Scribd Logo
Upload

Welcome to Scribd!

  • 7 views

    6.4 Hornilla vs. Salunat

    Uploaded by

    I took her to my penthouse and i freaked it
    Respondent Atty. Ernesto S. Salunat was accused of illegal and unethical practice and conflict of interest. He was engaged as counsel for the Philippine Public School Teachers Association (PPSTA) while his brother served on the PPSTA Board that approved his engagement. Complainants, who were PPSTA members, filed cases against the PPSTA Board. Respondent entered an appearance as counsel for the Board members in those cases. The Supreme Court held that a lawyer engaged by a corporation cannot represent members of that corporation's board in a derivative suit against them, as it would constitute representing conflicting interests prohibited by ethics rules.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    6.4 Hornilla vs. Salunat

    Uploaded by

    I took her to my penthouse and i freaked it
    7 views1 page
    Respondent Atty. Ernesto S. Salunat was accused of illegal and unethical practice and conflict of interest. He was engaged as counsel for the Philippine Public School Teachers Association (PPSTA) while his brother served on the PPSTA Board that approved his engagement. Complainants, who were PPSTA members, filed cases against the PPSTA Board. Respondent entered an appearance as counsel for the Board members in those cases. The Supreme Court held that a lawyer engaged by a corporation cannot represent members of that corporation's board in a derivative suit against them, as it would constitute representing conflicting interests prohibited by ethics rules.

    Copyright

    © © All Rights Reserved

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Respondent Atty. Ernesto S. Salunat was accused of illegal and unethical practice and conflict of interest. He was engaged as counsel for the Philippine Public School Teachers Association (PPSTA) while his brother served on the PPSTA Board that approved his engagement. Complainants, who were PPSTA members, filed cases against the PPSTA Board. Respondent entered an appearance as counsel for the Board members in those cases. The Supreme Court held that a lawyer engaged by a corporation cannot represent members of that corporation's board in a derivative suit against them, as it would constitute representing conflicting interests prohibited by ethics rules.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    7 views1 page

    6.4 Hornilla vs. Salunat

    Uploaded by

    I took her to my penthouse and i freaked it
    Respondent Atty. Ernesto S. Salunat was accused of illegal and unethical practice and conflict of interest. He was engaged as counsel for the Philippine Public School Teachers Association (PPSTA) while his brother served on the PPSTA Board that approved his engagement. Complainants, who were PPSTA members, filed cases against the PPSTA Board. Respondent entered an appearance as counsel for the Board members in those cases. The Supreme Court held that a lawyer engaged by a corporation cannot represent members of that corporation's board in a derivative suit against them, as it would constitute representing conflicting interests prohibited by ethics rules.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 1

    BENEDICTO HORNILLA v. ATTY. ERNESTO S. SALUNAT, AC. No.

    5804, 2003-07-01

    Facts:

    o An administrative complaint was filed before the IBP against respondent Atty. Ernesto S.
    Salunat for illegal and unethical practice and conflict of interest.
    o Complainants alleged that respondent is a member of the ASSA Law and Associates,
    which was the retained counsel of the Philippine Public School Teachers Association
    (PPSTA).
    o Respondent's brother, Aurelio S. Salunat, was a member of the PPSTA Board which
    approved respondent's engagement as retained counsel of PPSTA.
    o Complainants, who are members of the PPSTA, filed an intra-corporate case against its
    members of the BOD for the terms 1992-1995 and 1995-1997 before the SEC and a
    complaint before the Office of the Ombudsman for unlawful spending and the
    undervalued sale of real property of the PPSTA.
    o Respondent entered his appearance as counsel for the PPSTA Board members in the said
    cases.
    o Complainants contend that respondent was guilty of conflict of interest because he was
    engaged by the PPSTA, of which complainants were members, and was being paid out of
    its corporate funds where complainants have contributed.
    o Despite being told by PPSTA members of the said conflict of interest, respondent refused
    to withdraw his appearance in the said cases.
    o After investigation, the IBP Commissioner recommended that respondent be suspended
    from the practice of law for six (6) months and the Board of Governors approved the
    report and recommendation of the investigating Commissioner.
    o MFR was filed, hence this case.

    Issue: can a lawyer engaged by a corporation defend members of the board of the same
    corporation in a derivative suit?

    NO.

    The possibility for conflict of interest here is universally recognized. Although early cases found
    joint representation permissible where no conflict of interest was obvious, the emerging rule is
    against dual representation in all derivative actions. Outside counsel must thus be retained to
    represent one of the defendants. The cases and ethics opinions differ on whether there must be
    separate representation from the outset or merely from the time the corporation seeks to take
    an active role. Furthermore, this restriction on dual representation should not be waivable by
    consent in the usual way; the corporation should be presumptively incapable of giving valid
    consent.

    The SC held that a lawyer engaged as counsel for a corporation cannot represent members of
    the same corporation's board of directors in a derivative suit brought against them. To do so
    would be tantamount to representing conflicting interests, which is prohibited by the Code of
    Professional Responsibility.

    In this jurisdiction, a corporation's board of directors is understood to be that body which (1)
    exercises all powers provided for under the Corporation Code; (2) conducts all business of the
    corporation; and (3) controls and holds all property of the corporation. Its members have
    been characterized as trustees or directors clothed with a fiduciary character. It is clearly
    separate and distinct from the corporate entity itself.

    You might also like