenses in a
legal matter he is handling for the client.
Palencia vs Linsangan, AC No 10557, July 10, 2018
Before us is a complaint1 filed by Jerry M. Palencia (complainant) against

Attorneys (Attys.) Pedro L. Linsangan, Gerard M. Linsangan2 and Glenda
Linsangan-Binoya (respondents) for disciplinary action.
Complainant was an overseas Filipino worker seafarer who was seriously

injured during work when he fell into the elevator shaft of the vessel M/T
"Panos G" flying a Cyprus flag.3 After initial treatment in Singapore, complainant
was discharged and flown to the Philippines to continue his medical treatment
and rehabilitation. While confined at the Manila Doctors Hospital, one "Moises,"
and later Jesherel L. Millena (Jesherel), paralegals in respondents' law office,
approached complainant. They convinced him to engage the services of
respondents' law office in order to file a suit against his employers for
indemnity.4 After several visits from the paralegals and respondent Atty. Pedro
Linsangan, complainant executed (1) an Attorney-Client Contract,5 and (2) a
Special Power of Attomey,6 where he engaged the legal services of respondents
and Gurbani & Co., a law firm based in Singapore, and agreed to pay attorney's
fees of 35% of any recovery or settlement obtained for both.
After execution of the contract, complainant, through the efforts of respondents,

was paid by his employer the following amounts: US$60,000.00 as indemnity
and US$20,000.00 under their collective bargaining agreement. From these
amounts, respondents charged complainant attorney's fees of 35%.7
Respondents and Gurbani & Co. also filed a tort case against the owners of
"Panos G" before the High Court of Singapore (Singapore case). For this case,
respondents engaged the services of Papadopoulos, Lycourgos & Co., a law firm
based in Cyprus, to draft a written opinion on the issues involving Cyprus law,
among others.8 They also engaged the services of retired Justice Emilio
Gancayco (Justice Gancayco) for his expert opinion regarding various issues
raised by defendant's lawyer and representatives.9 Thereafter, negotiations led
to a settlement award in favor of complainant in the amount of US$95,000.00.
Gurbani & Co. remitted to respondents the amount of US$59,608.40. 10 From this
amount, respondents deducted: (1) US$5,000.00 as payment to Justice
Gancayco; (2) their attorney's fees equivalent to 35%; and (3) other expenses,
leaving the net amount of US$ l 8, 132.43 for complainant. 11
Respondents tendered the amount of US$20,756.05 (representing the

US$18,132.43) to complainant, which the latter refused. 12 As complainant
contested the amount comprised of the expenses and attorney's fees deducted,
the following civil actions ensued between complainant and respondents:
(1) On September 12, 2005, respondents filed an action for preliminary

mandatory injunction (Civil Case No. 05113475) before the Regional Trial Court (R
TC) of Manila to compel complainant to receive the amount tendered.13 This case
was dismissed by the RTC, and the dismissal was eventually upheld by this
Court on July 7, 2008.14
(2) On September 22, 2005, complainant filed with the RTC of Ligao City an
action for accounting, remittance of settlement amounts and damages (Civil
Case No. 2401 or accounting case). 15 On June 16, 2011, the RTC ruled in favor of
complainant and ordered respondents to make proper accounting, among
others. 16 Although the RTC upheld the stipulated attorney's fees as binding
between the parties, it determined that the fees are lumped for both
respondents and Gurbani & Co. 17 On appeal, the CA affirmed the RTC's Decision
but reduced the rate of attorney's fees to 10%.18 This Court affirmed the CA
Decision in our Resolution dated February 20, 2013 in G.R. No. 205088. An Entry
of Judgment was issued on August 8, 2013.
On March 28, 2007, complainant also filed the subject letter-complaint19 with the
Integrated Bar of the Philippines (IBP) Commission on Bar Discipline (CBD). He
requested that an investigation be conducted and the corresponding disciplinary
action be imposed upon respondents for committing the following unethical
acts: (1) refusing to remit the amount collected in the Singapore case worth
US$95,000.00, and in offering only US$20,756.05; (2) depositing complainant's
money into their own account; and (3) engaging in "ambulance chasing" by
deploying their agents to convince complainant to hire respondents' services
while the former was still bedridden in the hospital.
In their answer,20 respondents explained that complainant retained respondents

and Gurbani & Co. 's services in 2004 for purposes of filing a claim against the
ship owner, its agents and principals. This led to the filing of a claim before the
Singapore High Court. They averred that on April 29, 2005, Gurbani & Co. advised
respondents of the settlement of the claim in Singapore for US$95,000.00.21 On
June 20, 2005, respondents sent a letter to complainant informing him that they
already received the settlement amount and requested him to come to the
former' s office to get his net share.22 Complainant went to respondents' law
office on June 28, 2005 where respondents tendered to the former his net share
of US$20,756.05.23 However, complainant unjustly refused to accept the amount.
Complainant also refused their tender of payment in their letter dated August 3,
2005.24 On September 12, 2005, respondents even filed a "consignation case"
(Civil Case No. 05113475) before the RTC of Manila.25
Respondents denied that they deposited the amount to their own account. They
claimed that the amount of US$20,756.05 has been placed for safekeeping in a
vault located inside their office ever since.26 On May 3, 2007, after their receipt of
the complaint and the IBP-CBD's Order dated April 3, 2007, they decided to
deposit the money with Bank of the Philippine Islands in an interest savings
account, in trust for complainant.27
As to the allegations of ambulance chasing, respondents averred that they

provide free legal advice to the public. It was in the course of this public service
when they met complainant.28
After proceedings, the IBP-CBD in its Report and Recommendation29 ruled that
respondents violated the canons of the Code of Professional Responsibility
(CPR): (1) in soliciting legal business through their agents while complainant
was in the hospital; (2) in failing to account for, and deliver the funds and
property of his client when due or upon demand; and (3) in hiring the services of
a foreign law firm and another lawyer without prior knowledge and consent of
complainant of the fees and expenses to be incurred. 30 The IBP-CBD found that
all three respondents connived and thus recommended that all respondents be
suspended from the practice of law for a period of one year. It also directed
respondents to comply with the Decision in the accounting case (Civil Case No.
2401) in favor of complainant. 31
The IBP Board of Governors adopted the Report and Recommendation. 32 After
respondents' motion for reconsideration33 and complainant's
opposition thereto, the IBP Board of Governors modified the penalty and
34
increased respondents' suspension from the practice of law to two years with
warning, and ordered respondents to return the 5% of the amount assessed to
complainant as attorney's fees. 35
We adopt the findings of the IBP on the unethical conduct of respondents Attys.
Pedro L. Linsangan and, Gerard M. Linsangan. We, however, absolve respondent
Atty. Glenda M. Linsangan-Binoya for lack of any evidence as to her
participation in the acts complained of.
The practice of law is a profession and not a business.36 Lawyers are reminded
to avoid at all times any act that would tend to lessen the confidence of the
public in the legal profession as a noble calling, including, among others, the
manner by which he makes known his legal services.
A lawyer in making known his legal services must do so in a dignified

manner.37 They are prohibited from soliciting cases for the purpose of gain,
either personally or through paid agents or brokers.38 The CPR explicitly states
that "[a] lawyer shall not do or permit to be done any act designed primarily to
solicit legal business."39 Corollary to this duty is for lawyers not to encourage
any suit or proceeding for any corrupt motive or interest.40 Thus, "ambulance
chasing," or the solicitation of almost any kind of business by an attorney,
personally or through an agent, in order to gain employment, is proscribed.41
Here, there is sufficient evidence to show that respondents violated these rules.
No less than their former paralegal Jesherel admitted that respondent Atty.
Pedro Linsangan came with her and another paralegal named Moises, to Manila
Doctors Hospital several times to convince complainant to hire their
services.42 This is a far cry from respondents' claim that they were merely
providing free legal advice to the public. Moreover, while respondents deny
Jesherel's connection with their law firm, this was sufficiently rebutted by
complainant when he presented Jesherel's resignation letter as received by
respondents' firm. 43 In employing paralegals to encourage complainant to file a
lawsuit against his employers, respondents indirectly solicited legal business
and encouraged the filing of suit. These constitute malpractice44 which calls for
the exercise of the court's disciplinary powers and warrants serious
sanctions.45
II
The relationship between a lawyer and his client is highly fiduciary. 46 This
relationship holds a lawyer to a great degree of fidelity and good faith especially
in handling money or property of his clients.47 Thus, Canon 16 and its rules
remind a lawyer to: (1) hold in trust all moneys and properties of his client that
may come into his possession;48 (2) deliver the funds and property of his client
when due or upon demand subject to his retaining lien;49 and (3) account for all
money or property collected or received for or from his client.50
Money collected by a lawyer on a judgment rendered in favor of his client

constitutes trust funds and must be immediately paid over to the client.51 As he
holds such funds as agent or trustee, his failure to pay or deliver the same to
the client after demand constitutes conversion.52 Thus, whenever a lawyer
collects money as a result of a favorable judgment, he must promptly report
and account the money collected to his client. 53
It is the lawyer's duty to give a prompt and accurate account to his client. Upon
the collection or receipt of property or funds for the benefit of the client, his
duty is to notify the client promptly and, absent a contrary understanding, pay or
remit the same to the client, less only proper fees and disbursements, as soon
as reasonably possible. 54 He is under absolute duty to give his client a full,
detailed, and accurate account of all money and property which has been
received and handled by him, and must justify all transactions and dealings
concerning them. 55 And while he is in possession of the client's funds, he
should not commingle it with his private property or use it for his personal
purposes without his client's consent. 56
Here, respondents claim that they promptly accounted for the total award of
US$95,000.00, and after deducting their fees, tendered the amount of
US$20,756.05. Complainant, however, refused to accept the amount because he
contested both the expenses and the separate deduction of attorney's fees by
respondents and Gurbani & Co.
We find that while respondents gave prompt notice to complainant of their

receipt of money collected in the latter's favor, they were amiss in their duties
to give accurate accounting of the amounts due to complainant, and to return
the money due to client upon demand.
The Attorney-Client Contract between the parties states: "We/I hereby

voluntarily agree and bind ourselves, our heirs and assigns to pay Atty. Pedro L.
Linsangan and his collaborating Singapore counsels, the sum equivalent to
thirty-five [35%] percent of any recovery or settlement obtained." 57 Clearly, the
stipulated rate referred to the combined professional fees of both respondents
and their collaborating Singapore counsel, Gurbani & Co.58 Nevertheless,
respondents proceeded to deduct separate fees on top of the amount already
deducted by Gurbani & Co. Complainant contested this deduction and refused to
accept the amount being tendered by respondents. Since a claim for attorney's
fees may be asserted either in the very action in which the services of a lawyer
had been rendered, or in a separate action,59 respondents, instead of forcibly
deducting their share, should have moved for the judicial determination and
collection of their attorney's fees. The fact alone that a lawyer has a lien for his
attorney's fees on money in his hands collected for his client does not entitle
him to unilaterally appropriate his client's money for himself.60
Worse, respondents allegedly kept the money inside the firm's vault for two
years until they were made aware of the disciplinary complaint against them
before the IBP-CBD. However, as noted by the IBP-CBD in its Report and
Recommendation:
[T]he defense of respondents that they kept in their office vault the share of
complainant as computed by them in the amount of US$18, 132.43, hence, they
forgot the same and remembered it only when they received the Order of this
Commission for them to file an Answer to complainant's Complaint [which is
more than 2 years] is rather highly incredible considering that it involves a
substantial amount, the series of communications between the parties, and the
Civil cases subsequently filed. 61 (Italics in the original.)
Even if we give credence to this explanation, it is improper for the lawyer to put
his client's funds in his personal safe deposit vault.62 Funds belonging to the
client should be deposited in a separate trust account in a bank or trust
company of good repute for safekeeping. 63
It is apparent from the foregoing that respondents failed to handle their client's
money with great degree of fidelity. Respondents also showed their lack of good
faith when they appropriated for themselves more than what is allowed under
their contract. They have demonstrated that the payment of their attorney's fees
is more important than their fiduciary and faithful duty of accounting and
returning what is rightfully due to their client. More, they also failed to observe
proper safekeeping of their client's money. Respondents violated the trust
reposed in them, and demonstrated their lack of integrity and moral
soundness. 64 Respondents' flagrant and malicious refusal to comply with the
CPR amounts to gross misconduct.65 This warrants the imposition of disciplinary
sanctions. 66
III
The practice of law is a profession, a form of public trust, the performance of

which is entrusted to those who are qualified and who possess good moral
character.67 Thus, the violation of the lawyer's oath and/or breach of the ethics
of the legal profession embodied in the CPR may, depending on the exercise of
sound judicial discretion based on the surrounding facts, result in the
suspension or disbarment of a member of the Bar.68
While we find respondents Attys. Pedro Linsangan and Gerard Linsangan to

have violated Rule 1.03, Rule 2.03, Canon 3, Canon 16, Rule 16.01, and Rule 16.03
of the CPR, the records do not support respondent Atty. Glenda Linsangan-
Binoya's participation in their unethical activities. Complainant himself admits
that he only dealt with respondents Attys. Pedro and Gerard Linsangan. 69 Thus,
we hold that the case against Atty. Glenda Linsangan-Binoya be dismissed.
For his violation of the proscription on ambulance chasing, we have previously

imposed the penalty of suspension of one year.70 We find no reason not to
impose the same penalty here.
On the other hand, the penalty for violation of Canon 16 of the CPR usually
ranges from suspension for six months, to suspension for one year, or two
years, and even disbarment depending on the amount involved and the severity
of the lawyer's misconduct.71 In addition, 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. 72 Complainant, who was impaired for life, was
constrained to file this complaint and the action for accounting because of his
lawyers' lack of fidelity and good faith in handling the award he received. We
recognize, however, respondents' efforts in tendering payment, albeit of an
improper amount, to complainant, as well as the fact that this is their first
offense. The imposition of a one year suspension is sufficient under the
circumstances. 73
This penalty of one year suspension for the second infraction is justified, and
does not deserve a further reduction. The fact that it is respondents' first
administrative case cannot serve to mitigate the penalty. In Cerdan v.
Gomez,74 respondent there was still suspended for a period of one year, after
already taking into account that it was his first offense. More, there are several
decisions which support the imposition of the one year suspension for similar
violations. 75 In Viray v. Sanicas, 76 the court imposed a one year penalty for the
same infraction even after exercising its "compassionate judicial discretion."77
More importantly, respondents' acts do not merely constitute a violation of

Canon 16 and its rules, but already amounts to gross
misconduct. First, respondents breached the trust reposed in them when they
78
betrayed the express language of their Attorney-Client Contract that they are
only entitled to a single 35% attorney's fees together with the Singapore
counsels. In the process, respondents have also unjustly retained for
themselves the 35% of the settlement award amounting to US$95,000.00-which
is more or less US$33,250.00 or roughly around ₱1.5 million pocketed, and also
immensely disparaging to the US$20,756.05 they tendered to
complainant. Second, their actions following complainant's objection manifests
their disregard of their fiduciary duties. For two years, respondents insisted on,
and forcibly deducted the amount when there are alternative avenues to
determine the correct amount of attorney's fees. They instead treaded to a path
where they advanced their own interests ahead of their
client's. Third, respondents also mishandled their client's money when they did
not exercise proper safekeeping over it; they failed to deposit it in a separate
trust account in a bank or trust company of good repute for safekeeping but co-
mingled it with their own funds. Undoubtedly, the gravity of these acts amounts
to gross misconduct that warrants, at the very least, a suspension. 79
For both violations, we adopt the recommendation of the IBP Board of

Governors of the imposition of two-year suspension for respondents Attys.
Pedro L. Linsangan and Gerard M. Linsangan. We emphasize that this penalty of
two years of suspension corresponds to the compounded infractions of the
violations of Rule 1.03, Rule 2.03, Canon 3, Canon 16, Rule 16.01, and Rule 16.03 of
the CPR: (1) the penalty of suspension of one year is imposed for the violation of
the proscription on ambulance chasing; and (2) the penalty of one year
suspension for gross misconduct consisting in the failure or refusal, despite
demand, of a lawyer to account for and toreturn money or property belonging to
a client.
To reiterate, there is no basis, and would even be unjust under the

circumstances, to reduce the penalty imposed on respondents.1âwphi1 Quite the
contrary, respondents should find themselves so fortunate that for all their
exploits, including their ambulance chasing, this Court would only impose a
two-year suspension.
Finally, we note that this Court, in G.R. No. 205088, has already affirmed the CA's
ruling as to the issue of how much respondents can collect from complainant as
attorney's fees. This judgment has long attained finality and, in fact, appears to
be set for execution. For this reason, we do not adopt the IBP Board of
Governors' recommendation for respondents to return to complainant 5% of the
amount assessed. The principle of immutability of judgments behooves us from
making any further statements on this particular issue
WHEREFORE, we find respondents Attys. Pedro L. Linsangan and Gerard M.

Linsangan GUILTY. Accordingly, we SUSPEND respondents Attys. Pedro
Linsangan and Gerard Linsangan from the practice of law for TWO
YEARS effective upon finality of this Decision, with a WARNING that a repetition
of the same or similar act in the future will be dealt with more severely. The
complaint against Atty. Glenda M. Linsangan-Binoya is DISMISSED.
SO ORDERED.
Metrobank vs CA, GR No. 86100-03, January 23, 1990
This petition for review on certiorari impugns the decision of the Court of
Appeals in CA-G.R. Nos. 08265-08268 1 affirming the order of Branch 168,
Regional Trial Court, National Capital Judicial Region, in Civil Cases Nos.
19123-28, 19136 and 19144, fixing attorney's fees and directing herein
petitioner Metropolitan Bank and Trust Company (Metrobank, for brevity),
as defendant in said civil cases, to pay its attorneys, herein private
respondent Arturo Alafriz and Associates, movant therein, the amount of
P936,000.00 as attorney's fees on a quantum meruit basis.
The records show that from March, 1974 to September, 1983, private
respondent handled the above-mentioned civil cases before the then
Court of First Instance of Pasig (Branches I, II, VI, X, XIII, XIX, XX AND XXIV)
in behalf of petitioner. 2 The civil cases were all for the declaration of
nullity of certain deeds of sale, with damages.
The antecedental facts 3 which spawned the filing of said actions are
undisputed and are hereinunder set forth as found by the trial court and
adopted substantially in the decision of respondent court. A certain
Celedonio Javier bought seven (7) parcels of land owned by Eustaquio
Alejandro, et al., with a total area of about ten (10) hectares. These
properties were thereafter mortgaged by Javier with the petitioner to
secure a loan obligation of one Felix Angelo Bautista and/or International
Hotel Corporation. The obligors having defaulted, petitioner foreclosed the
mortgages after which certificates of sale were issued by the provincial
sheriff in its favor as purchaser thereof Subsequently, Alejandro, alleging
deceit, fraud and misrepresentation committed against him by Javier in
the sale of the parcels of land, brought suits against Javier et al., and
included petitioner as defendant therein.
It was during the pendency of these suits that these parcels of land were
sold by petitioner to its sister corporation, Service Leasing Corporation on
March 23, 1983 for the purported price of P600,000.00. On the same day,
the properties were resold by the latter to Herby Commercial and
Construction Corporation for the purported price of P2,500,000.00. Three
months later, or on June 7, 1983, Herby mortgaged the same properties
with Banco de Oro for P9,200,000.00. The lower court found that private
respondent, did not have knowledge of these transfers and transactions.
As a consequence of the transfer of said parcels of land to Service
Leasing Corporation, petitioner filed an urgent motion for substitution of
party on July 28, 1983. Private respondent, on its part, filed on August 16,
1983 a verified motion to enter in the records of the aforesaid civil cases
its charging lien, pursuant to Section 37, Rule 138 of the Rules of Court,
equivalent to twenty-five percent (25%) of the actual and current market
values of the litigated properties as its attorney's fees. Despite due notice,
petitioner failed to appear and oppose said motion, as a result of which the
lower court granted the same and ordered the, Register of Deeds of Rizal
to annotate the attorney's liens on the certificates of title of the parcels of
land.
Meanwhile, the plaintiffs Alejandro, et al. in the aforesaid civil cases,

which had been consolidated and were pending before the Regional Trial
Court of Pasig, filed a motion to dismiss their complaints therein, which
motion the lower court granted with prejudice in its order dated
September 5, 1983. On December 29, 1983, the same court ordered the
Register of Deeds to annotate the attorney's liens of private respondent on
the derivative titles which cancelled Transfer Certificates of Title Nos.
453093 to 453099 of the original seven (7) parcels of land hereinbefore
adverted to.
On May 28,1984, private respondent filed a motion to fix its attorney's fees,
based on quantum meruit, which motion precipitated an exchange of
arguments between the parties. On May 30, 1984, petitioner manifested
that it had fully paid private respondent; the latter, in turn, countered that
the amount of P50,000.00 given by petitioner could not be considered as
full payment but merely a cash advance, including the amount of
P14,000.00 paid to it on December 15, 1980. It further appears that private
respondent attempted to arrange a compromise with petitioner in order to
avoid suit, offering a compromise amount of P600,000.00 but the
negotiations were unsuccessful.
Finally, on October 15,1984, the court a quo issued the order assailed on
appeal before respondent court, granting payment of attorney's fees to
private respondent, under the following dispositive portion:
PREMISES CONSIDERED, the motion is hereby granted and the

Metropolitan Bank and Trust Company (METROBANK) and Herby
Commercial and Construction Corporation 4 are hereby ordered to
pay the movant Arturo Alafriz and Associates the amount of
P936,000.00 as its proper, just and reasonable attorney's fees in
these cases. 5
On appeal, respondent court affirmed the order of the trial court in its
decision promulgated on February 11, 1988. A motion for reconsideration,
dated March 3, 1988, was filed by petitioner but the same was denied in a
resolution promulgated on November 19, 1988, hence the present
recourse.
The issues raised and submitted for determination in the present petition
may be formulated thus: (1) whether or not private respondent is entitled
to the enforcement of its charging lien for payment of its attorney's fees;
(2) whether or not a separate civil suit is necessary for the enforcement of
such lien and (3) whether or not private respondent is entitled to twenty-
five (25%) of the actual and current market values of the litigated
properties on a quantum meruit basis.
On the first issue, petitioner avers that private respondent has no

enforceable attorney's charging lien in the civil cases before the court
below because the dismissal of the complaints therein were not, in the
words of Section 37, Rule 138, judgments for the payment of money or
executions issued in pursuance of such judgments. 6
We agree with petitioner.
On the matter of attorney's liens Section 37, Rule 138 provides:
. . . He shall also have a lien to the same extent upon all judgments
for the payment of money, and executions issued in pursuance of
such judgments, which he has secured in a litigation of his client,
from and after the time when he shall have caused a statement of
his claim of such lien to be entered upon the records of the court
rendering such judgment, or issuing such execution, and shall have
caused written notice thereof to be delivered to his client and to the
adverse party; and he shall have the same right and power over
such judgments and executions as his client would have to enforce
his lien and secure the payment of his just fees and disbursements.
Consequent to such provision, a charging lien, to be enforceable as
security for the payment of attorney's fees, requires as a condition sine
qua non a judgment for money and execution in pursuance of such
judgment secured in the main action by the attorney in favor of his client.
A lawyer may enforce his right to fees by filing the necessary petition as
an incident in the main action in which his services were rendered when
something is due his client in the action from which the fee is to be paid. 7
In the case at bar, the civil cases below were dismissed upon the initiative
of the plaintiffs "in view of the frill satisfaction of their claims." 8 The
dismissal order neither provided for any money judgment nor made any
monetary award to any litigant, much less in favor of petitioner who was a
defendant therein. This being so, private respondent's supposed charging
lien is, under our rule, without any legal basis. It is flawed by the fact that
there is nothing to generate it and to which it can attach in the same
manner as an ordinary lien arises and attaches to real or personal
property.
In point is Morente vs. Firmalino, 9 cited by petitioner in support of its

position. In that case, movant-appellant attorney sought the payment of
his fees from his client who was the defendant in a complaint for
injunction which was dismissed by the trial court after the approval of an
agreement entered into by the litigants. This Court held:
. . . The defendant having suffered no actual damage by virtue of the

issuance of a preliminary injunction, it follows that no sum can be
awarded the defendant for damages. It becomes apparent, too, that
no amount having been awarded the defendant, herein appellant's
lien could not be enforced. The appellant, could, by appropriate
action, collect his fees as attorney.
Private respondent would nevertheless insist that the lien attaches to the
"proceeds of a judgment of whatever nature," 10 relying on the case
of Bacolod-Murcia Milling Co. Inc. vs. Henares 11 and some American cases
holding that the lien attaches to the judgment recovered by an attorney
and the proceeds in whatever form they may be. 12
The contention is without merit just as its reliance is misplaced. It is true

that there are some American cases holding that the lien attaches even to
properties in litigation. However, the statutory rules on which they are
based and the factual situations involved therein are neither explained nor
may it be said that they are of continuing validity as to be applicable in this
jurisdiction. It cannot be gainsaid that legal concepts of foreign origin
undergo a number of variegations or nuances upon adoption by other
jurisdictions, especially those with variant legal systems.
In fact, the same source from which private respondent culled the
American cases it cited expressly declares that "in the absence of a
statute or of a special agreement providing otherwise, the general rule is
that an attorney has no lien on the land of his client, notwithstanding such
attorney has, with respect to the land in question, successfully prosecuted
a suit to establish the title of his client thereto, recovered title or
possession in a suit prosecuted by such client, or defended successfully
such client's right and title against an unjust claim or an unwarranted
attack," 13 as is the situation in the case at bar. This is an inescapable
recognition that a contrary rule obtains in other jurisdictions thereby
resulting in doctrinal rulings of converse or modulated import.
To repeat, since in our jurisdiction the applicable rule provides that a

charging lien attaches only to judgments for money and executions in
pursuance of such judgment, then it must be taken in haec verba. The
language of the law is clear and unequivocal and, therefore, it must be
taken to mean exactly what it says, barring any necessity for elaborate
interpretation. 14
Notably, the interpretation, literal as it may appear to be, is not without

support in Philippine case law despite the dearth of cases on all fours with
the present case. In Caina et al. vs. Victoriano, et al., 15 the Court had the
occasion to rule that "the lien of respondent is not of a nature which
attaches to the property in litigation but is at most a personal claim
enforceable by a writ of execution." In Ampil vs. Juliano-Agrava, et
al., 16 the Court once again declared that a charging lien "presupposes that
the attorney has secured a favorable money judgment for his client . . ."
Further, in Director of Lands vs. Ababa, et al., 17 we held that "(a) charging
lien under Section 37, Rule 138 of the Revised Rules of Court is limited
only to money judgments and not to judgments for the annulment of a
contract or for delivery of real property as in the instant case."
Even in the Bacolod-Murcia Milling case, which we previously noted as
cited by private respondent, there was an express declaration that "in this
jurisdiction, the lien does not attach to the property in litigation."
Indeed, an attorney may acquire a lien for his compensation upon money
due his client from the adverse party in any action or proceeding in which
the attorney is employed, but such lien does not extend to land which is
the subject matter of the litigation. 18 More specifically, an attorney merely
defeating recovery against his client as a defendant is not entitled to a lien
on the property involved in litigation for fees and the court has no power
to fix the fee of an attorney defending the client's title to property already
in the client's
possession. 19
While a client cannot defeat an attorney's right to his charging lien by

dismissing the case, terminating the services of his counsel, waiving his
cause or interest in favor of the adverse party or compromising his
action, 20 this rule cannot find application here as the termination of the
cases below was not at the instance of private respondent's client but of
the opposing party.
The resolution of the second issue is accordingly subsumed in the

preceding discussion which amply demonstrates that private respondent
is not entitled to the enforcement of its charging lien.
Nonetheless, it bears mention at this juncture that an enforceable

charging lien, duly recorded, is within the jurisdiction of the court trying
the main case and this jurisdiction subsists until the lien is settled. 21 There
is certainly no valid reason why the trial court cannot pass upon a petition
to determine attorney's fees if the rule against multiplicity of suits is to be
activated. 22 These decisional rules, however, apply only where the
charging lien is valid and enforceable under the rules.
On the last issue, the Court refrains from resolving the same so as not to
preempt or interfere with the authority and adjudicative facility of the
proper court to hear and decide the controversy in a proper proceeding
which may be brought by private respondent.
A petition for recovery of attorney's fees, either as a separate civil suit or
as an incident in the main action, has to be prosecuted and the allegations
therein established as any other money claim. The persons who are
entitled to or who must pay attorney's fees have the right to be heard upon
the question of their propriety or amount. 23 Hence, the obvious necessity
of a hearing is beyond cavil.
Besides, in fixing a reasonable compensation for the services rendered by

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

unnecessary burden on private respondent in collecting the fees to which
it may rightfully be entitled. But, as in the exercise of any other right
conferred by law, the proper legal remedy should be availed of and the
procedural rules duly observed to forestall and obviate the possibility of
abuse or prejudice, or what may be misunderstood to be such, often to the
undeserved discredit of the legal profession.
Law advocacy, it has been stressed, is not capital that yields profits. The
returns it births are simple rewards for a job done or service rendered. It
is a calling that, unlike mercantile pursuits which enjoy a greater deal of
freedom from government interference, is impressed with public interest,
for which it is subject to State regulation. 26
ACCORDINGLY, the instant petition for review is hereby GRANTED and the
decision of respondent Court of Appeals of February 11, 1988 affirming the
order of the trial court is hereby REVERSED and SET ASIDE, without
prejudice to such appropriate proceedings as may be brought by private
respondent to establish its right to attorney's fees and the amount thereof.
SO ORDERED.
Canon 17
A LAWYER OWES FIDELITY TO THE CAUSE OF HIS CLIENT AND HE SHALL

BE MINDFUL OF THE TRUST AND CONFIDENCE REPOSED IN HIM.
Paces Industrial Corporation vs Salandanan, AC No. 1346, July
25, 2017
This is a complaint which Paces Industrial Corporation (Paces) filed

against its former lawyer, Atty. Edgardo M. Salandanan, for allegedly
committing malpractice and/or gross misconduct when he represented
conflicting interests.
The procedural and factual antecedents of the instant case are as follows:
Sometime in October 1973, Salandanan became a stockholder of Paces,

and later became its Director, Treasurer, Administrative Officer, Vice-
President for Finance, then its counsel. As lawyer for Paces, he appeared
for it in several cases such as in Sisenando Malveda, et al. v. Paces
Corporation (NLRC R-04 Case No. 11-3114-73) and Land & Housing
Development Corporation v. Paces Corporation (Civil Case No. 18791). In
the latter case, Salandanan failed to file the Answer, after filing a Motion
for a Bill of Particulars, which the court had denied. As a result, an order
of default was issued against Paces. Salandanan never withdrew his
appearance in the case nor notified Paces to get the services of another
lawyer. Subsequently, a decision was rendered against Paces which later
became final and executory.
On December 4, 1973, E.E. Black Ltd., through its counsel, sent a letter to
Paces regarding the latter's outstanding obligation to it in the amount of
P96,513.91. In the negotiations that transpired thereafter, Salandanan was
the one who represented Paces. He was likewise entrusted with the
documents relative to the agreement between Paces and E.E. Black Ltd.
Meanwhile, disagreements on various management policies ensued

among the stockholders and officers in the corporation. Eventually,
Salandanan and his group were forced to sell out their shareholdings in
the company to the group of Mr. Nicolas C. Balderama on May 27, 1974.
After said sell-out, Salandanan started handling the case between E.E.
Black Ltd. and Paces, but now, representing E.E. Black Ltd. Salandanan
then filed a complaint with application for preliminary attachment against
Paces for the collection of its obligation to E.E. Black Ltd. He later
succeeded in obtaining an order of attachment, writ of attachment, and
notices of garnishment to various entities which Paces had business
dealings with.
Thus, Paces filed a complaint against Salandanan. It argued that when he

acted as counsel for E.E. Black Ltd., he represented conflicting interests
and utilized, to the full extent, all the information he had acquired as its
stockholder, officer, and lawyer. On the other hand, Salandanan claimed
that he was never employed nor paid as a counsel by Paces. There was no
client-lawyer contract between them. He maintained that his being a
lawyer was merely coincidental to his being a stockholder-officer and did
not automatically make him a lawyer of the corporation, particularly with
respect to its account with E.E. Black Ltd. He added that whatever
knowledge or information he had obtained on the operation of Paces only
took place in the regular, routinary course of business as him being an
investor, stockholder, and officer, but never as a lawyer of the company.
After a thorough and careful review of the case, the Commission on Bar
Discipline of the Integrated Bar of the Philippines (IBP) recommended
Salandanan's suspension for one (1) year on November 2, 2011.1 On
September 28, 2013, the IBP Board of Governors passed Resolution No.
XX-2013-1202 adopting and approving, with modification, the
aforementioned recommendation, thus:
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED

and APPROVED, with modification, the Report and Recommendation of the
Investigating Commissioner in the above-entitled case, herein made part
of this Resolution as Annex "A, " and finding the recommendation fully
supported by the evidence on record and the applicable laws and rules
and considering that the Respondent violated the conflict of interest rule,
Atty. Edgardo M Salandanan is hereby SUSPENDED from the practice of
law for three (3) years.
On August 8, 2014, the IBP Board of Governors passed Resolution No. XXI-
2014-413,3 denying Salandanan's motion for reconsideration and affirming
Resolution No. XX-2013-120.
The Court's Ruling
The Court finds no justifiable reason to deviate from the findings and
recommendations of the IBP.
Rule 15.03, Canon 15 and Canon 21 of the Code of Professional

Responsibility (CPR) provide:
CANON 15 – A LAWYER SHALL OBSERVE CANDOR, FAIRNESS AND

LOYALTY IN ALL HIS DEALINGS AND TRANSACTIONS WITH HIS CLIENTS.
x x x x
Rule 15.03 A lawyer shall not represent conflicting interests except by

x x x x
CANON 21 – A LAWYER SHALL PRESERVE THE CONFIDENCES AND

SECRETS OF HIS CLIENT EVEN AFTER THE ATTORNEY-CLIENT RELATION
IS TERMINATED.
Under the aforecited rules, it is explicit that a lawyer is prohibited from

representing new clients whose interests oppose those of a former client
in any manner, whether or not they are parties in the same action or on
totally unrelated cases.4 Conflict of interest exists when a lawyer
represents inconsistent interests of two or more opposing parties. The
test is whether or not in behalf of one client, it is the lawyer's duty to fight
for an issue or claim, but it is his duty to oppose it for the other client. In
short, if he argues for one client, this argument will be opposed by him
when he argues for the other client. This rule covers not only cases in
which confidential communications have been confided, but also those in
which no confidence has been bestowed or will be used. Also, there is
conflict of interests if the acceptance of the new retainer will require the
attorney to perform an act which will injuriously affect his first client in
any matter in which he represents him and also whether he will be called
upon in his new relation to use against his first client any knowledge
acquired through their connection. Another test of the inconsistency of
interests is whether the acceptance of a new relation will prevent an
attorney from the full discharge of his duty of undivided fidelity and loyalty
to his client or invite suspicion of unfaithfulness or double-dealing in the
performance of said duty.5 The prohibition is founded on the principles of
public policy and good taste.6
The prohibition against conflict of interest rests on the following five (5)
rationales:7
First, the law seeks to assure clients that their lawyers will represent
them with undivided loyalty. A client is entitled to be represented by a
lawyer whom the client can trust. Instilling such confidence is an objective
important in itself.
Second, the prohibition against conflicts of interest seeks to enhance the

effectiveness of legal representation. To the extent that a conflict of
interest undermines the independence of the lawyer's professional
judgment or inhibits a lawyer from working with appropriate vigor in the
client's behalf, the client's expectation of effective representation could be
compromised.
Third, a client has a legal right to have the lawyer safeguard confidential
information pertaining to it. Preventing the use of confidential information
against the interests of the client to benefit the lawyer's personal interest,
in aid of some other client, or to foster an assumed public purpose, is
facilitated through conflicts rules that reduce the opportunity for such
abuse.
Fourth, conflicts rules help ensure that lawyers will not exploit clients,
such as by inducing a client to make a gift or grant in the lawyer's favor.
Finally, some conflict-of-interest rules protect interests of the legal

system in obtaining adequate presentations to tribunals. In the absence of
such rules, for example, a lawyer might appear on both sides of the
litigation, complicating the process of taking proof and compromise
adversary argumentation.
Even the termination of the attorney-client relationship does not justify a

lawyer to represent an interest adverse to or in conflict with that of the
former client. The spirit behind this rule is that the client's confidence once
given should not be stripped by the mere expiration of the professional
employment. Even after the severance of the relation, a lawyer should not
do anything that will injuriously affect his former client in any matter in
which the lawyer previously represented the client. Nor should the lawyer
disclose or use any of the client's confidences acquired in the previous
relation. In this regard, Canon 17 of the CPR expressly declares that: "A
lawyer owes fidelity to the cause of his client and he shall be mindful of
the trust and confidence reposed in him." The lawyer's highest and most
unquestioned duty is to protect the client at all hazards and costs even to
himself. The protection given to the client is perpetual and does not cease
with the termination of the litigation, nor is it affected by the client's
ceasing to employ the attorney and retaining another, or by any other
change of relation between them. It even survives the death of the client. 8
It must, however, be noted that a lawyer's immutable duty to a former

client does not cover transactions that occurred beyond the lawyer's
employment with the client. The intent of the law is to impose upon the
lawyer the duty to protect the client's interests only on matters that he
previously handled for the former client and not for matters that arose
after the lawyer-client relationship has terminated.9
Here, contrary to Salandanan's futile defense, he sufficiently represented

or intervened for Paces in its negotiations for the payment of its obligation
to E.E. Black Ltd. The letters he sent to the counsel of E.E. Black Ltd.
identified him as the Treasurer of Paces. Previously, he had likewise
represented Paces in two (2) different cases. It is clear, therefore, that his
duty had been to fight a cause for Paces, but it later became his duty to
oppose the same for E.E. Black Ltd. His defense for Paces was eventually
opposed by him when he argued for E.E. Black Ltd. Thus, Salandanan had
indisputably obtained knowledge of matters affecting the rights and
obligations of Paces which had been placed in him in unrestricted
confidence. The same knowledge led him to the identification of those
attachable properties and business organizations that eventually made the
attachment and garnishment against Paces a success. To allow him to
utilize said information for his own personal interest or for the benefit of
E.E. Black Ltd., the adverse party, would be to violate the element of
confidence which lies at the very foundation of a lawyer-client
relationship.
The rule prohibiting conflict of interest was fashioned to prevent situations

wherein a lawyer would be representing a client whose interest is directly
adverse to any of his present or former clients. In the same way, a lawyer
may only be allowed to represent a client involving the same or a
substantially related matter that is materially adverse to the former client
only if the former client consents to it after consultation. The rule is
grounded in the fiduciary obligation of loyalty. Throughout the course of a
lawyer-client relationship, the lawyer learns all the facts connected with
the client's case, including the weak and strong points of the case.
Knowledge and information gathered in the course of the relationship
must be treated as sacred and guarded with care.10 It behooves lawyers,
not only to keep inviolate the client's confidence, but also to avoid the
appearance of treachery and double-dealing for only then can litigants be
encouraged to entrust their secrets to their lawyers, which is of
paramount importance in the administration of justice.11 The nature of that
relationship is, therefore, one of trust and confidence of the highest
degree.12
In the absence of the express consent from Paces after full disclosure to
it of the conflict of interest, Salandanan should have either outrightly
declined representing and entering his appearance as counsel for E.E.
Black Ltd., or advised E.E. Black Ltd. to simply engage the services of
another lawyer. Unfortunately, he did neither, and must necessarily suffer
the dire consequences.13
Applying the above-stated principles, the Court agrees with the IBP's
finding that Salandanan represented conflicting interests and, perforce,
must be held administratively liable for the same.14
WHEREFORE, IN VIEW OF THE FOREGOING, the Court SUSPENDS Atty.

Edgardo M. Salandanan from the practice of law for three (3) years
effective upon his receipt of this decision, with a warning that his
commission of a similar offense will be dealt with more severely.
Let copies of this decision be included in the personal record of Atty.

Edgardo M. Salandanan and entered in his file in the Office of the Bar
Confidant.
Let copies of this decision be disseminated to all lower courts by the

Office of the Court Administrator, as well as to the Integrated Bar of the
Philippines for its guidance.
SO ORDERED.
Canon 18
A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND

DILIGENCE.
Rules 18.01 - A lawyer shall not undertake a legal service which he knows
or should know that he is not qualified to render. However, he may render
such service if, with the consent of his client, he can obtain as
collaborating counsel a lawyer who is competent on the matter.
Rule 18.02 - A lawyer shall not handle any legal matter without adequate
preparation.
Rule 18.03 - A lawyer shall not neglect a legal matter entrusted to him,
and his negligence in connection therewith shall render him liable.
Rule 18.04 - A lawyer shall keep the client informed of the status of his
case and shall respond within a reasonable time to the client's request for
information.
Solatan vs Inocentes, Ac No. 6504, August 9, 2005
The present case focuses on a critical aspect of the lawyer-client

relationship¾the duty of loyalty. The fidelity lawyers owe their clients is
traditionally characterized as "undivided." This means that lawyers must
represent their clients and serve their needs without interference or
impairment from any conflicting interest.
This administrative case traces its roots from the manner by which Attys.
Jose C. Camano and Oscar A. Inocentes responded to the efforts of
complainant, George C. Solatan, to lease a certain Quezon City apartment
belonging to the attorneys’ clients. On the basis of acts branded by the
Integrated Bar of the Philippines (IBP) as "bordering on technical
extortion," accepting funds and giving unsolicited advice to an adverse
party, and casting doubts as to the procedure of levy, the IBP resolved1 to
recommend the suspension of Atty. Camano from the practice of law for
one (1) year. It likewise recommended the reprimand of Atty. Inocentes,
whom it held liable for the aforementioned acts of his associate, under the
principle of command responsibility.
Only Atty. Inocentes has elected to contest the resolution of the IBP, as he
questions the propriety of his being held administratively liable for acts
done by Atty. Camano.2 However, the recommendation to suspend Atty.
Camano shall also be passed upon by virtue of Section 12, Rule 139-B of
the Rules of Court.3
Attys. Inocentes and Camano were both engaged in the practice of law
under the firm name of Oscar Inocentes and Associates Law Office. Atty.
Inocentes held office in his home located at No. 19 Marunong St., Central
District, Quezon City, while Atty. Camano was stationed at an "extension
office" of the firm located in 3rd/F, 956 Aurora Blvd., Quirino Dist., Quezon
City.
The Oscar Inocentes and Associates Law Office was retained by spouses
Andres and Ludivina Genito (spouses Genito), owners of an apartment
complex (the Genito Apartments) located at 259 Tandang Sora cor. Visayas
Avenue, Quezon City, when the Genito Apartments were placed under
sequestration by the Presidential Commission on Good Government
(PCGG) on 9 July 1986.4 The law office represented the spouses Genito
before the PCGG and the Sandiganbayan, and subsequently, with authority
from the PCGG.5 in ejectment cases against non-paying tenants occupying
the Genito Apartments.6
Complainant’s sister, Gliceria Solatan, was a tenant in Door 10, Phase B of

the Genito Apartments. It appears from the records that Gliceria Solatan
left for the United States in 1986, and since then, the apartment was either
intermittently used by members of her family or placed under the charge
of caretakers.7 In August 1987, a complaint for ejectment for non-payment
of rentals was filed against Gliceria Solatan.8 On 3 March 1988, in a
judgment by default, a Decision9 was rendered ordering Gliceria Solatan to
vacate the premises of the apartment, pay the spouses Genito the amount
of Thirty Thousand Six Hundred Pesos (₱30,600.00) as unpaid rentals from
February 1986 to July 1987 with interest at 24% per annum from 20 August
1987 until the premises are vacated, Ten Thousand Pesos (₱10,000.00) as
attorney’s fees, and costs of the suit.10
Complainant was occupying the subject apartment when he learned of the

judgment rendered against his sister. On 10 May 1988, prior to the
implementation of a writ to execute the judgment, complainant and his
mother, Elvira Solatan, approached Atty. Inocentes at his home office.
Complainant informed Atty. Inocentes of his desire to arrange the
execution of a lease contract by virtue of which complainant would be the
new lessee of the apartment and thus make possible his continued stay
therein. Atty. Inocentes referred complainant and his mother to his
associate, Atty. Camano, the attorney in charge of the ejectment cases
against tenants of the Genito apartments. After the exchange, complainant
went to Atty. Camano at the satellite office of Atty. Inocentes’s firm. From
here on out, events quickly turned sour. Different versions of subsequent
events were presented. The facts reproduced hereunder are by and large
culled from the findings of the IBP Investigating Commissioner, Siegfred B.
Mison.
During the meeting with Atty. Camano, a verbal agreement was made in
which complainant and his mother agreed to pay the entire judgment debt
of Gliceria Solatan, including fifty percent of the awarded attorney’s fees
and One Thousand Six Hundred Pesos (₱1,600.00) as costs of suit provided
that Atty. Camano would allow complainant’s continued stay at Door 10,
Phase B of the Genito Apartments. As partial compliance with the
agreement, complainant issued in the name Atty. Camano a check for Five
Thousand Pesos (₱5,000.00) representing half of the ₱10,000.00 attorney’s
fees adjudged against complainant’s sister.
Complainant and his mother failed to make any other payment. Thus, the
sheriff in coordination with Atty. Camano and some policemen, enforced
the writ of execution on 22 June 1988 and levied the properties found in
the subject apartment. An attempt at renegotiation took place at the
insistence of complainant, resulting in Atty. Camano’s acquiescence to
release the levied properties and allowing complainant to remain at the
apartment, subject to the latter’s payment of costs incurred in enforcing
the writ of execution and issuance of postdated checks representing
installment rental payments. Complainant, thus, issued four (4) checks
drawn on Far East Bank and Trust Company dated the fifteenth (15th) of
July, August, September, and October 1988 each in the amount of Three
Thousand Four Hundred Pesos (₱3,400.00).11 Half of the amount
represented complainant’s monthly rental, while the other half, a monthly
installment for the payment of Gliceria Solatan’s judgment debt.
On 28 June 1988, acting on the advice of Atty. Camano, complainant

presented an Affidavit of Ownership to the sheriff who then released the
levied items to complainant. However, a Northern Hill 3-burner gas stove
was not retuned to complainant. The stove was in fact kept by Atty.
Camano in the unit of the Genito Apartments wherein he temporarily
stayed12 and, thereafter, turned over the same to a certain Recto Esberto,
caretaker of the Genito Apartments.13
On 1 August 1988, complainant filed the instant administrative case for

disbarment against Atty. Inocentes and Atty. Camano.14 After formal
investigation, and despite conflicting testimonies on the tenor and content
of agreements and conversations, several disturbing facts were revealed
to have been uncontroverted*Atty. Camano’s acceptance from
complainant of attorney’s fees and the costs of implementing the writ of
execution, possession of complainant’s levied Northern Hill oven, and
advice to complainant on how to recover the latter’s levied items. Thus,
IBP Investigating Commissioner Siegfred B. Mison, made the following
recommendations, viz:
Based on the facts revealed in their respective Memoranda, the penalty of
six (6) months suspension is therefore recommended to be imposed on
Respondent Camano for committing the following acts that adversely
reflects (sic) on his moral fitness to continue to practice law[:]
1. He received money (₱5,000 then ₱1,000) from the adverse party

purportedly for attorneys fees and for reimbursement of sheriff’s
expenses. Such act of accepting funds from the adverse party in the
process of implementing a writ, borders on technical extortion particularly
in light of the factual circumstances as discussed.
2. He gave unsolicited advice to the adverse party in suggesting the filing

of an Affidavit of Ownership over the levied properties, a suggestion
evidently in conflict with [the interest of] his own client, supposedly, the
Genitos.
3. He failed to turn over the gas stove to either party thereby casting doubt
as to the procedure of the levy.
Based on the facts revealed, the penalty of Reprimand is therefore

recommended to be imposed on Respondent Inocentes for committing the
following acts that adversely reflects (sic) in his fitness to continue to
practice law[:]
1. He allowed Camano to perform all the aforementioned acts, either by

negligence or inadvertence which are inimical to the legal profession. He
cannot claim ignorance or feign innocence in this particular transaction
considering that the Complainants themselves went to his office on
different occasions regarding this transaction. Ultimately, he exercised
command responsibility over the case and had supervisory control over
Respondent Camano inasmuch as he received periodic reports either by
phone or in person from the latter.
2. The letter disclaimer executed by Mr. Genito filed by Respondent

Inocentes does not mitigate any liability whatsoever since the wrongdoing
done against the profession cannot be undone by a mere letter from a
third party.15 (Emphasis supplied.)
The IBP Board of Governors approved the aforequoted recommendation,
with the modification of an increase in Atty. Camano’s period of
suspension from six (6) months to one (1) year, in a resolution stating, viz:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and

APPROVED, the Report and Recommendation of the of the Investigating
Commissioner…finding the recommendation fully supported by the
evidence on record and the applicable laws and rules, with modification,
and for accepting funds from adverse party in the process of
implementing a writ borders on technical extortion, for giving unsolicited
advice to the adverse party a suggestion evidently in conflict with [the
interest of] his own client and for casting doubts to the procedure of the
levy, Atty. Jose C. Camano is hereby SUSPENDED from the practice of law
for one (1) year, likewise, Atty. Oscar Inocentes is hereby REPRIMANDED
for he exercised command responsibility over the case inasmuch as he
received periodic reports either by phone or in person.16
The IBP held that Atty. Camano’s act of giving unsolicited advice to
complainant is a culpable act because the advice conflicted with the
interest of his clients, the spouses Genito. The rule on conflicting interests,
established in Rule 15.03 of the Code of Professional Responsibility, deals
with conflicts in the interests of an attorney’s actual clients among
themselves, of existing and prospective clients, and of the attorney and his
clients. It states that a lawyer shall not represent conflicting interests
except by written consent of all concerned given after a full disclosure of
the facts.
The relation of attorney and client begins from the time an attorney is
retained.17 An attorney has no power to act as counsel or legal
representative for a person without being retained.18 To establish the
professional relation, it is sufficient that the advice and assistance of an
attorney are sought and received in any manner pertinent to his
profession.19 At the time the questioned statement was made, Atty.
Camano had called the police to restrain complainant from surreptitiously
pulling out the levied properties from the apartment complex by virtue of
which the latter was brought to the police station for questioning. The
statement was made in response to complainant’s insistence at the police
station that the levied properties were owned by him and not by the
judgment debtor.20 No employment relation was offered or accepted in the
instant case.
More fitting, albeit, to the mind of this Court, inapplicable to the case, is
Canon 15 of the same Code which encompasses the aforementioned rule.
In general terms, Canon 15 requires lawyers to observe loyalty in all
dealings and transactions with their clients.21 Unquestionably, an attorney
giving legal advice to a party with an interest conflicting with that of his
client resulting in detriment to the latter may be held guilty of disloyalty.
However, far be it that every utterance of an attorney which may have
afforded an individual some relief adverse to the former’s client may be
labeled as a culpable act of disloyalty. As in every case, the acts alleged to
be culpable must be assessed in light of the surrounding circumstances.
While the levy was made on chattel found in the apartment of the
judgment debtor, Gliceria Solatan, the complainant was the true owner of
the properties. Consequently, the latter had a right to recover the same. In
fact, considering the circumstances, the questioned statement is in
consonance with complainant’s foremost duty to uphold the law as an
officer of the court. The statement of Atty. Camano in such a context
should not be construed by this Court as giving advice in conflict against
the interest of the spouses Genito as in fact the latter have no interest
over the incorrectly levied properties.
We, thus, note that the act of informing complainant that the levied
properties would be returned to him upon showing proof of his ownership
thereof may hint at infidelity to the interest of the spouses Genito, but, in
this circumstance, lacks the essence of double dealing and betrayal of the
latter’s confidence so as to deserve outright categorization as infidelity or
disloyalty to his clients’ cause. Nonetheless, after having noted the
foregoing, we remain convinced with the propriety of meting the one (1)
year suspension from the practice of law on Atty. Camano, as
recommended by the IBP, based on his other culpable acts which tend to
degrade the profession and foment distrust in the integrity of court
processes.
On the other hand, Atty. Inocentes seeks to distance himself from the
events that transpired and the reprimand resulting therefrom by asserting
that he was incorrectly punished for Atty. Camano’s acts when his mere
participation in the fiasco was to refer complainant and his mother to Atty.
Camano.
However, it is precisely because of such participation, consisting as it did

of referring the complainant to his associate lawyer, that Atty. Inocentes
may be held administratively liable by virtue of his associate’s unethical
acts. His failure to exercise certain responsibilities over matters under the
charge of his law firm is a blameworthy shortcoming. The term "command
responsibility," as Atty. Inocentes suggests, has special meaning within
the circle of men in uniform in the military; however, the principle does not
abide solely therein. It controls the very circumstance in which Atty.
Inocentes found himself.
We are not unaware of the custom of practitioners in a law firm of

assigning cases and even entire client accounts to associates or other
partners with limited supervision, if at all. This is especially true in the
case of Attys. Inocentes and Camano who, from the records, both appear
to be seasoned enough to be left alone in their work without requiring
close supervision over each other’s conduct and work output. However, let
it not be said that law firm practitioners are given a free hand to assign
cases to seasoned attorneys and thereafter conveniently forget about the
case. To do so would be a disservice to the profession, the integrity and
advancement of which this Court must jealously protect.
That the firm name under which the two attorneys labored was that
of Oscar Inocentes and Associates Law Office does not automatically
make Atty. Inocentes the default lawyer acting in a supervisory capacity
over Atty. Camano. It did, however, behoove Atty. Inocentes to exert
ordinary diligence to find out what was going on in his law firm. It placed
in Atty. Inocentes the active responsibility to inquire further into the
circumstances affecting the levy of complainant’s properties, irrespective
of whether the same were in fact events which could possibly lead to
administrative liability. Moreover, as name practitioner of the law office,
Atty. Inocentes is tasked with the responsibility to make reasonable
efforts to ensure that all lawyers in the firm should act in conformity to
the Code of Professional Responsibility.22 It is not without reason or
consequence that Atty. Inocentes’s name is that which was used as the
official designation of their law office.
With regard to the actual existence of Atty. Inocentes’s supervisory
capacity over Atty. Camano’s activities, the IBP Investigating
Commissioner based the same on his finding that Atty. Inocentes received
periodic reports from Atty. Camano on the latter’s dealings with
complainant. This finding is the linchpin of Atty. Inocentes’s supervisory
capacity over Atty. Camano and liability by virtue thereof.
Law practitioners are acutely aware of the responsibilities that are

naturally taken on by partners and supervisory lawyers over the lawyers
and non-lawyers of the law office. We have held that lawyers are
administratively liable for the conduct of their employees in failing to
timely file pleadings.23 In Rheem of the Philippines, Inc., et al. v. Zoilo R.
Ferrer, et al.,24 partners in a law office were admonished for the
contemptuous language in a pleading submitted to court despite, and even
due to, the fact that the pleading was not passed upon by any of the
partners of the office. We held therein that partners are duty bound to
provide for efficacious control of court pleadings and other court papers
that carry their names or the name of the law firm.25
We now hold further that partners and practitioners who hold supervisory
capacities are legally responsible to exert ordinary diligence in apprising
themselves of the comings and goings of the cases handled by the
persons over which they are exercising supervisory authority and in
exerting necessary efforts to foreclose the occurrence of violations of the
Code of Professional Responsibility by persons under their charge.
Nonetheless, the liability of the supervising lawyer in this regard is by no
means equivalent to that of the recalcitrant lawyer. The actual degree of
control and supervision exercised by said supervising lawyer varies, inter
alia, according to office practice, or the length of experience and
competence of the lawyer supervised. Such factors can be taken into
account in ascertaining the proper penalty. Certainly, a lawyer charged
with the supervision of a fledgling attorney prone to rookie mistakes
should bear greater responsibility for the culpable acts of the underling
than one satisfied enough with the work and professional ethic of the
associate so as to leave the latter mostly to his/her own devises.
While Atty. Camano’s irregular acts perhaps evince a need for greater
supervision of his legal practice, there is no question that it has been Atty.
Inocentes’ practice to allow wide discretion for Atty. Camano to practice
on his own. It does constitute indifference and neglect for Atty. Inocentes
to fail to accord even a token attention to Atty. Camano’s conduct which
could have brought the then impending problem to light. But such is not
equivalent to the proximate responsibility for Atty. Camano’s acts.
Moreover, it appears from the records that Atty. Inocentes is a former
judge and a lawyer who, as of yet, is in good standing and it is the first
time in which Atty. Inocentes has been made to answer vicariously for the
misconduct of a person under his charge. An admonition is appropriate
under the circumstances.
WHEREFORE, PREMISES CONSIDERED, the Petition is hereby GRANTED.

The Resolution dated 16 April 2004 is AFFIRMED in respect of the sanction
meted out on Atty. Camano. Atty. Inocentes is hereby ADMONISHED to
monitor more closely the activities of his associates to make sure that the
same are in consonance with the Code of Professional Responsibility with
the WARNING that repetition of the same or similar omission will be dealt
with more severely.
No pronouncement as to costs.
SO ORDERED.
Gone vs Ga, AC No. 7771, April 6, 2011
This case stemmed from the complaint for disciplinary action dated 23
October 1989 filed by Patricio Gone against Atty. Macario Ga before the
Commission on Bar Discipline of the Integrated Bar of the Philippines
(IBP). The complaint was due to Atty. Ga’s failure to reconstitute or turn
over the records of the case in his possession. Complainant Gone
reported that Atty. Ga is his counsel in NLRC Case No. RB-IV-2Q281-78
entitled "Patricio Gone v. Solid Mills, Inc." The case was dismissed by the
Labor Arbiter and was elevated to the National Labor Relations
Commission (NLRC).
Complainant alleged that on 13 December 1983, the NLRC building in

Intramuros, Manila was burned and among the records destroyed was his
appealed case.
Complainant Gone further reported that as early as 8 March 1984, Atty. Ga

had obtained a certification from the NLRC that the records of NLRC Case
No. RB-IV-2Q281-78 were burned. Despite knowledge of the destruction of
the records, Atty. Ga allegedly did not do anything to reconstitute the
records of the appealed case.
On 9 September 1989, complainant allegedly sent a letter to Atty. Ga

requesting him to return the records of the case in his possession. As of
date of complaint, Atty. Ga has yet to turn over the records. Complainant
submits that his counsel’s continued refusal has caused great injustice to
him and his family.1
On 16 February 1999, Commissioner Gonzales-delos Reyes, IBP

Commission on Bar Discipline, issued an Order directing respondent Ga to
file his answer on the complaint.2
In a letter dated 22 November 1999, Atty. Ga explained that as far as he

could recall, during the pendency of their motion for reconsideration, the
NLRC Office in Manila caught fire. Although worried of the records of their
case, he was relieved when he received summons from the NLRC setting
the case for hearing. It was unfortunate, however, that in the two
scheduled hearings set by the NLRC herein complainant failed to appear.
For such absence, the NLRC allegedly shelved their case.3
Atty. Ga averred that had it not been for the instant complaint, he would
not have, as he never, heard from complainant Gone since 1984. What he
was aware of was the latter’s abandonment of his family way back in 1978.
Complainant’s wife is the relative of Atty. Ga, being the daughter of his
first cousin.4
The instant case was set for presentation of evidence on 17 January 2000.
On said date, complainant appeared without counsel while respondent
failed to appear.5 Several hearings were set for the case but these were
reset for failure of one or both of the parties to appear.6
In the hearing held on 19 June 2000, complainant appeared with counsel

but respondent failed to appear despite notice. During that hearing, the
Commissioner asked complainant if there was a possibility for the case to
be settled amicably considering that respondent is a relative of his wife.
The complainant answered in the affirmative and the case was reset to 24
July 2000. The two succeeding hearings scheduled by the Commissioner
were again reset. On 10 November 2000, a hearing was conducted wherein
respondent Ga appeared while complainant was absent despite notice. In
view of the latter’s absence, respondent Ga prayed for time to file a Motion
to Dismiss.7
In his Motion to Dismiss dated 8 December 2000,8 respondent Ga alleged

that he had a heart to heart talk with complainant about his labor case and
the latter may have already understood that it was not respondent’s fault
that the case was shelved by the NLRC. He averred that complainant may
have already been dissuaded from pursuing the case, thus his absence in
the hearing held on 10 November 2000. Nevertheless, if there is still hope
for the case, he commits to help complainant by whatever means he can.
On 14 February 2007, Commissioner Marilyn S. Guzman, IBP Commission

on Bar Discipline, submitted her report recommending that respondent
Atty. Ga be censured for violation of Rule 18.03, Canon 18 of the Code of
Professional Responsibility.9
On 19 September 2007, the Board of Governors of the IBP adopted and

approved with modification, the report and recommendation of the
Investigating Commissioner.10 Respondent Atty. Ga was censured for
violation of Rule 18.03, Canon 18 of the Code of Professional Responsibility
and was directed to reconstitute and turn over the records of the case to
complainant, with stern warning that failure to do so would merit a stiffer
penalty.
In a resolution dated 2 June 2008, the Office of the Bar Confidant and the
IBP were directed to inform the Court if any motion for reconsideration
was filed in the case. The IBP was further directed to confirm if
respondent has complied with Resolution No. XVIII-2007-94 dated 19
September 2007 directing him to reconstitute and turn over the records of
the case to complainant.11
In compliance with the resolution, the Office of the Bar Confidant reported
that no motion for reconsideration or petition for review was filed by
either party.12
The IBP Commission on Bar Discipline, for its part, reported that no motion
for reconsideration was filed by either party and that respondent failed to
comply with IBP Resolution No. XVIII-2007-94 dated 19 September 2007.13
Thus, on 2 September 2009, the Court issued a resolution requiring Atty.

Ga to explain his failure to comply with IBP Resolution No. XVIII-2007-
94.14 Record of the instant case reveals that the resolution dated 2
September 2009 was received by Atty. Ga on 15 October 2009. To date,
Atty. Ga has yet to comply with the resolution.
We agree with the findings and recommendation of the IBP. The Code of
Professional Responsibility mandates lawyers to serve their clients with
competence and diligence. Rule 18.03 and Rule 18.04 state:
Rule 18.03. A lawyer shall not neglect a legal matter entrusted to him, and
his negligence in connection therewith shall render him liable.
Rule 18.04. A lawyer shall keep the client informed of the status of his
case and shall respond within a reasonable time to the client’s request for
information.
Respondent Atty. Ga breached these duties when he failed to reconstitute

or turn over the records of the case to his client, herein complainant Gone.
His negligence manifests lack of competence and diligence required of
every lawyer. His failure to comply with the request of his client was a
gross betrayal of his fiduciary duty and a breach of the trust reposed upon
him by his client. In the case of Navarro v. Meneses,15 the Court held:
It is settled that a lawyer is not obliged to act as counsel for every person
who may wish to become his client. He has the right to decline
employment subject however, to the provision of Canon 14 of the Code of
Professional Responsibility. Once he agrees to take up the cause of a
client, he owes fidelity to such cause and must always be mindful of the
trust and confidence reposed to him. Respondent Meneses, as counsel,
had the obligation to inform his client of the status of the case and to
respond within a reasonable time to his client’s request for information.
Respondent’s failure to communicate with his client deliberately
disregarding its request for an audience or conference is an unjustifiable
denial of its right to be fully informed of the developments in and the
status of its case.
Respondent’s sentiments against complainant Gone is not a valid reason

for him to renege on his obligation as a lawyer. The moment he agreed to
handle the case, he was bound to give it his utmost attention, skill and
competence. Public interest requires that he exerts his best efforts and all
his learning and ability in defense of his client’s cause. Those who perform
that duty with diligence and candor not only safeguard the interests of the
client, but also serve the ends of justice.16 They do honor to the bar and
help maintain the community’s respect for the legal profession.17
If respondent believed that he will not be able to represent complainant

effectively because of what the latter has done to his family, then he
should have withdrawn his services as a lawyer. Had it not been for
complainant’s insistence, his labor case would have forever remained
dormant. The fact that respondent is retained as the lawyer of the
complainant, he was duty bound to give his best service. His failure to do
so constitutes an infringement of his oath.1avvphi1
In addition, We note respondent’s disregard of the IBP Commission on Bar

Discipline’s directive for him to reconstitute and turn over the records of
the case to complainant. Likewise, respondent unjustifiably ignored the
directive of the Court for him to explain his failure to comply with IBP
Resolution No. XVIII-2007-94.
Respondent’s unjustified disregard of the lawful orders of this Court and
the IBP is not only irresponsible, but also constitutes utter disrespect for
the Judiciary and his fellow lawyers.18 His conduct is unbecoming of a
lawyer, for lawyers are particularly called upon to obey Court orders and
processes and are expected to stand foremost in complying with Court
directives being themselves officers of the Court.19
As an officer of the Court, respondent is expected to know that a

resolution of this Court is not a mere request but an order which should
be complied with promptly and completely.20 This is also true of the orders
of the IBP as the investigating arm of the Court in administrative cases
against lawyers.21
Respondent should strive harder to live up to his duties of observing and

maintaining the respect due to the Courts,22 respect for law and for legal
processes,23 and of upholding the integrity and dignity of the legal
profession24 in order to perform his responsibilities as a lawyer
effectively.
All told, We could suspend respondent for his transgressions. Considering,

however, that he is already in the twilight of his career and considering
further that he was not entirely to be blamed for the archiving of the labor
case, complainant’s absence during the hearings being contributory
therein, We deem the penalty of fine in the amount of ₱5,000.00 sufficient
sanction under the circumstances. Such consideration would be more in
line with the very purpose of administrative cases against lawyers, that is,
not so much to punish but to instill discipline in them, as well as, protect
the integrity of the Court and shelter the public from the misconduct and
inefficiency of lawyers.
Wherefore, respondent Macario Ga is hereby fined in the amount of Five

Thousand Pesos (₱5,000.00) for his failure to comply with the directive in
Resolution No. XVIII-2007-94 dated 19 September 2007 of the Board of
Governors of the Integrated Bar of the Philippines. Atty. Ga is given a final
warning that a more drastic punishment shall be imposed upon him
should he fail to comply with the directive for him to reconstitute and turn
over the records of the case to complainant.
SO ORDERED.
Heirs of Falame vs Baguio, Ac No 6876, March 7, 2008
On Petition for Review1 is the Resolution of the Integrated Bar of the

Philippines (IBP) Board of Governors dismissing the disbarment complaint
filed by the Heirs of Lydio "Jerry" Falame (complainants) against Atty.
Edgar J. Baguio (respondent), docketed as CBD Case No. 04-1191.
In their Complaint2 against respondent, complainants alleged that on 15

July 1991, their father, the late Lydio "Jerry" Falame (Lydio), engaged the
services of respondent to represent him in an action for forcible entry
docketed as Civil Case No. A-2694 (the first civil case) and entitled "Heirs
of Emilio T. Sy, represented by Anastacia Velayo Vda. De Sy and Belen V.
Sy v. Lydio 'Jerry' Falame, Raleigh Falame and Four (4) John Does," in
which Lydio was one of the defendants.3
Complainants recounted that respondent, as counsel for the defendants,

filed the answer to the complaint in the first civil case. Subsequently,
when the parties to the first civil case were required to file their
respective position papers, respondent used and submitted in evidence
the following: (1) a special power of attorney dated 1 July 1988 executed by
Lydio in favor of his brother, Raleigh Falame, appointing the latter to be
his attorney-in-fact; and (2) the affidavit of Raleigh Falame dated 23 July
1988, executed before respondent, in which Raleigh stated that Lydio
owned the property subject of the first civil case.4
Complainants claimed that even after the Municipal Trial Court of Dipolog
City had ruled in favor of the defendants in the first civil case, Lydio
retained the services of respondent as his legal adviser and counsel for
his businesses until Lydio's death on 8 September 1996.5
However, on 23 October 2000, in representation of spouses Raleigh and

Noemi Falame, respondent filed a case against complainants allegedly
involving the property subject of the first civil case, entitled "Spouses
Rally F. Falame and Noemi F. Falame v. Melba A. Falame, Leo A. Falame,
Jerry A. Falame, Jr., Sugni Realty Holdings and Development Corporations,
their representatives, agents and persons acting in their behalf" and
docketed as Civil Case No. 5568 (the second civil case) before the
Regional Trial Court of Dipolog City, Branch 6. The complaint sought the
declaration of nullity of the deed of sale, its registration in the registry of
deeds, Transfer Certificate of Title No. 20241 issued as a consequence of
the registration of the deed of sale, and the real estate mortgage on the
said property. Alternatively, it prayed for specific performance and
reconveyance or legal redemption and damages with preliminary
injunction and restraining order.6
Firstly, complainants maintained that by acting as counsel for the spouses

Falame in the second civil case wherein they were impleaded as
defendants, respondent violated his oath of office and duty as an attorney.
Plainly, they contended that the spouses Falame's interests are adverse to
those of his former client, Lydio.7
Secondly, complainants claimed that respondent knowingly made false

statements of fact in the complaint in the second civil case to mislead the
trial court. In so doing, respondent violated paragraph (d), Section 208 of
Rule 138 of the Rules of Court,9 complainants asserted further.
Lastly, complainants alleged that the second civil case is a baseless and
fabricated suit which respondent filed as counsel for complainants' uncle
against the heirs of respondent's deceased client. Specifically, they
averred that respondent filed the case for the sole purpose of retaining,
maintaining and/or withholding the possession of the subject property
from complainants who are its true owners. Complainants concluded that
respondent violated paragraph (g), Section 2010 of Rule 138 of the Rules of
Court.11
In his Answer with Motion to Dismiss,12 respondent controverted

complainants' allegations. He emphasizes that it was only Raleigh Falame
who personally engaged his legal services for him and on Lydio's behalf
and that, in fact, it was Raleigh who paid him the attorney's fees. He also
stated that he signed the jurat in Raleigh's affidavit, which was submitted
as evidence in the first civil case, believing to the best of his knowledge
that there is good ground to support it. Insisting that he did not betray the
confidence reposed in him by Lydio as the latter's counsel in the first civil
case, respondent maintained that he did not reveal or use any fact he
acquired knowledge of during the existence of the attorney-client relation
in the first civil case as he had never even conferred with nor talked to
Lydio in the first place. Respondent likewise contended that he did not
knowingly make any misleading or untruthful statement of fact in the
complaint in the second civil case and neither did he employ any means
inconsistent with truth and honor in the hearing of the case.13
Respondent vigorously averred that Lydio had not retained him as counsel
in any case or transaction. Stressing the long interval of twelve years
separating the termination of the first civil case and his acceptance of the
second civil case, respondent pointed out that the first civil case was not
between Lydio and Raleigh but rather between the heirs of Emilio T. Sy on
one hand and Lydio and Raleigh on the other where physical possession of
property was at stake. Respondent further averred that in contrast the
second civil case is one involving the spouses Raleigh and Noemi Falame
as plaintiffs, and Melba, Leo and Jerry Jr., all surnamed Falame, and Sugni
Realty Holdings and Development Corporation, as defendants'a case which
arose from the wrongful acts committed by Melba, Leo and Jerry Jr. after
Lydio's death.14
Respondent maintained that since the second civil case was still pending
before the trial court, the IBP had no jurisdiction over the instant
administrative case. He added that complainants filed this administrative
case when Raleigh could no longer testify in his own favor as he had died
a year earlier.15
In their Position Paper16 dated 7 September 2004, in addition to their

previous charges against respondent, complainants claimed that
respondent violated Rule 15.0317 of the Code of Professional Responsibility
when he represented the cause of the spouses Falame against that of his
former client, Lydio.18
On 25 June 2005, the IBP Board of Governors passed Resolution No. XVI-
2005-167 adopting and approving Investigating Commissioner Winston D.
Abuyuan's report and recommendation for the dismissal of this
administrative case, thus:19
x x x The charge lacks specification as to what part of the lawyer's oath

was violated by the respondent and what confidence was disclosed. The
complainants may have in mind the prohibition against disclosure of
secret information learned in confidence, but there is no specification in
the complaint what secret or information learned in confidence under Civil
Case No. A-2694 was disclosed or will be disclosed by respondent in Civil
Case No. 5568. In administrative complaints for disbarment or suspension
against lawyers, the complainant must specify in the affidavit-complaint
the alleged secrets or confidential information disclosed or will be
disclosed in the professional employment (Uy v. Gonzalez, 426 SCRA 422;
431). In the absence of such specification, the complaint must fail.
In the complaint, there is no specific charge against respondent for

violation of Canon 15, Rule 15.03 of the Code of Professional Responsibility
about the prohibition against representation of conflicting interest. So, the
allegation in paragraph 1, page 8 and 9 of complainants' position paper
stating: With all due respect, it is submitted that respondent violated
Canon 15, Rule 15.03 of the Code of Professional Responsibility" cannot be
countenanced. The reason being that it is an elementary principle of due
process to which the respondent is entitled that only those charged in the
complaint can be proved by the complainants. A charge not specified in
the complaint cannot be proved (Uy v. Gonzales, id.)
x x x But still this charge will not proper for lack of sufficient bases.
xxx
Civil Case No. 5568, which was commenced on 03 October 2000, or three
years since the complainants became owners of Lydio Falame's
properties, is a suit against the complainants, not as representatives of
Lydio Falame, but as owners of their respective aliquot interests in the
property in question (Gayon v. Gayon, 36 SCRA 104; 107-108). The
complainants are sued not on the basis of the acts, rights, obligations and
interest of Lydio Falame on the material possession of the improvements
found on Lot 345 litigated in Civil Case No. A-2694 nor even on such land
itself, but rather on the facts alleged in the second amended and
supplemental complaint which give rise to their cause of action against
them.
While the complainants could not specify under what circumstances the
respondent committed [the] alleged breach of confidence, breach of
secrecy or revelation of secret or confidential information[,] the
respondent has shown that he did not commit any violation of such duties
or obligations of an attorney.
It is clear that only Raleigh Falame engaged the legal services of the
respondent for his and Lydio Falame's defense in Civil Case No. A-2694.
xxx
The other allegations of the complainants that the respondent violated

paragraph (d), Section 20 of Rule 139, Rules of Court, and his lawyer's oath
when he allegedly betrayed the trust and confidence of his former client
by denying knowledge of the fact that the land was owned by Lydio Falame
and when he did not disclose to the Court that at one time his present
clients categorically declared and unconditionally recognized the full
ownership of the late Lydio Falame and complainant Melba Falame over
subject matter of both cases equally lacks evidentiary basis.
xxx
It is beyond the competence of the complainants to conclude and is

outside the jurisdiction of this Honorable Commission to rule as to
whether or nor (sic) the complaint in Civil Case No.5568 is baseless or
fabricated. It is only the Honorable Court which has the exclusive
jurisdiction to determine the same and cannot be the subject of an
administrative complaint against the respondent.
xxx
WHEREFORE, premises considered, it is respectfully recommended that

this complaint be dismissed on grounds of prescription, the same having
been filed four (4) years after the alleged misconduct took place and for
lack of merit.
RESPECTFULLY SUBMITTED.20
Dissatisfied, complainants filed the instant Petition for Review under Rule
45 of the Rules of Court reiterating their allegations in the complaint and
their position paper.21 They likewise assert that the IBP erred in holding
that the instant administrative complaint had been filed out of time since it
was filed on 16 January 2004, or three (3) years, four (4) months and
sixteen (16) days after the second civil case was filed on 23 October
2000.22 In addition, in their Consolidated Comment (should be Consolidated
Reply),23 complainants invoke the Court's ruling in Frias v. Bautista-
Lozada24 to support their contention that administrative complaints
against members of the bar do not prescribe.25
In his Comment,26 respondent principally maintains that the charges

imputed to him have never been proven by clear, convincing and
satisfactory evidence which is the quantum of proof required in
administrative cases against lawyers, and that complainants have the
burden to prove their accusations as he enjoys the presumption of
innocence.27 Respondent likewise asserts that in accusing him of violation
of Rule 15.03 of the Code of Professional Responsibility only in their
position paper and in the instant petition, complainants infringed his right
to due process and to be informed of the nature and cause of accusation
against him.28
There is merit in the petition.
At the outset, the Court holds that the instant administrative action is not
barred by prescription. As early as 1947, the Court held in Calo, Jr. v.
Degamo,29 to wit:
The ordinary statutes of limitation have no application to disbarment

proceedings, nor does the circumstance that the facts set up as a ground
for disbarment constitute a crime, prosecution for which in a criminal
proceeding is barred by limitation, affect the disbarment proceeding x x x
(5 Am. Jur. 434)30
This doctrine was reaffirmed in the relatively recent case of Frias v.

Bautista-Lozada31 where the Court held that Rule VII, Section 1 of the Rules
of Procedure of the CBD-IBP, which provides for a prescriptive period for
the filing of administrative complaints against lawyers, should be struck
down as void and of no legal effect for being ultra vires.32
Prescinding from the unavailability of the defense of prescription, the

Court concurs with the Investigating Commissioner's opinion that some of
the charges raised by complainants in their complaint are
unsubstantiated.
There is, however, sufficient basis to hold respondent accountable for
violation of Rule 15.03 of the Code of Professional Responsibility. While
this charge was not raised in the initiatory pleading, it was put forward in
complainants' position paper filed with the IBP and in the petition filed with
the Court. In fact, respondent proffered his defenses to the charge in his
position paper before the IBP and likewise in his comment before the
Court. In his very first pleading before the IBP, the answer with motion to
dismiss, he denied having Lydio as his client. Such absence of attorney-
client relationship is the essential element of his defense to the charge of
conflict of interest, as articulated in his subsequent submissions.
The Court, therefore, rules and so holds that respondent has been
adequately apprised of and heard on the issue. In administrative cases, the
requirement of notice and hearing does not connote full adversarial
proceedings. Actual adversarial proceedings only become necessary for
clarification when there is a need to propound searching questions to
witnesses who give vague testimonies. Due process is fulfilled when the
parties were given reasonable opportunity to be heard and to submit
evidence in support of their arguments.33
Rule 15.03 of the Code of Professional Responsibility provides:
A lawyer shall not represent conflicting interests except by written

consent of all concerned given after a full disclosure of the facts.
A lawyer may not, without being guilty of professional misconduct, act as

counsel for a person whose interest conflicts with that of his present or
former client.34 The test is whether, on behalf of one client, it is the
lawyer's duty to contest for that which his duty to another client requires
him to oppose or when the possibility of such situation will develop.35 The
rule covers not only cases in which confidential communications have
been confided, but also those in which no confidence has been bestowed
or will be used.36 In addition, the rule holds even if the inconsistency is
remote or merely probable or the lawyer has acted in good faith and with
no intention to represent conflicting interests.37
The rule concerning conflict of interest prohibits a lawyer from

representing a client if that representation will be directly adverse to any
of his present or former clients. In the same way, a lawyer may only be
allowed to represent a client involving the same or a substantially related
matter that is materially adverse to the former client only if the former
client consents to it after consultation. The rule is grounded in the
fiduciary obligation of loyalty.38 In the course of a lawyer-client
relationship, the lawyer learns all the facts connected with the client's
case, including the weak and strong points of the case. The nature of that
relationship is, therefore, one of trust and confidence of the highest
degree.39
The termination of attorney-client relation provides no justification for a

lawyer to represent an interest adverse to or in conflict with that of the
former client. The client's confidence once reposed should not be divested
by mere expiration of professional employment. Even after the severance
of the relation, a lawyer should not do anything which will injuriously
affect his former client in any matter in which he previously represented
him nor should he disclose or use any of the client's confidences acquired
in the previous relation.40
In relation to this, Canon 17 of the Code of Professional Responsibility

provides that a lawyer owes fidelity to the cause of his client and shall be
mindful of the trust and confidence reposed on him. His highest and most
unquestioned duty is to protect the client at all hazards and costs even to
himself.41 The protection given to the client is perpetual and does not
cease with the termination of the litigation, nor is it affected by the party's
ceasing to employ the attorney and retaining another, or by any other
change of relation between them. It even survives the death of the client.42
In the case at bar, respondent admitted having jointly represented Lydio

and Raleigh as defendants in the first civil case. Evidently, the attorney-
client relation between Lydio and respondent was established despite the
fact that it was only Raleigh who paid him. The case of Hilado v.
David43 tells us that it is immaterial whether such employment was paid,
promised or charged for.44
As defense counsel in the first civil case, respondent advocated the stance
that Lydio solely owned the property subject of the case. In the second
civil case involving the same property, respondent, as counsel for Raleigh
and his spouse, has pursued the inconsistent position that Raleigh owned
the same property in common with Lydio, with complainants, who
inherited the property, committing acts which debase respondent's rights
as a co-owner.
The fact that the attorney-client relation had ceased by reason of Lydio's
death or through the completion of the specific task for which respondent
was employed is not reason for respondent to advocate a position
opposed to that of Lydio.45 Precedents tell us that even after the
termination of his employment, an attorney may not act as counsel against
his client in the same general matter, even though, while acting for his
former client, he acquired no knowledge which could operate to his
client's disadvantage in the subsequent adverse employment.46 And while
complainants have never been respondent's clients, they derive their
rights to the property from Lydio's ownership of it which respondent
maintained in the first civil case.
For representing Raleigh's cause which is adverse to that of his former

client Raleigh's supposed co-ownership of the subject property'
respondent is guilty of representing conflicting interests. Having
previously undertaken joint representation of Lydio and Raleigh,
respondent should have diligently studied and anticipated the
potential conflict of interest. Accordingly, disciplinary action is

warranted.47 Heretofore, respondent is enjoined to look at any
representation situation from "the point of view that there are possible
conflicts"; and further, "to think in terms of impaired loyalty" that is to
evaluate if his representation in any way will impair loyalty to a
client.48 Considering, however, that this is respondent's first offense, the
Court resolves to reprimand respondent, with admonition to observe a
higher degree of fidelity in the practice of his profession.49
WHEREFORE, respondent Atty. Edgar J. Baguio is found GUILTY of

representing conflicting interests and meted out the penalty of
REPRIMAND. He is further admonished to observe a higher degree of
fidelity in the practice of his profession and to bear in mind that a
repetition of the same or similar acts will be dealt with more severely.
SO ORDERED.

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A LAWYER SHALL NOT REFUSE HIS SERVICES TO THE NEEDY.

Rule 14.01 - A lawyer shall not decline to represent a person solely on

Rule 14.03 - A lawyer may not refuse to accept representation of an

PROPOSED RULE ON MANDATORY LEGAL AID SERVICE FOR PRACTICING

Acting on the Memorandum dated January 27, 2009 of Justice Renato C.

February 10, 2009

SECTION 1. Title. - This Rule shall be known as "The Rule on Mandatory

SECTION 2. Purpose. - This Rule seeks to enhance the duty of lawyers to

SECTION 4. Definition of Terms. - For purposes of this Rule:

(a) Practicing lawyers are members of the Philippine Bar who

(i) Government employees and incumbent elective officials not

(ii) Lawyers who by law are not allowed to appear in court;

(iii) Supervising lawyers of students enrolled in law student

(iv) Lawyers not covered under subparagraphs (i) to (iii)

(d) Free legal aid services refer to appearance in court or quasi-

(e) Integrated Bar of the Philippines (IBP) is the official national

(f) National Committee on Legal Aid (NCLA) is the committee of the

(g) Committee on Bar Discipline (CBD) is the committee of the IBP

The term shall also include an officer holding a similar position in

(a) Every practicing lawyer is required to render a minimum of sixty

The practicing lawyer shall report compliance with the requirement

(b) A practicing lawyer shall be required to secure and obtain a

The certificate shall contain the following information:

(ii) The number of hours actually spent attending a hearing or

(iii) The number of hours actually spent attending mediation,

(iv) A motion (except a motion for extension of time to file a

The Clerk of Court shall issue the certificate in triplicate, one

(c) Said compliance report shall be submitted to the Legal Aid

(d) The IBP Chapter shall, after verification, issue a compliance

(f) Before the end of a particular year, lawyers covered by the

(g) Before the end of a particular year, lawyers covered by the

(h) Before the end of a particular year, lawyers covered by the

(c) The NCLA shall act as the national repository of records in

(d) The NCLA shall prepare the following forms: certificate to be

The accounting shall be included by the IBP in its report to the

(b) The "not in good standing" declaration shall be effective for a

(d) Any lawyer who falsifies a certificate or any form required to be

(e) The falsification of a certificate or any contents thereof by any

SECTION 8. Credit for Mandatory Continuing Legal Education (MCLE). - A

SECTION 9. Implementing Rules. - The IBP, through the NCLA, is hereby

Attorney appointed by the court.

To defend an indigent defendant in a criminal action.

To represent a destitute party.

An experienced and impartial attorney invited by the court to appear and

It implies friendly intervention of counsel to call the attention of the court

Amicus par excellence

The present case is a typical example of such rare exception.

Petitioner engaged the services of counsel to handle her case. Said

WHEREFORE, judgment is hereby rendered ordering defendant

Judgment is likewise rendered ordering defendant to pay exemplary

1. For loss and destroyed goodwill and reputation in the amount of

2. The sum of P61,704.40 as adjustments in the costs of labor and

3. The sum of P50,000.00 as unearned income for the delay of

4. The sum of P16,635.57 and P50,424.40 as additional compensatory

5. The sum of P10,000.00 as and by way of attorney's fees; and

6. The costs of suit.3

At public auction, the sheriff sold the aforestated property of petitioner to

Upon learning of this unfortunate turn of events, petitioner prevailed upon