Pointers:

1. CPRA Canons 3-6

2. Responsible and Accountable Lawyer
3. Confidentiality of Privileged Communication; Protecting Client Confidences
4. Lawyer-Client Relationship; Termination of Lawyer-Client Relationship
5. Fair and Reasonable Fees
6. Compensation of Attorneys (Quantum merit; Contingent Fee; Retainer’s Fee;
Retaining Lien; Charging Lien; Champertous Contract)

Quantum meruit is a legal doctrine that allows a court to award a reasonable

amount of compensation to a person who has provided services, even if there
was no explicit agreement for compensation in a contract. The term is Latin
for "as much as one has deserved".
In the context of attorney compensation, quantum meruit can be used when:
 There is no written agreement between the attorney and the client
 The attorney was unable to complete the case for a justifiable reason
 The circumstances indicate that it would be unfair to deprive the attorney of
compensation
When determining an attorney's compensation using quantum meruit, the
court considers the following factors: The importance of the subject matter,
The extent of the services provided, and The attorney's professional standing.
To establish an implied agreement between the parties, evidence such as
emails, correspondence, or verbal statements can be used.
A contingency fee is a contractual arrangement between a lawyer and a client
in the Philippines where the lawyer's payment is based on a percentage that
the lawyer gets if he wins the case and is usually could be around 30 up
to 50 percent of the property or money involved.This arrangement is common
in cases where the client can't afford to pay for legal services upfront or on an
hourly basis. of the monetary amount t

An attorney's lien is a legal right that allows an attorney to claim a portion of a

client's recovery in a case. Attorneys' liens are used to ensure that lawyers
are paid for their work and to prevent clients from terminating their lawyers
without compensating them. There are two types of attorney's liens: retaining
liens and charging liens:
 Retaining liens
Allow attorneys to keep a client's funds, documents, and papers until their fees and
disbursements are paid.
 Charging liens
Allow attorneys to claim a portion of any money paid to the client as a result of a
judgment. Charging liens arise when a client fails to pay for legal services. A
charging lien can only be enforced if there is a judgment for money and execution in favor
of the attorney's client.
Ha
A champertous contract is an agreement that violates the fiduciary
relationship between a lawyer and their client and is considered against public
policy in the Philippines. It occurs when a third party, such as a finance
company, provides funds for a lawsuit in exchange for a percentage of the
recovery.

Here are some examples of champertous contracts in the Philippines:

 Lawyer agrees to pay expenses
When a lawyer agrees to pay for the expenses of a client's lawsuit, this is
considered champertous.
 Litigation financing arrangement
When a third party with a superior bargaining position provides funds for a lawsuit,
but there is no specific agreement on how much the third party will receive in return,
this is considered champertous.
t their client receives when they win or settle the case
7. Non-Discrimination

Lawyers in the Philippines have a responsibility to not discriminate and to

behave in a manner that is consistent with the dignity of the legal profession:
 Avoid discrimination
Lawyers should not discriminate against anyone, including in their conduct,
language, or actions. For example, lawyers should not engage in gender-based
harassment or discrimination, and should use gender-fair language.
 Behave appropriately
 Lawyers should behave in a manner that is respectful, firm, and decent, and should
observe proper decorum at all times. They should also dress in a way that is
consistent with the dignity of the court or government agency they are appearing
before.
 Avoid conduct that reflects poorly on the legal profession
Lawyers should not engage in conduct that reflects poorly on their fitness to
practice law, or that brings discredit to the legal profession. For example, the
Supreme Court has penalized lawyers for making homophobic social media posts.
 Use dignified language
Lawyers should use dignified, culturally-sensitive, and child-friendly language in all
professional and personal dealings.

August 17, 2023

The right to privacy of lawyers is limited, especially when it comes to their

social media accounts.

Thus said the Supreme Court in a 26-page Per Curiam Decision as it

reprimanded Atty. Morgan Rosales Nicanor (Atty. Nicanor), Atty. Joseph
Marion Peña Navarrete (Atty. Navarrete), Atty. Noel V. Antay, Jr. (Atty.
Antay), and Atty. Israel P. Calderon (Atty. Calderon), and imposed a
PhP25,000 fine on Atty. Ernesto A. Tabujara III (Atty. Tabujara), all for
violation of Rule 7.03 of the Code of Professional Responsibility, with a stern
warning that a repetition of the same or similar offense will be more severely
dealt with.

On June 29, 2021, the Court motu proprio resolved to require Atty. Antay,
Atty. Tabujara, Atty. Calderon, Atty. Nicanor, and Atty. Navarrete to show
cause why no administrative charges should be filed against them for
certain Facebook posts.

Atty. Antay initiated a Facebook thread with a post stating he had “(j)ust
prosecuted and helped convict a member of the LGBTA community for large
scale estafa. The new convict then began cussing at me accusing me of

being a bigot. A first for me ,” adding: “The judge (who is somewhat

effeminate) comes to my defense and warns the felon to behave. All in a

day’s work. ”
This was followed by a comment from Atty. Tabujara, who asked “(s)ino
yung bakla na judge…(n)aka eye liner and eye shadow pag
nag hehearing. Ang taray pa!” Atty. Tabujara later on commented that the
joke among lawyers is that in a certain courthouse, “sa 2nd floor puro may
sira ulo mga judge, sa baba bakla at mga corrupt.”

In another comment, Atty. Calderon then replied to Atty. Antay:

“Baka type ka,” later on adding “Nakita n’ya intelligence mo given na good
looks eh na convict mo pa s’ya. Tapos syempre di ka mapapasakamay n’ya
kaya ayon imbyerna I. [sic]. Charot haha.”

Atty. Nicanor agreed, posting: “(f)eel ko type ka bossing. Hehehe,” to which

Atty. Tabujara added: “Dapat kinurot mo! Charot!”

Atty. Navarrete chimed in, saying that he remembered Atty. Nicanor’s client
that the latter brought to the Ombudsman. He said: “Pinatawag lang ako
ng Prof Morgan Nicanor mga panahon nayan. Tapos bitbit nya kliyente niya.
Ang natatandaan ko lang is malagkit tingin kay papa, este Prof. Morgan.”

Atty. Antay then posted: “Matikas kasi si Prof. Morgan eh, Habulin.”

In its Report and Recommendation dated August 31, 2022, the Office of the
Bar Confidant (OBC) recommended that the lawyers be admonished, noting
that their comments show that the main topic of their online conversation
was LGBTQIA+ community members and judges. The OBC opined that
though no other names were mentioned, the comments of the five lawyers
were made in a degrading and shameful manner, contrary to the duty of
lawyers to “conduct themselves with the highest degree of propriety and
decorum” and to “refrain from making remarks and conjectures that tend to
ridicule a certain segment of the population such as the LGBTQIA+
community.” The OBC recommended the penalty of admonition, taking into
consideration that the lawyers concerned have apologized and appear to be
remorseful.

In finding the five lawyers administratively liable for their statements, the
Supreme Court first resolved the issue of whether the said lawyers can
invoke their right to privacy vis-à-vis their online activities. The Court ruled
that such right of lawyers to privacy is limited, especially when it concerns
their social media accounts.

Citing the 2016 case of Belo-Henares v. Guevarra, the Court said it is clear
that “there can be no reasonable expectation of privacy as regards social
media posts, regardless if the same are ‘locked,’ precisely because the
access restriction settings in social media platforms do not absolutely bar
other users from obtaining access to the same.”

The Court further reiterated that restricting the privacy of

one’s Facebook posts to “Friends” only does not guarantee absolute
protection from the prying eyes of other users. Thus, the Court said, it
cannot give credence to the invocation of Atty. Antay, who started the post,
of his right to privacy.

“His excuse—that his social media account is locked and the contents
thereof cannot be accessed by outsiders—is a mere allegation at best.
Allegations are not proof. Further, the fact that the exchanges leaked means
that his social media account is not locked as he claims or that there is a rat
amidst them,” lamented the Court.

In finding the lawyers liable for violation of Rule 7.03 of the Code of
Professional Responsibility, which prohibits lawyers from engaging in
conduct that adversely reflects on their fitness to practice law and prohibits
them from behaving in a scandalous manner to the discredit of the legal
profession, the Court said that inappropriate, disrespectful, and defamatory
language of lawyers, even in the private sphere, are still within the Court’s
disciplinary authority.

It further stressed that members of the legal profession must respect the
freedom of LGBTQIA+ individuals to be themselves and express who they
are, as part of their constitutionally guaranteed right to freedom of
expression.

The Court likewise reiterated that the Philippines adheres to the

internationally-recognized principle of non-discrimination and equality. “As
such, every member of the legal profession is bound to observe and abide by
them, especially when dealing with LGBTQIA+ individuals.”

The Court also pointed out that inappropriate, disrespectful, belligerent, or

malicious language can be a source of criminal liability under the Safe
Spaces Act. “Gender-based sexual harassment - encompassing transphobic
and homophobic slurs – in streets and public spaces as well as online, may
warrant progressive penalties ranging from community service, fines and
imprisonment,” said the Court.
In the present case, the Court found the subject Facebook posts laced with
homophobic undertones, with descriptions of the convict and the judge that
are “uncalled for and have no context in the narrative, thus showing gender
bias.” The posts also include statements that tend to propagate and enforce
an unfair and harmful stereotype that are not representative of LGBTQIA+
individuals, said the Court, adding, “There is no room for such stereotypes in
conversations among lawyers.”

The Court held that Atty. Nicanor, Atty. Navarrete, Atty. Antay, and Atty.
Calderon should thus be reprimanded for their intemperate language against
the LGBTQIA+ community, adding that “their fixation on the respective
sexual orientations of their subjects was uncalled for and they should be
more circumspect in their choice of words and be mindful of gender-fair
language.”

In imposing a heavier penalty on Atty. Tabujara, the Court said that not only
did Atty. Tabujara, whose unapologizing stance, with “no slightest hint of
remorse,” was found disturbing by the Court, violate Rule 7.03 of the Code of
Professional Responsibility, but he did so in a reckless, wanton, and
malevolent manner.

“What made his infraction worse…is that Atty. Tabujara III made a sweeping
statement about the mental fitness of judges and implied that homosexual
judges have the same degree of immorality as those of corrupt
judges.” (Courtesy of the Supreme Court – Public Information

8. New Code of Judicial Conduct

9. Inhibition/Disqualification of a Judge

In the Philippines, a judge may be disqualified or inhibited from a case for a

number of reasons, including:
 The judge has a personal bias or prejudice against a party in the case
 The judge has knowledge of disputed evidence in the case
 The judge previously worked as a lawyer or was a witness in the case
 The judge or a family member has an economic interest in the outcome of the
case
 The judge is related to a party in the case or to counsel in the case
  The judge's ruling in a lower court is being reviewed
A judge may also disqualify themselves from a case at their discretion for
other valid reasons. The judge's decision to inhibit themselves is based on
their rational and logical assessment of the circumstances of the case.
If a judge is disqualified or inhibited, all parties in the case must be notified
within five days. The notification must include the reason for the
disqualification or inhibition.
If all first level court judges in an area are disqualified or inhibited, the
Executive Judge of the nearest station will designate a judge to hear the case.

10. Civil and Criminal Case against a Judge

In the Philippines, the Board of Governors and Commission on Bar Discipline

(IBP) forwards all cases involving judges and justices of lower courts to the
Supreme Court for action. This includes complaints that are not related to the
judge's official duties, such as immorality, estafa, and crimes against property
or persons.

A judge in the Philippines can be the subject of a civil or criminal case, or

both, if they are accused of misconduct or other inappropriate behavior:
 Civil cases
These are disputes that are settled in civil court, such as cases involving family,
housing, or consumer issues.
 Criminal cases
These cases are brought in criminal court for crimes such as assault, robbery,
murder, arson, and rape.
 Administrative complaints
These can be filed against judges and are investigated by the Court of Appeals.
Here are some things to consider when a judge is accused of misconduct:
 Good faith
A judge can use good faith and absence of malice as a defense.
 Bias and prejudice
A judge must clearly act in a way that shows bias or prejudice to be considered
biased.
 Code of Judicial Conduct
Judges must follow the Code of Judicial Conduct, which prohibits them from
allowing relationships to influence their judgment or using their office to advance
private interests.
 Forwarding cases to the Supreme Court
All cases involving judges and justices are forwarded to the Supreme Court for
action.

The responsible and accountable lawyer.

Section 2. The responsible and accountable lawyer. - A lawyer shall uphold the
Constitution, obey the laws of the land, promote respect for laws and legal
processes, safeguard human rights, and at all times advance the honor and
integrity of the legal profession.

As an officer of the court, a lawyer shall uphold the rule of law and conscientiously
assist in the speedy and efficient administration of justice.

As an advocate, a lawyer shall represent the client with fidelity and zeal within the
bounds of the law and the CPRA.

Confidentiality of Privileged Communication;

Protecting Client Confidences
Section 27, Canon III
SECTION 27. Confidentiality of privileged communication. – A lawyer shall
maintain the confidences of the client, and shall respect data privacy laws. The
duty of confidentiality shall continue even after the termination of the lawyer-client
engagement. (2023 Code of Professional Responsibility and Accountability or
CPRA)
1. Confidentiality of privileged communication
a. Duty of confidentiality
Under this section, lawyers are required to “maintain the confidences of the
client, and shall respect data privacy laws.”

1) Even after termination of lawyer-client engagement

Under this section, the duty of confidentiality does not end with the termination of
the lawyer-client engagement; rather, the duty of confidentiality continues “even
after the termination of the lawyer-client engagement.”

b. Attorney-client privilege
The purpose of the attorney-client privilege is to encourage a client to make full
disclosure to his or her attorney and to place unrestricted confidence in the
attorney in matters affecting the client’s rights or obligations. (Simonetti v.
Marapao, A.C. No. 10297, March 09, 2022, Per Dimaampao, J.)

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. 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.
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. 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. Thus, the duty of a lawyer to preserve his
client’s secrets and confidence outlasts the termination of the attorney-client
relationship, and continues even after the client’s death. 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. 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.
(Mercado v. Vitriolo, A.C. No. 5108, May 26, 2005, Per Puno, J.)

1) Factors
Mercado v. Vitriolo, A.C. No. 5108, May 26, 2005, Per Puno, J.:

• 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.

• 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. 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.

• 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, 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. The client must intend the communication to be confidential.

• 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.

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, an offer and counter-offer for settlement, or a
document given by a client to his counsel not in his professional capacity, are not
privileged communications, the element of confidentiality not being present.

• (3) The legal advice must be sought from the attorney in his professional
capacity.

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.

• If the client seeks an accounting service, or business or personal assistance,

and not legal advice, the privilege does not attach to a communication disclosed
for such purpose.

2) Burden of proof: complainant

Mercado v. Vitriolo, A.C. No. 5108, May 26, 2005, Per Puno, J.:

• Applying [the above-mentioned rules on attorney-client privilege] 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. The burden of proving
that the privilege applies is placed upon the party asserting the privilege.

c. Client’s identity
Regala et al. v. Sandiganbayan, En Banc, G.R. No. 105938, September 20,
1996, Per Kapunan, J.:

• As a matter of public policy, a client’s identity should not be shrouded in

mystery. Under this premise, the general rule in our jurisdiction as well as in the
United States is that a lawyer may not invoke the privilege and refuse to divulge
the name or identity of this client.

• The reasons advanced for the general rule are well established.

• First, the court has a right to know that the client whose privileged information is
sought to be protected is flesh and blood.

• Second, the privilege begins to exist only after the attorney-client relationship
has been established. The attorney-client privilege does not attach until there is a
client.

• Third, the privilege generally pertains to the subject matter of the relationship.

• Finally, due process considerations require that the opposing party should, as a
general rule, know his adversary. “A party suing or sued is entitled to know who
his opponent is.” He cannot be obliged to grope in the dark against unknown
forces.

1) Exceptions
[I]nformation relating to the identity of a client may fall within the ambit of the
privilege when the client’s name itself has an independent significance, such that
disclosure would then reveal client confidences.(Regala et al. v.
Sandiganbayan, En Banc, G.R. No. 105938, September 20, 1996, Per
Kapunan, J.)

Regala et al. v. Sandiganbayan, En Banc, G.R. No. 105938, September 20,

1996, Per Kapunan, J.:

• Notwithstanding these considerations, the general rule is however qualified by

some important exceptions.
• 1) Client identity is privileged where a strong probability exists that revealing the
client’s name would implicate that client in the very activity for which he sought
the lawyer’s advice.

In Ex-Parte Enzor, a state supreme court reversed a lower court order requiring a
lawyer to divulge the name of her client on the ground that the subject matter of
the relationship was so closely related to the issue of the client’s identity that the
privilege actually attached to both. In Enzor, the unidentified client, an election
official, informed his attorney in confidence that he had been offered a bribe to
violate election laws or that he had accepted a bribe to that end. In her testimony,
the attorney revealed that she had advised her client to count the votes correctly,
but averred that she could not remember whether her client had been, in fact,
bribed. The lawyer was cited for contempt for her refusal to reveal his client’s
identity before a grand jury. Reversing the lower court’s contempt orders, the
state supreme court held that under the circumstances of the case, and under
the exceptions described above, even the name of the client was privileged.

• U.S. v. Hodge and Zweig, involved the same exception, i.e. that client identity is
privileged in those instances where a strong probability exists that the disclosure
of the client’s identity would implicate the client in the very criminal activity for
which the lawyer’s legal advice was obtained.

The Hodge case involved federal grand jury proceedings inquiring into the
activities of the “Sandino Gang,” a gang involved in the illegal importation of
drugs in the United States. The respondents, law partners, represented key
witnesses and suspects including the leader of the gang, Joe Sandino.

• In connection with a tax investigation in November of 1973, the IRS issued

summons to Hodge and Zweig, requiring them to produce documents and
information regarding payment received by Sandino on behalf of any other
person, and vice versa. The lawyers refused to divulge the names. The Ninth
Circuit of the United States Court of Appeals, upholding non-disclosure under the
facts and circumstances of the case, held:

A client’s identity and the nature of that client’s fee arrangements may be
privileged where the person invoking the privilege can show that a strong
probability exists that disclosure of such information would implicate that client in
the very criminal activity for which legal advice was sought Baird v. Koerner, 279
F. 2d at 680. While in Baird Owe enunciated this rule as a matter of California
law, the rule also reflects federal law. Appellants contend that the Baird exception
applies to this case.
The Baird exception is entirely consonant with the principal policy behind the
attorney-client privilege. “In order to promote freedom of consultation of legal
advisors by clients, the apprehension of compelled disclosure from the legal
advisors must be removed; hence, the law must prohibit such disclosure except
on the client’s consent.” J. Wigmore, supra sec. 2291, at 545. In furtherance of
this policy, the client’s identity and the nature of his fee arrangements are, in
exceptional cases, protected as confidential communications.

• 2) Where disclosure would open the client to civil liability; his identity is
privileged. For instance, the peculiar facts and circumstances of Neugass v.
Terminal Cab Corporation, prompted the New York Supreme Court to allow a
lawyer’s claim to the effect that he could not reveal the name of his client
because this would expose the latter to civil litigation.

• In the said case, Neugass, the plaintiff, suffered injury when the taxicab she
was riding, owned by respondent corporation, collided with a second taxicab,
whose owner was unknown. Plaintiff brought action both against defendant
corporation and the owner of the second cab, identified in the information only as
John Doe. It turned out that when the attorney of defendant corporation appeared
on preliminary examination, the fact was somehow revealed that the lawyer
came to know the name of the owner of the second cab when a man, a client of
the insurance company, prior to the institution of legal action, came to him and
reported that he was involved in a car accident. It was apparent under the
circumstances that the man was the owner of the second cab. The state
supreme court held that the reports were clearly made to the lawyer in his
professional capacity. The court said:

That his employment came about through the fact that the insurance company
had hired him to defend its policyholders seems immaterial. The attorney is such
cases is clearly the attorney for the policyholder when the policyholder goes to
him to report an occurrence contemplating that it would be used in an action or
claim against him.

xxx xxx xxx

All communications made by a client to his counsel, for the purpose of

professional advice or assistance, are privileged, whether they relate to a suit
pending or contemplated, or to any other matter proper for such advice or aid; …
And whenever the communication made, relates to a matter so connected with
the employment as attorney or counsel as to afford presumption that it was the
ground of the address by the client, then it is privileged from disclosure…
It appears… that the name and address of the owner of the second cab came to
the attorney in this case as a confidential communication. His client is not
seeking to use the courts, and his address cannot be disclosed on that theory,
nor is the present action pending against him as service of the summons on him
has not been effected. The objections on which the court reserved decision are
sustained.

• In the case of Matter of Shawmut Mining Company, the lawyer involved was
required by a lower court to disclose whether he represented certain clients in a
certain transaction. The purpose of the court’s request was to determine whether
the unnamed persons as interested parties were connected with the purchase of
properties involved in the action. The lawyer refused and brought the question to
the State Supreme Court. Upholding the lawyer’s refusal to divulge the names of
his clients the court held:

If it can compel the witness to state, as directed by the order appealed from, that
he represented certain persons in the purchase or sale of these mines, it has
made progress in establishing by such evidence their version of the litigation. As
already suggested, such testimony by the witness would compel him to disclose
not only that he was attorney for certain people, but that, as the result of
communications made to him in the course of such employment as such
attorney, he knew that they were interested in certain transactions. We feel sure
that under such conditions no case has ever gone to the length of compelling an
attorney, at the instance of a hostile litigant, to disclose not only his retainer, but
the nature of the transactions to which it related, when such information could be
made the basis of a suit against his client.

• 3) Where the government’s lawyers have no case against an attorney’s client

unless, by revealing the client’s name, the said name would furnish the only link
that would form the chain of testimony necessary to convict an individual of a
crime, the client’s name is privileged.

In Baird vs. Korner, a lawyer was consulted by the accountants and the lawyer of
certain undisclosed taxpayers regarding steps to be taken to place the
undisclosed taxpayers in a favorable position in case criminal charges were
brought against them by the U.S. Internal Revenue Service (IRS).

• It appeared that the taxpayers’ returns of previous years were probably

incorrect and the taxes understated. The clients themselves were unsure about
whether or not they violated tax laws and sought advice from Baird on the
hypothetical possibility that they had. No investigation was then being undertaken
by the IRS of the taxpayers. Subsequently, the attorney of the taxpayers
delivered to Baird the sum of $12, 706.85, which had been previously assessed
as the tax due, and another amount of money representing his fee for the advice
given. Baird then sent a check for $12,706.85 to the IRS in Baltimore, Maryland,
with a note explaining the payment, but without naming his clients. The IRS
demanded that Baird identify the lawyers, accountants, and other clients
involved. Baird refused on the ground that he did not know their names, and
declined to name the attorney and accountants because this constituted
privileged communication. A petition was filed for the enforcement of the IRS
summons. For Baird’s repeated refusal to name his clients he was found guilty of
civil contempt. The Ninth Circuit Court of Appeals held that, a lawyer could not be
forced to reveal the names of clients who employed him to pay sums of money to
the government voluntarily in settlement of undetermined income taxes, unsued
on, and with no government audit or investigation into that client’s income tax
liability pending. The court emphasized the exception that a client’s name is
privileged when so much has been revealed concerning the legal services
rendered that the disclosure of the client’s identity exposes him to possible
investigation and sanction by government agencies. The Court held:

The facts of the instant case bring it squarely within that exception to the general
rule. Here money was received by the government, paid by persons who thereby
admitted they had not paid a sufficient amount in income taxes some one or
more years in the past. The names of the clients are useful to the government for
but one purpose — to ascertain which taxpayers think they were delinquent, so
that it may check the records for that one year or several years. The voluntary
nature of the payment indicates a belief by the taxpayers that more taxes or
interest or penalties are due than the sum previously paid, if any. It indicates a
feeling of guilt for nonpayment of taxes, though whether it is criminal guilt is
undisclosed. But it may well be the link that could form the chain of testimony
necessary to convict an individual of a federal crime. Certainly the payment and
the feeling of guilt are the reasons the attorney here involved was employed — to
advise his clients what, under the circumstances, should be done.

• Apart from these principal exceptions, there exist other situations which could
qualify as exceptions to the general rule.

• For example, the content of any client communication to a lawyer lies within the
privilege if it is relevant to the subject matter of the legal problem on which the
client seeks legal assistance. Moreover, where the nature of the attorney-client
relationship has been previously disclosed and it is the identity which is intended
to be confidential, the identity of the client has been held to be privileged, since
such revelation would otherwise result in disclosure of the entire transaction.

• Summarizing these exceptions, information relating to the identity of a client

may fall within the ambit of the privilege when the client’s name itself has an
independent significance, such that disclosure would then reveal client
confidences.

Fair and Reasonable Fees

Bihag v. Era
A.C. No. 12880 (November 23, 2021)
Atty. Edgardo O. Era was disbarred due to a complaint from Lanao del Norte Electric
Cooperative, which highlighted deceitful conduct, exorbitant fees, and unethical
practices, including extrinsic fraud. The case emphasized the essential role of
integrity and ethical standards in the legal profession.

Facts:

This case involves a verified complaint for disbarment filed by several

members of the Lanao del Norte Electric Cooperative (LANECO) against Atty.
Edgardo O. Era. In 2008, LANECO engaged Atty. Era’s services to challenge
the legality of the 1993 Provincial Tax Revenue Code of Lanao del Norte due
to alleged wrongful taxation on real property and franchise taxes. The Board
of Directors of LANECO, convinced of Atty. Era's qualifications, approved two
petitions that he prepared: one for declaratory relief concerning franchise
taxes and another for prohibition against real property taxes.

However, the complainants later discovered that Atty. Era only needed to file
one petition, as both cases were based on the same premise: the
unconstitutionality of the imposition of taxes under the 1993 Provincial Tax
Code. The legal fees charged by Atty. Era quickly drew scrutiny; he asked for
an acceptance fee of ₱300,000 for the declaratory relief and ₱700,000 for
the petition for prohibition, alongside additional fees that included pre-
success and success fees totaling millions. The complainants alleged that
these fees were exorbitantly high, especially given LANECO’s limited
financial resources.

As the situation progressed, Atty. Era claimed entitlement to a success fee

amounting to over ₱13 million after the Regional Trial Court ruled favorably.
This claim was eventually found to be erroneously inflated since the actual
assessed tax dues from LANECO were significantly lower. Tensions escalated
when Atty. Era's actions led to the garnishment of LANECO's funds without
the Board's knowledge, stemming from a collection case Atty. Era filed and a
dishonest course of dealings with the cooperative’s former general manager,
Engr. Resnol Torres.
The situation ultimately led to a series of complaints against Atty. Era for
unethical conduct, with accusations ranging from overcharging fees, filing
two separate petitions, failure to provide the engagement contract to the
Board, constitutional fraud in a collection suit, and continued representation
of LANECO after being terminated as its counsel.

Legal Issues:

The central legal issues in this case include:

1. Whether Atty. Edgardo O. Era engaged in deceitful and unethical conduct in

his legal representation of LANECO.
2. Whether his charging of legal fees, including success fees, amounted to
overreaching and constituted grounds for disbarment.
3. Whether Atty. Era's actions violated the Code of Professional Responsibility
(CPR) and the applicable Rules of Court.

Arguments of Both Sides:

 Complainants' Arguments:
 They contended that Atty. Era acted deceitfully by unnecessarily
splitting the petitions, leading to inflated legal fees.
 His legal fees were grossly excessive, especially given LANECO's
financial struggles.
 They asserted that Atty. Era was complicit in defrauding the
cooperative through manipulative practices including changing the
dates on checks and filing a collection case without authorization from
the Board.

 Atty. Era's Defense:

 Atty. Era argued that the engagement contract was duly agreed upon
by the Board after review and that it was not coercively obtained.
 He maintained that the nature of the case justified the filing of two
separate petitions, asserting that they were distinct legal remedies.
 Atty. Era also claimed entitlement to the claimed success fees based
on accusations that there were greater sums at stake than were
reflected.

Court's Decision and Legal Reasoning:

The Integrated Bar of the Philippines (IBP) Commission on Bar Discipline

found Atty. Era guilty of violating several provisions of the CPR, specifically
those regarding professionalism, honesty, and fair dealing with clients.
Commissioner De la Rama recommended a two-year suspension, citing
multiple acts of deceit and violation of ethical rules in Atty. Era's handling of
the case.

However, the Supreme Court, upon reevaluation, determined that Atty. Era’s
actions constituted several serious breaches of ethical duties, including
extrinsic fraud and unprofessional conduct. These violations warranted
disbarment rather than a suspension.

The Court underscored that membership in the Bar carries obligations to

uphold legal integrity and trustworthiness, aging this was not aligned with
Atty. Era’s conduct, which had deleterious effects on public confidence in the
legal profession.

As a consequence, Atty. Era was disbarred and ordered to return excessive

fees charged to LANECO, emphasizing the principle that the legal profession
must be directed toward public service rather than profit.

Significant Legal Principles Established:

1. Ethical Standards of Lawyers: The case emphasizes the stringent ethical

obligations lawyers owe their clients, including transparency and fairness in
the billing of fees.
2. Disbarment as a Penalty: The case illustrates that repeated or severe
violations of the Code of Professional Responsibility can result in disbarment,
prioritizing the integrity of the profession over individual conduct.
3. Fraudulent Practices: The responsibility of legal professionals to avoid
deceitful practices not only protects clients but also sustains the legal
profession's credibility.

The ruling stands as a stark reminder to legal practitioners about the serious
repercussions of failure to adhere to ethical standards.