Pale 2nd Syllabus 10-17 PDF

1 | PALE |2SYLLABUS | CANON 10-17
Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-25291 January 30, 1971
THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES ASSOCIATION-NATU, FGU INSURANCE GROUP WORKERS
and EMPLOYEES ASSOCIATION-NATU, and INSULAR LIFE BUILDING EMPLOYEES ASSOCIATION-NATU, petitioners,
vs.
THE INSULAR LIFE ASSURANCE CO., LTD., FGU INSURANCE GROUP, JOSE M. OLBES and COURT OF INDUSTRIAL
RELATIONS, respondents.
Lacsina, Lontok and Perez and Luis F. Aquino for petitioners.
Francisco de los Reyes for respondent Court of Industrial Relations.
Araneta, Mendoza and Papa for other respondents.
CASTRO, J.:
Appeal, by certiorari to review a decision and a resolution en banc of the Court of Industrial Relations dated August
17, 1965 and October 20, 1965, respectively, in Case 1698-ULP.
The Insular Life Assurance Co., Ltd., Employees Association-NATU, FGU Insurance Group Workers & Employees
Association-NATU, and Insular Life Building Employees Association-NATU (hereinafter referred to as the Unions),
while still members of the Federation of Free Workers (FFW), entered into separate collective bargaining
agreements with the Insular Life Assurance Co., Ltd. and the FGU Insurance Group (hereinafter referred to as the
Companies).
Two of the lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter was formerly the secretary-
treasurer of the FFW and acting president of the Insular Life/FGU unions and the Insular Life Building Employees
Association. Garcia, as such acting president, in a circular issued in his name and signed by him, tried to dissuade
the members of the Unions from disaffiliating with the FFW and joining the National Association of Trade Unions
(NATU), to no avail.
Enaje and Garcia soon left the FFW and secured employment with the Anti-Dummy Board of the Department of
Justice. Thereafter, the Companies hired Garcia in the latter part of 1956 as assistant corporate secretary and legal
assistant in their Legal Department, and he was soon receiving P900 a month, or P600 more than he was receiving
from the FFW. Enaje was hired on or about February 19, 1957 as personnel manager of the Companies, and was
likewise made chairman of the negotiating panel for the Companies in the collective bargaining with the Unions.
In a letter dated September 16, 1957, the Unions jointly submitted proposals to the Companies for a modified
renewal of their respective collective bargaining contracts which were then due to expire on September 30, 1957.
The parties mutually agreed and to make whatever benefits could be agreed upon retroactively effective October
1, 1957.
Thereafter, in the months of September and October 1957 negotiations were conducted on the Union's proposals,
but these were snagged by a deadlock on the issue of union shop, as a result of which the Unions filed on January
27, 1958 a notice of strike for "deadlock on collective bargaining." Several conciliation conferences were held
under the auspices of the Department of Labor wherein the conciliators urged the Companies to make reply to the
Unions' proposals en toto so that the said Unions might consider the feasibility of dropping their demand for union
security in exchange for other benefits. However, the Companies did not make any counter-proposals but, instead,
insisted that the Unions first drop their demand for union security, promising money benefits if this was done.
Thereupon, and prior to April 15, 1958, the petitioner Insular Life Building Employees Association-NATU dropped
this particular demand, and requested the Companies to answer its demands, point by point, en toto. But the
respondent Insular Life Assurance Co. still refused to make any counter-proposals. In a letter addressed to the two
other Unions by the joint management of the Companies, the former were also asked to drop their union security
demand, otherwise the Companies "would no longer consider themselves bound by the commitment to make
money benefits retroactive to October 1, 1957." By a letter dated April 17, 1958, the remaining two petitioner
unions likewise dropped their demand for union shop. April 25, 1958 then was set by the parties to meet and
discuss the remaining demands.
From April 25 to May 6, 1958, the parties negotiated on the labor demands but with no satisfactory result due to a
stalemate on the matter of salary increases. On May 13, 1958 the Unions demanded from the Companies final
counter-proposals on their economic demands, particularly on salary increases. Instead of giving counter-
proposals, the Companies on May 15, 1958 presented facts and figures and requested the Unions to submit a
workable formula which would justify their own proposals, taking into account the financial position of the former.
Forthwith the Unions voted to declare a strike in protest against what they considered the Companies' unfair labor
practices.
Meanwhile, eighty-seven (87) unionists were reclassified as supervisors without increase in salary nor in
responsibility while negotiations were going on in the Department of Labor after the notice to strike was served on
the Companies. These employees resigned from the Unions.
On May 20, 1958 the Unions went on strike and picketed the offices of the Insular Life Building at Plaza Moraga.
On May 21, 1958 the Companies through their acting manager and president, the respondent Jose M. Olbes
(hereinafter referred to as the respondent Olbes), sent to each of the strikers a letter (exhibit A) quoted verbatim
as follows:
We recognize it is your privilege both to strike and to conduct picketing.
However, if any of you would like to come back to work voluntarily, you may:
1. Advise the nearest police officer or security guard of your intention to do so.
2. Take your meals within the office.
3. Make a choice whether to go home at the end of the day or to sleep nights at the office where
comfortable cots have been prepared.
4. Enjoy free coffee and occasional movies.
5. Be paid overtime for work performed in excess of eight hours.
6. Be sure arrangements will be made for your families.

The decision to make is yours whether you still believe in the motives of the strike or in the
fairness of the Management.
The Unions, however, continued on strike, with the exception of a few unionists who were convinced to desist by
the aforesaid letter of May 21, 1958.
From the date the strike was called on May 21, 1958, until it was called off on May 31, 1958, some management
men tried to break thru the Unions' picket lines. Thus, on May 21, 1958 Garcia, assistant corporate secretary, and
Vicente Abella, chief of the personnel records section, respectively of the Companies, tried to penetrate the picket
lines in front of the Insular Life Building. Garcia, upon approaching the picket line, tossed aside the placard of a
picketer, one Paulino Bugay; a fight ensued between them, in which both suffered injuries. The Companies
organized three bus-loads of employees, including a photographer, who with the said respondent Olbes,
succeeded in penetrating the picket lines in front of the Insular Life Building, thus causing injuries to the picketers
and also to the strike-breakers due to the resistance offered by some picketers.
Alleging that some non-strikers were injured and with the use of photographs as evidence, the Companies then
filed criminal charges against the strikers with the City Fiscal's Office of Manila. During the pendency of the said
cases in the fiscal's office, the Companies likewise filed a petition for injunction with damages with the Court of
First Instance of Manila which, on the basis of the pendency of the various criminal cases against striking members
of the Unions, issued on May 31, 1958 an order restraining the strikers, until further orders of the said court, from
stopping, impeding, obstructing, etc. the free and peaceful use of the Companies' gates, entrance and driveway
and the free movement of persons and vehicles to and from, out and in, of the Companies' building.
On the same date, the Companies, again through the respondent Olbes, sent individually to the strikers a letter
(exhibit B), quoted hereunder in its entirety:
The first day of the strike was last 21 May 1958.
Our position remains unchanged and the strike has made us even more convinced of our
decision.
We do not know how long you intend to stay out, but we cannot hold your positions open for
long. We have continued to operate and will continue to do so with or without you.
If you are still interested in continuing in the employ of the Group Companies, and if there are no
criminal charges pending against you, we are giving you until 2 June 1958 to report for work at
the home office. If by this date you have not yet reported, we may be forced to obtain your
replacement.
Before, the decisions was yours to make.
So it is now.
Incidentally, all of the more than 120 criminal charges filed against the members of the Unions, except three (3),
were dismissed by the fiscal's office and by the courts. These three cases involved "slight physical injuries" against
one striker and "light coercion" against two others.
At any rate, because of the issuance of the writ of preliminary injunction against them as well as the ultimatum of
the Companies giving them until June 2, 1958 to return to their jobs or else be replaced, the striking employees
decided to call off their strike and to report back to work on June 2, 1958.
However, before readmitting the strikers, the Companies required them not only to secure clearances from the
City Fiscal's Office of Manila but also to be screened by a management committee among the members of which
were Enage and Garcia. The screening committee initially rejected 83 strikers with pending criminal charges.
However, all non-strikers with pending criminal charges which arose from the breakthrough incident were
readmitted immediately by the Companies without being required to secure clearances from the fiscal's office.
Subsequently, when practically all the strikers had secured clearances from the fiscal's office, the Companies
readmitted only some but adamantly refused readmission to 34 officials and members of the Unions who were
most active in the strike, on the ground that they committed "acts inimical to the interest of the respondents,"
without however stating the specific acts allegedly committed. Among those who were refused readmission are
Emiliano Tabasondra, vice president of the Insular Life Building Employees' Association-NATU; Florencio Ibarra,
president of the FGU Insurance Group Workers & Employees Association-NATU; and Isagani Du Timbol, acting
president of the Insular Life Assurance Co., Ltd. Employees Association-NATU. Some 24 of the above number were
ultimately notified months later that they were being dismissed retroactively as of June 2, 1958 and given
separation pay checks computed under Rep. Act 1787, while others (ten in number) up to now have not been
readmitted although there have been no formal dismissal notices given to them.
On July 29, 1958 the CIR prosecutor filed a complaint for unfair labor practice against the Companies under
Republic Act 875. The complaint specifically charged the Companies with (1) interfering with the members of the
Unions in the exercise of their right to concerted action, by sending out individual letters to them urging them to
abandon their strike and return to work, with a promise of comfortable cots, free coffee and movies, and paid
overtime, and, subsequently, by warning them that if they did not return to work on or before June 2, 1958, they
might be replaced; and (2) discriminating against the members of the Unions as regards readmission to work after
the strike on the basis of their union membership and degree of participation in the strike.
On August 4, 1958 the Companies filed their answer denying all the material allegations of the complaint, stating
special defenses therein, and asking for the dismissal of the complaint.
After trial on the merits, the Court of Industrial Relations, through Presiding Judge Arsenio Martinez, rendered on
August 17, 1965 a decision dismissing the Unions' complaint for lack of merit. On August 31, 1965 the Unions
seasonably filed their motion for reconsideration of the said decision, and their supporting memorandum on
September 10, 1965. This was denied by the Court of Industrial Relations en banc in a resolution promulgated on
October 20, 1965.
Hence, this petition for review, the Unions contending that the lower court erred:
1. In not finding the Companies guilty of unfair labor practice in sending out individually to the
strikers the letters marked Exhibits A and B;
2. In not finding the Companies guilty of unfair labor practice for discriminating against the
striking members of the Unions in the matter of readmission of employees after the strike;
3. In not finding the Companies guilty of unfair labor practice for dismissing officials and
members of the Unions without giving them the benefit of investigation and the opportunity to
present their side in regard to activities undertaken by them in the legitimate exercise of their
right to strike; and
4. In not ordering the reinstatement of officials and members of the Unions, with full back wages,
from June 2, 1958 to the date of their actual reinstatement to their usual employment.
I. The respondents contend that the sending of the letters, exhibits A and B, constituted a legitimate exercise of
their freedom of speech. We do not agree. The said letters were directed to the striking employees individually
by registered special delivery mail at that without being coursed through the Unions which were representing
the employees in the collective bargaining.
The act of an employer in notifying absent employees individually during a strike following
unproductive efforts at collective bargaining that the plant would be operated the next day and
that their jobs were open for them should they want to come in has been held to be an unfair
labor practice, as an active interference with the right of collective bargaining through dealing
with the employees individually instead of through their collective bargaining representatives.
(31 Am. Jur. 563, citing NLRB v. Montgomery Ward & Co. [CA 9th] 133 F2d 676, 146 ALR 1045)
Indeed, it is an unfair labor practice for an employer operating under a collective bargaining agreement to
negotiate or to attempt to negotiate with his employees individually in connection with changes in the agreement.
And the basis of the prohibition regarding individual bargaining with the strikers is that although the union is on
strike, the employer is still under obligation to bargain with the union as the employees' bargaining representative
(Melo Photo Supply Corporation vs. National Labor Relations Board, 321 U.S. 332).
Indeed, some such similar actions are illegal as constituting unwarranted acts of interference. Thus, the act of a
company president in writing letters to the strikers, urging their return to work on terms inconsistent with their
union membership, was adjudged as constituting interference with the exercise of his employees' right to
collective bargaining (Lighter Publishing, CCA 7th, 133 F2d 621). It is likewise an act of interference for the
employer to send a letter to all employees notifying them to return to work at a time specified therein, otherwise
new employees would be engaged to perform their jobs. Individual solicitation of the employees or visiting their
homes, with the employer or his representative urging the employees to cease union activity or cease striking,
constitutes unfair labor practice. All the above-detailed activities are unfair labor practices because they tend to
undermine the concerted activity of the employees, an activity to which they are entitled free from the employer's
molestation.1
Moreover, since exhibit A is a letter containing promises of benefits to the employees in order to entice them to
return to work, it is not protected by the free speech provisions of the Constitution (NLRB v. Clearfield Cheese Co.,
Inc., 213 F2d 70). The same is true with exhibit B since it contained threats to obtain replacements for the striking
employees in the event they did not report for work on June 2, 1958. The free speech protection under the
Constitution is inapplicable where the expression of opinion by the employer or his agent contains a promise of
benefit, or threats, or reprisal (31 Am. Jur. 544; NLRB vs. Clearfield Cheese Co., Inc., 213 F2d 70; NLRB vs. Goigy
Co., 211 F2d 533, 35 ALR 2d 422).
Indeed, when the respondents offered reinstatement and attempted to "bribe" the strikers with "comfortable
cots," "free coffee and occasional movies," "overtime" pay for "work performed in excess of eight hours," and
"arrangements" for their families, so they would abandon the strike and return to work, they were guilty of strike-
breaking and/or union-busting and, consequently, of unfair labor practice. It is equivalent to an attempt to break a
strike for an employer to offer reinstatement to striking employees individually, when they are represented by a
union, since the employees thus offered reinstatement are unable to determine what the consequences of
returning to work would be.
Likewise violative of the right to organize, form and join labor organizations are the following acts: the offer of a
Christmas bonus to all "loyal" employees of a company shortly after the making of a request by the union to
bargain; wage increases given for the purpose of mollifying employees after the employer has refused to bargain
with the union, or for the purpose of inducing striking employees to return to work; the employer's promises of
benefits in return for the strikers' abandonment of their strike in support of their union; and the employer's
statement, made about 6 weeks after the strike started, to a group of strikers in a restaurant to the effect that if
the strikers returned to work, they would receive new benefits in the form of hospitalization, accident insurance,
profit-sharing, and a new building to work in.2
Citing paragraph 5 of the complaint filed by the acting prosecutor of the lower court which states that "the officers
and members of the complainant unions decided to call off the strike and return to work on June 2, 1958 by reason
of the injunction issued by the Manila Court of First Instance," the respondents contend that this was the main
cause why the strikers returned to work and not the letters, exhibits A and B. This assertion is without merit. The
circumstance that the strikers later decided to return to work ostensibly on account of the injunctive writ issued by
the Court of First Instance of Manila cannot alter the intrinsic quality of the letters, which were calculated, or
which tended, to interfere with the employees' right to engage in lawful concerted activity in the form of a strike.
Interference constituting unfair labor practice will not cease to be such simply because it was susceptible of being
thwarted or resisted, or that it did not proximately cause the result intended. For success of purpose is not, and
should not, be the criterion in determining whether or not a prohibited act constitutes unfair labor practice.
The test of whether an employer has interfered with and coerced employees within the meaning
of subsection (a) (1) is whether the employer has engaged in conduct which it may reasonably be
said tends to interfere with the free exercise of employees' rights under section 3 of the Act, and
it is not necessary that there be direct evidence that any employee was in fact intimidated or
coerced by statements of threats of the employer if there is a reasonable inference that anti-
union conduct of the employer does have an adverse effect on self-organization and collective
bargaining. (Francisco, Labor Laws 1956, Vol. II, p. 323, citing NLRB v. Ford, C.A., 1948, 170 F2d
735).
Besides, the letters, exhibits A and B, should not be considered by themselves alone but should be read in the light
of the preceding and subsequent circumstances surrounding them. The letters should be interpreted according to
the "totality of conduct doctrine,"
... whereby the culpability of an employer's remarks were to be evaluated not only on the basis
of their implicit implications, but were to be appraised against the background of and in
conjunction with collateral circumstances. Under this "doctrine" expressions of opinion by an
employer which, though innocent in themselves, frequently were held to be culpable because of
the circumstances under which they were uttered, the history of the particular employer's labor
relations or anti-union bias or because of their connection with an established collateral plan of
coercion or interference. (Rothenberg on Relations, p. 374, and cases cited therein.)
It must be recalled that previous to the petitioners' submission of proposals for an amended renewal of their
respective collective bargaining agreements to the respondents, the latter hired Felipe Enage and Ramon Garcia,
former legal counsels of the petitioners, as personnel manager and assistant corporate secretary, respectively,
with attractive compensations. After the notice to strike was served on the Companies and negotiations were in
progress in the Department of Labor, the respondents reclassified 87 employees as supervisors without increase in
salary or in responsibility, in effect compelling these employees to resign from their unions. And during the
negotiations in the Department of Labor, despite the fact that the petitioners granted the respondents' demand
that the former drop their demand for union shop and in spite of urgings by the conciliators of the Department of
Labor, the respondents adamantly refused to answer the Unions' demands en toto. Incidentally, Enage was the
chairman of the negotiating panel for the Companies in the collective bargaining between the former and the
Unions. After the petitioners went to strike, the strikers were individually sent copies of exhibit A, enticing them to
abandon their strike by inducing them to return to work upon promise of special privileges. Two days later, the
respondents, thru their president and manager, respondent Jose M. Olbes, brought three truckloads of non-
strikers and others, escorted by armed men, who, despite the presence of eight entrances to the three buildings
occupied by the Companies, entered thru only one gate less than two meters wide and in the process, crashed
thru the picket line posted in front of the premises of the Insular Life Building. This resulted in injuries on the part
of the picketers and the strike-breakers.lwph1.t Then the respondents brought against the picketers criminal
charges, only three of which were not dismissed, and these three only for slight misdemeanors. As a result of these
criminal actions, the respondents were able to obtain an injunction from the court of first instance restraining the
strikers from stopping, impeding, obstructing, etc. the free and peaceful use of the Companies' gates, entrance and
driveway and the free movement of persons and vehicles to and from, out and in, of the Companies' buildings. On
the same day that the injunction was issued, the letter, Exhibit B, was sent again individually and by registered
special delivery mail to the strikers, threatening them with dismissal if they did not report for work on or before
June 2, 1958. But when most of the petitioners reported for work, the respondents thru a screening committee
of which Ramon Garcia was a member refused to admit 63 members of the Unions on the ground of "pending
criminal charges." However, when almost all were cleared of criminal charges by the fiscal's office, the
respondents adamantly refused admission to 34 officials and union members. It is not, however, disputed that all-
non-strikers with pending criminal charges which arose from the breakthrough incident of May 23, 1958 were
readmitted immediately by the respondents. Among the non-strikers with pending criminal charges who were
readmitted were Generoso Abella, Enrique Guidote, Emilio Carreon, Antonio Castillo, Federico Barretto, Manuel
Chuidian and Nestor Cipriano. And despite the fact that the fiscal's office found no probable cause against the
petitioning strikers, the Companies adamantly refused admission to them on the pretext that they committed
"acts inimical to the interest of the respondents," without stating specifically the inimical acts allegedly committed.
They were soon to admit, however, that these alleged inimical acts were the same criminal charges which were
dismissed by the fiscal and by the courts..
Verily, the above actuations of the respondents before and after the issuance of the letters, exhibit A and B, yield
the clear inference that the said letters formed of the respondents scheme to preclude if not destroy unionism
within them.
To justify the respondents' threat to dismiss the strikers and secure replacements for them in order to protect and
continue their business, the CIR held the petitioners' strike to be an economic strike on the basis of exhibit 4
(Notice of Strike) which states that there was a "deadlock in collective bargaining" and on the strength of the
supposed testimonies of some union men who did not actually know the very reason for the strike. It should be
noted that exhibit 4, which was filed on January 27, 1958, states, inter alia:
TO: BUREAU OF LABOR RELATIONS

DEPARTMENT OF LABOR
MANILA
Thirty (30) days from receipt of this notice by the Office, this [sic] unions intends to go on strike
against
THE INSULAR LIFE ASSURANCE CO., LTD.

Plaza Moraga, Manila
THE FGU INSURANCE GROUP

Plaza Moraga, Manila
INSULAR LIFE BUILDING ADMINISTRATION

Plaza Moraga, Manila .
for the following reason: DEADLOCK IN COLLECTIVE BARGAINING...
However, the employees did not stage the strike after the thirty-day period, reckoned from January 27, 1958. This
simply proves that the reason for the strike was not the deadlock on collective bargaining nor any lack of economic
concessions. By letter dated April 15, 1958, the respondents categorically stated what they thought was the cause
of the "Notice of Strike," which so far as material, reads:
3. Because you did not see fit to agree with our position on the union shop, you filed a notice of
strike with the Bureau of Labor Relations on 27 January 1958, citing `deadlock in collective
bargaining' which could have been for no other issue than the union shop." (exhibit 8, letter
dated April 15, 1958.)
The strike took place nearly four months from the date the said notice of strike was filed. And the actual and main
reason for the strike was, "When it became crystal clear the management double crossed or will not negotiate in
good faith, it is tantamount to refusal collectively and considering the unfair labor practice in the meantime being
committed by the management such as the sudden resignation of some unionists and [who] became supervisors
without increase in salary or change in responsibility, such as the coercion of employees, decided to declare the
strike." (tsn., Oct. 14, 1958, p. 14.) The truth of this assertion is amply proved by the following circumstances: (1) it
took the respondents six (6) months to consider the petitioners' proposals, their only excuse being that they could
not go on with the negotiations if the petitioners did not drop the demand for union shop (exh. 7, respondents'
letter dated April 7, 1958); (2) when the petitioners dropped the demand for union shop, the respondents did not
have a counter-offer to the petitioners' demands. Sec. 14 of Rep. Act 875 required the respondents to make a
reply to the petitioners' demands within ten days from receipt thereof, but instead they asked the petitioners to
give a "well reasoned, workable formula which takes into account the financial position of the group companies."
(tsn., Sept. 8, 1958, p. 62; tsn., Feb. 26, 1969, p. 49.)
II. Exhibit H imposed three conditions for readmission of the strikers, namely: (1) the employee must be interested
in continuing his work with the group companies; (2) there must be no criminal charges against him; and (3) he
must report for work on June 2, 1958, otherwise he would be replaced. Since the evidence shows that all the
employees reported back to work at the respondents' head office on June 2, 1953, they must be considered as
having complied with the first and third conditions.
Our point of inquiry should therefore be directed at whether they also complied with the second condition. It is
not denied that when the strikers reported for work on June 2, 1958, 63 members of the Unions were refused
readmission because they had pending criminal charges. However, despite the fact that they were able to secure
their respective clearances 34 officials and union members were still refused readmission on the alleged ground
that they committed acts inimical to the Companies. It is beyond dispute, however, that non-strikers who also had
criminal charges pending against them in the fiscal's office, arising from the same incidents whence the criminal
charges against the strikers evolved, were readily readmitted and were not required to secure clearances. This is a
clear act of discrimination practiced by the Companies in the process of rehiring and is therefore a violation of sec.
4(a) (4) of the Industrial Peace Act.
The respondents did not merely discriminate against all the strikers in general. They separated the active from the
less active unionists on the basis of their militancy, or lack of it, on the picket lines. Unionists belonging to the first
category were refused readmission even after they were able to secure clearances from the competent authorities
with respect to the criminal charges filed against them. It is significant to note in this connection that except for
one union official who deserted his union on the second day of the strike and who later participated in crashing
through the picket lines, not a single union officer was taken back to work. Discrimination undoubtedly exists
where the record shows that the union activity of the rehired strikers has been less prominent than that of the
strikers who were denied reinstatement.
So is there an unfair labor practice where the employer, although authorized by the Court of
Industrial Relations to dismiss the employees who participated in an illegal strike, dismissed only
the leaders of the strikers, such dismissal being evidence of discrimination against those
dismissed and constituting a waiver of the employer's right to dismiss the striking employees and
a condonation of the fault committed by them." (Carlos and Fernando, Labor and Social
Legislation, p. 62, citing Phil. Air Lines, Inc. v. Phil. Air Lines Emloyees Association, L-8197, Oct. 31,
1958.)
It is noteworthy that perhaps in an anticipatory effort to exculpate themselves from charges of discrimination in
the readmission of strikers returning to work the respondents delegated the power to readmit to a committee.
But the respondent Olbes had chosen Vicente Abella, chief of the personnel records section, and Ramon Garcia,
assistant corporate secretary, to screen the unionists reporting back to work. It is not difficult to imagine that
these two employees having been involved in unpleasant incidents with the picketers during the strike were
hostile to the strikers. Needless to say, the mere act of placing in the hands of employees hostile to the strikers the
power of reinstatement, is a form of discrimination in rehiring.
Delayed reinstatement is a form of discrimination in rehiring, as is having the machinery of

reinstatement in the hands of employees hostile to the strikers, and reinstating a union official
who formerly worked in a unionized plant, to a job in another mill, which was imperfectly
organized. (Morabe, The Law on Strikes, p. 473, citing Sunshine Mining Co., 7 NLRB 1252;
Cleveland Worsted Mills, 43 NLRB 545; emphasis supplied.)
Equally significant is the fact that while the management and the members of the screening committee admitted
the discrimination committed against the strikers, they tossed back and around to each other the responsibility for
the discrimination. Thus, Garcia admitted that in exercising for the management the authority to screen the
returning employees, the committee admitted the non-strikers but refused readmission to the strikers (tsn., Feb.
6, 1962, pp. 15-19, 23-29). Vicente Abella, chairman of the management's screening committee, while admitting
the discrimination, placed the blame therefor squarely on the management (tsn., Sept. 20, 1960, pp. 7-8, 14-18).
But the management, speaking through the respondent Olbes, head of the Companies, disclaimed responsibility
for the discrimination. He testified that "The decision whether to accept or not an employee was left in the hands
of that committee that had been empowered to look into all cases of the strikers." (tsn., Sept. 6, 1962, p. 19.)
Of course, the respondents through Ramon Garcia tried to explain the basis for such discrimination by
testifying that strikers whose participation in any alleged misconduct during the picketing was not serious in nature
were readmissible, while those whose participation was serious were not. (tsn., Aug. 4, 1961, pp. 48-49, 56). But
even this distinction between acts of slight misconduct and acts of serious misconduct which the respondents
contend was the basis for either reinstatement or discharge, is completely shattered upon a cursory examination
of the evidence on record. For with the exception of Pascual Esquillo whose dismissal sent to the other strikers
cited the alleged commission by them of simple "acts of misconduct."
III. Anent the third assignment of error, the record shows that not a single dismissed striker was given the
opportunity to defend himself against the supposed charges against him. As earlier mentioned, when the striking
employees reported back for work on June 2, 1958, the respondents refused to readmit them unless they first
secured the necessary clearances; but when all, except three, were able to secure and subsequently present the
required clearances, the respondents still refused to take them back. Instead, several of them later received letters
from the respondents in the following stereotyped tenor:
This will confirm the termination of your employment with the Insular Life-FGU Insurance Group
as of 2 June 1958.
The termination of your employment was due to the fact that you committed acts of misconduct
while picketing during the last strike. Because this may not constitute sufficient cause under the
law to terminate your employment without pay, we are giving you the amount of P1,930.32
corresponding to one-half month pay for every year of your service in the Group Company.
Kindly acknowledge receipt of the check we are sending herewith.
Very truly yours,

(Sgd.) JOSE M. OLBES

President, Insurance Life
Acting President, FGU.
The respondents, however, admitted that the alleged "acts of misconduct" attributed to the dismissed strikers
were the same acts with which the said strikers were charged before the fiscal's office and the courts. But all these
charges except three were dropped or dismissed.
Indeed, the individual cases of dismissed officers and members of the striking unions do not indicate sufficient
basis for dismissal.
Emiliano Tabasondra, vice-president of the petitioner FGU Insurance Group Workers & Employees Association-
NATU, was refused reinstatement allegedly because he did not report for duty on June 2, 1958 and, hence, had
abandoned his office. But the overwhelming evidence adduced at the trial and which the respondents failed to
rebut, negates the respondents' charge that he had abandoned his job. In his testimony, corroborated by many
others, Tabasondra particularly identified the management men to whom he and his group presented themselves
on June 2, 1958. He mentioned the respondent Olbes' secretary, De Asis, as the one who received them and later
directed them when Olbes refused them an audience to Felipe Enage, the Companies' personnel manager.
He likewise categorically stated that he and his group went to see Enage as directed by Olbes' secretary. If
Tabasondra were not telling the truth, it would have been an easy matter for the respondents to produce De Asis
and Enage who testified anyway as witnesses for the respondents on several occasions to rebut his
testimony. The respondents did nothing of the kind. Moreover, Tabasondra called on June 21, 1958 the
respondents' attention to his non-admission and asked them to inform him of the reasons therefor, but instead of
doing so, the respondents dismissed him by their letter dated July 10, 1958. Elementary fairness required that
before being dismissed for cause, Tabasondra be given "his day in court."
At any rate, it has been held that mere failure to report for work after notice to return, does not constitute
abandonment nor bar reinstatement. In one case, the U.S. Supreme Court held that the taking back of six of eleven
men constituted discrimination although the five strikers who were not reinstated, all of whom were prominent in
the union and in the strike, reported for work at various times during the next three days, but were told that there
were no openings. Said the Court:
... The Board found, and we cannot say that its finding is unsupported, that, in taking back six
union men, the respondent's officials discriminated against the latter on account of their union
activities and that the excuse given that they did not apply until after the quota was full was an
afterthought and not the true reason for the discrimination against them. (NLRB v. Mackay Radio
& Telegraph Co., 304 U.S. 333, 58 Sup. Ct. 904, 82 L. Ed. 1381) (Mathews, Labor Relations and the
Law, p. 725, 728)
The respondents' allegation that Tabasondra should have returned after being refused readmission on June 2,
1958, is not persuasive. When the employer puts off reinstatement when an employee reports for work at the
time agreed, we consider the employee relieved from the duty of returning further.
Sixto Tongos was dismissed allegedly because he revealed that despite the fact that the Companies spent more
than P80,000 for the vacation trips of officials, they refused to grant union demands; hence, he betrayed his trust
as an auditor of the Companies. We do not find this allegation convincing. First, this accusation was emphatically
denied by Tongos on the witness stand. Gonzales, president of one of the respondent Companies and one of the
officials referred to, took a trip abroad in 1958. Exchange controls were then in force, and an outgoing traveller on
a combined business and vacation trip was allowed by the Central Bank, per its Circular 52 (Notification to
Authorized Agent Banks) dated May 9, 1952, an allocation of $1,000 or only P2,000, at the official rate of two
pesos to the dollar, as pocket money; hence, this was the only amount that would appear on the books of the
Companies. It was only on January 21, 1962, per its Circular 133 (Notification to Authorized Agent Banks), that the
Central Bank lifted the exchange controls. Tongos could not therefore have revealed an amount bigger than the
above sum. And his competence in figures could not be doubted considering that he had passed the board
examinations for certified public accountants. But assuming arguendo that Tongos indeed revealed the true
expenses of Gonzales' trip which the respondents never denied or tried to
disprove his statements clearly fall within the sphere of a unionist's right to discuss and advertise the facts
involved in a labor dispute, in accordance with section 9(a)(5) of Republic Act 875 which guarantees the
untramelled exercise by striking employees of the right to give "publicity to the existence of, or the fact involved in
any labor dispute, whether by advertising, speaking, patrolling or by any method not involving fraud or violence."
Indeed, it is not only the right, it is as well the duty, of every unionist to advertise the facts of a dispute for the
purpose of informing all those affected thereby. In labor disputes, the combatants are expected to expose the
truth before the public to justify their respective demands. Being a union man and one of the strikers, Tongos was
expected to reveal the whole truth on whether or not the respondent Companies were justified in refusing to
accede to union demands. After all, not being one of the supervisors, he was not a part of management. And his
statement, if indeed made, is but an expression of free speech protected by the Constitution.
Free speech on both sides and for every faction on any side of the labor relation is to me a
constitutional and useful right. Labor is free ... to turn its publicity on any labor oppression,
substandard wages, employer unfairness, or objectionable working conditions. The employer,
too, should be free to answer and to turn publicity on the records of the leaders of the unions
which seek the confidence of his men ... (Concurring opinion of Justice Jackson in Thomas v.
Collins, 323 U.S. 516, 547, 65 Sup. Ct. 315, 89 L. Ed. 430.) (Mathews, Labor Relations and the Law,
p. 591.)
The respondents also allege that in revealing certain confidential information, Tongos committed not only a
betrayal of trust but also a violation of the moral principles and ethics of accountancy. But nowhere in the Code of
Ethics for Certified Public Accountants under the Revised Rules and Regulations of the Board of Accountancy
formulated in 1954, is this stated. Moreover, the relationship of the Companies with Tongos was that of an
employer and not a client. And with regard to the testimonies of Juan Raymundo and Antolin Carillo, both vice-
presidents of the Trust Insurance Agencies, Inc. about the alleged utterances made by Tongos, the lower court
should not have given them much weight. The firm of these witnesses was newly established at that time and was
still a "general agency" of the Companies. It is not therefore amiss to conclude that they were more inclined to
favor the respondents rather than Tongos.
Pacifico Ner, Paulino Bugay, Jose Garcia, Narciso Dao, Vicente Alsol and Hermenigildo Ramirez, opined the lower
court, were constructively dismissed by non-readmission allegedly because they not only prevented Ramon Garcia,
assistant corporate secretary, and Vicente Abella, chief of the personnel records section of the Companies, from
entering the Companies' premises on May 21, 1958, but they also caused bruises and abrasions on Garcia's chest
and forehead acts considered inimical to the interest of the respondents. The Unions, upon the other hand,
insist that there is complete lack of evidence that Ner took part in pushing Garcia; that it was Garcia who elbowed
his way through the picket lines and therefore Ner shouted "Close up," which the picketers did; and that Garcia
tossed Paulino Bugay's placard and a fight ensued between them in which both suffered injuries. But despite these
conflicting versions of what actually happened on May 21, 1958, there are grounds to believe that the picketers
are not responsible for what happened.lwph1.t The picketing on May 21, 1958, as reported in the police
blotter, was peaceful (see Police blotter report, exh. 3 in CA-G.R. No. 25991-R of the Court of Appeals, where Ner
was acquitted). Moreover, although the Companies during the strike were holding offices at the Botica Boie
building at Escolta, Manila; Tuason Building at San Vicente Street, Manila; and Ayala, Inc. offices at Makati, Rizal,
Garcia, the assistant corporate secretary, and Abella, the chief of the personnel records section, reported for work
at the Insular Life Building. There is therefore a reasonable suggestion that they were sent to work at the latter
building to create such an incident and have a basis for filing criminal charges against the petitioners in the fiscal's
office and applying for injunction from the court of first instance. Besides, under the circumstances the picketers
were not legally bound to yield their grounds and withdraw from the picket lines. Being where the law expects
them to be in the legitimate exercise of their rights, they had every reason to defend themselves and their rights
from any assault or unlawful transgression. Yet the police blotter, about adverted to, attests that they did not
resort to violence.
The heated altercations and occasional blows exchanged on the picket line do not affect or diminish the right to
strike. Persuasive on this point is the following commentary: .
We think it must be conceded that some disorder is unfortunately quite usual in any extensive or
long drawn out strike. A strike is essentially a battle waged with economic weapons. Engaged in it
are human beings whose feelings are stirred to the depths. Rising passions call forth hot words.
Hot words lead to blows on the picket line. The transformation from economic to physical
combat by those engaged in the contest is difficult to prevent even when cool heads direct the
fight. Violence of this nature, however much it is to be regretted, must have been in the
contemplation of the Congress when it provided in Sec. 13 of Act 29 USCA Sec. 163, that nothing
therein should be construed so as to interfere with or impede or diminish in any way the right to
strike. If this were not so, the rights afforded to employees by the Act would indeed be illusory.
We accordingly recently held that it was not intended by the Act that minor disorders of this
nature would deprive a striker of the possibility of reinstatement. (Republic Steel Corp. v. N. L. R.
B., 107 F2d 472, cited in Mathews, Labor Relations and the Law, p. 378)
Hence the incident that occurred between Ner, et al. and Ramon Garcia was but a necessary incident of the strike
and should not be considered as a bar to reinstatement. Thus it has been held that:
Fist-fighting between union and non-union employees in the midst of a strike is no bar to reinstatement. (Teller,
Labor Disputes and Collective Bargaining, Vol. II, p. 855 citing Stackpole Carbon, Co. 6 NLRB 171, enforced 105 F2d
167.)
Furthermore, assuming that the acts committed by the strikers were transgressions of law, they amount only to
mere ordinary misdemeanors and are not a bar to reinstatement.
In cases involving misdemeanors the board has generally held that unlawful acts are not bar to reinstatement.
(Teller, Labor Disputes and Collective Bargaining, Id., p. 854, citing Ford Motor Company, 23 NLRB No. 28.)
Finally, it is not disputed that despite the pendency of criminal charges against non-striking employees before the
fiscal's office, they were readily admitted, but those strikers who had pending charges in the same office were
refused readmission. The reinstatement of the strikers is thus in order.
[W]here the misconduct, whether in reinstating persons equally guilty with those whose
reinstatement is opposed, or in other ways, gives rise to the inference that union activities rather
than misconduct is the basis of his [employer] objection, the Board has usually required
reinstatement." (Teller, supra, p. 853, citing the Third Annual Report of NLRB [1938], p. 211.)
Lastly, the lower Court justified the constructive dismissal of Florencio Ibarra allegedly because he committed acts
inimical to the interest of the respondents when, as president of the FGU Workers and Employees Association-
NATU, he advised the strikers that they could use force and violence to have a successful picket and that picketing
was precisely intended to prevent the non-strikers and company clients and customers from entering the
Companies' buildings. Even if this were true, the record discloses that the picket line had been generally peaceful,
and that incidents happened only when management men made incursions into and tried to break the picket line.
At any rate, with or without the advice of Ibarra, picketing is inherently explosive. For, as pointed out by one
author, "The picket line is an explosive front, charged with the emotions and fierce loyalties of the union-
management dispute. It may be marked by colorful name-calling, intimidating threats or sporadic fights between
the pickets and those who pass the line." (Mathews, Labor Relations and the Law, p. 752). The picket line being the
natural result of the respondents' unfair labor practice, Ibarra's misconduct is at most a misdemeanor which is not
a bar to reinstatement. Besides, the only evidence presented by the Companies regarding Ibarra's participation in
the strike was the testimony of one Rodolfo Encarnacion, a former member of the board of directors of the
petitioner FGU Insurance Group Workers and Employees Union-NATU, who became a "turncoat" and who likewise
testified as to the union activities of Atty. Lacsina, Ricardo Villaruel and others (annex C, Decision, p. 27) another
matter which emphasizes the respondents' unfair labor practice. For under the circumstances, there is good
ground to believe that Encarnacion was made to spy on the actvities of the union members. This act of the
respondents is considered unjustifiable interference in the union activities of the petitioners and is unfair labor
practice.
It has been held in a great number of decisions at espionage by an employer of union activities,
or surveillance thereof, are such instances of interference, restraint or coercion of employees in
connection with their right to organize, form and join unions as to constitute unfair labor
practice.
... "Nothing is more calculated to interfere with, restrain and coerce employees in the exercise of
their right to self-organization than such activity even where no discharges result. The
information obtained by means of espionage is in valuable to the employer and can be used in a
variety of cases to break a union." The unfair labor practice is committed whether the espionage
is carried on by a professional labor spy or detective, by officials or supervisory employees of the
employer, or by fellow employees acting at the request or direction of the employer, or an ex-
employee..." (Teller, Labor Disputes and Collective Bargaining, Vol. II, pp. 765-766, and cases
cited.) .
IV. The lower court should have ordered the reinstatement of the officials and members of the Unions, with full
back wages from June 2, 1958 to the date of their actual reinstatement to their usual employment. Because all too
clear from the factual and environmental milieu of this case, coupled with settled decisional law, is that the Unions
went on strike because of the unfair labor practices committed by the respondents, and that when the strikers
reported back for work upon the invitation of the respondents they were discriminatorily dismissed. The
members and officials of the Unions therefore are entitled to reinstatement with back pay.
[W]here the strike was induced and provoked by improper conduct on the part of an employer
amounting to an 'unfair labor practice,' the strikers are entitled to reinstatement with back pay.
(Rothenberg on Labor Relations, p. 418.)
[A]n employee who has been dismissed in violation of the provisions of the Act is entitled to
reinstatement with back pay upon an adjudication that the discharge was illegal."
(Id., citing Waterman S. S. Corp. v. N. L. R. B., 119 F2d 760; N. L. R. B. v. Richter's Bakery, 140 F2d
870; N. L. R. B. v. Southern Wood Preserving Co., 135 F. 2d 606; C. G. Conn, Ltd. v. N. L. R. B., 108
F2d 390; N. L. R. B. v. American Mfg. Co., 106 F2d 61; N. L. R. B. v. Kentucky Fire Brick Co., 99 F2d
99.)
And it is not a defense to reinstatement for the respondents to allege that the positions of these union members
have already been filled by replacements.
[W]here the employers' "unfair labor practice" caused or contributed to the strike or where the
'lock-out' by the employer constitutes an "unfair labor practice," the employer cannot
successfully urge as a defense that the striking or lock-out employees position has been filled by
replacement. Under such circumstances, if no job sufficiently and satisfactorily comparable to
that previously held by the aggrieved employee can be found, the employer must discharge the
replacement employee, if necessary, to restore the striking or locked-out worker to his old or
comparable position ... If the employer's improper conduct was an initial cause of the strike, all
the strikers are entitled to reinstatement and the dismissal of replacement employees wherever
necessary; ... . (Id., p. 422 and cases cited.)
A corollary issue to which we now address ourselves is, from what date should the backpay payable to the
unionists be computed? It is now a settled doctrine that strikers who are entitled to reinstatement are not entitled
to back pay during the period of the strike, even though it is caused by an unfair labor practice. However, if they
offer to return to work under the same conditions just before the strike, the refusal to re-employ or the imposition
of conditions amounting to unfair labor practice is a violation of section 4(a) (4) of the Industrial Peace Act and the
employer is liable for backpay from the date of the offer (Cromwell Commercial Employees and Laborers Union vs.
Court of Industrial Relations, L-19778, Decision, Sept. 30, 1964, 12 SCRA 124; Id., Resolution on motion for
reconsideration, 13 SCRA 258; see also Mathews, Labor Relations and the Law, p. 730 and the cited cases). We
have likewise ruled that discriminatorily dismissed employees must receive backpay from the date of the act of
discrimination, that is, from the date of their discharge (Cromwell Commercial Employees and Laborers Union vs.
Court of Industrial Relations, supra).
The respondents notified the petitioner strikers to report back for work on June 2, 1958, which the latter did. A
great number of them, however, were refused readmission because they had criminal charges against them
pending before the fiscal's office, although non-strikers who were also facing criminal indictments were readily
readmitted. These strikers who were refused readmission on June 2, 1958 can thus be categorized as
discriminatorily dismissed employees and are entitled to backpay from said date. This is true even with respect to
the petitioners Jose Pilapil, Paulino Bugay, Jr. and Jose Garcia, Jr. who were found guilty only of misdemeanors
which are not considered sufficient to bar reinstatement (Teller, Labor Disputes and Collective Bargaining, p. 854),
especially so because their unlawful acts arose during incidents which were provoked by the respondents' men.
However, since the employees who were denied readmission have been out of the service of the Companies (for
more than ten years) during which they may have found other employment or other means of livelihood, it is only
just and equitable that whatever they may have earned during that period should be deducted from their back
wages to mitigate somewhat the liability of the company, pursuant to the equitable principle that no one is
allowed to enrich himself at the expense of another (Macleod & Co. of the Philippines v. Progressive Federation of
Labor, 97 Phil. 205 [1955]).
The lower court gave inordinate significance to the payment to and acceptance by the dismissed employees of
separation pay. This Court has ruled that while employers may be authorized under Republic Act 1052 to terminate
employment of employees by serving the required notice, or, in the absence thereof, by paying the required
compensation, the said Act may not be invoked to justify a dismissal prohibited by law, e.g., dismissal for union
activities.
... While Republic Act No. 1052 authorizes a commercial establishment to terminate the
employment of its employee by serving notice on him one month in advance, or, in the absence
thereof, by paying him one month compensation from the date of the termination of his
employment, such Act does not give to the employer a blanket authority to terminate the
employment regardless of the cause or purpose behind such termination. Certainly, it cannot be
made use of as a cloak to circumvent a final order of the court or a scheme to trample upon the
right of an employee who has been the victim of an unfair labor practice. (Yu Ki Lam, et al. v.
Nena Micaller, et al., 99 Phil. 904 [1956].)
Finally, we do not share the respondents' view that the findings of fact of the Court of Industrial Relations are
supported by substantial and credible proof. This Court is not therefore precluded from digging deeper into the
factual milieu of the case (Union of Philippine Education Employees v. Philippine Education Company, 91 Phil. 93;
Lu Do & Lu Ym Corporation v. Philippine-Land-Air-Sea Labor Union, 11 SCRA 134 [1964]).
V. The petitioners (15 of them) ask this Court to cite for contempt the respondent Presiding Judge Arsenio
Martinez of the Court of Industrial Relations and the counsels for the private respondents, on the ground that the
former wrote the following in his decision subject of the instant petition for certiorari, while the latter quoted the
same on pages 90-91 of the respondents' brief: .
... Says the Supreme Court in the following decisions:
In a proceeding for unfair labor practice, involving a determination as to

whether or not the acts of the employees concerned justified the adoption of
the employer of disciplinary measures against them, the mere fact that the
employees may be able to put up a valid defense in a criminal prosecution for
the same acts, does not erase or neutralize the employer's right to impose
discipline on said employees. For it is settled that not even the acquittal of an
employee of the criminal charge against him is a bar to the employer's right to
impose discipline on its employees, should the act upon which the criminal
charged was based constitute nevertheless an activity inimical to the
employer's interest... The act of the employees now under consideration may be
considered as a misconduct which is a just cause for dismissal. (Lopez, Sr., et al.
vs. Chronicle Publication Employees Ass'n. et al., G.R. No. L-20179-81,
December 28, 1964.) (emphasis supplied)
The two pertinent paragraphs in the above-cited decision * which contained the underscored portions of the
above citation read however as follows:
Differently as regard the dismissal of Orlando Aquino and Carmelito Vicente, we are inclined to
uphold the action taken by the employer as proper disciplinary measure. A reading of the article
which allegedly caused their dismissal reveals that it really contains an insinuation albeit subtly of
the supposed exertion of political pressure by the Manila Chronicle management upon the City
Fiscal's Office, resulting in the non-filing of the case against the employer. In rejecting the
employer's theory that the dismissal of Vicente and Aquino was justified, the lower court
considered the article as "a report of some acts and omissions of an Assistant Fiscal in the
exercise of his official functions" and, therefore, does away with the presumption of malice. This
being a proceeding for unfair labor practice, the matter should not have been viewed or gauged
in the light of the doctrine on a publisher's culpability under the Penal Code. We are not here to
determine whether the employees' act could stand criminal prosecution, but only to find out
whether the aforesaid act justifies the adoption by the employer of disciplinary measure against
them. This is not sustaining the ruling that the publication in question is qualified privileged, but
even on the assumption that this is so, the exempting character thereof under the Penal Code
does not necessarily erase or neutralize its effect on the employer's interest which may warrant
employment of disciplinary measure. For it must be remembered that not even the acquittal of
an employee, of the criminal charges against him, is a bar to the employer's right to impose
discipline on its employees, should the act upon which the criminal charges was based constitute
nevertheless an activity inimical to the employer's interest.
In the herein case, it appears to us that for an employee to publish his "suspicion," which actually
amounts to a public accusation, that his employer is exerting political pressure on a public official
to thwart some legitimate activities on the employees, which charge, in the least, would sully the
employer's reputation, can be nothing but an act inimical to the said employer's interest. And the
fact that the same was made in the union newspaper does not alter its deleterious character nor
shield or protect a reprehensible act on the ground that it is a union activity, because such end
can be achieved without resort to improper conduct or behavior. The act of the employees now
under consideration may be considered as a misconduct which is a just cause for dismissal.**
(Emphasis ours)
It is plain to the naked eye that the 60 un-underscored words of the paragraph quoted by the respondent Judge do
not appear in the pertinent paragraph of this Court's decision in L-20179-81. Moreover, the first underscored
sentence in the quoted paragraph starts with "For it is settled ..." whereas it reads, "For it must be remembered
...," in this Court's decision. Finally, the second and last underlined sentence in the quoted paragraph of the
respondent Judge's decision, appears not in the same paragraph of this Court's decision where the other sentence
is, but in the immediately succeeding paragraph.
This apparent error, however, does not seem to warrant an indictment for contempt against the respondent Judge
and the respondents' counsels. We are inclined to believe that the misquotation is more a result of clerical
ineptitude than a deliberate attempt on the part of the respondent Judge to mislead. We fully realize how saddled
with many pending cases are the courts of the land, and it is not difficult to imagine that because of the pressure
of their varied and multifarious work, clerical errors may escape their notice. Upon the other hand, the
respondents' counsels have the prima facie right to rely on the quotation as it appears in the respondent Judge's
decision, to copy it verbatim, and to incorporate it in their brief. Anyway, the import of the underscored sentences
of the quotation in the respondent Judge's decision is substantially the same as, and faithfully reflects, the
particular ruling in this Court's decision, i.e., that "[N]ot even the acquittal of an employee, of the criminal charges
against him, is a bar to the employer's right to impose discipline on its employees, should the act upon which the
criminal charges were based constitute nevertheless an activity inimical to the employer's interest."
Be that as it may, we must articulate our firm view that in citing this Court's decisions and rulings, it is the bounden
duty of courts, judges and lawyers to reproduce or copy the same word-for-word and punctuation mark-for-
punctuation mark. Indeed, there is a salient and salutary reason why they should do this. Only from this Tribunal's
decisions and rulings do all other courts, as well as lawyers and litigants, take their bearings. This is because the
decisions referred to in article 8 of the Civil Code which reads, "Judicial decisions applying or interpreting the laws
or the Constitution shall form a part of the legal system of the Philippines," are only those enunciated by this Court
of last resort. We said in no uncertain terms in Miranda, et al. vs. Imperial, et al. (77 Phil. 1066) that "[O]nly the
decisions of this Honorable Court establish jurisprudence or doctrines in this jurisdiction." Thus, ever present is the
danger that if not faithfully and exactly quoted, the decisions and rulings of this Court may lose their proper and
correct meaning, to the detriment of other courts, lawyers and the public who may thereby be misled. But if
inferior courts and members of the bar meticulously discharge their duty to check and recheck their citations of
authorities culled not only from this Court's decisions but from other sources and make certain that they are
verbatim reproductions down to the last word and punctuation mark, appellate courts will be precluded from
acting on misinformation, as well as be saved precious time in finding out whether the citations are correct.
Happily for the respondent Judge and the respondents' counsels, there was no substantial change in the thrust of
this Court's particular ruling which they cited. It is our view, nonetheless, that for their mistake, they should be, as
they are hereby, admonished to be more careful when citing jurisprudence in the future. ACCORDINGLY, the
decision of the Court of Industrial Relations dated August 17, 1965 is reversed and set aside, and another is
entered, ordering the respondents to reinstate the dismissed members of the petitioning Unions to their former or
comparatively similar positions, with backwages from June 2, 1958 up to the dates of their actual reinstatements.
Costs against the respondents.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Fernando, Teehankee, Barredo, Villamor and Makasiar, JJ.,
concur.
Zaldivar, J., took no part.


SUPREME COURT
Manila
EN BANC
G.R. No. L-27072 January 9, 1970
SURIGAO MINERAL RESERVATION BOARD, ET AL., petitioners,

vs.
HON. GAUDENCIO CLORIBEL ETC., ET AL., respondents, In Re: Contempt Proceedings Against Attorneys Vicente L.
Santiago, Jose Beltran Sotto, Graciano C. Regala and Associates, Erlito R. Uy, Juanito M. Caling; and Morton F.
Meads.
RESOLUTION
SANCHEZ, J.:
After the July 31, 1968 decision of this Court adverse to respondent MacArthur International Minerals Co., the
Solicitor General brought to our attention statements of record purportedly made by Vicente L. Santiago, Erlito R.
Uy, Graciano Regala, and Jose Beltran Sotto, members of the Bar, with the suggestion that disciplinary action be
taken against them. On November 21, 1968, this Court issued a show-cause order.
The following statements, so the Solicitor General avers, are set forth in the memoranda personally signed by Atty.
Jose Beltran Sotto:
a. They (petitioners, including the Executive Secretary) have made these false, ridiculous and wild
statements in a desperate attempt to prejudice the courts against MacArthur International. Such
efforts could be accurately called "scattershot desperation" (Memorandum for Respondents
dated March 27, 1968, pp. 13-14, three lines from the bottom of page 13 and first line page 14).
b. Such a proposition is corrupt on its face and it lays bare the immoral and arrogant attitude of
the petitioners. (Respondents' Supplemental Memorandum and Reply to Petitioner's
Memorandum Brief, dated April 13, 1968, p. 16, last two lines on bottom of the page).
c. The herein petitioners ... opportunistically change their claims and stories not only from case
to case but from pleading to pleading in the same case. (Respondents' Supplemental
Memorandum, Ibid., p.17, sixth, seventh and eighth lines from bottom of the page).
MacArthur's third motion for reconsideration signed by Atty. Vicente L. Santiago, on his behalf and purportedly for
Attys. Erlito R. Uy, Graciano Regala and Associates, and Jose B. Sotto, the Solicitor General points out, contain the
following statements:
d. ... ; and [the Supreme Court] has overlooked the applicable law due to the misrepresentation
and obfuscation of the petitioners' counsel. (Last sentence, par. 1, Third Motion for
Reconsideration dated Sept. 10, 1968).
e. ... Never has any civilized, democratic tribunal ruled that such a gimmick (referring to the
"right to reject any and all bids") can be used by vulturous executives to cover up and excuse
losses to the public, a government agency or just plain fraud ... and it is thus difficult, in the light
of our upbringing and schooling, even under many of the incumbent justices, that the Honorable
Supreme Court intends to create a decision that in effect does precisely that in a most absolute
manner. (Second sentence, par. 7, Third Motion for Reconsideration dated Sept. 10, 1968).
The motion to inhibit filed on September 21, 1968 after judgment herein was rendered and signed by Vicente
L. Santiago for himself and allegedly for Attys. Erlito R. Uy, and Graciano Regala and Associates, asked Mr. Chief
Justice Roberto Concepcion and Mr. Justice Fred Ruiz Castro to inhibit themselves from considering, judging and
resolving the case or any issue or aspect thereof retroactive to January 11, 1967. The motion charges "[t]hat the
brother of the Honorable Associate Justice Castro is a vice-president of the favored party who is the chief
beneficiary of the false, erroneous and illegal decision dated January 31, 1968" and the ex parte preliminary
injunction rendered in the above-entitled case, the latter in effect prejudging and predetermining this case even
before the joining of an issue. As to the Chief Justice, the motion states "[t]hat the son of the Honorable Chief
Justice Roberto Concepcion was given a significant appointment in the Philippine Government by the President a
short time before the decision of July 31, 1968 was rendered in this case." The appointment referred to was as
secretary of the newly-created Board of Investments. The motion presents a lengthy discourse on judicial ethics,
and makes a number of side comments projecting what is claimed to be the patent wrongfulness of the July 31,
1968 decision. It enumerates "incidents" which, according to the motion, brought about respondent MacArthur's
belief that "unjudicial prejudice" had been caused it and that there was "unjudicial favoritism" in favor of
"petitioners, their appointing authority and a favored party directly benefited by the said decision." The "incidents"
cited are as follows:
(a) said decision is in violation of the law, which law has not been declared unconstitutional.
(b) said decision ignores totally the applicable law in the above-entitled case.
(c) said decision deprives respondent of due process of law and the right to adduce evidence as is
the procedure in all previous cases of this nature.
(d) due course was given to the unfounded certiorari in the first place when the appeal from a
denial of a motion to dismiss was and is neither new nor novel nor capable of leading to a
wholesome development of the law but only served to delay respondent for the benefit of the
favored party.
(e) the preliminary injunction issued herein did not maintain the status quo but destroyed it, and
the conclusion cannot be avoided that it was destroyed for a reason, not for no reason at all.
(f) there are misstatements and misrepresentations in the said decision which the Honorable
Supreme Court has refused to correct.
(g) the two main issues in the said decision were decided otherwise in previous decisions, and
the main issue "right to reject any or all bids" is being treated on a double standard basis by the
Honorable Supreme Court.
(h) the fact that respondent believes that the Honorable Supreme Court knows better and has
greater understanding than the said decision manifests.
(i) the public losses (sic) one hundred and fifty to two hundred million dollars by said decision
without an effort by the Honorable Supreme Court to learn all the facts through presentation
through the trial court, which is elementary.
On November 21, 1968, Atty. Vicente L. Santiago, again for himself and Attys. Erlito R. Uy and Graciano Regala and
Associates, in writing pointed out to this Court that the statements specified by the Solicitor General were either
quoted out of context, could be defended, or were comments legitimate and justifiable. Concern he expressed for
the fullest defense of the interests of his clients. It was stressed that if MacArthur's attorney could not plead such
thoughts, his client would be deprived of due process of law. However, counsel sought to change the words "Chief
Justice" to "Supreme Court" appearing on line 7, paragraph 2 of the motion to inhibit. Atty. Santiago also
voluntarily deleted paragraph 6 of the said motion, which in full reads:
6. Unfortunately for our people, it seems that many of our judicial authorities believe that they
are the chosen messengers of God in all matters that come before them, and that no matter
what the circumstances are, their judgment is truly ordained by the Almighty unto eternity. Some
seem to be constitutionally incapable of considering that any emanation from their mind or pen
could be the product of unjudicial prejudice or unjudicial sympathy or favoritism for a party or an
issue. Witness the recent absurdity of Judge Alikpala daring to proceed to judge a motion to hold
himself in contempt of court seemingly totally oblivious or uncomprehending of the violation
of moral principle involved and also of Judge Geraldez who refuses to inhibit himself in judging
a criminal case against an accused who is also his correspondent in two other cases. What is the
explanation for such mentality? Is it outright dishonesty? Lack of intelligence? Serious deficiency
in moral comprehension? Or is it that many of our government officials are just amoral?
And, in addition, he attempted to explain further subparagraphs (f) and (h) of paragraph 7 thereof.
It was on December 2, 1968 that Atty. Vicente L. Santiago filed his compliance with this Court's resolution of
November 21, 1968. He there stated that the motion to inhibit and third motion for reconsideration were of his
exclusive making and that he alone should be held responsible therefor. He further elaborated on his explanations
made on November 21, 1968.
On December 5, 1968, he supplemented his explanations by saying that he already deleted paragraph 6 of the
Motion to Inhibit heretofore quoted from his rough draft but that it was still included through inadvertence.
On March 1, 1969, Atty. Vicente L. Santiago, as counsel for MacArthur, registered an amended motion to inhibit.
While it repeats the prayer that Mr. Chief Justice Concepcion and Mr. Justice Castro inhibit themselves, it left but
three paragraphs of the original motion to inhibit, taking out the dissertation on judicial ethics and most of the
comments attacking the decision of this Court of July 31, 1968.
On the part of Atty. Jose Beltran Sotto, it must be stated that as early as October 7, 1968, he insisted in
withdrawing his appearance in this case as one of the lawyers of MacArthur. His ground was that he did not agree
with the filing of the motion to inhibit the two justices. According to him, "[t]he present steps (sic) now being taken
is against counsel's upbringing and judicial conscience."
In Atty. Jose Beltran Sotto's return of November 29, 1968, he took pains to say that the questioned statements he
made were also taken out of context and were necessary for the defense of his client MacArthur. He made the
admission, though, that those statements lifted out of context would indeed be sufficient basis for a finding that
Section 20(f), Rule 138, had been violated.
On January 8, 1969, additional arguments were filed by Atty. Jose Beltran Sotto. He there averred that the
Supreme Court had no original jurisdiction over the charge against him because it is one of civil contempt against a
party and the charge is originally cognizable by the Court of First Instance under Sections 4 and 10, Rule 71 of the
Rules of Court. He also stressed that said charge was not signed by an "offended party or witness", as required by
law; and that the Solicitor General and his assistants could not stand in the stead of an "offended Party or
witness."
We now come to Atty. Graciano C. Regala. In his explanation of December 2, 1968, as further clarified by a
supplemental motion of December 27, 1968, he manifested that the use of or reference to his law firm in this case
was neither authorized nor consented to by him or any of his associates; that on July 14, 1967, one Morton F.
Meads, in MacArthur's behalf, offered to retain his services, which was accepted; that Meads inquired from him
whether he could appear in this case; that he advised Meads that this case was outside his professional
competence and referred Meads to another lawyer who later on likewise turned down the offer; that in view of
the rejection, Meads and he agreed to terminate their previous retainer agreement; that he had not participated
in any manner in the preparation or authorship of any pleading or any other document in connection with this
case.
On February 4, 1969, Atty. Erlito R. Uy explained his side of the case. In brief, he denied participation in any of the
court papers subject of our November 21, 1968 order; claimed that he was on six months' leave of absence from
July 1, 1968 to December 31, 1968 as one of the attorneys for MacArthur but that he gave his permission to have
his name included as counsel in all of MacArthur's pleadings in this case (L-27072), even while he was on leave of
absence.
Hearing on this contempt incident was had on March 3, 1969.
A second contempt proceeding arose when, on July 14, 1969, respondent MacArthur, through new counsel, Atty.
Juanito M. Caling who entered a special appearance for the purpose, lodged a fourth motion for reconsideration
without express leave of court. Said motion reiterated previous grounds raised, and contained the following
paragraphs:
4. The said decision is illegal because it was penned by the Honorable Chief Justice Roberto
Concepcion when in fact he was outside the borders of the Republic of the Philippines at the
time of the Oral Argument of the above-entitled case which condition is prohibited by the
New Rules of Court Section 1, Rule 51, and we quote: "Justices; who may take part. ... . only
those members present when any matter is submitted for oral argument will take part in its
consideration and adjudication ..." This requirement is especially significant in the present
instance because the member who penned the decision was the very member who was absent
for approximately four months or more. This provision also applies to the Honorable Justices
Claudio Teehankee and Antonio Barredo.
xxx xxx xxx
6. That if the respondent MacArthur International Minerals Company abandons its quest for
justice in the Judiciary of the Philippine Government, it will inevitably either raise the graft and
corruption of Philippine Government officials in the bidding of May 12, 1965, required by the
Nickel Law to determine the operator of the Surigao nickel deposits, to the World Court on
grounds of deprivation of justice and confiscation of property and /or to the United States
Government, either its executive or judicial branches or both, on the grounds of confiscation of
respondent's proprietary vested rights by the Philippine Government without either
compensation or due process of law and invoking the Hickenlooper Amendment requiring the
cutting off of all aid and benefits to the Philippine Government, including the sugar price
premium, amounting to more than fifty million dollars annually, until restitution or
compensation is made.
This elicited another resolution from this Court on July 18, 1969, requiring Atty. Juanito M. Caling "to show cause
within five (5) days from receipt of notice hereof why he should not be dealt with for contempt of court."
On July 30, 1969, Atty. Juanita M. Caling filed his return. He there alleged that the said fourth motion for
reconsideration was already finalized when Atty. Vicente L. Santiago came to his office and requested him to
accommodate MacArthur by signing the motion; that he turned down said request twice on the ground that he did
not know anything about the case, much less the truth of the allegations stated in the motion; that "the allegations
in said motion were subsequently explained to the undersigned counsel together with the background of the case
involved by Atty. Vicente L. Santiago and by one Morton F. Meads"; that upon assurance that there was nothing
wrong with the motion he was persuaded in good faith to sign the same; that he was misled in so signing and the
true facts of the allegations were not revealed to him especially the oral argument allegedly made in the case.
Because of the foregoing explanation by Atty. Caling, this Court, on August 4, 1969, resolved "to require Atty.
Vicente L. Santiago and Morton Meads to file in writing their answer to the said return [of Atty. Caling] and at the
same time to show cause why they, Atty. Vicente L. Santiago and Morton Meads, should not be dealt with for
contempt of court, on or before August 16, 1969; and ... to direct that the three, Atty. Juanita M. Caling, Atty.
Vicente L. Santiago, and Morton Meads, personally appear Before this Court on Thursday, August 27, 1969, at 9:30
a.m., on which date the contempt proceedings against all of them will be heard by this Court."
On August 13, 1969, Atty. Vicente L. Santiago gave his explanation. He disavowed the truth of Atty. Caling's
statement that he (Santiago) convinced Caling to sign the motion. The truth, according to Santiago, is that one day
Morton Meads went to his office and asked him if he knew of a lawyer nearby who could help him file another
motion for reconsideration, and he (Santiago) mentioned Atty. Caling; he there upon accompanied Meads to
Caling, told Caling of Meads' desire and left Meads with Caling. Santiago insists that he never prepared the motion
and that he never even read it.
On August 15, 1969, Morton Meads answered. Meads' version is as follows: On July 14, 1969, he went to Atty.
Santiago's office with the fourth motion for reconsideration which he himself prepared. Santiago started to read
the motion and in fact began to make some changes in Pencil in the first or second paragraph when Meads told
him that MacArthur wanted a new lawyer, not Santiago, to file the same. Meads asked Santiago if he could
recommend one. They then went to Caling whose office was on the same floor. Santiago introduced Meads to
Caling at the same time handing the fourth motion to Caling. While Caling was reading the document, Santiago
left. After reading the motion, Caling gave his go-signal. He signed the same after his name was typed therein. The
motion was then filed. According to Meads, from the time he entered the office of Santiago to the time the motion
was filed, the period that elapsed was approximately one hour and a half. Santiago was with Caling for about three
minutes and Meads was with Caling for about fifteen minutes.
In defending himself from the contempt charge, Meads asserts that the quotation from the Rules of Court set forth
in the fourth motion for reconsideration has not been taken out of context because said quotation is precisely
accurate; that the "xs" indicate that it is not a complete quotation and that it is a common practice in court
pleadings to submit partial quotations. Meads further contends that the announced plan to bring the case to the
World Court is not a threat. In fact, his answer also included a notice of appeal to the World Court.
On August 27, 1969, this Court heard Attys. Vicente L. Santiago and Juanito Caling and Morton Meads in oral
argument with respect to the second contempt incident. We shall now discuss the first and second contempt
incidents seriatim.
1. We start with the case of Atty. Vicente L. Santiago. In his third motion for reconsideration, we, indeed, find
language that is not to be expected of an officer of the courts. He pictures petitioners as "vulturous executives". He
speaks of this Court as a "civilized, democratic tribunal", but by innuendo would suggest that it is not.
In his motion to inhibit, his first paragraph categorizes our decision of July 31, 1968 as "false, erroneous and illegal"
in a presumptuous manner. He there charges that the ex parte preliminary injunction we issued in this case
prejudiced and predetermined the case even before the joining of an issue. He accuses in a reckless manner two
justices of this Court for being interested in the decision of this case: Associate Justice Fred Ruiz Castro, because
his brother is the vice president of the favored party who is the chief beneficiary of the decision, and Chief Justice
Roberto Concepcion, whose son was appointed secretary of the newly-created Board of Investments, "a significant
appointment in the Philippine Government by the President, a short time before the decision of July 31, 1968 was
rendered." In this backdrop, he proceeds to state that "it would seem that the principles thus established [the
moral and ethical guidelines for inhibition of any judicial authority by the Honorable Supreme Court should first
apply to itself." He puts forth the claim that lesser and further removed conditions have been known to create
favoritism, only to conclude that there is no reason for a belief that the conditions obtaining in the case of the
Chief Justice and Justice Castro "would be less likely to engender favoritism or prejudice for or against a particular
cause or party." Implicit in this at least is that the Chief Justice and Justice Castro are insensible to delicadeza,
which could make their actuation suspect. He makes it plain in the motion that the Chief Justice and Justice Castro
not only were not free from the appearance of impropriety but did arouse suspicion that their relationship did
affect their judgment. He points out that courts must be above suspicion at all times like Caesar's wife, warns that
loss of confidence for the Tribunal or a member thereof should not be allowed to happen in our country, "although
the process has already begun."
It is true that Santiago voluntarily deleted paragraph 6 which contained language that is as disrespectful. But we
cannot erase the fact that it has been made. He explained that, he deleted this paragraph in his rough draft, which
paragraph was included in the motion filed in this Court only because of mere inadvertence. This explanation does
not make much of a distinguishing difference; it erects no shield. Not only because it was belatedly made but also
because his signature appeared on the motion to inhibit which included paragraph 6. And this paragraph 6
describes with derision "many of our judicial authorities" who "believe that they are the chosen messengers of
God in all matters that come before them, and that no matter what the circumstances are, their judgment is truly
ordained by the Almighty unto eternity." It depicts them as seemingly "incapable of considering that any
emanation from their mind or pen could be the product of unjudicial prejudice or unjudicial sympathy or favoritism
for a party or an issue." After citing acts of two judges of first instance, he paused to ask: "What is the explanation
for such mentality? Is it outright dishonesty? Lack of intelligence? Serious deficiency in moral comprehension? Or
is it that many of our government officials are just amoral?"
Paragraph 7 also of the motion to inhibit repeated mention of "unjudicial prejudice" against respondent
MacArthur and spoke of "unjudicial favoritism" for petitioners, their appointing authority and a favored party
directly benefited by the decision. Paragraph 8 is a lecture on judicial ethics. Paragraph 9 is a warning to this Court
about loss of confidence, and paragraph 10 makes a sweeping statement that "any other justices who have
received favors or benefits directly or indirectly from any of the petitioners or members of any board-petitioner, or
their agents or principals, including the President", should also inhibit themselves.
What is disconcerting is that Atty. Santiago's accusations have no basis in fact and in law. The slur made is not
limited to the Chief Justice and Mr. Justice Castro. It sweepingly casts aspersion on the whole court. For, inhibition
is also asked of, we repeat, "any other justices who have received favors or benefits directly or indirectly from any
of the petitioners or any members of any board-petitioner or their agents or principals, including the president."
The absurdity of this posture is at once apparent. For one thing, the justices of this Court are appointed by the
President and in that sense may be considered to have each received a favor from the President. Should these
justices inhibit themselves every time a case involving the Administration crops up? Such a thought may not
certainly be entertained. The consequence thereof would be to paralyze the machinery of this Court. We would in
fact, be wreaking havoc on the tripartite system of government operating in this country. Counsel is presumed to
know this. But why the unfounded charge? There is the not-too-well concealed effort on the part of a losing
litigant's attorney to downgrade this Court.
The mischief that stems from all of the foregoing gross disrespect is easy to discern. Such disrespect detracts much
from the dignity of a court of justice. Decidedly not an expression of faith, counsel's words are intended to create
an atmosphere of distrust, of disbelief. We are thus called upon to repeat what we have said in Rheem of the
Philippines vs. Ferrer (1967), 20 SCRA 441, 444, as follows: "By now, a lawyer's duties to the Court have become
common place. Really, there could hardly be any valid excuse for lapses in the observance thereof. Section 20(b),
Rule 138 of the Rules of Court, in categorical terms, spells out one such duty: 'To observe and maintain the respect
due to the courts of justice and judicial officers.' As explicit is the first canon of legal ethics which pronounces that
'[i]t is the duty of the lawyer to maintain towards the Courts a respectful attitude, not for the sake of the
temporary incumbent of the judicial office, but for the maintenance of its supreme importance.' That same canon,
as a corollary, makes it peculiarly incumbent upon lawyers to support the courts against 'unjust criticism and
clamor.' And more. The attorney's oath solemnly binds him to a conduct that should be 'with all good fidelity ... to
the courts.' Worth remembering is that the duty of an attorney to the courts can only be maintained by rendering
no service involving any disrespect to the judicial office which he is bound to uphold.' "
A lawyer is an officer of the courts; he is, "like the court itself, an instrument or agency to advance the ends of
justice."1 His duty is to uphold the dignity and authority of the courts to which he owes fidelity, "not to promote
distrust in the administration of justice."2 Faith in the courts a lawyer should seek to preserve. For, to undermine
the judicial edifice "is disastrous to the continuity of government and to the attainment of the liberties of the
people."3 Thus has it been said of a lawyer that "[a]s an officer of the court, it is his sworn and moral duty to help
build and not destroy unnecessarily that high esteem and regard towards the courts so essential to the proper
administration of justice."4
It ill behooves Santiago to justify his language with the statement that it was necessary for the defense of his
client. A client's cause does not permit an attorney to cross the line between liberty and license. Lawyers must
always keep in perspective the thought that "[s]ince lawyers are administrators of justice, oath-bound servants of
society, their first duty is not to their clients, as many suppose, but to the administration of justice; to this, their
clients' success is wholly subordinate; and their conduct ought to and must be scrupulously observant of law and
ethics."5 As rightly observed by Mr. Justice Malcolm in his well-known treatise, a judge from the very nature of his
position, lacks the power to defend himself and it is the attorney, and no other, who can better or more
appropriately support the judiciary and the incumbent of the judicial position.6 From this, Mr. Justice Malcolm
continued to say: "It will of course be a trying ordeal for attorneys under certain conditions to maintain respectful
obedience to the court. It may happen that counsel possesses greater knowledge of the law than the justice of the
peace or judge who presides over the court. It may also happen that since no court claims infallibility, judges may
grossly err in their decisions. Nevertheless, discipline and self-restraint on the part of the bar even under adverse
conditions are necessary for the orderly administration of
justice."7
The precepts, the teachings, the injunctions just recited are not unfamiliar to lawyers. And yet, this Court finds in
the language of Atty. Santiago a style that undermines and degrades the administration of justice. The stricture in
Section 3 (d) of Rule 71 of the Rules against improper conduct tending to degrade the administration of
justice8 is thus transgressed. Atty. Santiago is guilty of contempt of court.
2. We next take the case of Atty. Jose Beltran Sotto. We analyze the statements pointed out to us by the Solicitor
General hereinbefore quoted. Sotto accuses petitioners of having made "false, ridiculous and wild statements in a
desperate attempt to prejudice the courts against MacArthur." He brands such efforts as "scattershot
desperation". He describes a proposition of petitioners as "corrupt on its face", laying bare "the immoral and
arrogant attitude of the petitioners." He charges petitioners with opportunistically changing their claims and
stories not only from case to case but from pleading to pleading in the same case. Such language is not arguably
protected; it is the surfacing of a feeling of contempt towards a litigant; it offends the court before which it is
made. It is no excuse to say that these statements were taken out of context. We have analyzed the lines
surrounding said statements. They do not in any manner justify the inclusion of offensive language in the
pleadings. It has been said that "[a] lawyer's language should be dignified in keeping with the dignity of the legal
profession."9 It is Sotto's duty as a member of the Bar "[t]o abstain from all offensive personality and to advance
no fact prejudicial to the honor or reputation of a party or witness, unless required by the justice of the cause with
which he is
charged." 10
Not far from the case of Atty. Sotto is People vs. Young, 83 Phil. 702, 708, where counsel for the accused convicted
of murder made use of the following raw language in his brief : "The accused since birth was a poor man and a son
of a poor farmer, that since his boyhood he has never owned a thousand pesos in his own name. Now, here comes
a chance for him. A cold fifty thousand bucks in exchange of a man's life. A simple job. Perhaps a question of
seconds' work and that would transform him into a new man. Once in a small nipa shack, now in a palatial
mansion! This poor ignorant man blinded by the promise of wealth, protection and stability was given to do the
forbidden deed." We there held that "[s]uch a plea is a disgrace to the bar and an affront to the court."
It will not avail Sotto any to say that the Solicitor General or his assistants may not be considered offended parties
in this case. This Court may motu proprio start proceedings of this nature. There should be no doubt about the
power of this Court to punish him for contempt under the circumstances. For, inherent in courts is the power "[t]o
control, in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner
connected with a case before it, in every manner appertaining thereto." 11
We, accordingly, hold that Atty. Jose Beltran Sotto has misbehaved, under Section 3 (a), Rule 71 of the Rules of
Court, as an officer of the court in the performance of his official duties; and that he too has committed, under
Section 3 (d) of the same rule, improper conduct tending to degrade the administration of justice. He is, therefore,
guilty of contempt.
3. Not much need be said of the case of Atty. Graciano C. Regala. It was improper for Atty. Santiago to have
included the name of the firm of Atty. Regala without the latter's knowledge and consent. Correctly did Regala
insist and this is confirmed by the other lawyers of respondents that he had not participated in any way in
the pleadings of the above-entitled case. Regala did not even know that his name was included as co-counsel in
this case. He is exonerated.
4. Last to be considered with respect to the first contempt incident is the case of Atty. Erlito R. Uy. Borne out by
the record is the fact that Atty. Uy was not also involved in the preparation of any of the pleadings subject of the
contempt citation. He should be held exempt from contempt.
5. We now turn our attention to the second contempt incident. The fourth motion for reconsideration is, indeed,
an act of contumacy.
First. It was filed without express leave of court. No explanation has been made why this has been done.
Second. It lifted Section 1. Rule 51, Rules of Court, out of context. Said Section 1 was quoted as follows: "Justices;
who may take part. ... only those members present when any matter is submitted for oral argument will take
part in its consideration and adjudication ..." However, the provision in its entire thought should be read thus
SECTION 1. Justices; who may take part. All matters submitted to the court for its
consideration and adjudication will be deemed to be submitted for consideration and
adjudication by any and all of the Justices who are members of the division of the court at the
time when such matters are taken up for consideration and adjudication, whether such Justices
were or were not present at the date of submission; however, only those members present
when any matter is submitted for oral argument will take part in its consideration and
adjudication, if the parties or either of them, express a desire to that effect in writing filed with
the clerk at the date of

submission. 12
Atty. Caling, who was admitted to the Bar in 1966, did not attempt to explain this point.
Meads, however, for his part tried to reason out why such a distorted quotation came about the portion left out
was anyway marked by "XS" which is a common practice among lawyers. Canon 22 of the Canons of Legal Ethics
reminds the lawyer to characterize his conduct with candor and fairness, and specifically states that "it is not
candid nor fair for the lawyer knowingly to misquote." While Morton Meads is admittedly not a lawyer, it does not
take a lawyer to see the deliberate deception that is being foisted upon this Court. There was a qualification to the
rule quoted and that qualification was intentionally omitted.
Third. The motion contained an express threat to take the case to the World Court and/or the United States
government. It must be remembered that respondent MacArthur at that time was still trying to overturn the
decision of this Court of July 31, 1968. In doing so, unnecessary statements were injected. More specifically, the
motion announced that MacArthur "will inevitably ... raise the graft and corruption of [the] Philippine government
officials in the bidding of May 12, 1965 ... to the World Court" and would invoke "the Hickenlooper Amendment
requiring the cutting off of all aid and benefits to the Philippine Government, including the sugar price premium,
amounting to more than fifty million dollars annually ... ."
This is a clear attempt to influence or bend the mind of this Court to decide the case in its favor. A notice of appeal
to the World Court has even been embodied in Meads' return. There is a gross inconsistency between the appeal
and the move to reconsider the decision. An appeal from a decision presupposes that a party has already
abandoned any move to reconsider that decision. And yet, it would appear that the appeal to the World Court is
being dangled as a threat to effect a change of the decision of this Court. Such act has no aboveboard explanation.
6. Atty. Caling has not shown to the satisfaction of this Court that he should be exempted from the contempt
charge against him. He knows that he is an officer of this Court. He admits that he has read the fourth motion for
reconsideration before he signed it. While he has been dragged in only at the last minute, still it was plainly his
duty to have taken care that his name should not be attached to pleadings contemptuous in character.
7. As for Morton F. Meads, he had admitted having prepared the fourth motion for reconsideration. He cannot beg
off from the contempt charge against him even though he is not a lawyer. He is guilty of contempt.
8. We go back to Atty. Vicente L. Santiago. His insistence that he had nothing to do with the fourth motion for
reconsideration and that he had not even read the same is too transparent to survive fair appraisal. It goes against
the grain of circumstances. Caling represents before us that it was Santiago who convinced him to sign the motion,
who with Meads explained to him the allegations thereof and the background of the case. Caling says that if not
for his friendship with Santiago, he would not have signed the motion. On the other hand, Meads states that
Santiago began to read the fourth motion for reconsideration and even started to make changes thereon in pencil.
We must not forget, too, that according to Meads himself, he spent, on July 14, 1969, quite some time with
Santiago before they proceeded to Caling. It is highly improbable that Santiago did not read the fourth motion for
reconsideration during all that time.
Furthermore, Santiago is a lawyer of record for respondent MacArthur in this case. He has not resigned from his
position as such lawyer. He has control of the proceedings. Whatever steps his client takes should be within his
knowledge and responsibility. Indeed, Canon 16 of the Canons of Legal Ethics should have reminded him that "[a]
lawyer should use his best efforts to restrain and to prevent his clients from doing those things which the lawyer
himself ought not to do, particularly with reference to their conduct towards courts, judicial officers, jurors,
witnesses and suitors. If a client persists in such wrongdoing the lawyer should terminate their relation."
The dignity of the Court, experience teaches, can never be protected where infraction of ethics meets with
complacency rather than punishment. The people should not be given cause to break faith with the belief that a
judge is the epitome of honor amongst men. To preserve its dignity, a court of justice should not yield to the
assaults of disrespect. Punctilio of honor, we prefer to think, is a standard of behavior so desirable in a lawyer
pleading a cause before a court of justice.
9. One last word. It would seem apropos to say again that, if only for one reason, this Court had really no
alternative but to decide the main case against respondent MacArthur. As we held in our decision of July 31, 1968,
MacArthur did not even adhere to the terms and conditions of the invitation to bid. For, this invitation to bid
explicitly warned that "bids not accompanied by bid bonds will be rejected. And We repeat, "[a]dmittedly, the bid
of the Company [MacArthur] had been submitted without the requisite bond." 13 It would not require the adroit
mind of a lawyer to say that a bid unaccompanied by a bond., contrary to the instructions to bidders, is not
entitled to any consideration.
It should be emphasized, too, that because the decision herein was by a unanimous Court, even if the Chief Justice
and Mr. Justice Fred Ruiz Castro had not taken part in the decision on the merits of this case, the result would have
been the same: MacArthur's cause would just the same have failed.
For the reasons given, this Court hereby finds:
1. On the first contempt charge, Atty. Vicente L. Santiago and Atty. Jose Beltran Sotto guilty of contempt of court,
and fines Atty. Santiago in the sum of P1,000, and Atty. Sotto, P100; and holds Attys. Graciano C. Regala and
Associates and Atty. Erlito R. Uy not guilty of contempt of court; and
2. On the second contempt charge, Atty. Vicente L. Santiago, Morton F. Meads and Atty. Juanita M. Caling guilty of
contempt of court, and fines Atty. Vicente L. Santiago, an additional P1,000, Morton F. Meads, P1,000, and Atty.
Juanito M. Caling, P200.
Let a copy of this resolution be forwarded to the Honorable, the Secretary of Justice, for whatever action he may
deem proper to take in the premises against Morton F. Meads who is an alien.
Let another copy of this resolution be forwarded to the Honorable, the Solicitor General, for such action as he may
deem proper in relation to the disbarment or suspension of Attys. Vicente L. Santiago, Jose Beltran Sotto and
Juanito M. Caling.
The Clerk of this Court is hereby directed to append a copy of this decision to the personal records of Attorneys
Vicente L. Santiago, Jose Beltran Sotto and Juanito M. Caling. So ordered.
Reyes, J.B.L., Dizon, Makalintal, Zaldivar and Fernando, JJ., concur.
Concepcion C.J., Castro, Teehankee and Barredo, JJ., took no part.


SUPREME COURT
Manila
SECOND DIVISION
A.C. No. 8954 November 13, 2013
HON. MARIBETH RODRIGUEZ-MANAHAN, Presiding Judge, Municipal Trial Court, San Mateo, Rizal,Complainant,
vs.
ATTY. RODOLFO FLORES, Respondent.
RESOLUTION
DEL CASTILLO, J.:
Respondent Atty. Rodolto Flores (Atty. Flores) was counsel for the defendant in Civil Case No. 1863 captioned as
Marsha Aranas plaintiff versus Arnold Balmores defendant a suit for damages filed before the Municipal Trial Court
of San Mateo, Rizal and presided by herein complainant Judge Maribeth Rodriguez-Manahan (Judge Manahan).
During the proceedings in Civil Case No. 1863, Judge Manahan issued an Order 1 dated January 12, 2011, whereby
she voluntarily inhibited from hearing Civil Case No. 1863. The said Order reads in part, viz:
More than mere contempt do his (Atty. Flores) unethical actuations, his traits of dishonesty and discourtesy not
only to his own brethren in the legal profession, but also to the bench and judges, would amount to grave
misconduct, if not a malpractice of law, a serious ground for disciplinary action of a member of the bar pursuant to
Rules 139 a & b.
IN VIEW WHEREOF, furnish a copy of this Order to the Bar Discipline Committee, Integrated Bar of the Philippines,
to the Supreme Court en banc, for appropriate investigation and sanction. 2
Upon receipt of the copy of the above Order, the Office of the Bar Confidant (OBC) deemed the pronouncements
of Judge Manahan as a formal administrative Complaint against Atty. Flores. Docketed as A.C. No. 8954, the case
was referred to the Executive Judge of the Regional Trial Court of Rizal for investigation, report and
recommendation.3
In her Investigation, Report and Recommendation,4 Investigating Judge Josephine Zarate Fernandez (Investigating
Judge) narrated the antecedents of the case as follows:
A complaint for Damages was filed before the Municipal Trial Court (MTC) of San Mateo, Rizal docketed as Civil
Case No. 1863, entitled Marsha Aranas vs. Arnold Balmores. The Public Attorneys Office (PAO) thru Atty.
Ferdinand P. Censon represented the complainant while Atty. Rodolfo Flores appeared as counsel for the
defendant.
x x x During the Preliminary Conference x x x, respondent Atty. Flores entered his appearance and was given time
to file a Pre-Trial Brief. x x x On May 24, 2010, respondent Atty. Flores filed his Pre-Trial Brief but without proof of
MCLE compliance hence it was expunged from the records without prejudice to the filing of another Pre-Trial Brief
containing the required MCLE compliance. x x x Atty. Flores asked for ten (10) days to submit proof.
The preliminary conference was reset several times (August 11, September 8) for failure of respondent Atty. Flores
to appear and submit his Pre-Trial Brief indicating thereon his MCLE compliance. The court a quo likewise issued
Orders dated September 15 and October 20, 2010 giving respondent Atty. Flores a last chance to submit his Pre-
Trial Brief with stern warning that failure to do so shall be considered a waiver on his part.
Meanwhile, respondent Atty. Flores filed a Manifestation in Court dated September 14, 2010 stating among
others, the following allegations:
xxxx
4. When you took your oath as member of the Bar, you promised to serve truth, justice and fair play. Do
you think you are being truthful, just and fair by serving a cheater?
5. Ignorance of the law excuses no one for which reason even Erap was convicted by the
Sandiganbayan.1wphi1 But even worse is a lawyer who violates the law.
6. Last but not the least, God said Thou shall not lie. Again the Philippine Constitution commands: Give
every Filipino his due. The act of refusal by the plaintiff is violative of the foregoing divine and human
laws.
xxxx
Respondent Atty. Flores later filed his Pre-Trial Brief bearing an MCLE number which was merely superimposed
without indicating the date and place of compliance. During the preliminary conference on November 24, 2010,
respondent Atty. Flores manifested that he will submit proof of compliance of his MCLE on the following day. On
December 1, 2010, respondent Atty. Flores again failed to appear and to submit the said promised proof of MCLE
compliance. In its stead, respondent Atty. Flores filed a Letter of even date stating as follows:
If only to give your Honor another chance to prove your pro plaintiff sentiment, I am hereby filing the attached
Motion which you may once more assign to the waste basket of nonchalance.
With the small respect that still remains, I have asked the defendant to look for another lawyer to represent him
for I am no longer interested in this case because I feel I cannot do anything right in your sala. 5
The Investigating Judge found Atty. Flores to have failed to give due respect to the court by failing to obey court
orders, by failing to submit proof of his compliance with the Mandatory Continuing Legal Education (MCLE)
requirement, and for using intemperate language in his pleadings. The Investigating Judge recommended that
Atty. Flores be suspended from the practice of law for one year.6
The OBC adopted the findings and recommendation of the Investigating Judge.7
Our Ruling
There is no doubt that Atty. Flores failed to obey the trial courts order to submit proof of his MCLE compliance
notwithstanding the several opportunities given him. "Court orders are to be respected not because the judges
who issue them should be respected, but because of the respect and consideration that should be extended to the
judicial branch of the Government. This is absolutely essential if our Government is to be a government of laws
and not of men. Respect must be had not because of the incumbents to the positions, but because of the authority
that vests in them. Disrespect to judicial incumbents is disrespect to that branc the Government to which they
belong, as well as to the State which has instituted the judicial system." 8
Atty. Flores also employed intemperate language in his pleadings. As an officer of the court, Atty. Flores is
expected to be circumspect in his language. Rule 11.03, Canon 11 of the Code of Professional Responsibility enjoins
all attorneys to abstain from scandalous, offensive or menacing language or behavior before the Courts. Atty.
Flores failed in this respect.
At this juncture, it is well to remind respondent that:
While a lawyer owes absolute fidelity to the cause of his client full devotion to his client's genuine interest and
warm zeal in the maintenance and defense of his client's rights, as well as the exertion of his utmost learning and
ability, he must do so only within the bounds of law. A lawyer is entitled to voice his c1iticism within the context of
the constitutional guarantee of freedom of speech which must be exercised responsibly. After all, every right
carries with it the corresponding obligation. Freedom is not freedom from responsibility, but freedom with
responsibility. The lawyer's fidelity to his client must not be pursued at the expense of truth and orderly
administration of justice. It must be done within the confines of reason and common sense. 9
However, we find the recommended penalty too harsh and not commensurate with the infractions committed by
the respondent. It appears that this is the first infraction committed by respondent. Also, we are not prepared to
impose on the respondent the penalty of one-year suspension for humanitarian reasons. Respondent manifested
before this Court that he has been in the practice of law for half a century. 10 Thus, he is already in his twilight
years. Considering the foregoing, we deem it proper to fine respondent in the amount of P5,000.00 and to remind
him to be more circumspect in his acts and to obey and respect court processes.
ACCORDINGLY, respondent Atty. Rodolfo Flores is FINED in the amount of P5,000.00 with STERN WARNING that
the repetition of a similar offense shall be dealt with more severely.
SO ORDERED.
MARIANO C. DEL CASTILLO

Associate Justice
FIRST DIVISION
A.C. No. 9116, March 12, 2014
NESTOR B. FIGUERAS AND BIENVENIDO VICTORIA, JR., Complainants, v. ATTY. DIOSDADO B.

JIMENEZ, Respondent.
RESOLUTION
VILLARAMA, JR., J.:
Before us is a petition for review filed by Atty. Diosdado B. Jimenez assailing the February 19, 2009 Resolution 1 of
the Board of Governors of the Integrated Bar of the Philippines (IBP) suspending him from the practice of law for a
period of six months for breach of Rule 12.03, 2 Canon 12,3 Canon 17,4Rule 18.03,5 and Canon 186 of the Code of
Professional Responsibility. He likewise assails the June 26, 2011 Resolution7 of the IBP Board of Governors
denying his motion for reconsideration.
The facts are as follows:chanRoblesVirtualawlibrary
Congressional Village Homeowners Association, Inc. is the entity in charge of the affairs of the homeowners of
Congressional Village in Quezon City. On January 7, 1993, the Spouses Federico and Victoria Santander filed a civil
suit for damages against the Association and Ely Mabanag8 before the Regional Trial Court (RTC) of Quezon City,
Branch 104 for building a concrete wall which abutted their property and denied them of their right of way. The
spouses Santander likewise alleged that said concrete wall was built in violation of Quezon City Ordinance No.
8633, S-71 which prohibits the closing, obstructing, preventing or otherwise refusing to the public or vehicular
traffic the use of or free access to any subdivision or community street. 9 The Law Firm of Gonzalez Sinense
Jimenez and Associates was the legal counsel for the Association, with respondent as the counsel of record and
handling lawyer. After trial and hearing, the RTC rendered a decision 10 on October 4, 1996 in favor of the Spouses
Santander. The Association, represented by said law firm, appealed to the Court of Appeals (CA). On February 5,
1999, the CA issued a Resolution11 in CA-G.R. CV No. 55577 dismissing the appeal on the ground that the original
period to file the appellants brief had expired 95 days even before the first motion for extension of time to file
said brief was filed. The CA also stated that the grounds adduced for the said motion as well as the six subsequent
motions for extension of time to file brief were not meritorious. The CA resolution became final.
Eight years later or on April 11, 2007, complainants Nestor Figueras and Bienvenido Victoria, Jr., as members of the
Association, filed a Complaint12 for Disbarment against respondent before the IBP Committee on Bar Discipline
(CBD) for violation of the Code of Professional Responsibility, particularly Rule 12.03, Canon 12; Canon 17; and
Rule 18.03, Canon 18 thereof for his negligence in handling the appeal and willful violation of his duties as an
officer of the court.
In his Verified Answer with Counter Complaint,13 respondent denied administrative liability. He claimed that
although his law firm represented the homeowners association in CA-G.R. CV No. 55577, the case was actually
handled by an associate lawyer in his law office. As the partner in charge of the case, he exercised general
supervision over the handling counsel and signed the pleadings prepared by said handling lawyer. Upon discovery
of the omissions of the handling lawyer, appropriate sanctions were imposed on the handling lawyer and he
thereafter personally took responsibility and spent personal funds to negotiate a settlement with Federico
Santander at no cost to the Association. No damage whatsoever was caused to the Association.
Respondent likewise alleged that after he defeated complainant Figueras in the election for President of the
homeowners association in 1996, Figueras and his compadre, complainant Victoria, stopped paying their
association dues and other assessments. Complainants and other delinquent members of the association were
sanctioned by the Board of Directors and were sued by the association before the Housing and Land Use
Regulatory Board (HLURB). In retaliation, complainants filed the present disbarment case against him and several
other cases against him and other officers of the association before the HLURB to question, among others, the
legitimacy of the Association, the election of its officers, and the sanctions imposed by the Association. Thus, he
concluded that the disbarment case was filed to harass him. Respondent added that complainants have no
personality to file the disbarment complaint as they were not his clients; hence, there was likewise no jurisdiction
over the complaint on the part of the IBP-CBD.
As counterclaim, respondent prayed for the outright dismissal of the disbarment case for lack of merit, the
imposition of sanctions on complainants, and the payment of damages for the filing of the baseless complaint for
disbarment.
On October 3, 2008, the Investigating Commissioner of the IBP-CBD found respondent liable for violation of
the Code of Professional Responsibility, particularly Rule 12.03 of Canon 12, Canon 17, Rule 18.03, and Canon 18
thereof, and recommended that respondent be suspended from the practice of law for a period of three to six
months, with warning that a repetition of the same or similar offense shall be dealt with more
severely.14crallawlibrary
On February 19, 2009, the Board of Governors of the IBP issued Resolution No. XVIII-2009-1415adopting the
recommendation with modifications as follows:chanRoblesVirtualawlibrary
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, with modification, the Report and
Recommendation of the Investigating Commissioner of 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 Respondents breach of Rule 12.03, Canon 12, Canon 17, Rule 18.03 and
Canon 18 of the Code of Professional Responsibility, Atty. Diosdado B. Jimenez is hereby SUSPENDED from the
practice of law for six (6) months. The Warning imposed against respondent is hereby deleted.
Respondent sought reconsideration of the resolution but his motion was denied in IBP Resolution No. XIX-2011-
480 dated June 26, 2011.16 The IBP Board of Governors noted that respondents motion was a mere reiteration of
matters already discussed and there were no substantial grounds to disturb the February 19, 2009 Resolution.
Respondent now comes to this Court essentially raising the issue whether the IBP correctly found him
administratively liable for violation of Rule 12.03, Canon 12, Canon 17, Rule 18.03, and Canon 18 of the Code of
Professional Responsibility.
After careful consideration of the records of the case, the Court finds that the suspension of respondent from the
practice of law is proper.
The Court finds no merit in respondents contention that complainants have no personality to file a disbarment
case against him as they were not his clients and that the present suit was merely instituted to harass him.
The procedural requirement observed in ordinary civil proceedings that only the real party-in-interest must initiate
the suit does not apply in disbarment cases. In fact, the person who called the attention of the court to a lawyers
misconduct is in no sense a party, and generally has no interest in the outcome.17crallawlibrary
In Heck v. Judge Santos,18 the Court held that [a]ny interested person or the court motu proprio may initiate
disciplinary proceedings. The right to institute disbarment proceedings is not confined to clients nor is it
necessary that the person complaining suffered injury from the alleged wrongdoing. Disbarment proceedings are
matters of public interest and the only basis for the judgment is the proof or failure of proof of the charges.
The Court agrees with the IBP that respondent had been remiss in the performance of his duties as counsel for
Congressional Village Homeowners Association, Inc. Records show that respondent filed the first motion for
extension of time to file appellants brief 95 days after the expiration of the reglementary period to file said brief,
thus causing the dismissal of the appeal of the homeowners association. To justify his inexcusable negligence,
respondent alleges that he was merely the supervising lawyer and that the fault lies with the handling lawyer. His
contention, however, is belied by the records for we note that respondent had filed with the CA an Urgent Motion
for Extension, which he himself signed on behalf of the law firm, stating that a previous motion had been filed but
due to the health condition of the undersigned counselhe was not able to finish said Appellants Brief within the
fifteen (15) day period earlier requested by him.19 Thus, it is clear that respondent was personally in charge of the
case.
A lawyer engaged to represent a client in a case bears the responsibility of protecting the latters interest with
utmost diligence. In failing to file the appellants brief on behalf of his client, respondent had fallen far short of his
duties as counsel as set forth in Rule 12.04,20 Canon 12 of the Code of Professional Responsibility which exhorts
every member of the Bar not to unduly delay a case and to exert every effort and consider it his duty to assist in
the speedy and efficient administration of justice. Rule 18.03, Canon 18 of the same Code also states
that:chanRoblesVirtualawlibrary
Canon 18A lawyer shall serve his client with competence and diligence.
Rule 18.03.A lawyer shall not neglect a legal matter entrusted to him and his negligence in connection therewith
shall render him liable.
In In Re: Atty. Santiago F. Marcos21 the Court considered a lawyers failure to file brief for his client as amounting
to inexcusable negligence. The Court held:chanRoblesVirtualawlibrary
An attorney is bound to protect his clients interest to the best of his ability and with utmost diligence. (Del Rosario
vs. Court of Appeals, 114 SCRA 159) A failure to file brief for his client certainly constitutes inexcusable negligence
on his part. (People vs. Villar, 46 SCRA 107) The respondent has indeed committed a serious lapse in the duty owed
by him to his client as well as to the Court not to delay litigation and to aid in the speedy administration of justice.
(Canons 21 and 22, Canons of Professional Ethics; People vs. Daban, 43 SCRA 185; People vs. Estocada, 43 SCRA
515).
It has been stressed that the determination of whether an attorney should be disbarred or merely suspended for a
period involves the exercise of sound judicial discretion.22 The penalties for a lawyers failure to file a brief or other
pleading range from reprimand,23 warning with fine,24suspension25 and, in grave cases, disbarment. 26 In the
present case, we find too harsh the recommendation of the IBP Board of Governors that respondent be suspended
from the practice of law for a period of six months. Under the circumstances, we deem the penalty of suspension
for one month from the practice of law to be more commensurate with the extent of respondents violation.
WHEREFORE, the petition is DENIED. Atty. Diosdado B. Jimenez is found administratively liable for violation of
Rule 12.04, Canon 12 and Rule 18.03, Canon 18 of the Code of Professional Responsibility. He is suspended from
the practice of law for one (1) month effective from finality of this Resolution, with warning that a repetition of the
same or similar violation shall be dealt with more severely.
Let a copy of this Resolution be furnished, upon its finality, to the Integrated Bar of the Philippines and all the
courts in the Philippines, and spread on the personal record of respondent lawyer in the Office of the Bar
Confidant, Supreme Court of the Philippines.
SO ORDERED.
Sereno, C.J., (Chairperson), Leonardo-De Castro, Bersamin, and Reyes, JJ., concur.

SUPREME COURT
Manila
EN BANC
A.C. No. 376 April 30, 1963
JOSEFINA ROYONG, complainant,

vs.
ATTY. ARISTON OBLENA, respondent.
BARRERA, J.:
In a verified complaint filed with this Court on January 14, 1959, complainant Josefina Royong charged the
respondent Ariston J. Oblena, a member of the Philippine Bar, with rape allegedly committed on her person in the
manner described therein. Upon requirement of this Court, the respondent filed his answer denying all the
allegations in the complaint and praying that he be not disbarred. On February 3, 1959, this Court referred the case
to the Solicitor General for investigation, report and recommendation.
On July 10, 1961, the Solicitor General submitted his report on the case with the recommendation that the
respondent "be permanently removed from his office lawyer and his name be stricken from the roll of attorneys".
The pertinent part of the report reads as follows:
The complainant testified that after lunch on August 5, 1958, Cecilia Angeles, her foster mother, left her
alone in their house and went down to the pig sty to feed the pigs. At about 1:00 p.m., while she"
(complainant) was ironing clothes on the second floor of the house the respondent entered and read a
newspaper at her back. Suddenly he covered her mouth with one hand and with the other hand dragged
her to one of the bedrooms of the house and forced her to lie down on the floor. She did not shout for
help because he threatened her and her family with death. He next undressed as she lay on the floor,
then had sexual intercourse with her after he removed her panties and gave her hard blows on the thigh
with his fist to subdue her resistance. After the sexual intercourse, he warned her not to report him to her
foster parents, otherwise, he would kill her and all the members of her family. She resumed ironing
clothes after he left until 5:00 o'clock that afternoon when she joined her foster mother on the first floor
of the house. As a result of the sexual intercourse she became pregnant and gave birth to a baby on June
2, 1959 (pp. 4-8, 21, 23, 26, 27, t.s.n., hearing of Aug. 5, 1959).
She admitted that had she shouted for help she would have been heard by the neighbors that she did not
report the outrage to anyone because of the threat made by the respondent; that she still frequented the
respondent's house after August 5, 1959, sometimes when he was alone, ran errands for him, cooked his
coffee, and received his mail for him. Once, on November 14, 1958, when respondent was sick of
influenza, she was left alone with him in his house while her aunt Briccia Angeles left for Manila to buy
medicine (pp. 11, 14-18, 24, t.s.n., hearing of August 5, 1959).
The respondent on the witness stand denied that he raped the complainant (p. 3, t.s.n., hearing of March
25 1960). He testified that after lunch on August 5, 1958, he went to the Commission Of Civil Service to
follow up his appointment as technical assistant in the office of the mayor of Makati, Rizal, and read the
record of the administrative case against Buenaventura Perez (pp. 23, 24, 34, t.s.n., hearing of March 25,
1960, Exhs. 1 and 2).
The respondent, however, admitted that he had illicit relations with the complainant from January, 1957
to December, 1958, when their clandestine affair was discovered by the complainant's foster parents, but
to avoid criminal liability for seduction, according to him, he limited himself to kissing and embracing her
and sucking her tongue before she completed her eighteenth birthday. They had their first sexual
intercourse on May 11, 1958, after she had reached eighteen, and the second one week later, on May 18.
The last intercourse took place before Christmas in December, 1958. In all, they had sexual intercourse
about fifty times, mostly in her house and sometimes in his house whenever they had the opportunity. He
intended to marry her when she could legally contract marriage without her foster parents' intervention,
'in case occasion will permit ... because we cannot ask permission to marry, for her foster parents will
object and even my common-law wife, will object.' After the discovery of their relationship by the
complainant's foster parents, he confessed the affair to Briccia, explaining that he wanted to have a child,
something she (Briccia) could not give him. (pp. 14-16, 19-25, t.s.n., hearing of March 25, 1960).
xxx xxx xxx
FINDINGS AND COMMENT
There is no controversy that the respondent had carnal knowledge of the complainant. The complainant
claims she surrendered to him under circumstances of violence and intimidation, but the undersigned are
convinced that the sexual intercourse was performed not once but repeatedly and with her consent. From
her behaviour before and after the alleged rape, she appears to have been more a sweetheart than of the
victim of an outrage involving her honor ....
But the foregoing observations notwithstanding, the undersigned cannot in conscience recommend
respondent's exoneration. The respondent tempted Briccia Angeles to live maritally with him not long
after she and her husband parted, and it is not improbable that the spouses never reconciled because of
him. His own evidence shows that, tiring of her after more than fifteen years of adulterous relationship
with her and on the convenient excuse that she, Briccia Angeles, could not bear a child, he seduced
Josefina Andalis, then 17 or 18 years of age, resulting in her pregnancy and the birth of a child, on June 2,
1959. The seduction was accomplished with grave abuse of confidence and by means of promises of
marriage which he knew he could not fulfill without grievous injury to the woman who forsook her
husband so that he, respondent, could have all of her. He also took advantage of his moral influence over
her. From childhood, Josefina Andalis, treated him as an uncle and called him 'tata' (uncle), undoubtedly
because he is the paramour of a sister of her mother. Considering her age (she was 17 or 18 years old
then), it is not difficult to see why she could not resist him.
The evidence further shows that on July 22, 1954, the respondent filed a sworn petition dated May 22,
1954 alleging "that he is a person of good moral character" (Par. 3) and praying that the Supreme Court
permit him "to take the bar examinations to be given on the first Saturday of August, 1954, or at any time
as the Court may fix.."
But he was not then the person of good moral character he represented himself to be. From 1942 to the
present, he has continuously lived an adulterous life with Briccia Angeles whose husband is still alive,
knowing that his concubine is a married woman and that her marriage still subsists. This fact permanently
disqualified him from taking the bar examinations, and had it been known to the Supreme Court in 1954,
he would not have been permitted to take the bar examinations that year or thereafter, or to take his
oath of office as a lawyer. As he was then permanently disqualified from admission to the Philippine Bar
by reason of his adulterous relations with a married woman, it is submitted that the same misconduct
should be sufficient ground for his permanent disbarment, unless we recognize a double standard of
morality, one for membership to the Philippine Bar and another for disbarment from the office of a
lawyer.
xxx xxx xxx
RECOMMENDATION
Wherefore, the undersigned respectfully recommend that after due hearing, respondent Ariston J. Oblena
be permanently removed from his office as a lawyer and his name be stricken from the roll of attorneys.
In view of his own findings as a result of his investigation, that even if respondent did not commit the alleged rape
nevertheless he was guilty of other misconduct, the Solicitor General formulated another complaint which he
appended to his report, charging the respondent of falsely and deliberately alleging in his application for admission
to the bar that he is a person of good moral character; of living adulterously with Briccia Angeles at the same time
maintaining illicit relations with the complainant Josefina Royong, niece of Briccia, thus rendering him unworthy of
public confidence and unfit and unsafe to manage the legal business of others, and praying that this Court render
judgment ordering "the permanent removal of the respondent ... from his office as a lawyer and the cancellation
of his name from the roll of attorneys."
In his answer to this formal complaint, respondent alleged the special defense that "the complaint does not merit
action", since the causes of action in the said complaint are different and foreign from the original cause of action
for rape and that "the complaint lacks the necessary formalities called for in Sec. 1, Rule 128 of the Rules of Court."
Respondent prayed that after due notice and hearing for additional evidence, the complaint be dismissed.
On September 13, 1961, this Court designated the Court Investigators to receive the additional evidence.
Accordingly the case was set for hearing of which the parties were duly notified. On September 29, 1961,
respondent asked leave to submit a memorandum which was granted, and on October 9, 1961 the same was filed,
alleging the following: 1) That the charge of rape has not been proven; 2) That no act of seduction was committed
by the respondent; 3) That no act of perjury or fraudulent concealment was committed by the respondent when
he filed his petition for admission to the bar; and 4) That the respondent is not morally unfit to be a member of the
bar.
Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted and approved by this
Honorable Court, without prejudice to the parties adducing other evidence to prove their case not covered by this
stipulation of facts. 1wph1.t
At the hearing on November 16, 1961, respondent presented his common-law wife, Briccia Angeles, who testified
as follows:
... Respondent is her common-law husband (t.s.n. 23). She first met respondent on December 16, 1941 at
Cavinti, Laguna (t.s.n. 23). She and her sister Cecilia Angeles-Royong were evacuated to Cavinti by the Red
Cross (t.s.n. 23). She was already married (to Teodoro Arines) at the time (t.s.n. 24). She and Arines are
from Iriga, Camarines Sur (t.s.n. 24). Respondent and one Mr. Flores registered them (t.s.n. 24) as
evacuees. When Mr. Flores asked her about her status she told him she was 'single' (t.s.n. 25). She and
her sister, Cecilia, were then told to stay at respondent's house, respondent courted her (t.s.n. 26).
Respondent asked her if she was married and she told him 'we will talk about that later on' (t.s.n. 26). She
told respondent she was married (to Arines) when she and respondent were already living together as
'husband and wife', in 1942( t.s.n. 26). Respondent asked her to marry him, when they were living as
husband and wife (t.s.n. 27). Her sister Cecilia left Cavinti 2 months after their arrival thereat, but she did
not go with her because she and respondent 'had already a good understanding'(sexual relations) [t.s.n.
27]. Later, she left Cavinti and went to her hometown in Iriga, Camarines Sur, because respondent was
already reluctant to live with her and he told her it was better for her to go home to Iriga (t.s.n. 25).
Arriving at Iriga, she met her legitimate husband (Arines), who told her he had already a wife, named
Conching Guevara (t.s.n. 28-29). She then went back to Cavinti (in 1943), with her father, and lived with
respondent (t.s.n. 29). Respondent eventually agreed that she live with him (t.s.n. 35); in fact, she is still
presently living with respondent (t.s.n. 35) [Report of Court Investigators, March 6, 1962, pp. 5-6]."
Thereafter, respondent requested permission to submit an affidavit at a later date, which request was also
granted. The affidavit was filed on December 16, 1961, the respondent averring, among others, the following:.
... That he never committed any act or crime of seduction against the complainant, because the latter was
born on February 19, 1940, and his first sexual intercourse with her took place on May 11, 1958, when she
was already above 18 years of age; that he had been living with his common-law wife, Briccia Angeles, for
almost 20 years, but from the time he began courting her, he 'had no intention to alienate' her love for
her husband, Arines, or to commit the crime of adultery; that he courted Briccia on October 16, 1941, and
was shortly thereafter accepted by her; that on February 21, 1942, he found Briccia alone in his house,
who told him that her sister, Cecilia, had gone to Pagsanjan with the other evacuees; that from said date
(February 21), to the present, he and Briccia had been living together as common-law husband and wife;
that 2 or 3 weeks thereafter, he asked Briccia to marry him, but she confessed she was already married,
and maybe her husband (Arines) was still living in Iriga; that he could not then drive Briccia away, because
she was a stranger in the place, nor could he urge her to join her sister Cecilia, as the latter had left
Pagsanjan; that in 1943 she told Briccia to separate from him and to return to Iriga, and urged her never
to see him again; that contrary to his expectations, Briccia returned to Cavinti 3 months thereafter; that
Briccia strongly insisted to live with him again, telling him that she cannot separate from him anymore, as
he was ashamed; that Briccia's father told him that Briccia's husband (Arines) had agreed not to molest
them as in fact he (Arines) was already living with another woman; that he had 'no choice but to live with
her' (Briccia) again; that when he filed his petition to take the bar examinations in 1954, he 'did not have
the slightest intention to hide' from this Court the fact of his 'open cohabitation with a married woman'
(Briccia Angeles); that he did not state said fact in his petition, because he did not see in the form of the
petition being used in 1954 that the fact must be stated; and that since his birth, he thought and believed
he was a man of good moral character, and it was only from the Solicitor General that he first learned he
was not so; and that he did not commit perjury or fraudulent concealment when he filed his petition to
take the bar examinations in 1954." (Report of the Court Investigators, pp. 6-8, March 6, 1962).
After hearing, the investigators submitted a report with the finding that: 1) Respondent used his knowledge of the
law to take advantage by having illicit relations with complainant, knowing as he did, that by committing immoral
acts on her, he was free from any criminal liability; and 2) Respondent committed gross immorality by continuously
cohabiting with a married woman even after he became a lawyer in 1955 to the present; and 3) That respondent
falsified the truth as to his moral character in his petition to take the 1954 bar examinations, being then immorally
(adulterously) in cohabitation with his common-law wife, Briccia Angeles, a married woman. The investigators also
recommended that the respondent be disbarred or alternatively, be suspended from the practice of law for a
period of one year.
Upon the submission of this report, a copy of which was served on respondent, through his counsel of record, the
case was set for hearing before the Court on April 30, 1962. Respondent asked leave to file his memorandum in
lieu of oral argument. This was granted and the corresponding memorandum was duly filed.
It is an admitted and uncontroverted fact that the respondent had sexual relations with the complainant several
times, and as a consequence she bore him a child on June 2, 1959; and that he likewise continuously cohabited
with Briccia Angeles, in an adulterous manner, from 1942 up to the present.
The main point in issue is thus limited illicit relations with the complainant Josefina Royong the and the open
cohabitation with Briccia Angeles, a married woman, are sufficient grounds to cause the respondent's disbarment.
It is argued by the respondent that he is not liable for disbarment notwithstanding his illicit relations with the
complainant and his open cohabitation with Briccia Angeles, a married woman, because he has not been convicted
of any crime involving moral turpitude. It is true that the respondent has not been convicted of rape, seduction, or
adultery on this count, and that the grounds upon which the disbarment proceedings is based are not among those
enumerated by Section 25, Rule 127 of the Rules of Court for which a lawyer may be disbarred. But it has already
been held that this enumeration is not exclusive and that the power of the courts to exclude unfit and unworthy
members of the profession is inherent; it is a necessary incident to the proper administration of justice; it may be
exercised without any special statutory authority, and in all proper cases unless positively prohibited by statute;
and the power may be exercised in any manner that will give the party be disbarred a fair trial and a fair
opportunity to be heard. (1 Francisco, Rules of Court [1958 ed.] 698, citing In Re Pelaez, 44 Phil. 567). Although it is
a well settled rule that the legislature (or the Supreme Court by virtue of its rule-making power) may provide that
certain acts or conduct shall require disbarment, the accepted doctrine is that statutes and rules merely regulate
the power to disbar instead of creating it, and that such statutes (or rules) do not restrict the general powers of
the court over attorneys, who are its officers, and that they may be removed for other than statutory grounds (7
C.J.S. 734). In the United States, where from our system of legal ethics is derived, "the continued possession of a
fair private and professional character or a good moral character is a requisite condition for the rightful
continuance in the practice of law for one who has been admitted, and its loss requires suspension or disbarment
even though the statutes do not specify that as a ground of disbarment". The moral turpitude for which an
attorney may be disbarred may consist of misconduct in either his professional or non-professional activities (5
Am. Jur. 417). The tendency of the decisions of this Court has been toward the conclusion that a member of the
bar may be removed or suspended from office as a lawyer for other than statutory grounds. Indeed, the rule is so
phrased as to be broad enough to cover practically any misconduct of a lawyer (In Re Pelaez, 44 Phil. 567). In the
case at bar, the moral depravity of the respondent is most apparent. His pretension that before complainant
completed her eighteenth birthday, he refrained from having sexual intercourse with her, so as not to incur
criminal liability, as he himself declared and that he limited himself merely to kissing and embracing her and
sucking her tongue, indicates a scheming mind, which together with his knowledge of the law, he took advantage
of, for his lurid purpose.
Moreover, his act becomes more despicable considering that the complainant was the niece of his common-law
wife and that he enjoyed a moral ascendancy over her who looked up to him as her uncle. As the Solicitor General
observed: "He also took advantage of his moral influence over her. From childhood, Josefina Andalis (Royong),
treated him as an uncle and called him 'tata' (uncle), undoubtedly because he is the paramour of a sister of her
mother. Considering her age (she was 17 or 18 years old then), her inexperience and his moral ascendency over
her, it is not difficult to see why she could not resist him." Furthermore, the blunt admission of his illicit relations
with the complainant reveals the respondent to be a person who would suffer no moral compunction for his acts if
the same could be done without fear of criminal liability. He has, by these acts, proven himself to be devoid of the
moral integrity expected of a member of the bar.
The respondent's misconduct, although unrelated to his office, may constitute sufficient grounds for disbarment.
This is a principle we have followed since the ruling in In Re Pelaez, 44 Phil. 567, where this Court quoted with
approval the following portion of the decision of the Supreme Court of Kansas in the case of Peyton's Appeal (12
Kan. 398, 404), to wit:.
The nature of the office, the trust relation which exists between attorney and client, as well as between
court and attorney, and the statutory rule prescribing the qualifications of attorneys, uniformly require
that an attorney be a person of good moral character. If that qualification is a condition precedent to a
license or privilege to enter upon the practice of the law, it would seem to be equally essential during the
continuance of the practice and the exercise of the privilege. So it is held that an attorney will be removed
not only for malpractice and dishonesty in his profession, but also for gross misconduct not connected
with his professional duties, which shows him to be unfit for the office and unworthy of the privileges
which his license and the law confer upon him. (Emphasis supplied).
Respondent's conduct though unrelated to his office and in no way directly bearing on his profession, has
nevertheless rendered him unfit and unworthy of the privileges of a lawyer. We cannot give sanction to his acts.
For us to do so would be as the Solicitor General puts it recognizing "a double standard of morality, one for
membership to the Philippine Bar, and another for disbarment from the office of the lawyer." If we concede that
respondent's adulterous relations and his simultaneous seduction of his paramour's niece did not and do not
disqualify him from continuing with his office of lawyer, this Court would in effect be requiring moral integrity as
an essential prerequisite for admission to the bar, only to later on tolerate and close its eyes to the moral depravity
and character degeneration of the members of the bar.
The decisions relied upon by the respondent in justifying his stand that even if he admittedly committed
fornication, this is no ground for disbarment, are not controlling. Fornication, if committed under such scandalous
or revolting circumstances as have proven in this case, as to shock common sense of decency, certainly may justify
positive action by the Court in protecting the prestige of the noble profession of the law. The reasons advanced by
the respondent why he continued his adulterous relations with Briccia Angeles, in that she helped him in some way
finish his law studies, and that his "sense of propriety and Christian charity" did not allow him to abandon her after
his admission to the bar after almost 13 years of cohabitation, are hardly an excuse for his moral dereliction. The
means he employed, as he stated, in order to extricate himself from the predicament he found himself in, by
courting the complainant and maintaining sexual relations with her makes his conduct more revolting. An immoral
act cannot justify another immoral act. The noblest means he could have employed was to have married the
complainant as he was then free to do so. But to continue maintaining adulterous relations with a married woman
and simultaneously maintaining promiscuous relations with the latter's niece is moral perversion that can not be
condoned. Respondent's conduct therefore renders him unfit and unworthy for the privileges of the legal
profession. As good character is an essential qualification for admission of an attorney to practice, he may be
removed therefrom whenever he ceases to possess such character (7 C.J.S. 735).
The respondent further maintains that the Solicitor General exceeded his authority in filing the present complaint
against him for seduction, adultery and perjury, as it charges an offense or offenses different from those originally
charged in the complaint of January 14, 1959 for rape, and cites as authority Sections 4 and 5 of Rule 128 of the
Rules of Court, which state:.
SEC. 4. Report of the Solicitor General. Based upon the evidence adduced at the hearing, if the Solicitor
General finds no sufficient ground to proceed against the respondent, he shall submit a report to the
Supreme Court containing his findings of fact and conclusion, whereupon the respondent shall be
exonerated unless the court orders differently.
SEC. 5. Complaint of the Solicitor General. Answer of the respondent. If the Solicitor General finds
sufficient ground to proceed against the respondent, he shall file the corresponding complaint,
accompanied with all the evidence introduced in his investigation, with the Supreme Court, and the
respondent shall be served by the clerk of the Supreme Court with a copy of the complaint with direction
to answer the same within fifteen days.
The contention is devoid of merit. Nothing in the language of the foregoing rules requires the Solicitor General to
charge in his complaint the same offense charged in the complaint originally filed by the complainant for
disbarment. Precisely, the law provides that should the Solicitor General find sufficient grounds to proceed against
the respondent, he shall file the corresponding complaint, accompanied by the evidence introduced in his
investigation. The Solicitor General therefore is at liberty to file any case against the respondent he may be
justified by the evidence adduced during the investigation..
The respondent also maintains that he did not falsify his petition to take the bar examinations in 1954 since
according to his own opinion and estimation of himself at that time, he was a person of good moral character. This
contention is clearly erroneous. One's own approximation of himself is not a gauge to his moral character. Moral
character is not a subjective term, but one which corresponds to objective reality. Moral character is what a
person really is, and not what he or other people think he is. As former Chief Justice Moran observed: An applicant
for license to practice law is required to show good moral character, or what he really is, as distinguished from
good reputation, or from the opinion generally entertained of him, the estimate in which he is held by the public in
the place where he is known. As has been said, ante the standard of personal and professional integrity which
should be applied to persons admitted to practice law is not satisfied by such conduct as merely enables them to
escape the penalties of criminal law. Good moral character includes at least common honesty (3 Moran,
Comments on the Rules of Court, [1957 ed.] 626, citing In Re Weinstein, 42 P. [2d] 744 B.L.D., Cooper v. Greeley. 1
Den. [N.Y.] 3447; In Re Del Rosario, 52 Phil. 399; and People v. Macauley, 82 N.E. 612). Respondent, therefore, did
not possess a good moral character at the time he applied for admission to the bar. He lived an adulterous life with
Briccia Angeles, and the fact that people who knew him seemed to have acquiesced to his status, did not render
him a person of good moral character. It is of no moment that his immoral state was discovered then or now as he
is clearly not fit to remain a member of the bar.
WHEREFORE, judgment is hereby entered striking the name of herein respondent, Ariston J. Oblena, from the roll
of attorneys.
Bengzon, C.J., Bautista Angelo, Labrador, Concepcion, Paredes, Regala and Makalintal, JJ., concur.
Padilla, Reyes, J.B.L., and Dizon, JJ., took no part.

SUPREME COURT
Manila
FIRST DIVISION
A.C. No. 10135 January 15, 2014
EDGARDO AREOLA, Complainant,

vs.
ATTY. MARIA VILMA MENDOZA, Respondent.
RESOLUTION
REYES, J.:
This refers to the administrative complaint1 filed by Edgardo D. Areola (Areola) a.k.a. Muhammad Khadafy against
Atty. Maria Vilma Mendoza (Atty. Mendoza), from the Public Attorney s Office (PAO) for violation of her attorney s
oath of office, deceit, malpractice or other gross misconduct in office under Section 27, Rule 138 of the Revised
Rules of Court, and for violation of the Code of Professional Responsibility.
In the letter-complaint dated November 13, 2006 addressed to the Honorable Commissioners, Commission on Bar
Discipline of the Integrated Bar of the Philippines (IBP), Areola stated that he was filing the complaint in behalf of
his co-detainees Allan Seronda, Aaron Arca, Joselito Mirador, Spouses Danilo Perez and Elizabeth Perez. He alleged
that on October 23, 2006, during Prisoners Week, Atty. Mendoza, visited the Antipolo City Jail and called all
detainees with pending cases before the Regional Trial Court (RTC), Branch 73, Antipolo City where she was
assigned, to attend her speech/lecture. 2 Areola claimed that Atty. Mendoza stated the following during her
speech:
"O kayong may mga kasong drugs na may pangpiyansa o pang- areglo ay maging praktikal sana kayo kung gusto
ninyong makalaya agad. Upang makatiyak kayo na hindi masasayang ang pera ninyo ay sa akin ninyo ibigay o ng
kamag-anak ninyo ang pera at ako na ang bahalang maglagay kay Judge Martin at Fiscal banqui; at kayong mga
detenidong mga babae na no bail ang kaso sa drugs, iyak-iyakan lang ninyo si Judge Martin at palalayain na kayo.
Malambot ang puso noon."3
Atty. Mendoza allegedly said that as she is handling more than 100 cases, all detainees should prepare and furnish
her with their Sinumpaang Salaysay so that she may know the facts of their cases and their defenses and also to
give her the necessary payment for their transcript of stenographic notes. 4
Areola furthermore stated that when he helped his co-inmates in drafting their pleadings and filing motions before
the RTC Branch 73, Antipolo City, Atty. Mendoza undermined his capability, to wit:
(1) Atty. Mendoza purportedly scolded detainee Seronda when she learned that the latter was assisted by
Areola in filing a Motion to Dismiss for Violation of Republic Act No. 8942 (Speedy Trial Act of 1998) in the
latters criminal case for rape, which was pending before the RTC, Branch 73, Antipolo City. She got
angrier when Seronda retorted that he allowed Areola to file the motion for him since there was nobody
to help him.
(2) Areola assisted Spouses Danilo and Elizabeth Perez in filing their Joint Motion for Consolidation of Trial
of Consolidated Offenses and Joint Motion to Plead Guilty to a Lesser Offense. The spouses were likewise
scolded for relying on the Complainant and alleged that the respondent asked for P2,000.00 to represent
them.
(3) Areola helped another co-detainee, Mirador in filing an "Ex-parte Motion to Plead Guilty to a Lesser
Offense". When Atty. Mendoza learned of it, she allegedly scolded Mirador and discredited Areola. 5
In her unverified Answer6 dated January 5, 2007, Atty. Mendoza asseverated that the filing of the administrative
complaint against her is a harassment tactic by Areola as the latter had also filed several administrative cases
against judges in the courts of Antipolo City including the jail warden of Taytay, Rizal where Areola was previously
detained. These actuations show that Areola has a penchant for filing various charges against anybody who does
not accede to his demand.7 Atty. Mendoza contended that Areola is not a lawyer but represented himself to his co-
detainees as one.8 She alleged that the motions/pleadings prepared and/or filed by Areola were not proper.
After both parties failed to appear in the Mandatory Conference set by the IBP on August 15, 2008, the
Investigating Commissioner considered the non-appearance as a waiver on their part. Nonetheless, in the interest
of justice, both parties were required to submit their respective position papers. 9
On December 29, 2009, the Investigating Commissioner issued his Report and Recommendation. 10 The
Investigating Commissioner stated that the Complainant is knowledgeable in the field of law. While he may be of
service to his fellow detainees, he must, however, be subservient to the skills and knowledge of a full fledged
lawyer. He however found no convincing evidence to prove that Atty. Mendoza received money from Areolas co-
detainees as alleged. The charges against Atty. Mendoza were also uncorroborated, viz:
There is no convincing evidence that will prove that the respondent received money from the inmates since the
charges are uncorroborated. In fact, the complainant is not the proper party to file the instant case since he was
not directly affected or injured by the act/s being complained of. No single affidavits of the affected persons were
attached to prove the said charges. Hence, it is simply hearsay in nature.11
Nonetheless, Atty. Mendoza admitted in her Answer that she advised her clients and their relatives to approach
the judge and the fiscal "to beg and cry" so that their motions would be granted and their cases against them
would be dismissed. To the Investigating Commissioner, this is highly unethical and improper as the act of Atty.
Mendoza degrades the image of and lessens the confidence of the public in the judiciary.12 The Investigating
Commissioner recommended that Atty. Mendoza be suspended from the practice of law for a period of two (2)
months.13
In a Notice of Resolution14 dated November 19, 2011, the Board of Governors resolved to adopt and approve the
Report and Recommendation of the Investigating Commissioner.
Atty. Mendoza sought to reconsider the Resolution15 dated November 19, 2011 but the IBP Board of Governors
denied her motion in its Resolution16 dated May 10, 2013. The Resolution of the IBP Board of Governors was
transmitted to the Court for final action pursuant to Rule 139-B, Section 12, Paragraph b17 of the Revised Rules of
Court.
The Courts Ruling
After a judicious examination of the records, the Court finds that the instant Complaint against Atty. Mendoza
profoundly lacks evidence to support the allegations contained therein. All Areola has are empty assertions against
Atty. Mendoza that she demanded money from his co-detainees.
The Court agrees with the IBP that Areola is not the proper party to file the Complaint against Atty. Mendoza. He is
not even a client of Atty. Mendoza. He claims that he filed the Complaint on behalf of his co-detainees Seronda,
Arca, Mirador and Spouses Perez, but it is apparent that no document was submitted which would show that they
authorized Areola to file a Complaint. They did not sign the Complaint he prepared. No affidavit was even executed
by the said co-detainees to substantiate the matters Areola raised. Consequently, the Court rejects Areolas
statements, especially as regards Atty. Mendozas alleged demands of money.
The Court agrees with the observations of the Investigating Commissioner that Areola initiated this complaint
when he felt insulted because Atty. Mendoza refused to acknowledge the pleadings and motions he prepared for
his co-detainees who are PAO clients of Atty. Mendoza.18 It appears that Areola is quite knowledgeable with
Philippine laws. However, no matter how good he thinks he is, he is still not a lawyer. He is not authorized to give
legal advice and file pleadings by himself before the courts. His familiarity with Philippine laws should be put to
good use by cooperating with the PAO instead of filing baseless complaints against lawyers and other government
authorities. It seems to the Court that Areola thinks of himself as more intelligent and better than Atty. Mendoza,
based on his criticisms against her. In his Reply19, he made fun of her grammatical errors and tagged her as using
carabao english20. He also called the PAO as "Pa-Amin Office"21 which seriously undermines the reputation of the
PAO. While Areola may have been frustrated with the way the PAO is managing the significant number of cases it
deals with, all the more should he exert efforts to utilize his knowledge to work with the PAO instead of maligning
it.
Interestingly, Atty. Mendoza admitted that she advised her clients to approach the judge and plead for compassion
so that their motions would be granted. This admission corresponds to one of Areolas charges against Atty.
Mendozathat she told her clients " Iyak-iyakan lang ninyo si Judge Martin at palalayain na kayo. Malambot ang
puso noon." Atty. Mendoza made it appear that the judge is easily moved if a party resorts to dramatic antics such
as begging and crying in order for their cases to be dismissed.
As such, the Court agrees with the IBP Board of Governors that Atty. Mendoza made irresponsible advices to her
clients in violation of Rule 1.02 and Rule 15.07 of the Code of Professional Responsibility. It is the mandate of Rule
1.02 that "a lawyer shall not counsel or abet activities aimed at defiance of the law or at lessening confidence in
the legal system." Rule 15.07 states that "a lawyer shall impress upon his client compliance with the laws and the
principles of fairness."
Atty. Mendozas improper advice only lessens the confidence of the public in our legal system. Judges must be free
to judge, without pressure or influence from external forces or factors22 according to the merits of a case. Atty.
Mendozas careless remark is uncalled for.
It must be remembered that a lawyers duty is not to his client but to the administration of justice.1wphi1 To that
end, his clients success is wholly subordinate. His conduct ought to and must always be scrupulously observant of
the law and ethics. Any means, not honorable, fair and honest which is resorted to by the lawyer, even in the
pursuit of his devotion to his clients cause, is condemnable and unethical. 23
In spite of the foregoing, the Court deems the penalty of suspension for two (2) months as excessive and not
commensurate to Atty. Mendozas infraction. Disbarment and suspension of a lawyer, being the most severe forms
of disciplinary sanction, should be imposed with great caution and only in those cases where the misconduct of the
lawyer as an officer of the court and a member of the bar is established by clear, convincing and satisfactory
proof.24 The Court notes that when Atty. Mendoza made the remark "Iyak-iyakan lang ninyo si Judge Martin at
palalayain na kayo. Malambot ang puso noon", she was not compelled by bad faith or malice. While her remark
was inappropriate and unbecoming, her comment is not disparaging and reproachful so as to cause dishonor and
disgrace to the Judiciary.
In several administrative cases, the Court has refrained from imposing the actual penalties in the presence of
mitigating factors. Factors such as the respondents length of service, the respondents acknowledgement of his or
her infractions and feeling of remorse, family circumstances, humanitarian and equitable considerations,
respondents advanced age, among other things, have had varying significance in the Courts determination of the
imposable penalty.25 The Court takes note of Atty. Mendozas lack of ill-motive in the present case and her being a
PAO lawyer as her main source of livelihood.26 Furthermore, the complaint filed by Areola is clearly baseless and
the only reason why this was ever given consideration was due to Atty. Mendozas own admission. For these
reasons, the Court deems it just to modify and reduce the penalty recommended by the IBP Board of Governors.
WHEREFORE, premises considered, the Court finds Atty. Maria Vilma Mendoza GUILTY of giving improper advice to
her clients in violation of Rule 1.02 and Rule 15.07 of the Code of Professional Responsibility and is accordingly
meted out the penalty of REPRIMAND, with the STERN WARNING that a repetition of the same or similar act will
be dealt with more severely.
SO ORDERED.
BIENVENIDO L. REYES
Associate Justice

SUPREME COURT
Manila
SECOND DIVISION
A.C. No. 9395 November 12, 2014
DARIA O. DAGING, Complainant,

vs.
ATTY. RIZ TINGALON L. DAVIS, Respondent.
RESOLUTION
DEL CASTILLO, J.:
This administrative complaint for disbarment arose from an Affidavit Complaint 1 filed by Daria O. Daging
(complainant) before the Integrated Bar of the Philippines (IBP), Benguet Chapter, 2 against Atty. Riz Tingalon L.
Davis (respondent).
Antecedents
Complainant was the owner and operator of Nashville Country Music Lounge. She leased from Benjie Pinlac
(Pinlac) a building spaGe located at No. 22 Otek St., Baguio City where she operated the bar.
Meanwhile, complainant received a Retainer Proposal3 from Davis & Sabling Law Office signed by respondent and
his partner Atty. Amos Saganib Sabling (Atty. Sabling). This eventually resulted in the signing by the complainant,
the respondent and Atty. Sabling of a Retainer Agreement4 dated March 7, 2005.
Because complainant was delinquent in paying the monthly rentals, Pinlac terminated the lease. Together with
Novie Balageo (Balageo) and respondent, Pinlac went to complainant's music bar, inventoried all the equipment
therein, and informed her that Balageo would take over the operation of the bar. Complainant averred that
subsequently respondent acted as business partner of Balageo in operating the bar under her business name,
which they later renamed Amarillo Music Bar.
Complainant likewise alleged that she filed an ejectment case against Pinlac and Balageo before the Municipal Trial
Court in Cities (MTCC), Branch 1, Baguio City. At that time, Davis & Sabling Law Office was still her counsel as their
Retainer Agreement remained subsisting and in force. However, respondent appeared as counsel for Balageo in
that ejectment case and filed, on behalf of the latter, an Answer with Opposition to the Prayer for the Issuance of a
Writ of Preliminary Injunction.5
In his Comment,6 respondent denied participation in the takeover or acting as a business partner of Balageo in the
operation of the bar. He asserted that Balageo is the sole proprietress of the establishment. He insisted that it was
Atty. Sabling, his partner, who initiated the proposal and was in fact the one who was able to convince
complainant to accept the law office as her retainer. Respondent maintained that he never obtained any
knowledge or information regarding the business of complainant who used to consult only Atty. Sabling.
Respondent admitted though having represented Balageo in the ejectment case, but denied that he took
advantage of the Retainer Agreement between complainant and Davis and Sabling Law Office. Thus:
3.a Prior to the engagement of the Complainant of the DAVIS and SABLING LAW OFFICE as her retainer,
Novie Balageo was already one of the Clients of Respondent in several cases;
3.b Sometime in the last week of the month of May 2005, while Respondent was in his office doing some
legal works, Novie Balageo called up Respondent informing the latter that his assistance is needed for
purposes of conducting an inventory of all items at the former Nashville Country Music Lounge;
3.c Respondent [asked] Novie Balageo [the purpose of] the inventory [to which] the latter x xx responded
x xx that she entered into a lease contract with the present administrator of the building, Benjie Pinlac;
3.d Respondent, to his disbelief requested Novie Balageo to go [to] the LAW OFFICE for further
clarification of the matter. Thereafter, Respondent was later informed that the business of Complainant
was taken over and operated by Mr. Benjie Pinlac for seven days. Furthermore, Mr. Benjie Pinlac offered
the said place to Novie Balageo which the latter readily accepted;
3.e [Left] with no recourse, Respondent requested one of his staff to assist Novie Balageo in conducting
an inventory. Furthermore, Respondent never acted as partner of Novie Balageo in operating the former
Nashville Country Music Lounge;
3.f When Complainant filed the civil case for Ejectment against Novie Balageo and Benjie Pinlac,
Respondent represented the former thereof without taking advantage of the retainership contract
between the DA VIS and SABLING LAW OFFICE [and] Complainant as Respondent has no knowledge or
information of any matters related by complainant to Atty. Sabling regarding the former' s business;
3.g While the Complaint was pending, respondent was xx x informed by Novie Balageo and Benjie Pinlac
of the truth of all matters x x x which x x x Respondent [was unaware of];
3.h However, for the interest of justice and fair play, x x x Respondent [deemed it prudent] to xx x
withdraw as Counsel for Novie Balageo. Hence, Respondent filed his Motion to Withdraw As Counsel. x x x
3.i The civil case was subsequently dismissed for lack of jurisdiction over the [Complaint's] subject matter.
x x x7
On October 15, 2008, the Investigating Commissioner rendered a Report and Recommendation 8 finding
respondent guilty of betrayal of his client's trust and for misuse of information obtained from his client to the
disadvantage of the latter and to the advantage of another person. He recommended that respondent be
suspended from the practice oflaw for a period of one year.
On December 11, 2008, the IBP Board of Governors adopted and approved the Report and Recommendation of
the Investigating Commissioner.9 Upon motion of the respondent, it reduced the penalty imposed to six months
suspension considering that there is no proof that respondent actually handled any previous legal matters
involving complainant.10
Our Ruling
It is undisputed that complainant entered into a Retainer Agreement dated March 7, 2005 with respondent's law
firm. This agreement was signed by the respondent and attached to the rollo of this case. And during the
subsistence of said Retainer Agreement, respondent represented and defended Balageo, who was impleaded as
one of the defendants in the ejectment case complainant filed before the MTCC of Baguio City. In fact, respondent
filed on behalf of said Balageo an Answer with Opposition to the Prayer for the Issuance of a Writ of Preliminary
Injunction dated July 11, 2005. It was only on August 26, 2005 when respondent withdrew his appearance for
Balageo.
Based on the established facts, it is indubitable that respondent transgressed Rule 15.03 of Canon 15 of the Code
of Professional Responsibility.1wphi1 It provides:
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.
"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."11 The prohibition against representing conflicting interests is
absolute and the rule applies even if the lawyer has acted in good faith and with no intention to represent
conflicting interests.12 In Quiambao v. Atty. Bamba,13 this Court emphasized that lawyers are expected 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.14
Respondent argues that while complainant is a client of Davis & Sabling Law office, her case is actually handled
only by his partner Atty. Sabling. He was not privy to any transaction between Atty. Sabling and complainant and
has no knowledge of any information or legal matter complainant entrusted or confided to his law partner. He thus
inveigles that he could not have taken advantage of an information obtained by his law firm by virtue of the
Retainer Agreement. We are not impressed. In Hilado v. David,15 reiterated in Gonzales v. Atty. Cabucana, Jr.,16this
Court held that a lawyer who takes up the cause of the adversary of the party who has engaged the services of his
law firm brings the law profession into public disrepute and suspicion and undermines the integrity of justice.
Thus, respondent's argument that he never took advantage of any information acquired by his law finn in the
course of its professional dealings with the complainant, even assuming it to be true, is of no moment. Undeniably
aware of the fact that complainant is a client of his law firm, respondent should have immediately informed both
the complainant and Balageo that he, as well as the other members of his law firm, cannot represent any of them
in their legal tussle; otherwise, they would be representing conflicting interests and violate the Code of
Professional Responsibility. Indeed, respondent could have simply advised both complainant and Balageo to
instead engage the services of another lawyer.
The penalty for representing conflicting interests may either be reprimand or suspension from the practice of law
ranging from six months to two years.17 We thus adopt the recommendation of the IBP Board of Governors.
WHEREFORE, the Court ADOPTS and AFFIRMS the January 15, 2012 Resolution of the Integrated Bar of the
Philippines Board of Governors. Atty. Riz Tingalon L. Davis is found GUILTY of violating Rule 15.03, Canon 15 of the
Code of Professional Responsibility and is hereby SUSPENDED from the practice of law for a period of six (6)
months effective upon receipt of this Resolution. He is warned that a commission of the same or similar offense in
the future will result in the imposition of a stiffer penalty.
Let a copy of this Resolution be entered into the records of Atty. Riz Tingalon L. Davis and furnished to the Office of
the Clerk of Court, the Office of the Bar Confidant, the Integrated Bar of the Philippines, and all courts in the
Philippines, for their information and guidance.
Atty. Riz Tingalon L. Davis is DIRECTED to inform the Court of the date of his receipt of this Resolution.
SO ORDERED.
MARIANO C. DEL CASTILLO

Associate Justice

SUPREME COURT
Manila
FIRST DIVISION
A.C. No. 9976 June 25, 2014

[Formerly CBD Case No. 09-2539]
ALMIRA C. FORONDA, Complainant,

vs.
ATTY. JOSE L. ALVAREZ, JR., Respondent.
DECISION
REYES, J.:
This refers to the complaint1 for disbarment filed before the Integrated Bar of the Philippines, Commission on Bar
Discipline (IBP-CBD) by Almira C. Foronda (complainant) against Atty. Jose L. Alvarez, Jr. (respondent) for the
following alleged infractions:
(1) Fraud and deceit in luring [the complainant] in transacting business with [the respondent]; (2)
Dishonesty and misrepresentation when [the respondent] misinformed [the complainant] that [her]
annulment case was already filed when in fact it was not;
(3) Issuing unfunded checks as payment for [the respondent's] obligations to [the complainant];
(4) Violation of Canon 15.06 of the Code of Professional Responsibilities when [the respondent]
represented to [the complainant] that he know[s] of court personnel who will help facilitate [the
complainants] annulment case;
(5) Violation of Canons 16.01 and 16.03 for failure to return [the complainants] money despite numerous
demands; and
(6) Violation of Canon 18.04 when [the respondent] misinformed [the complainant] regarding the status
of [her] annulment case.2
Facts
The complainant is an overseas Filipino worker in Dubai. In May 2008, she returned to the Philippines to institute a
case for the nullification of her marriage. The respondent was referred to her and the complainant agreed to
engage his services for a fee of P195,000.00 to be paid as follows: 50% or P100,000.00 upon the signing of the
contract; 25% or P50,000.00 on or before June 10, 2008; and 25% or P45,000.00 before the filing of the case.3The
complainant paid the amounts as agreed. The amount of P45,000.00 was even paid on June 10, 2008,4 after being
informed by the respondent that the petition for the annulment of marriage was ready for filing.
The complainant averred that the respondent promised to file the petition after he received the full payment of his
attorneys fee, or on June 11, 2008. In September 2008, the complainant inquired about the status of her case and
was allegedly told by the respondent that her petition was pending in court; and in another time, she was told that
a decision by the court was already forthcoming. However, when she came back to the country in May 2009, the
respondent told her that her petition was still pending in court and apologized for the delay. Eventually, the
complainant was able to get a copy of her petition and found out that it was filed only on July 16, 2009. 5
The complainant further alleged in her complaint that the week after she signed the contract of service with the
respondent, the latter requested for a meeting. Thinking that they were going to discuss her case, she agreed. But
during the meeting, the respondent invited her to be an investor in the lending business allegedly ran by the
respondents sister-in-law.6 The respondent encouraged her to invest P200,000.00 which he said can earn five
percent (5%) interest per month.
The complainant finally agreed on the condition that the respondent shall issue personal and post-dated checks in
her favor dated the 10th of each month starting July 2008 until June 10,2009, representing the five percent (5%)
interest that the complainants money shall earn. Thus, the complainant gave P200,000.00 to the respondent upon
the security of thirteen (13) United Coconut Planters Bank (UCPB) checks. Eleven (11) of said checks were
for P8,000.00 each. The other two (2) checks dated June 8, 2009 and June 10, 2009 were for P100,000.00
and P108,000.00, respectively.7
According to the complainant, upon presentment of these checks, the drawee-bank honored the first two (2)
checks, but the rest were dishonored for being drawn against a closed account. When she brought the matter to
the respondent, he promised to pay her in cash. He actually paid her certain amounts as interest through her
representative. Nevertheless, the respondent failed to pay the entire obligation as promised. Thereafter, the
respondent issued eight (8) Banco de Oro (BDO)checks as replacement for the dishonored UCPB checks. However,
the BDO checks were likewise dishonored for being drawn against a closed account.8
In his Answer,9 the respondent admitted that he filed the petition for annulment only in July 2009 but this was not
due to his own fault. The delay was caused by the complainant herself who allegedly instructed him to hold the
filing of the said petition as she and her husband were discussing a possible reconciliation.10 He further claimed
that he filed the petition on July 16, 2009 after negotiations with the complainants husband apparently failed.11
The respondent also admitted that he invited the complainant to be a partner in a lending business and clarified
that the said business was being managed by a friend. He further stated that he was also involved in the said
business as a partner.12
The respondent admitted that only the first two (2) of the checks he issued were honored by the drawee-bank. He
stated that prior to the presentment and dishonor of the rest of the UCPB checks, he advised the complainant that
the third check should not be deposited just yet due to losses in their lending business caused by the failure of
some borrowers to settle their obligations.13 Apart from the foregoing, the respondent denied most of the
allegations in the complaint, including the dishonor of the BDO checks, for lack of sufficient information to form a
belief as to the truth thereof.14
By way of special and affirmative defense, the respondent asserted the following: that it was the complainant who
owed him notarial fee amounting to 80,000.00 as he notarized a deed of conditional sale executed between her
and a certain Rosalina A. Ruiz over a real property worth 4,000,000.00;15 and that the contract he executed with
the complainant was a mere contract of loan. Being a contract of loan, he cannot be held guilty of violation of
Batas Pambansa Bilang 22 (B.P. Blg. 22) since the checks he issued were to serve only as security for it. 16
The parties were called to a mandatory conference before the IBP-CBD on January 18, 2010 by the Investigating
Commissioner.17 Thereafter, the parties were required to submit their respective position paper.
In an undated Report,18 the Investigating Commissioner made the following factual findings:
From the foregoing, it appears that the following facts are not disputed. The complainant is an overseas Filipino
worker based in Dubai. During her vacation in the Philippines in May 2008, she contracted the services of
respondent to file a petition for the annulment of her marriage for an agreed packaged fee of [P]195,000.00 which
she paid in full by June 2008. Respondent, however, filed the petition for the annulment of her marriage only in
July 2009. In the meantime, more specifically in June 2008, respondent obtained [P]200,000.00 from complainant
with the promise to pay the same with interestat 4% per month starting July 2008 until June 2009. Respondent
issued complainant eleven (11) checks for [P]8,000.00 each postdated checks monthly from 10 July 2008 until 10
May 2009 plus a check for [P]108,000.00 payable on 10 June 2009 and another check for [P]100,000.00 payable on
8 June 2009. When presented for payment, the first two (2) checks were good but the rest of the checks were
dishonored for being drawn against a closed account. When complainant demanded payment, respondent issued
to her eight (8) new replacement postdated checks dated 25th of every month from June 2009 to January 2010. All
of the replacement checks, however, were likewise dishonored for being drawn against a closed account. When
respondent was unable to pay respondent, complainant filed a criminal complaint against him for violation of BP
22 before the Office of the City Prosecutor of Muntinlupa. The criminal complaint was eventually dismissed after
complainant executed an affidavit of desistance after she was paid a certain amount by respondent.19
The Investigating Commissioner found that there was basis to hold the respondent liable, to wit: 1. Respondent
Atty. Alvarez, Jr. is guilty of delay in the filing of the petition for annulment of the marriage of complainant for
almost a year. Initially, in his Answer, he claims that the delay was due to the instruction of complainant to hold in
abeyance the filing of the petition as she and her husband discussed possible reconciliation. In his Position Paper,
he claims that the delay was due to the failure of the complainant to submit to an interview by the psychologist
and the time it took him to research on the guidelines on the matter. Finally, in his Supplemental Affidavit, he
admits the delay and apologizes for it. For delaying in filing the petition for complainant, respondent should be
deemed guilty of violating Canons 17 and 18 of the Code of Professional Responsibility which pertinent read:
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.
CANON 18. A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE[.]
Rule 18.03 A lawyer shall not neglect a legal matter entrusted to him, and the negligence in connection therewith
xxxx
2. Respondent lied about the delay. The allegations of complainant about how respondent lied to her about the
delay in the filing of the petition are very detailed. While denying he misrepresented to complainant that the
petition has been filed when it was not, respondent did not care to refute also in detail the allegations of
complainant. In his Answer, he simply denied the same for the reason [that] he has no sufficient information to
form a belief as to the truth thereof. It should be noted, however, that the allegations pertains [sic] to things
respondent said and did[,] and are therefore[,] matters which he knew or should have known. His denial is
therefore tantamount to an admission. In doing so, respondent is guilty of violating not only Canon 15 but also
Rule 18.04 of the Code of Professional Responsibility, which read:
CANON 15. A LAWYER SHALL OBSERVE CANDOR, FAIRNESS AND LOYALTY IN ALL HIS DEALINGS AND
TRANSACTIONS WITH HIS CLIENT.
Rule 18.04 A lawyer shall keep his client informed of the status of his case and shall respond within a reasonable
time to the clients request for information.
xxxx
3. Respondent induced complainant to lend him money at 5% interest per month but failed to pay the same. This is
admitted by respondent. Rule 16.04 provides that a lawyer shall not borrow money from his client unless the
clients interests are fully protected by the nature of the case or by independent advice. Obviously, respondent
borrowed money from his client and his clients interest was not fully protected. In fact, respondent repeatedly
failed to comply with his promise to pay complainant. The fact that he subsequently paid complainant more than
the amount due from him as part of the settlement of the criminal complaint filed by her against him hardly serves
to mitigate his liability. x x x.
4. He issued two sets of checks which were dishonored when presented for payment. This is admitted by
respondent. x x x.20
The Investigating Commissioner, thereby, recommended the penalty of two years suspension from the practice of
law with a warning that a repetition of the offenses shall merit a heavier penalty.21
In a Resolution dated December 14, 2012, the Board of Governors of the IBP adopted and approved with
modification the findings of the Investigating Commissioner. It directed the suspension of the respondent from the
practice of law for one year with warning that repetition of the similar conduct shall be dealt with more severely. 22
The Courts Ruling
At the outset, it must be stressed that "[a] lawyer, by taking the lawyers oath, becomes a guardian of the law and
an indispensable instrument for the orderly administration of justice."23 He can be disciplined for any conduct, in
his professional or private capacity, which renders him unfit to continue to be an officer of the court. 24 For of all
classes and professions, it is the lawyer who is most sacredly bound to uphold the laws, for he is their sworn
servant.25
"Disbarment of lawyers is a proceeding that aims to purge the law profession of unworthy members of the bar. It is
intended to preserve the nobility and honor of the legal profession." 26 Therefore, it is incumbent upon this Court to
determine the full extent of the respondents liability, and to impose the proper penalty therefor.
It was established that the complainant engaged the professional services of the respondent. She expected the
immediate filing of the petition for the nullity of her marriage after the full payment of attorneys fees on June 10,
2008. However, the respondent filed the said petition only on July 16, 2009. The respondent gave out different
reasons for the delay in an attempt to exculpate himself. At the end, the respondent admitted the delay and
apologized for it. It cannot be gainsaid that the complainant through her agent was diligent in following up the
petition. The different excuses proffered by the respondent also show his lack of candor in his dealings with the
complainant.
"Once a lawyer agrees to take up the cause of a client, the lawyer owes fidelity to such cause and must always be
mindful of the trust and confidence reposed in him." 27 "[H]e is required by the Canons of Professional
Responsibility to undertake the task with zeal, care and utmost devotion."28 "A lawyer who performs his duty with
diligence and candor not only protects the interest of his client, he also serves the ends of justice, does honor to
the bar, and helps maintain the respect of the community to the legal profession." 29
Anent the P200,000.00 which was received by the respondent from the complainant, the respondent argued that
it was a loan and not really meant to be the latters investment in any money-lending business. At any rate, the
respondent issued 13 UCPB checks to serve as security for the alleged loan; among which, only two of said checks
were honored by the drawee-bank while the rest were dishonored for having been drawn against a closed
account. By reason of said dishonor, the respondent paid certain amounts in cash to the complainant as interest to
the said loan. Ultimately, the respondent issued eight BDO checks as replacement for the dishonored UCPB checks.
However, the BDO checks were also dishonored due to the same reason they were drawn against a closed
account.
The respondents act of issuing worthless checks is a violation of Rule 1.01 of the Code of Professional
Responsibility which requires that "a lawyer shall not engage in unlawful, dishonest, immoral or deceitful
conduct."30 "[T]he issuance of checks which were later dishonored for having been drawn against a closed account
indicates a lawyers unfitness for the trust and confidence reposed on him, shows such lack of personal honesty
and good moral character as to render him unworthy of public confidence, and constitutes a ground for
disciplinary action."31
It cannot be denied that the respondents unfulfilled promise to settle his obligation and the issuance of worthless
checks have seriously breached the complainants trust. She went so far as to file multiple criminal cases for
violation of B.P. Blg. 22 against him. "The relationship of an attorney to his client is highly fiduciary. Canon 15 of
the Code of Professional Responsibility provides that a lawyer shall observe candor, fairness and loyalty in all his
dealings and transactions with his client. Necessity and public interest enjoin lawyers to be honest and truthful
when dealing with his client."32
All told, this Court finds that the respondent is liable for violation of Canons 15, 33 17,34 Rule 18.04,35 and Rule
16.0436 of the Code of Professional Responsibility. Likewise, he is also liable under Rule 1.01 37 thereof pursuant to
our ruling in Co v. Atty. Bernardino.38
The complainant seeks the disbarment of the respondent. However, "[d]isbarment, jurisprudence teaches, should
not be decreed where any punishment less severe, such as reprimand, suspension, or fine, would accomplish the
end desired. This is as it should be considering the consequence of disbarment on the economic life and honor of
the erring person."39
"The severity of disbarment or suspension proceedings as the penalty for an attorneys misconduct has always
moved the Court to treat the complaint with utmost caution and deliberate circumspection." 40 While the Court has
the plenary power to discipline erring lawyers through this kind of proceedings, it does so in the most vigilant
manner so as not to frustrate its preservative principle. The Court, in the exercise of its sound judicial discretion, is
inclined to impose a less severe punishment if through it the end desired of reforming the errant lawyer is
possible.41
In Baldado v. Mejica,42 the Court found Atty. Aquilino A. Mejica guilty of violating Canon 18 of the Code of
Professional Responsibility for his negligence in protecting the interest of his client, and suspended him from the
practice of law for a period of three months, with a warning that a repetition of the same or a similar act will be
dealt with more severely.1wphi1
In Solidon v. Macalalad,43 the Court imposed on Atty. Ramil E. Macalalad (Atty. Macalalad) the penalty of six
months suspension from the practice of law for violations of Rule16.01 and Rule 18.03 of the Code of Professional
Responsibility. In said case, Atty. Macalalad failed to file the required petition and did not account for the money
he received, as attorneys fee, from the complainant.
In Junio v. Atty. Grupo,44 Atty. Salvador M. Grupo was found guilty of violating Rule 16.04 of the Code of
Professional Responsibility for borrowing money from his client and was suspended from the practice of law for a
period of one month.
In Wong v. Atty. Moya II,45 Atty. Salvador N. Moya II was ordered suspended from the practice of law for two years,
because aside from issuing worthless checks and failure to pay his debts, he also had seriously breached his clients
trust and confidence to his personal advantage and had shown a wanton disregard of the IBP orders in the course
of its proceedings.
Further, in Wilkie v. Atty. Limos,46 the Court held, to wit:
In Barrios v. Martinez, we disbarred the respondent who issued worthless checks for which he was convicted in the
criminal case filed against him.
In Lao v. Medel, we held that the deliberate failure to pay just debts and the issuance of worthless checks
constitute gross misconduct, for which a lawyer may be sanctioned with one-year suspension from the practice of
law. The same sanction was imposed on the respondent-lawyer in Rangwani v. Dinohaving been found guilty of
gross misconduct for issuing bad checks in payment of a piece of property the title of which was only entrusted to
him by the complainant. But in Barrientos v. Libiran-Meteoro, we meted out only a six-month suspension to Atty.
Elerizza Libiran-Meteoro for having issued several checks to the complainants in payment of a pre-existing debt
without sufficient funds, justifying the imposition of a lighter penalty on the ground of the respondents payment
of a portion of her debt to the complainant, unlike in the aforementioned Lao and Rangwani cases where there
was no showing of any restitution on the part of the respondents. 47 (Citations omitted and emphases ours)
In the instant case, the Court very well takes note of the fact that the criminal charges filed against the respondent
have been dismissed upon an affidavit of desistance executed by the complainant. 48 The Court also acknowledges
that he dutifully participated in the proceedings before the IBP-CBD and that he completely settled his obligation
to the complainant, as evidenced by the Acknowledgment Receipt signed by the complainant's counsel. Therein, it
was acknowledged that the respondent paid the amount of P650,000.00 in payment for the: (1) P200,000.00 for
the amount of checks he issued in favor of the complainant; (2) P195,000.00 for the attorney's fees he received for
the annulment case; and (3) cost and expenses that the complainant incurred in relation to the cases the latter
filed against the respondent including the instant complaint with the IBP. 49 Unlike in Solidon where the respondent
failed to file the required petition and did not account for the money he received, the respondent was able to file,
albeit belatedly, the complainant's petition. In addition, he returned in full the money he received as attorney's fee
in spite of having gone through all the trouble of preparing the required petition and in filing the same - not to
mention the cost he incurred for the purpose.50
In light of the foregoing and the Court's rulings in the cases mentioned above, the Court finds that the penalty of
six months suspension from the practice of law is commensurate, with a stem warning that a repetition of any of
the infractions attributed to him in this case, or any similar act, shall merit a heavier penalty.
WHEREFORE, respondent Atty. Jose L. Alvarez, Jr. is SUSPENDED FOR SIX (6) MONTHS from the practice of law with
a stem warning that a repetition of any of the offenses involved in this case or a commission of similar acts will
merit a more severe penalty. Let a copy of this Decision be entered in Atty. Jose L. Alvarez, Jr. 's record as a
member of the Bar, and notice of the same be served on the Integrated Bar of the Philippines, and on the Office of
the Court Administrator for circulation to all courts in the country.
SO ORDERED.
BIENVENIDO L. REYES
Associate Justice
SECOND DIVISION
A.C. No. 9860, September 11, 2013
JOSEPHINE L. OROLA, MYRNA L. OROLA, MANUEL L. OROLA, MARY ANGELYN OROLA-BELARGA, MARJORIE
MELBA OROLA-CALIP, AND KAREN OROLA, Complainants, v. ATTY. JOSEPH ADOR RAMOS, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
For the Courts resolution is a disbarment complaint1 filed against respondent Atty. Joseph Ador Ramos
(respondent) for his violation of Rule 15.03, Canon 15 (Rule 15.03) of the Code of Professional Responsibility
(Code) and Section 20(e), Rule 138 of the Rules of Court (Rules).
The Facts
Complainants Josephine, Myrna, Manuel, (all surnamed Orola), Mary Angelyn Orola-Belarga (Mary Angelyn), and
Marjorie Melba Orola-Calip (Marjorie) are the children of the late Trinidad Laserna-Orola (Trinidad), married to
Emilio Q. Orola (Emilio).2cralaw virtualaw library
Meanwhile, complainant Karen Orola (Karen) is the daughter of Maricar Alba-Orola (Maricar) and Antonio L. Orola
(Antonio), the deceased brother of the above-named complainants and the son of Emilio.3cralaw virtualaw library
In the settlement of Trinidads estate, pending before the Regional Trial Court of Roxas City, Branch 18 (RTC) and
docketed as Special Proceeding No. V-3639, the parties were represented by the following: (a) Atty. Roy M. Villa
(Atty. Villa) as counsel for and in behalf of Josephine, Myrna, Manuel, Mary Angelyn, and Marjorie (Heirs of
Trinidad); (b) Atty. Ely F. Azarraga, Jr. (Atty. Azarraga) as counsel for and in behalf of Maricar, Karen, and the other
heirs4 of the late Antonio (Heirs of Antonio), with respondent as collaborating counsel; and (c) Atty. Aquiliana
Brotarlo as counsel for and in behalf of Emilio, the initially appointed administrator of Trinidads estate. In the
course of the proceedings, the Heirs of Trinidad and the Heirs of Antonio moved for the removal of Emilio as
administrator and, in his stead, sought the appointment of the latters son, Manuel Orola, which the RTC granted
in an Order5 dated September 20, 2007 (RTC Order). Subsequently, or on October 10, 2007, respondent filed an
Entry of Appearance as collaborating counsel for Emilio in the same case and moved for the reconsideration of the
RTC Order.6cralaw virtualaw library
Due to the respondents new engagement, complainants filed the instant disbarment complaint before the
Integrated Bar of the Philippines (IBP), claiming that he violated: (a) Rule 15.03 of the Code, as he undertook to
represent conflicting interests in the subject case;7 and (b) Section 20(e), Rule 138 of the Rules, as he breached the
trust and confidence reposed upon him by his clients, the Heirs of Antonio. 8 Complainants further claimed that
while Maricar, the surviving spouse of Antonio and the mother of Karen, consented to the withdrawal of
respondents appearance, the same was obtained only on October 18, 2007, or after he had already entered his
appearance for Emilio on October 10, 2007. 9 In this accord, respondent failed to disclose such fact to all the
affected heirs and, as such, was not able to obtain their written consent as required under the Rules. 10cralaw
virtualaw library
For his part, respondent refuted the abovementioned charges, contending that he never appeared as counsel for
the Heirs of Trinidad or for the Heirs of Antonio. He pointed out that the records of the case readily show that the
Heirs of Trinidad were represented by Atty. Villa, while the Heirs of Antonio were exclusively represented by Atty.
Azarraga.11 He averred that he only accommodated Maricar's request to temporarily appear on her behalf as their
counsel of record could not attend the scheduled June 16 and July 14, 2006 hearings and that his appearances
thereat were free of charge.12 In fact, he obtained Maricars permission for him to withdraw from the case as no
further communications transpired after these two hearings. Likewise, he consulted Maricar before he undertook
to represent Emilio in the same case.13 He added that he had no knowledge of the fact that the late Antonio had
other heirs and, in this vein, asserted that no information was disclosed to him by Maricar or their counsel of
record at any instance.14 Finally, he clarified that his representation for Emilio in the subject case was more of a
mediator, rather than a litigator,15 and that since no settlement was forged between the parties, he formally
withdrew his appearance on December 6, 2007.16 In support of his assertions, respondent submitted the affidavits
of Maricar17and Atty. Azarraga18 relative to his limited appearance and his consultation with Maricar prior to his
engagement as counsel for Emilio.
The Recommendation and Action of the IBP
In the Report and Recommendation19 dated September 15, 2008 submitted by IBP Investigating Commissioner
Jose I. De La Rama, Jr. (Investigating Commissioner), respondent was found guilty of representing conflicting
interests only with respect to Karen as the records of the case show that he never acted as counsel for the other
complainants. The Investigating Commissioner observed that while respondent's withdrawal of appearance was
with the express conformity of Maricar, respondent nonetheless failed to obtain the consent of Karen, who was
already of age and one of the Heirs of Antonio, as mandated under Rule 15.03 of the Code. 20cralaw virtualaw
library
On the other hand, the Investigating Commissioner held that there was no violation of Section 20, Rule 138 of the
Rules as complainants themselves admitted that respondent did not acquire confidential information from his
former client nor did he use against the latter any knowledge obtained in the course of his previous
employment.21 Considering that it was respondent's first offense, the Investigating Commissioner found the
imposition of disbarment too harsh a penalty and, instead, recommended that he be severely reprimanded for his
act with warning that a repetition of the same or similar acts would be dealt with more severely. 22cralaw virtualaw
library
The IBP Board of Governors adopted and approved with modification the aforementioned report in its Resolution
No. XVIII-2008-64123 dated December 11, 2008 (Resolution No. XVIII-2008-641), finding the same to be fully
supported by the evidence on record and the applicable laws and rules but imposed against respondent the
penalty of six (6) months suspension from the practice of law.
Respondent's motion for reconsideration24 was denied in IBP Resolution No. XX-2013-1725 dated January 3, 2013.
The Issue Before the Court
The sole issue in this case is whether or not respondent is guilty of representing conflicting interests in violation of
Rule 15.03 of the Code.
The Courts Ruling
The Court concurs with the IBPs finding that respondent violated Rule 15.03 of the Code, but reduced the
recommended period of suspension to three (3) months.
Rule 15.03 of the Code reads:chanrobles virtua1aw 1ibrary

CANON 15 A LAWYER SHALL OBSERVE CANDOR, FAIRNESS AND LOYALTY IN ALL HIS DEALINGS AND
TRANSACTIONS WITH HIS CLIENTS.
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. (Emphasis supplied)
Under the afore-cited rule, 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. The prohibition is founded on the principles of public policy and good taste. 26 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.27 In Hornilla v. Salunat28 (Hornilla), the Court explained the concept of
conflict of interest, to wit:chanrobles virtua1aw 1ibrary
There is conflict of interest 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 brief, 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 thereof.29 (Emphasis supplied; citations omitted)
It must, however, be noted that a lawyers immutable duty to a former client does not cover transactions that
occurred beyond the lawyers employment with the client. The intent of the law is to impose upon the lawyer the
duty to protect the clients 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.30cralaw virtualaw library
Applying the above-stated principles, the Court agrees with the IBPs finding that respondent represented
conflicting interests and, perforce, must be held administratively liable therefor.
Records reveal that respondent was the collaborating counsel not only for Maricar as claimed by him, but for all
the Heirs of Antonio in Special Proceeding No. V-3639. In the course thereof, the Heirs of Trinidad and the Heirs of
Antonio succeeded in removing Emilio as administrator for having committed acts prejudicial to their interests.
Hence, when respondent proceeded to represent Emilio for the purpose of seeking his reinstatement as
administrator in the same case, he clearly worked against the very interest of the Heirs of Antonio particularly,
Karen in violation of the above-stated rule.
Respondent's justification that no confidential information was relayed to him cannot fully exculpate him for the
charges against him since the rule on conflict of interests, as enunciated in Hornilla, provides an absolute
prohibition from representation with respect to opposing parties in the same case. In other words, a lawyer cannot
change his representation from one party to the latters opponent in the same case. That respondents previous
appearances for and in behalf of the Heirs of Antonio was only a friendly accommodation cannot equally be given
any credence since the aforesaid rule holds even if the inconsistency is remote or merely probable or even if the
lawyer has acted in good faith and with no intention to represent conflicting interests.31cralaw virtualaw library
Neither can respondent's asseveration that his engagement by Emilio was more of a mediator than a litigator and
for the purpose of forging a settlement among the family members render the rule inoperative. In fact, even on
that assertion, his conduct is likewise improper since Rule 15.04,32Canon 15 of the Code similarly requires the
lawyer to obtain the written consent of all concerned before he may act as mediator, conciliator or arbitrator in
settling disputes. Irrefragably, respondent failed in this respect as the records show that respondent was remiss in
his duty to make a full disclosure of his impending engagement as Emilios counsel to all the Heirs of Antonio
particularly, Karen and equally secure their express written consent before consummating the same. Besides, it
must be pointed out that a lawyer who acts as such in settling a dispute cannot represent any of the parties to
it.33 Accordingly, for respondents violation of the aforestated rules, disciplinary sanction is warranted.
In this case, the penalty recommended by the Investigating Commissioner was increased from severe reprimand to
a suspension of six (6) months by the IBP Board of Governors in its Resolution No. XVIII-2008-641. However, the
Court observes that the said resolution is bereft of any explanation showing the bases of the IBP Board of
Governors modification; as such, it contravened Section 12(a), Rule 139-B of the Rules which specifically mandates
that [t]he decision of the Board upon such review shall be in writing and shall clearly and distinctly state the facts
and the reasons on which it is based.34 Verily, the Court looks with disfavor the change in the recommended
penalty without any ample justification therefor. To this end, the Court is wont to remind the IBP Board of
Governors of the importance of the requirement to announce in plain terms its legal reasoning, since the
requirement that its decision in disciplinary proceedings must state the facts and the reasons on which the same is
based is akin to what is required of courts in promulgating their decisions. The reasons for handing down a penalty
occupy no lesser station than any other portion of the ratio.35cralaw virtualaw library
In the foregoing light, the Court finds the penalty of suspension from the practice of law for a period of three (3)
months to be more appropriate taking into consideration the following factors: first, respondent is a first time
offender; second, it is undisputed that respondent merely accommodated Maricars request out of gratis to
temporarily represent her only during the June 16 and July 14, 2006 hearings due to her lawyers
unavailability; third, it is likewise undisputed that respondent had no knowledge that the late Antonio had any
other heirs aside from Maricar whose consent he actually acquired (albeit shortly after his first appearance as
counsel for and in behalf of Emilio), hence, it can be said that he acted in good faith; and fourth, complainants
admit that respondent did not acquire confidential information from the Heirs of Antonio nor did he use against
them any knowledge obtained in the course of his previous employment, hence, the said heirs were not in any
manner prejudiced by his subsequent engagement with Emilio. Notably, in Ilusorio-Bildner v. Lokin, Jr.,36 the Court
similarly imposed the penalty of suspension from the practice of law for a period of three months to the counsel
therein who represented parties whose interests are hostile to his other clients in another case.
WHEREFORE, respondent Atty. Joseph Ador Ramos is hereby held GUILTY of representing conflicting interests in
violation of Rule 15.03, Canon 15 of the Code of Professional Responsibility. Accordingly, he is
hereby SUSPENDED from the practice of law for a period of three (3) months, with WARNING that a repetition of
the same or similar acts in the future will be dealt with more severely.chanroblesvirtualawlibrary
SO ORDERED.
Carpio, (Chairperson), Brion, Del Castillo, and Perez, JJ., concur.

SECOND DIVISION
[Adm. Case No. 5831. January 13, 2003]
CESAR A. ESPIRITU, complainant, vs. ATTY. JUAN CABREDO IV, respondent.
DECISION
MENDOZA, J.:
This is an administrative complaint filed with the Integrated Bar of the Philippines (IBP) on May 8, 2001 by
complainant Cesar A. Espiritu against Atty. Juan Cabredo IV for failure to fulfill a fiduciary obligation to a client.
The complaint alleges the following facts:
On November 5, 1999, the BPI Family Savings Bank Inc. (BPI-FSB) filed two complaints for replevin and
damages against Esphar Medical Center, (Esphar) Inc. and its president Cesar Espiritu and a certain John Doe. In
the first complaint, the BPI-FSB alleged that, on July 14, 1997, Esphar, Cesar Espiritu, and a certain John Doe
executed in favor of Gencars, Inc. (Gencars) a promissory note in which they obligated themselves jointly and
severally to pay the latter P511,956.00 in monthly installments pursuant to a schedule they had agreed upon. It
was provided that failure on the part of the makers to pay any installment when due shall make subsequent
installments and the balance of the obligation immediately due and demandable. The promissory note was
secured by a chattel mortgage on an Isuzu Close Van (1997 model) and registered with the Register of Deeds and
the Land Transportation Commission. On July 14, 1997, Gencars executed a deed of assignment in favor of the BPI-
FSB, assigning to the latter all of its rights, title and interest in the promissory note secured by the chattel
mortgage. In 1999, Esphar, Espiritu and John Doe failed to pay installments for three consecutive months, for
which reason demands were made on the three to pay the entire balance of P186,806.28, with accrued interest at
the rate of 36% per annum or to give to BPI-FSB the possession of the Isuzu van in order to foreclose the
mortgage. As the three failed to comply with the demands, the BPI-FSB brought suit for replevin and damages
against them.[1]
The second complaint alleged similar facts involving Citimotors, Inc. as the payee of another promissory note
in which Esphar, Espiritu and John Doe, as makers, obligated themselves solidarily to pay the former P674,640.00
in monthly installments. The promissory note was secured by a chattel mortgage on a Mitsubishi L-300 Exceed
Montone Van (1997 model), which BPI-FSB, as holder of the said promissory note, sought to foreclose due to the
makers failure to comply with its terms and conditions.[2]
On December 10, 1999, Espiritu engaged the services of Atty. Juan Cabredo IV, herein respondent, to
represent him in the two civil cases. On same day, Cabredos secretary, Rose Tria, picked up copies of the
complaints from Espiritus office and, on December 14, 1999, his representative Reynaldo Nuez received from
Esphar P16,000.00 for use as filing and acceptance fees.While the cases were pending in court, Atty. Cabredo
advised Esphar to remit money and update payments to BPI-FSB through the trial court. Accordingly, on December
28, 1999 and again January 28, 2000, Esphars representative, Maritess Alejandrino, delivered a total of P51,161.00
to Atty. Cabredos office. Later on, when Atty. Cabredo failed to appear at a hearing of the civil cases, the
management of Esphar found out that he did not deliver the sum of P51,161.00 to the court or BPI-FSB. The
management of Esphar then agreed to settle the cases amicably. For this reason, a joint motion to dismiss was
filed by the parties, and the cases were dismissed on May 15, 2000. Thereafter, on May 8, 2001, Espiritu filed a
complaint against Atty. Cabredo for fraud.[3]
In his answer dated June 6, 2001, respondent Cabredo admitted that his secretary, Rose Tria, had indeed
received P51,161.00 from Esphar, but claimed that Tria failed to inform him about it. It was only when he read
Esphars first demand letter dated March 21, 2000 that he learned for the first time about the receipt of the
money. Respondent claimed that he failed to get complainants demand letters of March 24, 2000 and January 5,
2001 because of lapses on the part of his staff. He thus shifted the blame on his staff.
7. It is quite unfortunate that this incident happened all thru the fault of the law firm personnel. In spite of
respondents candid, honest and sincere desire to faithfully and religiously serve good clients, [his efforts have
been] rendered inutile by lapses of his staff;
8. Respondent believes that complainant Cesar A. Espiritu would not have resorted to this present action had the
firm personnel been vigilant enough to inform respondent of this matter.
Respondent said he was willing to reimburse complainant to show his good faith and to erase the suspicion
that respondent intentionally spent the amount for his own use and benefit. [4]
Acting on the complaint, the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline scheduled a
hearing on September 24, 2001. However, the hearing had to be rescheduled three times on November 14,
2001, December 14, 2001, and January 18, 2002 because of respondents failure to appear despite due notice to
him. In orders dated November 14, 2001[5] and December 14, 2001,[6] respondent was warned that the investigator
would proceed with the case if he failed to appear again in subsequent hearings. Finally, in the order dated January
18, 2002, Investigating Commissioner Wilfredo Reyes ordered:
Considering that this is the fifth (5th) time that the respondent has failed to appear despite notice, the
undersigned Commissioner has no option but to decide the case on the basis of the pleadings submitted. It must
be noted that despite receipt of the Orders of the Commission, the respondent Atty. Juan Cabredo IV has failed to
appear before the Commission on Bar Discipline.
This case is deemed submitted for resolution based on the pleadings submitted by the parties. [7]
On February 13, 2002, Commissioner Reyes submitted his report and recommendation. He found respondent
guilty of violation of the Code of Professional Responsibility and recommended that the latter be suspended from
the practice of law for three months and ordered to return the amount of P51,161.00 to Esphar.[8] In a resolution
dated August 3, 2002, the IBP Board of Governors adopted and approved the recommendation of the investigating
commissioner.[9]
Except for the penalty, we find the recommendation is well taken.
The Code of Professional Responsibility provides:
CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT THAT MAY COME
INTO HIS POSSESSION.
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.
The relationship between a lawyer and a client is highly fiduciary; it requires a high degree of fidelity and
good faith.[10] Hence, in dealing with trust property, a lawyer should be very scrupulous. Money or other trust
property of the client coming into the possession of the lawyer should be reported by the latter and accounted for
promptly and should not, under any circumstances, be commingled with his own or be used by him. [11]
In this case, respondent claims that he did not know about the receipt by his secretary on the amount
of P51,161.00 received from Esphar until he read the first demand letter of the company, which stated:
March 21, 2000
JUDGE JUAN CABREDO
Cubao, Quezon City
Dear Judge Cabredo:
Due to your failure to make an interbank deposit as what we have agreed upon yesterday, March 20, 2000, we are
sending bearer, MRS. MARITESS ALEJANDRINO, to collect the amount of P51,161.00 representing payment
intended for BPI FAMILY BANK which was coursed through your office per your instruction.
We are hoping that you will not fail to return the money through bearer hereof. Her specimen signature is shown
below for identification purposes.
Thank you.
Very truly yours,
ESPHAR MEDICAL CENTER, INC.
(signed)
AUTHORIZED SIGNATURE
Specimen Signature of:
(signed)
MARITESS ALEJANDRINO
However, even after receiving this notice and two other demand letters, respondent never returned the
money of complainant nor paid it to the bank. Indeed, it is improbable that respondents secretary failed to inform
complainant about the receipt of such a substantial sum of money. In failing to account for the money of his client,
respondent violated not only the Code of Professional Responsibility but also his oath to conduct himself with all
good fidelity to his clients.[12] Like judges, lawyers must not only be proper but they must also appear to be so. This
way, the peoples faith in the justice system would remain unshaken. [13]
It appears that respondent, while now a practicing lawyer, was a former judge. [14] Thus, he should have
known the ethical precepts guiding lawyers who handle money given to them in trust by their clients and the
necessary consequences for violation thereof. Rule 138 of the Rules of Court provides,
Sec. 27. Disbarment or suspension of attorneys by Supreme Court; grounds therefore. A member of the bar may
be disbarred or suspended from his office as attorney by the Supreme Court for any deceit, malpractice, or other
gross misconduct in such office, grossly immoral conduct, or by reason of his conviction of a crime involving moral
turpitude, or for any violation of the oath which he is required to take before admission to practice, or for a wilful
disobedience of any lawful order of a superior court, or for corruptly or wilfully appearing as an attorney for a
party to a case without authority so to do. The practice of soliciting cases at law for the purpose of gain, either
personally or through paid agents or brokers, constitutes malpractice. [emphasis supplied]
From the evidence presented by complainant, which respondent failed to rebut, it is clear that the breach of
trust committed by respondent amounted to deceit, as well as a violation of his oath, for which he should be
penalized with either disbarment or suspension. While we agree with the findings of the investigating
commissioner, we find the recommended penalty of suspension for three months to be too light. In Reyes v.
Maglaya[15] a lawyer was suspended for one year for failing to return P1,500.00 belonging to his client despite
numerous demands. In Castillo v. Taguines,[16] a lawyer failed to deliver to his client P500.00, representing the
monetary settlement of a civil suit despite demands. To make matters worse, he fooled the client by issuing a
bouncing check. He was suspended for one year.
For his failure to account for P51, 161.00 received from his client and to restitute it without any reason,
respondent should be suspended for one year.
WHEREFORE, Atty. Juan Cabredo IV is hereby SUSPENDED for one (1) year and ORDERED to immediately
return to Esphar Medical Center, Inc. the sum of P51,161.00, with WARNING that a repetition of the same or
similar acts will be dealt with more severely. Let copies of the Decision be entered in his record as an attorney and
be furnished the Integrated Bar of the Philippines (IBP) and all the courts in the country for their information and
guidance.
SO ORDERED.
Bellosillo, (Chairman), Quisumbing, Austria-Martinez, and Callejo, Sr., JJ., concur.

SUPREME COURT
Manila
EN BANC
A.C. No. 10240 November 25, 2014

[Formerly CBD No. 11-3241]
ESTRELLA R. SANCHEZ, Complainant,

vs.
ATTY. NICOLAS C. TORRES, M.D., Respondent.
DECISION
PER CURIAM:
Before us is a Complaint1 dated November 24, 2011 for disciplinary action against respondent Atty. Nicolas C.
Torres (Atty. Torres) filed by Estrella R. Sanchez (Sanchez) with the Integrated Bar of the Philippines Commission on
Bar Discipline (IBP-CBD), docketed as CBD Case No. 11-3241, now A.C. No. 10240, for violation of Batas Pambansa
Bilang 22 (B.P. 22) and non-payment of debt.
In her complaint, Sanchez claimed that she is a friend and close acquaintance of Atty. Torres. That in 2007, Atty.
Torres asked Sanchez to lend him money in the amount of Two Million Two Hundred Thousand Pesos
(P2,200,000.00), and convinced her that he will pay the said amount within a period of one (1) month, plus
interest. On November 8, 2007, persuaded by Atty. Torres' promise that he will pay immediately, Sanchez was
convinced and handed him the cash amounting to Two Million Two Hundred Thousand Pesos (P2,200,000.00),
which Sanchez withdrew from the bank in Atty. Torres' presence. To bolster Sanchez's trust and confidence, Atty.
Torres issued two (2) Allied Bank checks with check nos. 0109386 and 0109387, under Account No. 001941-01285-
8, both dated November 8, 2007, amounting to P1,200,000.00 and P1,000,000.00, respectively, or in the total
amount of P2,200,000.002
However, after one (1) month,Atty. Torres failed to pay his obligation as promised. When Sanchez called Atty.
Torres over the phone, she was told that she could again deposit the check and assured her that the checks will be
honored upon presentment for payment.
On May 2, 2008, Sanchez deposited the said checks to her account, but the same were returned due to "ACCOUNT
CLOSED."
Despite repeated demands for the last three (3) years, Atty. Torres had yet to pay his obligation since then, and
thus, complainant sought legal assistance. As a consequence, formal demand letters were sent by the
complainant's lawyer which respondent received on August 14, 20083 and November 17, 2008,4 respectively, and
the same proved futile as Atty. Torres failed and refused to pay his obligation. Nonetheless, Atty. Torres, in his
letter dated May 9, 2009,5 promised to pay anew the amount of P2,200,000.00 in cash on or before May 15, 2009
as replacement for the two checks he previously issued. But no payment whatsoever was made. Hence, the instant
complaint filed on November 28, 2011.
On November 28, 2011, the IBPCommission on Bar Discipline (CBD) required Atty. Torres to file an answer. 6
On December 29, 2011, Atty. Torres moved for extension of time to file an answer. He alleged that his bookkeeper
was on a holiday leave and that the receipts of payments and audit report were in the custody of the bookkeeper
which will be available only in the 1st week of January 2012.7 However, in an Order8 dated March 2, 2012, the IBP-
CBD noted that Atty. Torres had yet to file his Answer to the complaint even after the expiration of the extension
period earlier granted; thus, a final extension was given anew and the case was set for mandatory conference.
Despite sufficient time for respondent Atty. Torres tofile his answer, he failed to do so. Worse, he even failed to
appear in the scheduled mandatory conference despite due notice.
Thus, in its Report and Recommendation9 dated June 15, 2012, the IBP-CBD found Atty. Torres guilty of willful
dishonesty and unethical conduct for failure to pay just debt and for issuing checks without sufficient funds. It
recommended that Atty. Torres be sanctioned with suspension from the practice of law for at least two (2) years.
On March 20, 2013, the IBP Board of Governors adopted and approved the Report and Recommendation of the
IBP-CBD. Atty. Torres was ordered suspended from the practice of law for a period of two (2) years, and further
ordered to return the amount of P2,200,000.00 to Sanchez, with legal interest.10
On August 5, 2013, respondent, through counsel, filed a Manifestation with Motion for Extension of Time to File
Motion for Reconsideration.11 He claimed that he had proof of receipts to show that he had already paid his
obligation to Sanchez.12
However, despite the lapse of considerable time after the receipt of notice to comply with the said Resolution, no
motion for reconsideration was filed. Hence, in a Resolution dated January 21, 2014, the Court resolved to note
the Report dated December 13, 2013, stating that records of the OBC showed that no motion for reconsideration
or petition for review was filed by either party as of November 22, 2013.
RULING
We sustain the findings and recommendations of the IBP-CBD and the IBP-Board of Governors.
In the instant case, the existence of the loan obligation is undisputed. Sanchez was able to discharge her burden of
proving that she loaned P2,200,000.00 to Atty. Torres as evidenced by the subject bank checks. Furthermore,
backed by Atty. Torres' admission in his letter dated May 9, 2009, his promise to pay the amount of P2,200,000.00
in cash, as replacement for the two checks he previously issued, is more than sufficient to establish a valid
obligation of Atty. Torres to Sanchez. Atty. Torres admission of the loan he contracted and his failure to pay the
same leave no room for interpretation. Likewise, other than his belated and empty claims of payment, Atty. Torres
failed to discharge his burden of proving that he had indeed paid his obligation to Sanchez.
In Barrientos v. Atty. Libiran-Meteoro,13 we held that:
x x x [the] deliberate failure to pay justdebts and the issuance of worthless checks constitute gross misconduct, for
which a lawyer may be sanctioned with suspension from the practice of law. Lawyers are instruments for the
administration of justice and vanguards of our legal system. They are expected to maintain not only legal
proficiency but also a high standard of morality, honesty, integrity and fair dealing so that the peoples faith and
confidence in the judicial system is ensured. They must at all times faithfully perform their duties to society, to the
bar, the courts and to their clients, which include prompt payment of financial obligations. They must conduct
themselves in a manner that reflect the values and norms of the legal profession as embodied in the Code of
Professional Responsibility.
Canon 1 and Rule 1.01 explicitly states: Canon 1 A lawyer shall upholdthe constitution, obey the laws of the land
and promote respect for law and for legal processes.
Rule 1.01A lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct.
We also note Atty. Torres' conduct in the course of the proceedings where he repeatedly asked for extensions of
time to file an answer and a motion for reconsideration, which he failed to submit, and his failure to attend the
disciplinary hearings set by the IBP do not speak well of his standing as a lawyer. In Ngayan v. Tugade, 14 we ruled
that "[a lawyers] failure to answer the complaint against him and his failure to appear at the investigation are
evidence of his flouting resistance to lawful orders of the court and illustrate his despiciency for his oath of office
in violation of Section 3, Rule 138, Rules of Court."
We come to the penalty imposable in this case.
In Lao v. Medel,15 we held that the deliberate failure to pay just debts and the issuance of worthless checks
constitute gross misconduct, for which a lawyer may be sanctioned with one-year suspension from the practice of
law. The same sanction was imposedon the respondent-lawyer in Rangwani v. Atty. Dino,16 having been found
guilty of gross misconduct for issuing bad checks in payment of a piece of property, the title of which was only
entrusted to him by the complainant.
Following the penalty imposed in a similar situation in A-1 Financial Services v. Valerio,17 we deem it proper to
adopt the penalty of two (2) years suspension in light of the amount involved and the brazen disregard by Atty.
Torres of the Orders of the IBP-CBDon the filing of an answer and appearance in the hearing. We cannot sustain,
however, the IBPs recommendation ordering respondent to return the amount of P2,200,000.00 to complainant.
In disciplinary proceedings against lawyers, the only issue is whether the officer of the court is still fit to be allowed
to continue as a member of the Bar. Our only concern isthe determination of respondents administrative liability.
Our findings have no material bearing on other judicial actions which the parties may choose to file against each
other.18
However, we note that in CF Sharp Crew management, Inc. v. Nicolas C. Torres, 19 the Court had already disbarred
Torres from the practice of law for having been found guilty of violating Rule 1.01, Canon 1 and Rules 16.01 and
16.03, Canon 16 of the Code of Professional Responsibility.
In view of the foregoing, we can no longer impose the penalty of suspension or disbarment against Atty. Torres,
considering that he has already been previously disbarred. We do not have double or multiple disbarments in our
laws or jurisprudence.20 Nevertheless, considering that the issues and the infraction committed are different from
his previous infraction, we deem it proper to resolve the instant case and give its corresponding penalty for
purposes of recording it in respondent's personal file in the Bar Confidant's Office.
WHEREFORE, Resolution No. XX-2013-202 dated March 20, 2013 of the IBP, which found respondent Atty. Nicolas
C. Torres guilty of gross misconduct and of violation of the Code of Professional Responsibility, is AFFIRMED and
respondent Atty. Nicolas C. Torres is hereby SUSPENDED for a period of two (2) years from the practice of law.
However, considering that respondent has already been previously disbarred, this penalty can no longer be
imposed.
Let a copy of this Decision be furnished to the Office of the Bar Confidant, to be appended to the personal r.ecord
of Atty. Torres as a member of the Bar; the Integrated Bar of the Philippines; and the Office of the Court
Administrator, for circulation to all courts in the country, for their information and guidance.
SO ORDERED.

SUPREME COURT
Manila
SECOND DIVISION
A.C. No. 5440 December 10, 2014
SPOUSES NICASIO DONELITA SAN PEDRO, Complainants,

vs.
ATTY. ISAGANI A. MENDOZA, Respondent.
RESOLUTION
LEONEN, J.:
For resolution is a complaint for disbarment filed by Spouses Nicasio and Donelita San Pedro (complainants)
against Atty. Isagani A. Mendoza (respondent).1 This case involves a determination of whether respondent violated
his duty to hold in trust all moneys and properties of the client; his duty to account for all funds and property
collected or received for or from the client; and his duty to deliver the funds and property of the client when due
or upon demand under the Code of Professional Responsibility.
The facts are summarized as follows:
On or about November 21, 1996, complainants engaged the services of respondent to facilitate the transfer of title
to property, in the name of Isabel Azcarraga Marcaida, to complainants.2 Complainants then gave respondent a
check for P68,250.00 for the payment of transfer taxes.3 They also gave respondent a check for P13,800.00 for
respondents professional fee.4
Respondent failed to produce the title despite complainants repeated follow-ups.5
Several letters were sent by respondent explaining the delay in the transfer of title.6 However, respondent still
failed to produce the title.
Complainants subsequently referred the case to the barangay.7 Respondent refused to return the amount
complainants gave for the transfer taxes.8 Complainants were then issued a certificate to file action.9 They also
sent a letter demanding the refund of the money intended for the transfer taxes. 10 Respondent still did not return
the money.
On May 8, 2000, respondent sent another letter to complainants. He promised to settle the transfer of the land
title.11 However, respondent reneged on this promise. 12 Complainants were then forced to obtain a loan from
Philippine American Life and General Insurance Company to secure the transfer of the title to the property in their
names.13
Respondent contested the allegations of complainants. According to him, it was complainants who caused the
three-year delay in the transfer of title to complainants names. Complainants were not able to furnish respondent
several important documents: (a) original copy of the deed of extrajudicial petition; (b) affidavit of publication with
the clippings of the published item in a newspaper of general circulation; and (c) a barangay certificate from the
barangay where the property is located as required by the Bureau of Internal Revenue. 14
In addition, respondent argued that complainants paid him the measly sum of P13,800.00 despite all the work he
did for them, including facilitating the sale of the property. These involved "being-pulled from the office four or
five times to discuss . . . the details of the transaction [with the sellers]; going twice to the Regional Trial Court of
Bian, Laguna[,] Branch 24, to expedite the . . . issuance of a [n]ew owners duplicate copy of the title; going twice
to the office of the Register of Deeds for Calamba, Laguna to make verification and submit the court [o]rder; [and
facilitating the] preparation and notarization of the Deed of Absolute Sale." 15
Respondent also claimed that retention of the money is justified owing to his receivables from complainants for
the services he rendered in various cases:
1) In the case of Spouses Nicasio and Donelita San Pedro versus Severo Basbas, for Forcible Entry,
docketed as Civil Case No. 2004 in the Metropolitan Trial Court of Santa Rosa, Laguna. This case was
dismissed by the Honorable Court for alleged lack of jurisdiction, the issue of possession being
intertwined with that of ownership;
2) In the case of Spouses Nicasio and Donelita San Pedro versus Severo Basbas for Accion Publiciana
docketed as Civil Case No. B-5386 raffled to the Regional Trial Court of Bian, Laguna[,] Branch 25;
3) In Civil Case No. B-4503 entitled Basbas versus Spouses Nicasio and Donelita San Pedro et al., for nullity
of title, [r]econveyance with prayer for issuance of writ of preliminary injunction directed specifically to
herein complainant. This case was assigned to the Regional Trial Court of San Pedro, Laguna[.]
Respondent, for and in behalf of herein complainant, submitted an [a]nswer and [o]pposition to the
prayer for issuance of the injunction, which was favorably acted upon. Consequently[,] the case was
dismissed by the Court[;]
4) In Civil Case No. B-688 entitled Basbas versus Spouses Nicasio and Donelita San Pedro et al., for [r]e-
partition and [r]econveyance, which was raffled to the Regional Trial Court of Bian, Laguna, Branch 24[;]
[and]
5) Likewise, respondent represented herein complainant in [an] ESTAFA case they [filed] against Greg
Ramos and Benjamin Corsino, which case, as per reliable source, was discontinued by complainant after
the civil aspect of the same was amicably settled.16 Respondent further alleged that complainants
challenged him to prove his worth as a lawyer by doing away with the requirements and expediting the
cancellation of the Marcaidas title.17
The present administrative case was referred to the Integrated Bar of the Philippines (IBP) for investigation, report
and recommendation.18 The parties were then called to a mandatory conference before the IBP Commission on
Bar Discipline.19 They were required to submit their position papers.20 Respondent did not submit his position
paper.21
On July 8, 2008, the Investigating Commissioner, Atty. Salvador B. Hababag, submitted his findings and
recommendation. The Investigating Commissioner found that respondent violated Canon 16, Rules 16.01 22 and
16.0323 of the Code of Professional Responsibility.
The Investigating Commissioner found that both checks issued to respondent were encashed despite respondents
failure to facilitate the release of the title in the name of complainants. 24 Complainants had to obtain a loan to
facilitate the transfer of title in their names. 25
Moreover, respondent admitted his liability in his letters to complainants.26 Complainant Nicasio San Pedros
affidavit of desistance is immaterial.27
The Investigating Commissioner recommended the disciplinary action of "censure and warning," hence:
WHEREFORE, premises considered, it is most respectfully recommended that the disciplinary sanction of CENSURE
and WARNING be given the respondent with the admonition that he be extremely careful of his acts to forego
severe penalty in the future.28
In the Notice of Resolution No. XVIII-2008-399 dated August 14, 2008, the IBP Board of Governors adopted with
modification the findings of the Investigating Commissioner. It held:
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED and APPROVED, with modification, the
Report and Recommendation of the Investigating Commissioner of 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 Respondents violation of Canon 16, [Rule] 16.01 and Rule 16.03 of the Code of
Professional Responsibility when he failed to effect the transfer of property despite encashment of the two checks,
Atty. Isagani A. Mendoza is hereby SUSPENDED from the practice of law for three (3) months and Ordered to
Returnthe amount of Sixty Eight Thousand Two Hundred Fifty (P68,250.00) Pesos to complainants within thirty
days from receipt of notice.29 (Emphasis, italics, and underscoring in the original)
On November 14, 2008, respondent filed his motion for reconsideration. 30 The IBP Board of Governors denied
respondents motion in the Notice of Resolution No. XX-2013-839 dated June 22, 2013:
RESOLVED to unanimously DENY Respondents Motion for Reconsideration, there being no cogent reason to
reverse the findings of the Commission and it being a mere reiteration of the matters which had already been
threshed out and taken into consideration. Thus, Resolution No. XVIII-2008-399 dated August 14, 2008 is hereby
AFFIRMED.31 (Emphasis and italics in the original)
On December 11, 2013, this court resolved to note the following: (a) Notice of Resolution No. XVIII-2008-399 dated
August 14, 2008 of the IBP Board of Governors; (b) Notice of Resolution No. XX-2013-839 dated June 22, 2013 of
the IBP Board of Governors;and (c) IBPs letter dated October 7, 2013 transmitting the documents pertaining to
the case.32
In the manifestation and motion dated October 25,2013, respondent requested for a formal hearing, reasoning
that he "wants to exercise his right to confront his accusers [to] cross[-]examine them and that of their
witness."33The manifestation and motion was denied by this court in the resolution dated September 22, 2014. 34
The main issue in this case is whether respondent is guilty of violating Canon 16 of the Code of Professional
Responsibility for failing to hold in trust the money of his clients.
After considering the parties arguments and the records of this case, this court resolves to adopt and approve the
Notice of Resolution No. XX-2013-839 dated June 22, 2013 of the IBP Board of Governors.
It has been said that "[t]he practice of law is a privilege bestowed on lawyers who meet the high standards oflegal
proficiency and morality. Any conduct that shows a violation of the norms and values of the legal profession
exposes the lawyer to administrative liability."35
An examination of the records reveals that respondent violated the Code of Professional Responsibility.
Canon 16 of the Code of Professional Responsibility states:
CANON 16 - A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT THAT MAY COME INTO
HIS POSSESSION.
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 clients interests 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.
Similarly, Rule138, Section 25 of the Rules of Court provides:
Section 25. Unlawful retention of client's funds; contempt. When an attorney unjustly retains in his hands
money of his client after it has been demanded, he may be punished for contempt as an officer of the Court who
has misbehaved in his official transactions; but proceedings under this section shall not be a bar to a criminal
prosecution.
A lawyers duty under Canon 16 of the Code of Professional Responsibility is clear:
The fiduciary nature of the relationship between counsel and client imposes on a lawyer the duty to account for
the money or property collected or received for or from the client[,] [thus] . . . [w]hen a lawyer collects or receives
money from his client for a particular purpose (such as for filing fees, registration fees, transportation and office
expenses), he should promptly account to the client how the money was spent. If he does not use the money for
its intended purpose, he must immediately return it to the client. His failure either to render an accounting or to
return the money (if the intended purpose of the money does not materialize) constitutes a blatant disregard of
Rule 16.01 of the Code of Professional Responsibility.
[The lawyers] failure to return the clients money upon demand gives rise to the presumption that he has
misappropriated it for his own use to the prejudice of and in violation of the trust reposed in him by the
client.36(Emphasis supplied)
Respondent admitted that there were delays in the transfer of title of property to complainants name.1wphi1 He
continuously assured complainants that he would still fulfill his duty. However, after three (3) years and several
demands from complainants, respondent failed to accomplish the task given to him and even refused to return the
money. Complainants alleged failure to provide the necessary documents to effect the transfer does not justify his
violation of his duty under the Code of Professional Responsibility.
Respondents assertion of a valid lawyers lien is also untenable. A valid retaining lien has the following elements:
An attorneys retaining lien is fully recognized if the presence of the following elements concur: (1) lawyer-client
relationship; (2) lawful possession of the clients funds, documents and papers; and (3) unsatisfied claim for
attorneys fees. Further, the attorneys retaining lien is a general lien for the balance of the account between the
attorney and his client, and applies to the documents and funds of the client which may come into the attorneys
possession in the course of his employment.37
Respondent did not satisfy all the elements of a valid retaining lien. He did not present evidence as to an
unsatisfied claim for attorneys fees. The enumeration of cases he worked on for complainants remains
unsubstantiated. When there is no unsatisfied claim for attorneys fees, lawyers cannot validly retain their clients
funds or properties.38
Furthermore, assuming that respondent had proven all the requisites for a valid retaining lien, he cannot
appropriate for himself his client's funds without the proper accounting and notice to the client. The rule is that
when there is "a disagreement, or when the client disputes the amount claimed by the lawyer . . . the lawyer
should not arbitrarily apply the funds in his possession to the payment of his fees .... " 39
We also note that despite complainant Nicasio San Pedro's affidavit of desistance dated March 14, 2008, both
complainants signed their comment to respondent's motion for reconsideration and prayed that the motion be
dismissed for lack of merit.40
WHEREFORE, respondent Atty. Isagani A. Mendoza is SUSPENDED from the practice of law for three (3) months. He
is also ordered to RETURN to complainants the amount of P68,250.00 with 6% legal interest from the date of
finality of this judgment until full payment. Respondent is further DIRECTED to submit to this court proof of
payment of the amount within 10 days from payment. Let a copy of this resolution be entered in respondent Atty.
Isagani A. Mendoza's personal record with the Office of the Bar Confidant, and a copy be served to the Integrated
Bar of the Philippines and the Office of the Court Administrator for circulation to all the courts in the land.
SO ORDERED.
MARVIC M.V.F. LEONEN

Associate Justice
EN BANC
A.C. No. 10579, December 10, 2014
ERLINDA FOSTER, Complainant, v. ATTY. JAIME V. AGTANG, Respondent.
DECISION
PER CURIAM:
This refers to the Resolution1 of the Board of Governors (BOG), Integrated Bar of the Philippines (IBP), dated March
23, 2014, affirming with modification the findings of the Investigating Commissioner, who recommended the
suspension of respondent Atty. Jaime V. Agtang (respondent) from the practice of law for one (1) year for ethical
impropriety and ordered the payment of his unpaid obligations to complainant.
From the records, it appears that the IBP, thru its Commission on Bar Discipline (CBD), received a complaint2, dated
May 31, 2011, filed by Erlinda Foster (complainant) against respondent for unlawful, dishonest, immoral and
deceitful3 acts as a lawyer.
In its July 1, 2011 Order,4 the IBP-CBD directed respondent to file his Answer within 15 days from receipt of the
order. Respondent failed to do so and complainant sent a query as to the status of her complaint. On October 10,
2011, the Investigating Commissioner issued the Order5 setting the case for mandatory conference/hearing on
November 16, 2011. It was only on November 11, 2011, or five (5) days before the scheduled conference when
respondent filed his verified Answer.6
During the conference, only the complainant together with her husband appeared. She submitted a set of
documents contained in a folder, copies of which were furnished the respondent. The Investigating
Commissioner7 indicated that the said documents would be reviewed and the parties would be informed if there
was a need for clarificatory questioning; otherwise, the case would be submitted for resolution based on the
documents on file. The Minutes8 of the mandatory conference showed that respondent arrived at 11:10 oclock in
the morning or after the proceeding was terminated.
On December 12, 2011, the complainant filed her Reply to respondents Answer.
On April 18, 2012, complainant submitted copies of the January 24, 2012 Decisions 9 of the Municipal Trial Court in
Small Claims Case Nos. 2011-0077 and 2011-0079, ordering respondent [defendant therein] to pay complainant
and her husband the sum of P100,000.00 and P22,000.00, respectively, with interest at the rate of 12% per annum
from December 8, 2011 until fully paid, plus cost of suit.10
Complainants Position
From the records, it appears that complainant was referred to respondent in connection with her legal problem
regarding a deed of absolute sale she entered into with Tierra Realty, which respondent had notarized. After their
discussion, complainant agreed to engage his legal services for the filing of the appropriate case in court, for which
they signed a contract. Complainant paid respondent P20,000.00 as acceptance fee and P5,000.00 for incidental
expenses.11
On September 28, 2009, respondent wrote a letter12 to Tropical Villas Subdivision in relation to the legal problem
referred by complainant. He then visited the latter in her home and asked for a loan of P100,000.00, payable in
sixty (60) days, for the repair of his car. Complainant, having trust and confidence on respondent being her lawyer,
agreed to lend the amount without interest. A promissory note 13 evidenced the loan.
In November 2009, complainant became aware that Tierra Realty was attempting to transfer to its name a lot she
had previously purchased. She referred the matter to respondent who recommended the immediate filing of a
case for reformation of contract with damages. On November 8, 2009, respondent requested and thereafter
received from complainant the amount of P150,000.00, as filing fee.14 When asked about the exorbitant amount,
respondent cited the high value of the land and the sheriffs travel expenses and accommodations in Manila, for
the service of the summons to the defendant corporation. Later, complainant confirmed that the fees paid for the
filing of Civil Case No. 14791-65, entitled Erlinda Foster v. Tierra Realty and Development Corporation, only
amounted to P22,410.00 per trial court records.15
During a conversation with the Registrar of Deeds, complainant also discovered that respondent was the one who
notarized the document being questioned in the civil case she filed. When asked about this, respondent merely
replied that he would take a collaborating counsel to handle complainants case. Upon reading a copy of the
complaint filed by respondent with the trial court, complainant noticed that: 1] the major differences in the
documents issued by Tierra Realty were not alleged; 2] the contract to buy and sell and the deed of conditional
sale were not attached thereto; 3] the complaint discussed the method of payment which was not the point of
contention in the case; and 4] the very anomalies she complained of were not mentioned. Respondent, however,
assured her that those matters could be brought up during the hearings.
On April 23, 2010, respondent wrote to complainant, requesting that the latter extend to him the amount of
P70,000.00 or P50,000.00 in the moment of urgency or emergency. 16 Complainant obliged the request and gave
respondent the sum of P22,000.00.
On August 31, 2010, respondent came to complainants house and demanded the sum of P50,000.00, purportedly
to be given to the judge in exchange for a favorable ruling. Complainant expressed her misgivings on this
proposition but she eventually gave the amount of P25,000.00 which was covered by a receipt,17 stating that it is
understood that the balance of P25,000.00 shall be paid later after favorable judgment for plaintiff Erlinda Foster.
On November 2, 2010, respondent insisted that the remaining amount be given by complainant prior to the next
hearing of the case, because the judge was allegedly asking for the balance. Yet again, complainant handed to
respondent the amount of P25,000.00. 18
On September 29, 2010, complainants case was dismissed. Not having been notified by respondent, complainant
learned of the dismissal on December 14, 2010, when she personally checked the status of the case with the court.
She went to the office of respondent, but he was not there. Instead, one of the office staff gave her a copy of the
order of dismissal.
On December 15, 2010, respondent visited complainant and gave her a copy of the motion for reconsideration. On
January 15, 2011, complainant went to see respondent and requested him to prepare a reply to the comment filed
by Tierra Realty on the motion for reconsideration; to include additional facts because the Land Registration
Authority would not accept the documents unless these were amended; and to make the additional averment that
the defendant was using false documents.
On January 18, 2011, respondents driver delivered to complainant a copy of the reply with a message from him
that the matters she requested to be included were mentioned therein. Upon reading the same, however,
complainant discovered that these matters were not so included. On the same occasion, the driver also asked for
P2,500.00 on respondents directive for the reimbursement of the value of a bottle of wine given to the judge as a
present. Complainant was also told that oral arguments on the case had been set the following month.19
On February 2, 2011, complainant decided to terminate the services of respondent as her counsel and wrote him a
letter of termination,20 after her friend gave her copies of documents showing that respondent had been
acquainted with Tierra Realty since December 2007. Subsequently, complainant wrote to respondent, requesting
him to pay her the amounts he received from her less the contract fee and the actual cost of the filing fees.
Respondent never replied.
Respondents Position
In his Answer,21 respondent alleged that he was 72 years old and had been engaged in the practice of law since
March 1972, and was President of the IBP Ilocos Norte Chapter from 1998 to 1999. He admitted the fact that he
notarized the Deed of Absolute Sale subject of complainants case, but he qualified that he was not paid his
notarial fees therefor. He likewise admitted acting as counsel for complainant for which he claimed to have
received P10,000.00 as acceptance fee and P5,000.00 for incidental fees. Anent the loan of P100,000.00,
respondent averred that it was complainant, at the behest of her husband, who willingly offered the amount to
him for his patience in visiting them at home and for his services. The transaction was declared as no loan and he
was told not to worry about its payment. As regards the amount of P150,000.00 he received for filing fees,
respondent claimed that the said amount was suggested by the complainant herself who was persistent in
covering the incidental expenses in the handling of the case. He denied having said that the sheriffs of the court
would need the money for their hotel accommodations. Complainants husband approved of the amount. In the
same vein, respondent denied having asked for a loan of P50,000.00 and having received P22,000.00 from
complainant. He also denied having told her that the case would be discussed with the judge who would rule in
their favor at the very next hearing. Instead, it was complainant who was bothered by the possibility that the other
party would befriend the judge. He never said that he would personally present a bottle of wine to the judge.
Further, respondent belied the Registrars comment as to his representation of Tierra Realty in the past.
Respondent saw nothing wrong in this situation since complainant was fully aware that another counsel was
assisting him in the handling of cases. Having been fully informed of the nature of her cause of action and the
consequences of the suit, complainant was aware of the applicable law on reformation of contracts. Finally, by way
of counterclaim, respondent demanded just compensation for the services he had rendered in other cases for the
complainant.
Reply of Complainant
In her Reply,22 complainant mainly countered respondents defenses by making reference to the receipts in her
possession, all evidencing that respondent accepted the amounts mentioned in the complaint. Complainant also
emphasized that respondent and Tierra Realty had relations long before she met him. While respondent was
employed as Provincial Legal Officer of the Provincial Government of Ilocos Norte, he was involved in the
preparation of several documents involving Flying V, an oil company owned by Ernest Villavicencio, who likewise
owned Tierra Realty. Complainant insisted that the amount of P100,000.00 she extended to respondent was never
considered as no loan.
On June 26, 2012, complainant furnished the Investigating Commissioner copies of the Resolution, dated June 20,
2012, issued by the Office of the City Prosecutor of Laoag City, finding probable cause against respondent for
estafa.23
Findings and Recommendation of the IBP
In its July 3, 2012 Report and Recommendation,24 the Investigating Commissioner found respondent guilty of
ethical impropriety and recommended his suspension from the practice of law for one (1) year.
In its September 28, 2013 Resolution, the IBP-BOG adopted and approved with modification the recommendation
of suspension by the Investigating Commissioner and ordered respondent to return to complainant: 1) his loan of
P122,000.00; and 2) the balance of the filing fee amounting to P127,590.00.
Respondent received a copy of the said resolution on January 16, 2014 to which he filed a motion for
reconsideration.25 Complainant filed her opposition thereto, informing the IBP-BOG that an information charging
respondent for estafa had already been filed in court and that a corresponding order for his arrest had been
issued.26
In its March 23, 2014 Resolution, the IBP-BOG denied respondents motion for reconsideration but modified the
penalty of his suspension from the practice of law by reducing it from one (1) year to three (3) months.
Respondent was likewise ordered to return the balance of the filing fee received from complainant amounting to
P127,590.00.
No petition for review was filed with the Court.
The only issue in this case is whether respondent violated the Code of Professional Responsibility (CPR).
The Courts Ruling
The Court sustains the findings and recommendation of the Investigating Commissioner with respect to
respondents violation of Rules 1 and 16 of the CPR. The Court, however, modifies the conclusion on his alleged
violation of Rule 15, on representing conflicting interests. The Court also differs on the penalty.
Rule 1.0, Canon 1 of the CPR, provides that [a] lawyer shall not engage in unlawful, dishonest, immoral or
deceitful conduct. It is well-established that a lawyers conduct is not confined to the performance of his
professional duties. A lawyer may be disciplined for misconduct committed either in his professional or private
capacity. The test is whether his conduct shows him to be wanting in moral character, honesty, probity, and good
demeanor, or whether it renders him unworthy to continue as an officer of the court.27
In this case, respondent is guilty of engaging in dishonest and deceitful conduct, both in his professional and
private capacity. As a lawyer, he clearly misled complainant into believing that the filing fees for her case were
worth more than the prescribed amount in the rules, due to feigned reasons such as the high value of the land
involved and the extra expenses to be incurred by court employees. In other words, he resorted to overpricing, an
act customarily related to depravity and dishonesty. He demanded the amount of P150,000.00 as filing fee, when
in truth, the same amounted only to P22,410.00. His defense that it was complainant who suggested that amount
deserves no iota of credence. For one, it is highly improbable that complainant, who was then plagued with the
rigors of litigation, would propose such amount that would further burden her financial resources. Assuming that
the complainant was more than willing to shell out an exorbitant amount just to initiate her complaint with the
trial court, still, respondent should not have accepted the excessive amount. As a lawyer, he is not only expected
to be knowledgeable in the matter of filing fees, but he is likewise duty-bound to disclose to his client the actual
amount due, consistent with the values of honesty and good faith expected of all members of the legal profession.
Moreover, the fiduciary nature of the relationship between the counsel and his client imposes on the lawyer the
duty to account for the money or property collected or received for or from his client.28Money entrusted to a
lawyer for a specific purpose but not used for the purpose should be immediately returned. A lawyers failure to
return upon demand the funds held by him on behalf of his client gives rise to the presumption that he has
appropriated the same for his own use in violation of the trust reposed in him by his client. Such act is a gross
violation of general morality as well as of professional ethics. It impairs public confidence in the legal profession
and deserves punishment.29
It is clear that respondent failed to fulfill this duty. As pointed out, he received various amounts from complainant
but he could not account for all of them. Worse, he could not deny the authenticity of the receipts presented by
complainant. Upon demand, he failed to return the excess money from the alleged filing fees and other expenses.
His possession gives rise to the presumption that he has misappropriated it for his own use to the prejudice of, and
in violation of the trust reposed in him by, the client.30 When a lawyer receives money from the client for a
particular purpose, the lawyer is bound to render an accounting to the client showing that the money was spent
for the intended purpose. Consequently, if the lawyer does not use the money for the intended purpose, the
lawyer must immediately return the money to the client.31
Somewhat showing a propensity to demand excessive and unwarranted amounts from his client, respondent
displayed a reprehensible conduct when he asked for the amount of P50,000.00 as representation expenses
allegedly for the benefit of the judge handling the case, in exchange for a favorable decision. Respondent himself
signed a receipt showing that he initially took the amount of P 25,000.00 and, worse, he subsequently demanded
and received the other half of the amount at the time the case had already been dismissed. Undoubtedly, this act
is tantamount to gross misconduct that necessarily warrants the supreme penalty of disbarment. The act of
demanding a sum of money from his client, purportedly to be used as a bribe to ensure a positive outcome of a
case, is not only an abuse of his clients trust but an overt act of undermining the trust and faith of the public in the
legal profession and the entire Judiciary. This is the height of indecency. As officers of the court, lawyers owe their
utmost fidelity to public service and the administration of justice. In no way should a lawyer indulge in any act that
would damage the image of judges, lest the publics perception of the dispensation of justice be overshadowed by
iniquitous doubts. The denial of respondent and his claim that the amount was given gratuitously would not
excuse him from any liability. The absence of proof that the said amount was indeed used as a bribe is of no
moment. To tolerate respondents actuations would seriously erode the publics trust in the courts.
As it turned out, complainants case was dismissed as early as September 29, 2010. At this juncture, respondent
proved himself to be negligent in his duty as he failed to inform his client of the status of the case, and left the
client to personally inquire with the court. Surely, respondent was not only guilty of misconduct but was also
remiss in his duty to his client.
Respondents unbecoming conduct towards complainant did not stop here. Records reveal that he likewise
violated Rule 16.04, Canon 16 of the CPR, which states that [a] lawyer shall not borrow money from his client
unless the clients interests 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. In his private capacity, he requested from his client, not just one, but
two loans of considerable amounts. The first time, he visited his client in her home and borrowed P100,000.00 for
the repair of his car; and the next time, he implored her to extend to him a loan of P70,000.00 or P50,000.00 in
the moment of urgency or emergency but was only given P22,000.00 by complainant. These transactions were
evidenced by promissory notes and receipts, the authenticity of which was never questioned by respondent. These
acts were committed by respondent in his private capacity, seemingly unrelated to his relationship with
complainant, but were indubitably acquiesced to by complainant because of the trust and confidence reposed in
him as a lawyer. Nowhere in the records, particularly in the defenses raised by respondent, was it implied that
these loans fell within the exceptions provided by the rules. The loans of P100,000.00 and P22,000.00 were surely
not protected by the nature of the case or by independent advice. Respondents assertion that the amounts were
given to him out of the liberality of complainant and were, thus, considered as no loan, does not justify his
inappropriate behavior. The acts of requesting and receiving money as loans from his client and thereafter failing
to pay the same are indicative of his lack of integrity and sense of fair dealing. Up to the present, respondent has
not yet paid his obligations to complainant.
Time and again, the Court has consistently held that deliberate failure to pay just debts constitutes gross
misconduct, for which a lawyer may be sanctioned with suspension from the practice of law. Lawyers are
instruments for the administration of justice and vanguards of our legal system. They are expected to maintain not
only legal proficiency, but also a high standard of morality, honesty, integrity and fair dealing so that the peoples
faith and confidence in the judicial system is ensured. They must, at all times, faithfully perform their duties to
society, to the bar, the courts and their clients, which include prompt payment of financial obligations.32
Verily, when the Code or the Rules speaks of conduct or misconduct, the reference is not confined to ones
behavior exhibited in connection with the performance of the lawyers professional duties, but also covers any
misconduct which, albeit unrelated to the actual practice of his profession, would show him to be unfit for the
office and unworthy of the privileges which his license and the law vest him with. Unfortunately, respondent must
be found guilty of misconduct on both scores.
With respect to respondents alleged representation of conflicting interests, the Court finds it proper to modify the
findings of the Investigating Commissioner who concluded that complainant presented insufficient evidence of
respondents lawyering for the opposing party, Tierra Realty.
Rule 15.03, Canon 15 of the CPR, provides that [a] lawyer shall not represent conflicting interest except by written
consent of all concerned given after a full disclosure of the facts. 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 clients 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. Part of the lawyers duty in this regard is to avoid representing conflicting interests. 33 Thus, even if lucrative
fees offered by prospective clients are at stake, a lawyer must decline professional employment if the same would
trigger the violation of the prohibition against conflict of interest. The only exception provided in the rules is a
written consent from all the parties after full disclosure.
The Court deviates from the findings of the IBP. There is substantial evidence to hold respondent liable for
representing conflicting interests in handling the case of complainant against Tierra Realty, a corporation to which
he had rendered services in the past. The Court cannot ignore the fact that respondent admitted to having
notarized the deed of sale, which was the very document being questioned in complainants case. While the
Investigating Commissioner found that the complaint in Civil Case No. 14791-65 did not question the validity of the
said contract, and that only the intentions of the parties as to some provisions thereof were challenged, the Court
still finds that the purpose for which the proscription was made exists. The Court cannot brush aside the
dissatisfied observations of the complainant as to the allegations lacking in the complaint against Tierra Realty and
the clear admission of respondent that he was the one who notarized the assailed document. Regardless of
whether it was the validity of the entire document or the intention of the parties as to some of its provisions
raised, respondent fell short of prudence in action when he accepted complainants case, knowing fully that he
was involved in the execution of the very transaction under question. Neither his unpaid notarial fees nor the
participation of a collaborating counsel would excuse him from such indiscretion. It is apparent that respondent
was retained by clients who had close dealings with each other. More significantly, there is no record of any
written consent from any of the parties involved.
The representation of conflicting interests is prohibited 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. An
attorney has the duty to deserve the fullest confidence of his client and represent him with undivided loyalty. Once
this confidence is abused or violated the entire profession suffers. 34
Penalties and Pecuniary Liabilities
A member of the Bar may be penalized, even disbarred or suspended from his office as an attorney, for violation of
the lawyers oath and/or for breach of the ethics of the legal profession as embodied in the CPR. 35 For 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.36 The appropriate penalty for an errant lawyer depends on the exercise of
sound judicial discretion based on the surrounding facts.37
Under Section 27, Rule 138 of the Revised Rules of Court, a member of the Bar may be disbarred or suspended on
any of the following grounds: (1) deceit; (2) malpractice or other gross misconduct in office; (3) grossly immoral
conduct; (4) conviction of a crime involving moral turpitude; (5) violation of the lawyer's oath; (6) willful
disobedience of any lawful order of a superior court; and (7) willful appearance as an attorney for a party without
authority. A lawyer may be disbarred or suspended for misconduct, whether in his professional or private capacity,
which shows him to be wanting in moral character, honesty, probity and good demeanor, or unworthy to continue
as an officer of the court.
Here, respondent demonstrated not just a negligent disregard of his duties as a lawyer but a wanton betrayal of
the trust of his client and, in general, the public. Accordingly, the Court finds that the suspension for three (3)
months recommended by the IBP-BOG is not sufficient punishment for the unacceptable acts and omissions of
respondent. The acts of the respondent constitute malpractice and gross misconduct in his office as attorney. His
incompetence and appalling indifference to his duty to his client, the courts and society render him unfit to
continue discharging the trust reposed in him as a member of the Bar.
For taking advantage of the unfortunate situation of the complainant, for engaging in dishonest and deceitful
conduct, for maligning the judge and the Judiciary, for undermining the trust and faith of the public in the legal
profession and the entire judiciary, and for representing conflicting interests, respondent deserves no less than the
penalty of disbarment.38
Notably, the Court cannot order respondent to return the money he borrowed from complainant in his private
capacity. In Tria-Samonte v. Obias,39 the Court held that it cannot order the lawyer to return money to
complainant if he or she acted in a private capacity because its findings in administrative cases have no bearing on
liabilities which have no intrinsic link to the lawyers professional engagement. In disciplinary proceedings against
lawyers, the only issue is whether the officer of the court is still fit to be allowed to continue as a member of the
Bar. The only concern of the Court is the determination of respondents administrative liability. Its findings have no
material bearing on other judicial actions which the parties may choose against each other.
To rule otherwise would in effect deprive respondent of his right to appeal since administrative cases are filed
directly with the Court. Furthermore, the quantum of evidence required in civil cases is different from the
quantum of evidence required in administrative cases. In civil cases, preponderance of evidence is required.
Preponderance of evidence is a phrase which, in the last analysis, means probability of the truth. It is evidence
which is more convincing to the court as worthier of belief than that which is offered in opposition thereto. 40 In
administrative cases, only substantial evidence is needed. Substantial evidence, which is more than a mere scintilla
but is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, would
suffice to hold one administratively liable.41 Furthermore, the Court has to consider the prescriptive period
applicable to civil cases in contrast to administrative cases which are, as a rule, imprescriptible. 42
Thus, the IBP-BOG was correct in ordering respondent to return the amount of P127,590.00 representing the
balance of the filing fees he received from complainant, as this was intimately related to the lawyer-client
relationship between them. Similar to this is the amount of P50,000.00 which respondent received from
complainant, as representation expenses for the handling of the civil case and for the purported purchase of a
bottle of wine for the judge. These were connected to his professional relationship with the complainant. While
respondents deplorable act of requesting the said amount for the benefit of the judge is stained with mendacity,
respondent should be ordered to return the same as it was borne out of their professional relationship. As to his
other obligations, respondent was already adjudged as liable for the personal loans he contracted with
complainant, per the small claims cases filed against him.
All told, 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. 43 The
Court likewise aims 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.44
WHEREFORE, finding the respondent, Atty. Jaime V. Agtang, GUILTY of gross misconduct in violation of the Code of
Professional Responsibility, the Court hereby DISBARS him from the practice of law and ORDERS him to pay the
complainant, Erlinda Foster, the amounts of P127,590.00, P50,000.00 and P2,500.00.
Let a copy of this Decision be sent to the Office of the Bar Confidant, the Integrated Bar of the Philippines and the
Office of the Court Administrator to be circulated to all courts.SO ORDERED

SUPREME COURT
Manila
EN BANC
A.C. No. 10438 September 23, 2014
CF SHARP CREW MANAGEMENT INCORPORATED, Complainant,

vs.
NICOLAS C. TORRES, Respondent.
DECISION
PER CURIAM:
For the Court's resolution is the Complaint1 dated October 30, 2008 filed by complainant CF Sharp Crew
Management Incorporated (complainant) against respondent Nicolas C. Torres (respondent), charging him with
violating the Code of Professional Responsibility (CPR).
The Facts
Complainant is a corporation duly organized and existing under Philippine laws engaged in overseas maritime
employment.2 It hired respondent, a medical doctor and a lawyer by profession, as its Legal and Claims Manager
who was tasked, inter alia, to serve as its legal counsel and to oversee the administration and management of legal
cases and medicalrelated claims instituted by seafarers against complainants various principals. Among the cases
respondent handled in his capacity as Legal and Claims Manager were the claims of seafarers Bernardo R. Mangi
(Mangi), Rodelio J. Sampani (Sampani), Joseph C. Delgado (Delgado), and Edmundo M. Chua (Chua). 3
In its administrative complaint, it was alleged that per respondents request, complainant issued checks in the
amounts of P524,000.00, P652,013.20, P145,650.00, P97,100.00, and P296,808.40 as settlement of the respective
claims of Mangi, Sampani, Delgado, and Chua.4 However, complainant later discovered that, save for the check in
the amount of 145,650.00 issued to Delgado, respondent never gave the checks to the seafarers and instead, had
them deposited at International Exchange Bank, Banawe, Quezon City Branch, under Account No. 003-10-06902-
1.5 With respect to Sampani, complainant also discovered that he only received the amounts of P216,936.00
and P8,303.00 or a total of P225,239.00 out of the requested amount of P652,013.20, through checks not issued by
complainant.6
On October 30, 2008, the Integrated Bar of the Philippines (IBP) Commission on Bar Discipline directly received the
instant complaint and on even date, issued an Order7 requiring respondent to file an answer, but the latter failed
to do so. Neither did respondent appear in the mandatory conference scheduled on March 20, 2009 nor did he file
his position paper.8
The IBPs Report and Recommendation
In a Report and Recommendation9 dated August 1, 2009, the IBP Investigating Commissioner found respondent
administratively liable for violating the CPR, and accordingly recommended that he be meted the penalty of
suspension from the practice of law for one (1) year.10
The Investigating Commissioner found that respondent had indeed requested and was issued checks as settlement
of the respective claims of Mangi, Sampani, Delgado, and Chua onthe pretense that the requested amounts
represented what was lawfully due them.11 However, instead of giving the said checks to the named seafarers, he
deposited the same at the International Exchange Bank, Banawe,Quezon City Branch, under Account No. 003-10-
06902-1,12 except for the check in the amount of 145,650.00 issued to Delgado. 13
Meanwhile, respondent belatedly filed his Verified Answer (With Motion to Re-Open Investigation)14 on March 24,
2010. He explained that he was not able to timely file an answer because complainant supplied a wrong address to
the IBP and filed non-bailable criminal cases against him which caused his detention in a regular prison cell and,
thus, his inability to comply with the IBPs directives.15
On the merits of the complaint,respondent maintained that the seafarers claims had long been settled and that
the release documents signed by the named seafarers were already inactual custody and possession of the
complainant.16 He further contended that he only signed the dorsal portions of the checks as a form of guaranty of
their genuineness17 and that he could not have encashed them as they wereall payable to a particular
payee.18Lastly, respondent claimed that when he resigned in August 2008, complainant forced him to sign
promissory notes to reimburse certain amounts which had not been accounted for by the latter in exchange for his
clearance documents.19 But before he was able to settle the promissory notes, he was already arrested in
connection with the criminal cases filed by complainant against him.20
In a Resolution21 dated December 29, 2012, the IBP Board of Governors unanimously adopted and approved the
aforesaid report and recommendation with modification, increasing the recommended period of suspension from
the practice of law to two (2) years, and ordering respondent to return the full amount of money he received from
complainant which is legally due to the seafarers, with legal interest, within thirty (30) days from receipt of notice.
Aggrieved, respondent filed a Motion for Reconsideration 22 on April 22, 2013 which was, however, denied in a
Resolution23 dated March 8, 2014.
The essential issue in this case is whether or not respondent should be held administratively liable for violating the
CPR.
The Courts Ruling
After a judicious perusal of the records, the Court concurs with the findings of the IBP in its report and
recommendation, except as to: (a) the recommended penalty to be imposed upon respondent; and (b) the
monetary award in favor of the complainant.
It is fundamental that the relationship between a lawyer and his client is highly fiduciary and ascribes to a lawyer a
great degree of fidelity and good faith.24 The highly fiduciary nature of this relationship imposes upon the lawyer
the duty to account for the money or property collected or received for or from his client. 25 This is the standard
laid down by Rules 16.01 and 16.03, Canon 16 of the CPR, which read:
CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENTTHAT MAY COME INTO
HIS POSSESSION.
Rule 16.03 A lawyer shall deliver the funds and property of his client when due or upon demand. x x x.
In the foregoing light, it has been heldthat a lawyers failure to return upon demand the funds held by him on
behalf of his client gives rise to the presumption that he has appropriated the same for his own use in violation of
the trust reposed in him by his client. Such act is a gross violation of general morality as well as of professional
ethics.26
In this case, the IBP Investigating Commissioner correctly found that complainant had duly proven its charges
against respondent. In particular, complainant had exposed respondents modus operandi of repeatedly
requesting the issuance of checks purportedly for the purpose of settling seafarers claims against the
complainants various principals, only to have such checks (except for the check inthe amount of 145,650.00 issued
to Delgado) deposited to an unauthorized bank account, particularly International Exchange Bank, Banawe,Quezon
City Branch, under Account No. 003-10-06902-1. It is well-settled that "when a lawyer receives money from the
client for a particular purpose,the lawyer is bound to render an accounting to the client showing that the money
was spent for a particular purpose. And if he does not use the money for the intended purpose, the lawyer must
immediately return the money to his client."27 This, respondent failed to do.
Clearly, respondents acts of misappropriation constitute dishonesty, abuse of trust and confidence reposedin him
by the complainant, and betrayal of his clients interests which he is duty-bound to protect.28 They are contrary to
the mandate of Rule 1.01, Canon 1 of the CPR which provides that "[a] lawyer shall not engage in unlawful,
dishonest, immoral, or deceitful conduct." Such malfeasance is not only unacceptable, disgraceful, and
dishonorable to the legal profession; it also reveals a basic moral flaw that makes him unfit to practice law. 29
Anent the proper penalty for respondents acts, the Court deems it proper to modify the penalty recommended by
the IBP.1wphi1 Jurisprudence provides that in similar cases where lawyers misappropriated their clients money,
the Court imposed upon them the ultimate penalty of disbarment from the practice of law. In Arellano University,
Inc. v. Mijares III,30 the Court disbarred the lawyer for misappropriating his clients money intended for securing a
certificate of title on the latters behalf. Similarly, in Freeman v. Reyes, 31 the same penalty was imposed upon the
lawyer who misappropriated the insurance proceeds of her clients deceased husband.
As already discussed, respondent's conduct of misappropriating complainant's money has made him unfit to
remain in the legal profession. He has definitely fallen below the moral bar when he engaged in deceitful,
dishonest, unlawful, and grossly immoral acts. 32 As a member of the Bar, he is expected at all times to uphold the
integrity and dignity of the legal profession and refrain from any act or omission which might lessen the trust and
confidence reposed in him by the public in the fidelity, honesty, and integrity of the legal
profession.33 Membership in the legal profession is a privilege, and whenever it is made to appear that an attorney
is no longer worthy of the trust and confidence of his clients and the public, it becomes not only the right but also
the duty of the Court to withdraw the same,34 as in this case. In view of the foregoing, respondent deserves the
ultimate penalty of disbarment from the practice of law.
Likewise, the Court cannot concur with the IBP's recommendation regarding the return of the settlement money
respondent received from complainant, considering, among others, that it was not specifically prayed for in the
latter's administrative complaint and that the civil liability of respondent therefor may already be the subject of
existing cases involving the same parties. WHEREFORE, respondent Nicolas C. Torres is found guilty of violating
Rule 1.01, Canon 1 and Rules 16.01 and 16.03, Canon 16 of the Code of Professional Responsibility. Accordingly, he
is hereby DISBARRED from the practice of law and his name ordered STRICKEN OFF from the roll of attorneys.
Let a copy of this Decision be attached to respondent's record in this Court as attorney. Further, let copies of this
Decision be furnished the Integrated Bar of the Philippines and the Office of the Court Administrator, which is
directed to circulate them to all the courts in the country for their information and guidance.
SO ORDERED.

SUPREME COURT
Manila
FIRST DIVISION
A.C. No. 8085 December 1, 2014
FELIPE LAYOS, Complainant,

vs.
ATTY. MARLITO I. VILLANUEVA, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
For the Court's resolution is a Sumbong1 dated November 26, 2008 filed by complainant Felipe Layos
(complainant), charging respondent Atty. Marlito I. Villanueva (respondent) of violating the Code of Professional
Responsibility (CPR) and the lawyer's oath for neglecting the interests of his client.
The Facts
In the Sumbong, it was alleged that respondent is complainant's counsel of record in Criminal Case No. 7367-B
pending before the Regional Trial Court of Bifian, Laguna, Branch 24 (RTC), wherein the former's constant failure to
appear during court hearings resulted in the RTC's issuance of an Order 2 dated June 26, 2003 (June26, 2003 Order)
waiving the defenses right to cross-examine a prosecution witness. Despite the issuance of such order,
respondent remained absent and thus, complainant was only able to move for reconsideration,3 thru respondent,
only four (4) years later, or on April 21, 2007, which was denied in an Order 4 dated June 21, 2007. Aggrieved,
complainant, also thru respondent, filed a petition for certiorari before the Court of Appeals (CA), docketed as CA-
G.R. SP No. 101274.5
In a Decision6 dated November 6, 2008, the CA dismissed the petition on the merits. The CA likewise chastised
respondent for his "lack of candidness and fervor on [his part] to champion the cause" of his client, considering
that, inter alia: (a) respondent never bothered to know the outcome of the hearings where he was absent from; (b)
it took respondent a long amount of time before moving to reconsider the RTCs June 26, 2003 Order; and (c)
respondent never questioned the appearances of other lawyers as complainants counsel during his
absence.7Citing as basis such disquisition by the CA, complainant filed the instant administrative case against
respondent.
In his Comment8 dated March 30, 2009, respondent denied being remiss in his duty as complainants counsel. He
averred that during the hearing on April 4, 2002 where the criminal case was supposed to be amicably settled, his
car broke down and thus, he was unable to attend the hearing. After his car was fixed, he decided to go back to his
office and asked his secretary to call complainant to know what happened in the said hearing. However,
respondent was unable to contact complainant and that he never heard from the latter for a long time.
Respondent claimed that he no longer received any notices from the RTC, and thus, he assumed that the amicable
settlement pushed through and that the case was dismissed already. 9
Further, respondent maintained that it was only sometime before November 15, 2005 when he receiveda notice of
hearing from the RTC.10 Pursuant to the same, he went to the RTC and found out about the June 26, 2003 Order
and that other lawyers were appearing for complainant.11 After the hearing, respondent approached the RTC
personnel in order to get a copy of the June 26, 2003 Order but was unable to do so due to lack of manpower in
the RTC. Thus, he relied on the RTC personnels word that they would mail him a copy of such Order, but theywere
unable to do so. Hence, he was only able to move for reconsideration of the June 26, 2003 Order on April 21, 2007
upon securing a copy of the same on April 4, 2006. 12
Finally, respondent averred thathe had a hard time locating complainant who was not at his home address and
was staying at his workplace in Carmona, Cavite. According to respondent, this caused him to advance the filing
fees and other expenses of complainants cases, not to mention that the latter has failed to pay the agreed
appearance fees and attorneys fees due him. 13
In a Report and Recommendation14 dated February 4, 2010, the Integrated Bar of the Philippines (IBP)
Commissioner found respondent administratively liable, and accordingly, recommended that he be suspended
from the practice of law for a period of six (6) months. 15 Citing the CA Decision dated November 6, 2008 in CA-G.R.
SP No. 101274, the IBP Commissioner found that respondent failed in his duty as counsel to serve complainants
interests with competence and diligence by neglecting the latters criminal case which was pending before the
RTC.16 In a Resolution17 dated February 13, 2013, the IBP Board of Governors (IBP Board) unanimously adopted and
approved the IBP Commissioners Report and Recommendation, and hence, upheld respondents recommended
penalty of suspension from the practice of law for a period of six (6) months for negligence in the performance of
his legal duty to complainant.
Respondent moved for reconsideration18 which was, however, denied by the IBP Board in a Resolution 19 dated
May 2, 2014. Aggrieved, respondent filed a Notice of Appeal20 as well as a Petition for Review on Certiorari21before
the Court.
The essential issue in this case is whether or not respondent should be held administratively liable for the acts
complained of.
The Courts Ruling
After a judicious perusal of the records, the Court concurs with the IBPs findings, subject to the modification of the
recommended penalty to be imposed upon respondent.
Under Canon 17 and Canon 18, Rules 18.03 and 18.04 of the CPR, it is the lawyers duty to serve his clients interest
with utmost zeal, candor and diligence. As such, he must keep abreast of all the developments in his clients case
and should inform the latter of the same, as it is crucial in maintaining the latters confidence, to wit:
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.
CANON 18 A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE. x x x x
Rule 18.03 A lawyer shall not neglecta legal matter entrusted to him, and his negligence in connection there with
Rule 18.04 A lawyer shall keep the client informed of the status of his case and shall respond within a reasonable
time to clients request for information.
As an officer of the court, it is the duty of an attorney to inform his client of whatever important information he
may have acquired affecting his clients case. He should notify his client of any adverse decision to enable his client
to decide whether to seek an appellate review thereof. Keeping the client informed of the developments of the
case will minimize misunderstanding and loss of trust and confidence in the attorney. The lawyer should not leave
the client in the dark on how the lawyer is defending the clients interests. In this connection, the lawyer must
constantly keep in mind that his actions, omissions, or nonfeasance would be binding upon his client. As such, the
lawyeris expected to be acquainted with the rudiments of law and legal procedure, and a clientwho deals with him
has the right to expect not just a good amount of professional learning and competence but also a whole-hearted
fealty to the clients cause.22
In the case at bar, records reveal that since missing the April 4, 2002 hearing due to car trouble, respondent no
longer kept track of complainants criminal case and merely assumed that the same was already amicably settled
and terminated. Thereafter, when respondent finally knew that the case was still on-going, he attended the
November 15, 2005 hearing, and discovered the RTCs issuance of the June 26, 2003 Order which is prejudicial to
complainants cause. Despite such alarming developments, respondent did not immediately seek any remedy to
further the interests of his client.1wphi1 Instead, he passively relied on the representations of the court
employees that they would send him a copy of the aforesaid Order. Worse, when he finally secured a copy on April
4, 2006, it still took him over a year, or until April 21, 2007, just to move the RTC to reconsider its June 26, 2003
Order. Naturally, the RTC and the CA denied the motion for being filed way beyond the reglementary period, to
the detriment of complainant. Clearly, respondent failed to exercise such skill, care, and diligence as men of the
legal profession commonly possess and exercise in such matters of professional employment. 23
While the Court agrees that respondent should be held administratively liable for the foregoing acts and thus,
must be suspended from the practice of law, it nevertheless deems that the IBPs recommended period of
suspension of six (6) months is too harsh a penalty, given the complainants seeming disinterest in the
developments of his own case. This is evidenced by complainant not communicating with respondent, getting
other lawyers referred to him by his friends despite having a counsel of record, and being indifferent despite being
informed of a standing warrant of arrest against him. 24 In Venterez v. Atty. Cosme,25 a case involving a lawyer who
committed culpable negligence in handling his clients case, the Court reduced his period of suspension from six (6)
months to three (3) months after considering the surrounding circumstances of the case.26 Similarly, in Somosot v.
Atty. Lara27which also involved a lawyer who was remiss in his duties as counsel, the Court also reducedthe period
of his suspension from six (6) months to three (3) months, inlight of his clients contributory faults. 28 In view of the
foregoing, the Court finds that respondents suspension from the practice of law for a period of three (3) months
would be commensurate penalty to the acts complained of.
It must be stressed that public interest requires that an attorney exert his best efforts in the prosecution or
defense of a clients cause. A lawyer who performs that duty with diligence and candor not only protects the
interests of his client, he also serves the ends of justice, does honor to the bar, and helps maintain the respect of
the community to the legal profession. Lawyers are indispensable part of the whole system of administering justice
in this jurisdiction. At a time when strong and disturbing criticisms are being hurled at the legal profession, strict
compliance with one's oath of office and the canons of professional ethics is an imperative. 29
WHEREFORE, respondent Atty. Marlito I. Villanueva is found administratively liable for violation of Canon 17 and
Canon 18, Rules 18.03 and 18.04 of the Code of Professional Responsibility. Accordingly, he is hereby SUSPENDED
from the practice of law for three (3) months effective from the finality of this Resolution, and is STERNLY WARNED
that a repetition of the same or similar act in the future shall be dealt with more severely.
Let a copy of this Resolution be furnished the Office of the Bar Confidant, to be appended to respondent's personal
record as attorney. Further, let copies of this Resolution be furnished the Integrated Bar of the Philippines and the
Office of the Court Administrator, which is directed to circulate them to all courts in the country for their
information and guidance.
SO ORDERED.
FIRST DIVISION
A.C. No. 9091, December 11, 2013
CONCHITA A. BALTAZAR, ROLANDO SAN PEDRO, ALICIA EULALIO-RAMOS, SOLEDAD A. FAJARDO AND
ENCARNACION A. FERNANDEZ, Complainants, v.ATTY. JUAN B. BAEZ, JR., Respondent.
RESOLUTION
SERENO, C.J.:
Complainants are the owners of three parcels of land located in Dinalupihan, Bataan. 1 On 4 September 2002, they
entered into an agreement with Gerry R. Fevidal (Fevidal), a subdivision developer. In that agreement, they stood
to be paid P35,000,000 for all the lots that would be sold in the subdivision.2 For that purpose, they executed a
Special Power of Attorney authorizing Fevidal to enter into all agreements concerning the parcels of land and to
sign those agreements on their behalf.3
Fevidal did not update complainants about the status of the subdivision project and failed to account for the titles
to the subdivided land.4 Complainants also found that he had sold a number of parcels to third parties, but that he
did not turn the proceeds over to them. Neither were complainants invited to the ceremonial opening of the
subdivision project.5 Thus, on 23 August 2005, they revoked the Special Power of Attorney they had previously
executed in his favor.6
Complainants subsequently agreed to settle with Fevidal for the amount of P10,000,000, but the latter again failed
to pay them.7 Complainants engaged the professional services of respondent for the purpose of assisting them in
the preparation of a settlement agreement.8 Instead of drafting a written settlement, respondent encouraged
them to institute actions against Fevidal in order to recover their properties.
Complainants then signed a contract of legal services,9 in which it was agreed that they would not pay acceptance
and appearance fees to respondent, but that the docket fees would instead be shared by the parties. Under the
contract, complainants would pay respondent 50% of whatever would be recovered of the properties.
In preparation for the filing of an action against Fevidal, respondent prepared and notarized an Affidavit of Adverse
Claim, seeking to annotate the claim of complainants to at least 195 titles in the possession of Fevidal. 10 A certain
Luzviminda Andrade (Andrade) was tasked to submit the Affidavit of Adverse Claim to the Register of Deeds of
Bataan.11 The costs for the annotation of the adverse claim were paid by respondent. Unknown to him, the
adverse claim was held in abeyance, because Fevidal got wind of it and convinced complainants to agree to
another settlement.12
Meanwhile, on behalf of complainants, and after sending Fevidal a demand letter dated 10 July 2006, respondent
filed a complaint for annulment, cancellation and revalidation of titles, and damages against Fevidal before the
Regional Trial Court (RTC) of Bataan on 13 October 2006.13
Complainants found it hard to wait for the outcome of the action. Thus, they terminated the services of
respondent on 8 June 2007, withdrew their complaint against Fevidal on 9 June 2007, and finalized their amicable
settlement with him on 5 July 2007.14
Respondent filed a Manifestation and Opposition 15 dated 20 July 2007 before the RTC, alleging that the
termination of his services and withdrawal of the complaint had been done with the intent of defrauding counsel.
On the same date, he filed a Motion for Recording of Attorneys Charging Lien in the Records of the Above-
Captioned Cases.16 When the RTC granted the withdrawal of the complaint, 17 he filed a Manifestation and Motion
for Reconsideration.18
After an exchange of pleadings between respondent and Fevidal, with the latter denying the formers allegation of
collusion,19 complainants sought the suspension/disbarment of respondent through a Complaint 20 filed before the
Integrated Bar of the Philippines (IBP) on 14 November 2007. Complainants alleged that they were uneducated
and underprivileged, and could not taste the fruits of their properties because the disposition thereof was now
clothed with legal problems brought about by respondent. 21 In their complaint, they alleged that respondent had
violated Canons 1.01,221.03,23 1.04,24 12.02,25 15.05,26 18.04,27 and 20.0428 of the Code of Professional
Responsibility.
On 14 August 2008, the IBP Commission on Bar Discipline adopted and approved the Report and
Recommendation29 of the investigating commissioner. It suspended respondent from the practice of law for a
period of one year for entering into a champertous agreement.30 On 26 June 2011, it denied his motion for
reconsideration.
On 26 November 2012, this Court noted the Indorsement of the IBP Commission on Bar Discipline, as well as
respondents second motion for reconsideration.
We find that respondent did not violate any of the canons cited by complainants. In fact, we have reason to
believe that complainants only filed the instant complaint against him at the prodding of Fevidal.
Respondent cannot be faulted for advising complainants to file an action against Fevidal to recover their
properties, instead of agreeing to a settlement of P10,000,000 a measly amount compared to that in the original
agreement, under which Fevidal undertook to pay complainants the amount of P35,000,000. Lawyers have a
sworn duty and responsibility to protect the interest of any prospective client and pursue the ends of justice.31 Any
lawyer worth his salt would advise complainants against the abuses of Fevidal under the circumstances, and we
cannot countenance an administrative complaint against a lawyer only because he performed a duty imposed on
him by his oath.
The claim of complainants that they were not informed of the status of the case is more appropriately laid at their
door rather than at that of respondent. He was never informed that they had held in abeyance the filing of the
adverse claim. Neither was he informed of the brewing amicable settlement between complainants and Fevidal.
We also find it very hard to believe that while complainants received various amounts as loans from respondent
from August 2006 to June 2007,32 they could not spare even a few minutes to ask about the status of the case. We
shall discuss this more below.
As regards the claim that respondent refused to patch up with Fevidal despite the pleas of complainants, we
note the latters Sinumpaang Salaysay dated 24 September 2007, in which they admitted that they could not
convince Fevidal to meet with respondent to agree to a settlement. 33
Finally, complainants apparently refer to the motion of respondent for the recording of his attorneys charging lien
as the legal problem preventing them from enjoying the fruits of their property.
Section 26, Rule 138 of the Rules of Court allows an attorney to intervene in a case to protect his rights concerning
the payment of his compensation. According to the discretion of the court, the attorney shall have a lien upon all
judgments for the payment of money rendered in a case in which his services have been retained by the client.
We recently upheld the right of counsel to intervene in proceedings for the recording of their charging lien.
In Malvar v. KFPI,34 we granted counsels motion to intervene in the case after petitioner therein terminated his
services without justifiable cause. Furthermore, after finding that petitioner and respondent had colluded in order
to deprive counsel of his fees, we ordered the parties to jointly and severally pay counsel the stipulated contingent
fees.
Thus, the determination of whether respondent is entitled to the charging lien is based on the discretion of the
court before which the lien is presented. The compensation of lawyers for professional services rendered is subject
to the supervision of the court, not only to guarantee that the fees they charge remain reasonable and
commensurate with the services they have actually rendered, but to maintain the dignity and integrity of the legal
profession as well.35 In any case, an attorney is entitled to be paid reasonable compensation for his services. 36 That
he had pursued its payment in the appropriate venue does not make him liable for disciplinary action.
Notwithstanding the foregoing, respondent is not without fault. Indeed, we find that the contract for legal services
he has executed with complainants is in the nature of a champertous contract an agreement whereby an
attorney undertakes to pay the expenses of the proceedings to enforce the clients rights in exchange for some
bargain to have a part of the thing in dispute.37 Such contracts are contrary to public policy38 and are thus void or
inexistent.39 They are also contrary to Canon 16.04 of the Code of Professional Responsibility, which states that
lawyers shall not lend money to a client, except when in the interest of justice, they have to advance necessary
expenses in a legal matter they are handling for the client.
A reading of the contract for legal services40 shows that respondent agreed to pay for at least half of the expense
for the docket fees. He also paid for the whole amount needed for the recording of complainants adverse claim.
While lawyers may advance the necessary expenses in a legal matter they are handling in order to safeguard their
clients rights, it is imperative that the advances be subject to reimbursement. 41 The purpose is to avoid a situation
in which a lawyer acquires a personal stake in the clients cause. Regrettably, nowhere in the contract for legal
services is it stated that the expenses of litigation advanced by respondent shall be subject to reimbursement by
complainants.
In addition, respondent gave various amounts as cash advances (bali), gasoline and transportation allowance to
them for the duration of their attorney-client relationship. In fact, he admits that the cash advances were in the
nature of personal loans that he extended to complainants. 42
Clearly, respondent lost sight of his responsibility as a lawyer in balancing the clients interests with the ethical
standards of his profession. Considering the surrounding circumstances in this case, an admonition shall suffice to
remind him that however dire the needs of the clients, a lawyer must always avoid any appearance of impropriety
to preserve the integrity of the profession.
WHEREFORE, Attorney Juan B. Baez, Jr. is hereby ADMONISHED for advancing the litigation expenses in a legal
matter he handled for a client without providing for terms of reimbursement and lending money to his client, in
violation of Canon 16.04 of the Code of Professional Responsibility. He is sternly warned that a repetition of the
same or a similar act would be dealt with more severely.
Let a copy of this Resolution be attached to the personal record of Attorney Baez, Jr.chanRoblesvirtualLawlibrary
SO ORDERED.

SUPREME COURT
Manila
SECOND DIVISION
A.C. No. 7965 November 13, 2013
AZUCENA SEGOVIA-RIBAYA, Complainant,

vs.
ATTY. BARTOLOME C. LAWSIN, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
For the Courts resolution is an administrative complaint1 filed by Azucena Segovia-Ribaya (complainant) against
Atty. Bartolome C. Lawsin (respondent), the antecedents of which are detailed as follows:
The Facts
On November 18, 2005, the parties entered into a retainership agreement 2 (retainer) whereby respondent
undertook to, inter alia process the registration and eventually deliver, within a period of six (6 ) months, 3 the
certificate of title over a certain parcel of land (subject land) in favor of complainant acting as the representative of
the Heirs of the late Isabel Segovia. In connection therewith, respondent received from complainant the amounts
of P15,000.00 and P39,000.004 to cover for the litigation and land registration expenses, respectively.
Notwithstanding the expenditure of the P39,000.00 given for registration expenses (subject amount) and the lapse
of more than three (3) years from the retainers date, complainant alleged that respondent, without proper
explanation, failed to fulfill his undertaking to register the subject land and deliver to complainant the certificate of
title over the same. As complainant was tired of respondents excuses, she finally decided to just withdraw the
subject amount from respondent. For such purpose, she confronted the latter at his office and also subsequently
sent him two (2) demand letters,5 but all to no avail.6 Hence, complainant was prompted to file the instant
administrative complaint.
In his Comment,7 respondent admitted that he indeed received the subject amount from complainant but averred
that after receiving the same, the latters brother, Erlindo, asked to be reimbursed the amount of P7,500.00 which
the latter purportedly paid to the land surveyor.8 Respondent likewise alleged that he later found out that he could
not perform his undertaking under the retainer because the ownership of the subject land was still under
litigation.9Finally, respondent stated that he wanted to return the balance of the subject amount to complainant
after deducting what Erlindo took from him, but was only prevented to do so because he was maligned by
complainant when she went to his office and there, shouted and called him names in the presence of his staff. 10
In the Courts Resolutions dated December 17, 200811 and March 2, 2009,12 the case was referred to the Integrated
Bar of the Philippines (IBP) for investigation, report, and recommendation. After both parties failed to appear
during the mandatory conference, IBP Investigating Commissioner Atty. Salvador B. Hababag (Investigating
Commissioner) required the parties to submit their respective position papers.13 Complainant filed her position
paper14 on October 8, 2009, while respondent failed to do so.
On November 6, 2009, the Investigating Commissioner issued his Report and Recommendation, 15 finding
respondent to have violated Rules 16.01 and 16.03, Canon 16 of the Code of Professional Responsibility (Code) for
his failure to properly account for the money entrusted to him without any adequate explanation why he could not
return the same. The Investigating Commissioner found that respondents acts demonstrated his "lack of candor,
fairness, and loyalty to his client, who entrusted him with money and documents for the registration of the subject
land."16 The Investigating Commissioner likewise held that respondents failure to return the subject amount,
despite being given "adequate time to return"17 the same, "not to mention the repeated x x x demands made upon
him,"18 constitutes "gross dishonesty, grave misconduct, and even misappropriation of money" 19 in violation of the
above-stated rules. In view of the foregoing, the Investigating Commissioner recommended that respondent be
suspended from the practice of law for a period of six (6) months, with a stern warning that a repetition of the
same or similar offenses in the future shall be dealt with more severely. 20
In a Resolution21 dated December 29, 2012, the IBP Board of Governors adopted and approved the Investigating
Commissioners Report and Recommendation with modification, ordering the return of the amount
of P31,500.00,22 with legal interest and within thirty (30) days from receipt of notice, to complainant.
The essential issue in this case is whether or not respondent should be held administratively liable for violating
Rules 16.01 and 16.03, Canon 16 of the Code.
The Courts Ruling
The Court concurs with and affirms the findings of the IBP anent respondents administrative liability but deems it
proper to: (a) extend the recommended period of suspension from the practice of law from six (6) months to one
(1) year; and (b) delete the recommended order for the return of the amount of P31,500.00.
Anent respondents administrative liability, the Court agrees with the IBP that respondents failure to properly
account for and duly return his clients money despite due demand is tantamount to a violation of Rules 16.01 and
16.03, Canon 16 of the Code which respectively read as follows:
CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND PROPERTIES OF HIS CLIENT THAT MAY COME
INTO HIS POSSESSION.
Rule 16.03 A lawyer shall deliver the funds and property of his client when due or upon
demand.1wphi1 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.
Records disclose that respondent admitted the receipt of the subject amount from complainant to cover for
pertinent registration expenses but posited his failure to return the same due to his clients act of confronting him
at his office wherein she shouted and called him names. With the fact of receipt being established, it was then
respondents obligation to return the money entrusted to him by complainant. To this end, suffice it to state that
complainants purported act of "maligning" respondent does not justify the latters failure to properly account for
and return his clients money upon due demand. Verily, a lawyers duty to his client is one essentially imbued with
trust so much so that it is incumbent upon the former to exhaust all reasonable efforts towards its faithful
compliance. In this case, despite that singular encounter, respondent had thereafter all the opportunity to return
the subject amount but still failed to do so. Besides, the obligatory force of said duty should not be diluted by the
temperament or occasional frustrations of the lawyers client, especially so when the latter remains unsatisfied by
the lawyers work. Indeed, a lawyer must deal with his client with professional maturity and commit himself
towards the objective fulfillment of his responsibilities. If the relationship is strained, the correct course of action is
for the lawyer to properly account for his affairs as well as to ensure the smooth turn-over of the case to another
lawyer. Except only for the retaining lien exception23 under Rule 16.03, Canon 16 of the Code, the lawyer should
not withhold the property of his client. Unfortunately, absent the applicability of such exception or any other
justifiable reason therefor, respondent still failed to perform his duties under Rules 16.01 and 16.03, Canon 16 of
the Code which perforce warrants his administrative liability.
The Court, however, deems it proper to increase the IBPs recommended period of suspension from the practice of
law from six (6) months to one (1) year in view of his concomitant failure to exercise due diligence in handling his
clients cause as mandated by Rules 18.03 and 18.04, Canon 18 of the Code:
CANON 18 - A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE. 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.
After a judicious scrutiny of the records, the Court observes that respondent did not only accomplish his
undertaking under the retainer, but likewise failed to give an adequate explanation for such non-performance
despite the protracted length of time given for him to do so. As such omissions equally showcase respondents
non-compliance with the standard of proficiency required of a lawyer as embodied in the above-cited rules, the
Court deems it apt to extend the period of his suspension from the practice of law from six (6) months to one (1)
year similar to the penalty imposed in the case of Del Mundo v. Capistrano. 24
As a final point, the Court must clarify that the foregoing resolution should not include a directive for the return of
the amount of P31,500.00 as recommended by the IBP Board of Governors. The same amount was given by
complainant to respondent to cover for registration expenses; hence, its return partakes the nature of a purely
civil liability which should not be dealt with during an administrative-disciplinary proceeding. In Tria-Samonte v.
Obias,25the Court recently held that its "findings during administrative-disciplinary proceedings have no bearing on
the liabilities of the parties involved which are purely civil in nature meaning, those liabilities which have no
intrinsic link to the lawyer's professional engagement as the same should be threshed out in a proper proceeding
of such nature." This pronouncement the Court applies to this case and thus, renders a disposition solely on
respondents administrative liability.
WHEREFORE, respondent Atty. Bartolome C. Lawsin is found guilty of violating Rules 16.01 and 16.03, Canon 16,
and Rules 18.03 and 18.04, Canon 18 of the Code of Professional Responsibility. Accordingly, he is hereby
SUSPENDED from the practice of law for a period of one (1) year effective upon his receipt of this Resolution with a
stem warning that a repetition of the same or similar acts will be dealt with more severely.
Let a copy of this Resolution be furnished the Office of the Bar Confidant the Integrated Bar of the Philippines and
the Office of the Court Administrator for circulation to all the courts.
SO ORDERED.
ESTELA M. PERLAS-BERNABE
Associate Justice
EN BANC
A.C. No. 10568 [Formerly CBD Case No. 10-2753], January 13, 2015
MARILEN G. SOLIMAN, Complainant, v. ATTY. DITAS LERIOS-AMBOY, Respondent.
RESOLUTION
REYES, J.:
This is an administrative complaint1 filed by Marilen G. Soliman (Soliman) against Atty. Ditas Lerios-Amboy (Atty.
Amboy) for violation of the Code of Professional Responsibility.
In her complaint, Soliman claimed that she engaged the services of Atty. Amboy on May 27, 2007 in connection
with a partition case. In accordance with the Retainer Agreement between the parties, Soliman agreed to pay
Atty. Amboy P50,000.00 as acceptance fee. Upon the latters engagement, Soliman paid her P25,000.00. Later on,
Atty. Amboy advised Soliman to no longer institute a partition case since the other co-owners of the property were
amenable to the partition thereof. Instead, Atty. Amboy just facilitated the issuance of the titles to the said
property from the co-owners to the individual owners; the P25,000.00 already paid to her was then treated as
payment for her professional services.2chanRoblesvirtualLawlibrary
In November 2008, Soliman gave Atty. Amboy P16,700.00 as payment for the transfer tax. In the second quarter
of 2009, Atty. Amboy told Soliman that there was a delay in the issuance of the titles to the property because of
the failure of the other co-owners to submit certain documents. Atty. Amboy then told Soliman that someone
from the Register of Deeds (RD) can help expedite the issuance of the titles for a fee of P80,000.00. On June 17,
2009, Atty. Amboy told Soliman that her contact in the RD agreed to reduce the amount to
P50,000.00.3chanRoblesvirtualLawlibrary
Meanwhile, Soliman deposited the amount of P8,900.00 to Atty. Amboys bank account as payment for the real
property tax for the year 2009. Thereafter, Soliman deposited the amount of P50,000.00 to Atty. Amboys bank
account as payment for the latters contact in the RD.4chanRoblesvirtualLawlibrary
On October 16, 2009, Atty. Amboy informed Soliman that the certificates of title to the property were then only
awaiting the signature of the authorized officer. However, Atty. Amboy failed to deliver the respective certificates
of title of Soliman and her co-owners to the subject property.5chanRoblesvirtualLawlibrary
On January 6, 2010, Atty. Amboys secretary informed Soliman that their contact in the RD was asking for an
additional P10,000.00 to facilitate the release of the said certificates of title. Soliman then refused to further pay
the amount being asked by Atty. Amboys secretary.6chanRoblesvirtualLawlibrary
Thereafter, Soliman kept on asking Atty. Amboy for any update on the release of the said titles, but the latter was
not responding to her queries. On July 7, 2010, Soliman and Atty. Amboys secretary went to the office of a certain
Atty. Marasigan, Deputy RD of Manila. Soliman asked Atty. Marasigan if he received the P50,000.00 as payment
for the release of the said titles. Atty. Marasigan denied having received any amount to facilitate the release of the
titles and claimed that the reason why the same could not be processed was that Atty. Amboy failed to file certain
documents.7chanRoblesvirtualLawlibrary
Soliman further claimed that Atty. Amboy thereafter refused to release the pertinent documents she gave to her
for the processing of the titles to the property or give back the P50,000.00 that was already paid to
her.8chanRoblesvirtualLawlibrary
For her part, Atty. Amboy admitted that she had a retainer agreement with Soliman, but denied having received
any amount from the latter pursuant to the said agreement. She claimed that the retainer agreement was not
implemented since the partition case was not instituted. She claimed that she merely undertook to research,
gather and collate all documents required in the partition and in the transfer of the titles from the co-owners to
the individual owners. She denied having failed to submit the relevant documents to the RD which caused the
delay in the processing of the said titles. She likewise denied having asked Soliman for P50,000.00 to facilitate the
release of the said titles.9chanRoblesvirtualLawlibrary
On May 29, 2012, after due proceedings, the Investigating Commissioner of the Commission on Bar Discipline of
the Integrated Bar of the Philippines (IBP) issued a Report and Recommendation,10 which recommended the
suspension of Atty. Amboy from the practice of law for six (6) months. The Investigating Commissioner opined
that Atty. Amboy violated the Code of Professional Responsibility by failing to observe due diligence in dealing with
Soliman. It also opined that she failed to inform the latter of the status of the proceedings for the issuance of the
said titles.
On March 20, 2013, the IBP Board of Governors issued a Resolution, 11 which adopted and approved the
recommendation of the Investigating Commissioner, albeit with the modification that the period of Atty. Amboys
suspension from the practice of law was increased from six (6) months to two (2) years and that she was
ordered to return the entire amount she received from Soliman.
Atty. Amboy sought a reconsideration12 of the Resolution dated March 20, 2013, but it was denied by the IBP
Board of Governors in its Resolution13 dated March 21, 2014.
After a thorough perusal of the respective allegations of the parties and the circumstances of this case, the Court
affirms the penalty imposed by the IBP Board of Governors.
The Code of Professional Responsibility clearly states that a lawyer owes fidelity to the cause of his client and that
he should be mindful of the trust and confidence reposed in him.14 A lawyer is mandated to serve his client with
competence and diligence; to never neglect a legal matter entrusted to him; and to keep his client informed of the
status of his case and respond within a reasonable time to the clients request for
information.15chanRoblesvirtualLawlibrary
The circumstances of this case clearly show that Atty. Amboy, after receiving P25,000.00 as payment for her
professional services, failed to submit material documents relative to the issuance of separate certificates of title
to the individual owners of the property. It was her negligence which caused the delay in the issuance of the
certificates of title.
To make matters worse, Atty. Amboy abetted the commission of an illegal act when she asked from Soliman the
amount of P50,000.00 to be paid to her contact inside the office of the RD in order to facilitate the release of the
said certificates of title. Further, notwithstanding the payment of P50,000.00, Atty. Amboy still failed to obtain
issuance of the said certificates of title. Instead of procuring the release of the certificates of title as she promised,
Atty. Amboy asked for an additional P10,000.00 from Soliman.
Clearly, this is not a simple case of negligence and incompetence by a counsel in dealing with a client. Atty.
Amboys acts undermined the legal processes, which she swore to uphold and defend. In swearing to the oath,
Atty. Amboy bound herself to respect the law and legal processes.
The Court further finds improper the refusal of Atty. Amboy to return the amount of P50,000.00 which she paid in
order to facilitate the release of the certificates of title. To reiterate, upon inquiry, Atty. Marasigan, the Deputy RD
of Manila, denied having received any amount from Atty. Amboy. In not returning the money to Soliman after a
demand therefor was made following her failure to procure the issuance of the certificates of title, Atty. Amboy
violated Canon 16 of the Code of Professional Responsibility, particularly Rule 16.03 thereof, which requires that a
lawyer shall deliver the funds and property of his client upon demand. It is settled that the unjustified withholding
of money belonging to a client warrants the imposition of disciplinary action. 16chanRoblesvirtualLawlibrary
A lawyers failure to return upon demand the funds held by him on behalf of his client gives rise to the
presumption that he has appropriated the same for his own use in violation of the trust reposed in him by his
client. Such act is a gross violation of general morality as well as of professional ethics. It impairs public
confidence in the legal profession and deserves punishment. 17chanRoblesvirtualLawlibrarychanrobleslaw
WHEREFORE, in consideration of the foregoing disquisitions, Atty. Ditas Lerios-Amboy is found GUILTY of violating
Rule 16.03, Canons 17 and 18, and Rules 18.03 and 18.04 of the Code of Professional Responsibility and is
hereby SUSPENDED from the practice of law for a period of two (2) years, effective upon receipt of this Resolution.
Furthermore, she is ORDERED to return to Marilen G. Soliman the entire amount of Fifty Thousand Pesos
(P50,000.00) she received from the latter, plus legal interest thereon, reckoned from finality of this Resolution until
fully paid. The respondent is further DIRECTED to promptly submit to this Court written proof of her compliance
within thirty (30) days from notice of this Resolution.
Let copies of this Resolution be furnished to the Office of the Bar Confidant, to be appended to Atty. Ditas Lerios-
Amboys personal record as an attorney; to the Integrated Bar of the Philippines; and to the Office of the Court
Administrator for dissemination to all courts throughout the country for their information and guidance.
SO ORDERED.cralawlawlibrary
[G.R. No. 137378. October 12, 2000]
PHILIPPINE ALUMINUM WHEELS, INC., petitioner, vs. FASGI ENTERPRISES, INC., respondent.
DECISION
VITUG, J.:
On 01 June 1978, FASGI Enterprises Incorporated ("FASGI"), a corporation organized and existing under and
by virtue of the laws of the State of California, United States of America, entered into a distributorship
arrangement with Philippine Aluminum Wheels, Incorporated ("PAWI"), a Philippine corporation, and Fratelli
Pedrini Sarezzo S.P.A. ("FPS"), an Italian corporation.The agreement provided for the purchase, importation and
distributorship in the United States of aluminum wheels manufactured by PAWI. Pursuant to the contract, PAWI
shipped to FASGI a total of eight thousand five hundred ninety four (8,594) wheels, with an FOB value of
US$216,444.30 at the time of shipment, the first batch arriving in two containers and the second in three
containers. Thereabouts, FASGI paid PAWI the FOB value of the wheels. Unfortunately, FASGI later found the
shipment to be defective and in non-compliance with stated requirements, viz;
"A. contrary to the terms of the Distributorship Agreement and in violation of U.S. law, the country of origin (the
Philippines) was not stamped on the wheels;
"B. the wheels did not have weight load limits stamped on them as required to avoid mounting on excessively
heavy vehicles, resulting in risk of damage or bodily injury to consumers arising from possible shattering of the
wheels;
"C. many of the wheels did not have an indication as to which models of automobile they would fit;
"D. many of the wheels did not fit the model automobiles for which they were purportedly designed;
"E. some of the wheels did not fit any model automobile in use in the United States;
"F. most of the boxes in which the wheels were packed indicated that the wheels were approved by the Specialty
Equipment Manufacturer's Association (hereafter, `SEMA'); in fact no SEMA approval has been obtained and this
indication was therefore false and could result in fraud upon retail customers purchasing the wheels."[1]
On 21 September 1979, FASGI instituted an action against PAWI and FPS for breach of contract and recovery of
damages in the amount of US$2,316,591.00 before the United States District Court for the Central District of
California. In January 1980, during the pendency of the case, the parties entered into a settlement, entitled
"Transaction" with the corresponding Italian translation "Convenzione Transsativa," where it was stipulated that
FPS and PAWI would accept the return of not less than 8,100 wheels after restoring to FASGI the purchase price of
US$268,750.00 viafour (4) irrevocable letters of credit ("LC"). The rescission of the contract of distributorship was
to be effected within the period starting January up until April 1980.[2]
In a telex message, dated 02 March 1980, PAWI president Romeo Rojas expressed the company's inability to
comply with the foregoing agreement and proposed a revised schedule of payment. The message, in part, read:
"We are most anxious in fulfilling all our obligations under compromise agreement executed by our Mr. Giancarlo
Dallera and your Van Curen. We have tried our best to comply with our commitments, however, because of the
situation as mentioned in the foregoing and currency regulations and restrictions imposed by our government on
the outflow, of foreign currency from our country, we are constrained to request for a revised schedule of
shipment and opening of L/Cs.
"After consulting with our bank and government monetary agencies and on the assumption that we submit the
required pro-forma invoices we can open the letters of credit in your favor under the following schedule:
"A) First L/C - it will be issued in April 1980 payable 90 days thereafter
"B) Second L/C - it will be issued in June 1980 payable 90 days thereafter
"C) Third L/C - it will be issued in August 1980 payable 90 days thereafter
"D) Fourth L/C - it will be issued in November 1980 payable 90 days thereafter
"We understand your situation regarding the lease of your warehouse. For this reason, we are willing to defray the
extra storage charges resulting from this new schedule. If you cannot renew the lease [of] your present
warehouse, perhaps you can arrange to transfer to another warehouse and storage charges transfer thereon will
be for our account. We hope you understand our position. The delay and the revised schedules were caused by
circumstances totally beyond our control."[3]
On 21 April 1980, again through a telex message, PAWI informed FASGI that it was impossible to open a letter
of credit on or before April 1980 but assured that it would do its best to comply with the suggested schedule of
payments.[4] In its telex reply of 29 April 1980, FASGI insisted that PAWI should meet the terms of the proposed
schedule of payments, specifically its undertaking to open the first LC within April of 1980, and that "If the letter of
credit is not opened by April 30, 1980, then x x x [it would] immediately take all necessary legal action to protect
[its] position."[5]
Despite its assurances, and FASGI's insistence, PAWI failed to open the first LC in April 1980 allegedly due to
Central Bank "inquiries and restrictions," prompting FASGI to pursue its complaint for damages against PAWI
before the California district court. Pre-trial conference was held on 24 November 1980. In the interim, the parties,
realizing the protracted process of litigation, resolved to enter into another arrangement, this time entitled
"Supplemental Settlement Agreement," on 26 November 1980. In substance, the covenant provided that FASGI
would deliver to PAWI a container of wheels for every LC opened and paid by PAWI:
"3. Agreement
"3.1 Sellers agree to pay FASGI Two Hundred Sixty-Eight Thousand, Seven Hundred Fifty and 00/100 Dollars
($268,750.00), plus interest and storage costs as described below. Sellers shall pay such amount by delivering to
FASGI the following four (4) irrevocable letters of credit, confirmed by Crocker Bank, Main Branch, Fresno,
California, as set forth below:
"(i) on or before June 30, 1980, a documentary letter of credit in the amount of (a) Sixty-Five Thousand, Three
Hundred Sixty-nine and 00/100 Dollars ($65,369.00), (b) plus interest on that amount at the annual rate of 16.25%
from January 1, 1980 until July 31, 1980, (c) plus Two Thousand Nine Hundred Forty Dollars and 00/100
($2,940.00) and (d) with interest on that sum at the annual rate of 16.25% from May 1, 1980 to July 31, 1980,
payable on or after August 31, 1980;
"(ii) on or before September 1, 1980, a documentary letter of credit in the amount of (a) Sixty-Seven Thousand,
Seven Hundred Ninety-Three Dollars and Sixty-Seven Cents ($67,793.67) plus (b) Two Thousand, Nine Hundred
Forty and 00/100 Dollars ($2,940.00), plus (c) interest at an annual rate equal to the prime rate of Crocker Bank,
San Francisco, in effect from time to time, plus two percent on the amount in (a) from January 1, 1980 until
December 21, 1980, and on the amount set forth in (b) from May 1, 1980 until December 21, 1980, payable ninety
days after the date of the bill of lading under the letter of credit;
"(iii) on or before November 1, 1980, a documentary letter of credit in the amount of (a) Sixty-Seven Thousand,
Seven Hundred Ninety-Three Dollars and Sixty-Seven Cents ($67,793.67) plus (b) Two Thousand, Nine Hundred
Forty and 00/100 Dollars ($2,490.00), plus (c) interest at an annual rate equal to the prime rate of Crocker Bank,
San Francisco, in effect from time to time, plus two percent on the amount in (a) from January 1, 1980 until
February 21, 1981, and on the amount set forth in (b) from May 1, 1980 until February 21, 1981, payable ninety
days after the date of the bill of lading under the latter of credit;
"(iv) on or before January 1, 1981, a documentary letter of credit in the amount of (a) Sixty-Seven Thousand, Seven
Hundred Ninety-Three Dollars and Sixty-Seven Cents ($67,793.67) plus (b) Five Thousand, Eight Hundred Eighty
and 00/100 Dollars ($5,880.00), plus (c) interest at an annual rate equal to the prime rate of Crocker Bank, San
Francisco, in effect from time to time, plus two percent on the amount in (a) from January 1, 1980 until April 21,
1981, and on the amount set forth in (b) from May 1, 1980 until April 21, 1981, payable ninety days after the date
of the bill of lading under the latter of credit."[6]
Anent the wheels still in the custody of FASGI, the supplemental settlement agreement provided that -
"3.4 (a) Upon execution of this Supplemental Settlement Agreement, the obligations of FASGI to store or maintain
the Containers and Wheels shall be limited to (i) storing the Wheels and Containers in their present warehouse
location and (ii) maintaining in effect FASGI's current insurance in favor of FASGI, insuring against usual commercial
risks for such storage in the principal amount of the Letters of Credit described in Paragraph 3.1. FASGI shall bear
no liability, responsibility or risk for uninsurable risks or casualties to the Containers or Wheels.
"x x x x x x x x x
"(e) From and after February 28, 1981, unless delivery of the Letters of Credit are delayed past such date pursuant
to the penultimate Paragraph 3.1, in which case from and after such later date, FASGI shall have no obligation to
maintain, store or deliver any of the Containers or Wheels."[7]
The deal allowed FASGI to enter before the California court the foregoing stipulations in the event of the failure of
PAWI to make good the scheduled payments; thus -
"3.5 Concurrently with execution and delivery hereof, the parties have executed and delivered a Mutual Release
(the `Mutual Release'), and a Stipulation for Judgment (the `Stipulation for Judgment') with respect to the
Action. In the event of breach of this Supplemental Settlement Agreement by Sellers, FASGI shall have the right to
apply immediately to the Court for entry of Judgment pursuant to the Stipulation for Judgment in the full amount
thereof, less credit for any payments made by Sellers pursuant to this Supplemental Settlement Agreement. FASGI
shall have the right thereafter to enforce the Judgment against PAWI and FPS in the United States and in any other
country where assets of FPS or PAWI may be located, and FPS and PAWI hereby waive all defenses in any such
country to execution or enforcement of the Judgment by FASGI. Specifically, FPS and PAWI each consent to the
jurisdiction of the Italian and Philippine courts in any action brought by FASGI to seek a judgment in those
countries based upon a judgment against FPS or PAWI in the Action."[8]
In accordance with the aforementioned paragraph 3.5 of the agreement, the parties made the following
stipulation before the California court:
"The undersigned parties hereto, having entered into a Supplemental Settlement Agreement in this action,
"IT IS HEREBY STIPULATED by and between plaintiff FASGI Enterprises, Inc. (`FASGI') and defendants Philippine
Aluminum Wheels, Inc., (`PAWI'), and each of them, that judgment may be entered in favor of plaintiff FASGI and
against PAWI, in the amount of Two Hundred Eighty Three Thousand Four Hundred Eighty And 01/100ths Dollars
($283,480.01).
"Plaintiff FASGI shall also be entitled to its costs of suit, and to reasonable attorneys' fees as determined by the
Court added to the above judgment amount."[9]
The foregoing supplemental settlement agreement, as well as the motion for the entry of judgment, was executed
by FASGI president Elena Buholzer and PAWI counsel Mr. Thomas Ready.
PAWI, again, proved to be remiss in its obligation under the supplemental settlement agreement. While it
opened the first LC on 19 June 1980, it, however, only paid on it nine (9) months after, or on 20 March 1981, when
the letters of credit by then were supposed to have all been already posted. This lapse, notwithstanding, FASGI
promptly shipped to PAWI the first container of wheels. Again, despite the delay incurred by PAWI on the second
LC, FASGI readily delivered the second container. Later, PAWI totally defaulted in opening and paying the third and
the fourth LCs, scheduled to be opened on or before, respectively, 01 September 1980 and 01 November 1980,
and each to be paid ninety (90) days after the date of the bill of lading under the LC. As so expressed in their
affidavits, FASGI counsel Frank Ker and FASGI president Elena Buholzer were more inclined to believe that PAWI's
failure to pay was due not to any restriction by the Central Bank or any other cause than its inability to pay. These
doubts were based on the telex message of PAWI president Romeo Rojas who attached a copy of a communication
from the Central Bank notifying PAWI of the bank's approval of PAWI's request to open LCs to cover payment for
the re-importation of the wheels. The communication having been sent to FASGI before the supplemental
settlement agreement was executed, FASGI speculated that at the time PAWI subsequently entered into the
supplemental settlement agreement, its request to open LCs had already been approved by the Central Bank. Irked
by PAWI's persistent default, FASGI filed with the US District Court of the Central District of California the following
stipulation for judgment against PAWI.
"PLEASE TAKE NOTICE that on May 17, 1982 at 10:00 A.M. in the Courtroom of the Honorable Laughlin E. Waters
of the above Court, plaintiff FASGI ENTERPRISES, INC. (hereinafter `FASGI') will move the Court for entry of
Judgment against defendant PHILIPPINE ALUMINUM WHEELS, INC. (hereinafter `PAWI'), pursuant to the
Stipulation for Judgment filed concurrently herewith, executed on behalf of FASGI and PAWI by their respective
attorneys, acting as their authorized agents.
"Judgment will be sought in the total amount of P252,850.60, including principal and interest accrued through May
17, 1982, plus the sum of $17,500.00 as reasonable attorneys' fees for plaintiff in prosecuting this action.
"The Motion will be made under Rule 54 of the Federal Rules of Civil Procedure, pursuant to and based upon the
Stipulation for Judgment, the Supplemental Settlement Agreement filed herein on or about November 21, 1980,
the Memorandum of Points and Authorities and Affidavits of Elena Buholzer, Franck G. Ker and Stan Cornwell all
filed herewith, and upon all the records, files and pleadings in this action.
"The Motion is made on the grounds that defendant PAWI has breached its obligations as set forth in the
Supplemental Settlement Agreement, and that the Supplemental Settlement Agreement expressly permits FASGI
to enter the Stipulation for Judgment in the event that PAWI has not performed under the Supplemental
Settlement Agreement."[10]
On 24 August 1982, FASGI filed a notice of entry of judgment. A certificate of finality of judgment was issued,
on 07 September 1982, by the US District Judge of the District Court for the Central District of California. PAWI, by
this time, was approximately twenty (20) months in arrears in its obligation under the supplemental settlement
agreement.
Unable to obtain satisfaction of the final judgment within the United States, FASGI filed a complaint for
"enforcement of foreign judgment" in February 1983, before the Regional Trial Court, Branch 61, of Makati,
Philippines. The Makati court, however, in an order of 11 September 1990, dismissed the case, thereby denying
the enforcement of the foreign judgment within Philippine jurisdiction, on the ground that the decree was tainted
with collusion, fraud, and clear mistake of law and fact.[11] The lower court ruled that the foreign judgment ignored
the reciprocal obligations of the parties. While the assailed foreign judgment ordered the return by PAWI of the
purchase amount, no similar order was made requiring FASGI to return to PAWI the third and fourth containers of
wheels.[12] This situation, the trial court maintained, amounted to an unjust enrichment on the part of
FASGI. Furthermore, the trial court said, the supplemental settlement agreement and the subsequent motion for
entry of judgment upon which the California court had based its judgment were a nullity for having been entered
into by Mr. Thomas Ready, counsel for PAWI, without the latter's authorization.
FASGI appealed the decision of the trial court to the Court of Appeals. In a decision,[13] dated 30 July 1997, the
appellate court reversed the decision of the trial court and ordered the full enforcement of the California
judgment.
Hence this appeal.
Generally, in the absence of a special compact, no sovereign is bound to give effect within its dominion to a
judgment rendered by a tribunal of another country;[14] however, the rules of comity, utility and convenience of
nations have established a usage among civilized states by which final judgments of foreign courts of competent
jurisdiction are reciprocally respected and rendered efficacious under certain conditions that may vary in different
countries.[15]
In this jurisdiction, a valid judgment rendered by a foreign tribunal may be recognized insofar as the
immediate parties and the underlying cause of action are concerned so long as it is convincingly shown that there
has been an opportunity for a full and fair hearing before a court of competent jurisdiction; that trial upon regular
proceedings has been conducted, following due citation or voluntary appearance of the defendant and under a
system of jurisprudence likely to secure an impartial administration of justice; and that there is nothing to indicate
either a prejudice in court and in the system of laws under which it is sitting or fraud in procuring the
judgment.[16] A foreign judgment is presumed to be valid and binding in the country from which it comes, until a
contrary showing, on the basis of a presumption of regularity of proceedings and the giving of due notice in the
foreign forum. Rule 39, section 48 of the Rules of Court of the Philippines provides:
Sec. 48. Effect of foreign judgments or final orders - The effect of a judgment or final order of a tribunal of a foreign
country, having jurisdiction to render the judgment or final order is as follows:
xxxx
(b) In case of a judgment or final order against a person, the judgment or final order is presumptive evidence of a
right as between the parties and their successors-in-interest by a subsequent title.
In either case, the judgment or final order may be repelled by evidence a want of jurisdiction, want of notice to the
party, collusion, fraud, or clear mistake of law or fact.
In Soorajmull Nagarmull vs. Binalbagan-Isabela Sugar Co. Inc.,[17] one of the early Philippine cases on the
enforcement of foreign judgments, this Court has ruled that a judgment for a sum of money rendered in a foreign
court is presumptive evidence of a right between the parties and their successors-in-interest by subsequent title,
but when suit for its enforcement is brought in a Philippine court, such judgment may be repelled by evidence of
want of jurisdiction, want of notice to the party, collusion, fraud or clear mistake of law or fact. In Northwest
Orient Airlines, Inc., vs. Court of Appeals,[18] the Court has said that a party attacking a foreign judgment is tasked
with the burden of overcoming its presumptive validity.
PAWI claims that its counsel, Mr. Ready, has acted without its authority. Verily, in this jurisdiction, it is clear
that an attorney cannot, without a client's authorization, settle the action or subject matter of the litigation even
when he honestly believes that such a settlement will best serve his client's interest. [19]
In the instant case, the supplemental settlement agreement was signed by the parties, including Mr. Thomas
Ready, on 06 October 1980. The agreement was lodged in the California case on 26 November 1980 or two (2)
days after the pre-trial conference held on 24 November 1980. If Mr. Ready was indeed not authorized by PAWI to
enter into the supplemental settlement agreement, PAWI could have forthwith signified to FASGI a disclaimer of
the settlement. Instead, more than a year after the execution of the supplemental settlement agreement,
particularly on 09 October 1981, PAWI President Romeo S. Rojas sent a communication to Elena Buholzer of FASGI
that failed to mention Mr. Ready's supposed lack of authority. On the contrary, the letter confirmed the terms of
the agreement when Mr. Rojas sought forbearance for the impending delay in the opening of the first letter of
credit under the schedule stipulated in the agreement.
It is an accepted rule that when a client, upon becoming aware of the compromise and the judgment
thereon, fails to promptly repudiate the action of his attorney, he will not afterwards be heard to complain about
it.[20]
Nor could PAWI claim any prejudice by the settlement. PAWI was spared from possibly paying FASGI
substantial amounts of damages and incurring heavy litigation expenses normally generated in a full-blown
trial. PAWI, under the agreement was afforded time to reimburse FASGI the price it had paid for the defective
wheels. PAWI, should not, after its opportunity to enjoy the benefits of the agreement, be allowed to later disown
the arrangement when the terms thereof ultimately would prove to operate against its hopeful expectations.
PAWI assailed not only Mr. Ready's authority to sign on its behalf the Supplemental Settlement Agreement
but denounced likewise his authority to enter into a stipulation for judgment before the California court on 06
August 1982 on the ground that it had by then already terminated the former's services. For his part, Mr. Ready
admitted that while he did receive a request from Manuel Singson of PAWI to withdraw from the motion of
judgment, the request unfortunately came too late. In an explanatory telex, Mr. Ready told Mr. Singson that under
American Judicial Procedures when a motion for judgment had already been filed a counsel would not be
permitted to withdraw unilaterally without a court order. From the time the stipulation for judgment was entered
into on 26 April 1982 until the certificate of finality of judgment was issued by the California court on 07
September 1982, no notification was issued by PAWI to FASGI regarding its termination of Mr. Ready's services. If
PAWI were indeed hoodwinked by Mr. Ready who purportedly acted in collusion with FASGI, it should have aptly
raised the issue before the forum which issued the judgment in line with the principle of international comity that
a court of another jurisdiction should refrain, as a matter of propriety and fairness, from so assuming the power of
passing judgment on the correctness of the application of law and the evaluation of the facts of the judgment
issued by another tribunal.[21]
Fraud, to hinder the enforcement within this jurisdiction of a foreign judgment, must be extrinsic, i.e., fraud
based on facts not controverted or resolved in the case where judgment is rendered, [22] or that which would go to
the jurisdiction of the court or would deprive the party against whom judgment is rendered a chance to defend the
action to which he has a meritorious case or defense. In fine, intrinsic fraud, that is, fraud which goes to the very
existence of the cause of action - such as fraud in obtaining the consent to a contract - is deemed already
adjudged, and it, therefore, cannot militate against the recognition or enforcement of the foreign judgment.[23]
Even while the US judgment was against both FPS and PAWI, FASGI had every right to seek enforcement of
the judgment solely against PAWI or, for that matter, only against FPS. FASGI, in its complaint, explained:
"17. There exists, and at all times relevant herein there existed, a unity of interest and ownership between
defendant PAWI and defendant FPS, in that they are owned and controlled by the same shareholders and
managers, such that any individuality and separateness between these defendants has ceased, if it ever existed,
and defendant FPS is the alter ego of defendant PAWI. The two entities are used interchangeably by their
shareholders and managers, and plaintiff has found it impossible to ascertain with which entity it is dealing at any
one time. Adherence to the fiction of separate existence of these defendant corporations would permit an abuse
of the corporate privilege and would promote injustice against this plaintiff because assets can easily be shifted
between the two companies thereby frustrating plaintiff's attempts to collect on any judgment rendered by this
Court."[24]
Paragraph 14 of the Supplemental Settlement Agreement fixed the liability of PAWI and FPS to be "joint and
several" or solidary. The enforcement of the judgment against PAWI alone would not, of course, preclude it from
pursuing and recovering whatever contributory liability FPS might have pursuant to their own agreement.
PAWI would argue that it was incumbent upon FASGI to first return the second and the third containers of
defective wheels before it could be required to return to FASGI the purchase price therefor, [25] relying on their
original agreement (the "Transaction").[26] Unfortunately, PAWI defaulted on its covenants thereunder that
thereby occasioned the subsequent execution of the supplemental settlement agreement. This time the parties
agreed, under paragraph 3.4(e)[27] thereof, that any further default by PAWI would release FASGI from any
obligation to maintain, store or deliver the rejected wheels. The supplemental settlement agreement evidently
superseded, at the very least on this point, the previous arrangements made by the parties.
PAWI cannot, by this petition for review, seek refuge over a business dealing and decision gone awry. Neither
do the courts function to relieve a party from the effects of an unwise or unfavorable contract freely entered
into. As has so aptly been explained by the appellate court, the over-all picture might, indeed, appear to be
onerous to PAWI but it should bear emphasis that the settlement which has become the basis for the foreign
judgment has not been the start of a business venture but the end of a failed one, and each party, naturally, has
had to negotiate from either position of strength or weakness depending on its own perception of who might have
to bear the blame for the failure and the consequence of loss.[28]
Altogether, the Court finds no reversible error on the part of the appellate court in its appealed judgment.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED. No costs.
SO ORDERED.

SUPREME COURT
Manila
SECOND DIVISION
A.C. No. 2736 May 27, 1991
LORENZANA FOOD CORPORATION represented by Mr. SOLOMON U. LORENZANA, JR., as its President and
General Manager, and/or Mrs. ELIZABETH L. DIAZ, as its Vice-President, petitioners,
vs.
ATTY. FRANCISCO L. DARIA, respondent.
Jose Feliciano Loy, Jr. for petitioners.
RESOLUTION
PER CURIAM:
The respondent lawyer, Atty. Francisco L. Daria, is administratively charged 1 on two counts, to wit:
1. Negligence and
2. Betrayal of his former client's confidences.
A verified complaint dated February 22, 1985 was filed by Lorenzana Food Corporation LFC, hereinafter), and
received by the Court on February 25, 1985. 2
The Court, on June 10, 1985, resolved to refer this case to the Office of the Solicitor General for investigation,
report, and recommendation.
After proper proceedings, the Office of the Solicitor General submitted its "Report and Recommendation," dated
February 21, 1990 and received by the Court on February 26, 1990.
From the findings made by the Solicitor General, the pertinent facts may be summarized as follows:
Respondent Francisco L. Daria is charged with negligence and betrayal of his former client's confidences.
The following facts are in connection with the charge of negligence:
Respondent was hired by complainant Lorenzana Food Corporation (LFC) on January 8, 1981 as its legal
counsel and was designated as its personnel manager six months later (tsn. pp. 6-7, Dec. 9, 1985). On May
23, 1983, LFC employee, Violeta Hanopol, filed a complaint for illegal dismissal and other monetary claims
against complainant before the Ministry (now Department) of Labor and Employment (MOLE). On May
30, 1983, summons was served on the parties with the requirement that position papers be submitted
(Exh. G).
During the initial hearing on June 13, 1973 * (sic) Hanopol and respondent tried to explore the possibility
of an amicable settlement. Since no agreement was reached the hearing was reset to June 17, 1983. On
the pretext that Hanopol was supposed to go to his office on that date respondent failed to appear for the
second setting (tsn. pp. 14-15, Dec. 9, 1985). So, the Labor Arbiter was constrained to further reset the
hearing to June 28, 1983. Respondent received on June 23, 1983 the Order for the resetting to June 1983
(Exh. J).
In the meantime, on June 20, 1983, respondent received an Order in another labor case, setting the
hearing therein also on June 28, 1983 (Exh. H-6). Faced with a conflicting schedule, respondent decided to
move to postpone the hearing in the Hanopol case. However, instead of filing a written motion for
postponement, he opted to call, through his secretary, the Office of the Labor Arbiter to move for
postponement (Exh. H-5; tsn. p. 16, Dec. 9, 1985). Respondent's telephone message apparently failed to
reach the Labor Arbiter, because at the hearing on June 28, 1983, he considered the case submitted for
decision on the basis of Hanopol's complaint and affidavit (Exh. G-1). Respondent had not submitted a
position paper.
After a month, on July 29, 1983, the Labor Arbiter issued a Decision directing LFC to pay Hanopol the total
sum of P6,469.60 in labor benefits, on the basis of Hanopol's evidence alone.
Respondent Daria appealed the Decision to the National Labor Relations Commission (NLRC) on August
23, 1983 (Exh. 4). The case was remanded to the Labor Arbiter for further proceedings. The case was set
for hearing on June 25, 1984 and July 12, 1984 wherein attempts for an amicable settlement still proved
futile. The Labor Arbiter set two more dates for hearing: July 27, 1984 and August 8, 1984 (tsn. pp. 21-22,
Dec. 9, 1985).
In the meantime, the middle of June 1984, respondent signified to management his intention to resign. In
the light of this development, management hired Atty. Rogelio Udarbe to take his place on July 16, 1984,
the effective date of his resignation (Exh. 2). Respondent endorsed the cases of complainant to Atty.
Udarbe (tsn. pp. 23-25, Dec. 9, 1985).
During the hearings in the Hanopol case on July 27, 1984 and August 8, 1984, no one appeared for
complainant.1avvphi1 So, on August 15, 1984, Hanopol filed a "Manifestation and Motion" praying that
the earlier Decision of the Labor Arbiter dated July 29, 1983 be revived. (Exh. 5).
On September 1, 1984, Atty. Jose Loy, Jr. was hired by complainant LFC vice Atty. Udarbe and he
immediately came across the abovementioned "Manifestation and Motion". On September 5, 1984, he
filed an Opposition (Exh. 6) thereto, and on September 19, 1984, he followed this up with a position paper
for LFC (Exh. 7). However, the Labor Arbiter had already revived his earlier Decision dated July 29, 1983 in
another Decision dated September 4, 1984, thereby prompting Atty. Loy to appeal the latter Decision
(Exh. 3). In a resolution dated May 9, 1985, the NLRC ordered anew the remand of the case for further
proceedings (Exh. 8).
In connection with the other charge of betrayal by respondent of his former client's confidences, the
following facts appear on record:
While respondent was still connected with complainant, its general manager, Sebastian Cortes, issued a
memorandum dated February 28, 1984 (Exh. C) to its employee, Roberto San Juan, requiring him to
submit a written explanation for his alleged double liquidation and unliquidated cash advances. Another
memorandum dated March 15, 1984 (Exh. D) was issued this time by complainant's internal auditor,
Rosario L. Bernardo, addressed to complainant's president, summing up San Juan's unliquidated advances
amounting to P9,351.15. Respondent was furnished a copy of this memorandum (Exh. D-3). The executive
committee, to which respondent belongs, investigated San Juan on his unliquidated advances. On account
of the gravity of the charge, respondent placed San Juan under preventive suspension, per his letter to
him dated April 25, 1984 (Exh. E).
On September 20, 1984, when respondent had already resigned, complainant sent a demand letter to San
Juan requiring him to restitute the amount of P9,351.15 (Exh. N-2). Since he failed to pay the amount
demanded, a complaint for estafa was lodged against him before the Office of the Provincial Fiscal. San
Juan thereafter resigned and sought the assistance of respondent in the preparation of his
counteraffidavit in January 1985 (tsn. p. 35, Nov. 5, 1985). Respondent prepared San Juan's
counteraffidavit and signed it (Exh. F). San Juan then submitted his counteraffidavit to the Office of the
Provincial Fiscal (tsn. p. 42, Nov. 5, 1985). 3
xxx xxx xxx
For failure to appear in two consecutive hearings and to submit a position paper in the Hanopol case which
resulted in complainant LFC's default and judgment against it by the Labor Arbiter, the respondent is faulted for
negligence. The respondent avers that Hanopol should have seen him in his office to work out a compromise
agreement, on the scheduled day of the second hearing, June 17, 1983, but did not. 4
It is the finding of the Solicitor General that this excuse by the respondent is not borne by the Constancia 5 setting
the case for hearing. The Constancia clearly states: "By agreement of the parties, case reset to June 17, 1983 at
2:00 p.m. as previously scheduled." 6 Since it was signed by both Hanopol and the respondent, the Solicitor
General argues that the respondent's explanation is manifestly unsatisfactory.
With regard to his second non-appearance for the hearing on June 2, 1983, the respondent justified his absence by
claiming that he had another hearing on the same date and that he told his secretary to call up the Office of the
Labor Arbiter to have the hearing of the Hanopol case postponed. 7 The Solicitor General avers:
. . . It is submitted that respondent's actuation was not warranted by the circumstances. As it turned out,
the telephone request apparently did not reach the Labor Arbiter, thereby constraining him to declare
complainant in default and render judgment against it. 8
In an effort to extricate himself from this charge, the respondent submits that since he was able to persuade the
National Labor Relations Commission (NLRC) on appeal to set aside the Decision of the Labor Arbiter and to
remand the case for further proceedings, then the charge of negligence should be considered moot and academic
already. 9 We find this submission not meritorious. Instead, we agree ,with the position of the Solicitor General:
Respondent's plea is untenable. The setting aside of the adverse Decision of the Labor Arbiter cannot
obliterate the effects of respondent's negligence. Indeed, had respondent attended the two scheduled
hearings and filed the required position paper, then at least, there would have been no delay in the
resolution of the case, which, perhaps, would have been in favor of complainant. The delay, by itself, was
prejudicial to complainant because it deprived successor-counsel Atty. Loy of time which he should be
devoting to other cases of complainant. In fact he had to prepare complainant's position paper which
respondent should have done earlier (Exh. 7). 10
From the foregoing, it is manifest that the respondent is indeed guilty of negligence, a clear violation of the Code
of Professional Responsibility: 11
CANON 18 A LAWYER SHALL SERVE HIS CLIENT WITH COMPETENCE AND DILIGENCE
Rule 18.03 A lawyer shall not neglect a legal matter entrusted to him and his negligence in connection
therewith shall render him liable.
The other accusation against the respondent by the Solicitor General was that he had betrayed complainant LFC's
confidences in violation of the then Canon 37 of the old Canons of Professional Ethics, to wit:
It is the duty of a lawyer to preserve his client's confidences. This duty outlasts the lawyer's employment,
and extends as well to his employee's and neither of them should accept employment which involves or
may involve the disclosure or use of these confidences, either for the private advantages of the client,
without his knowledge and consent, and even though there are other available sources of such
information. A lawyer should not continue employment when he discovers that this obligation prevents
the performance of his full duty to his former or to his new client.
xxx xxx xxx
Superseded by the Code of Professional Responsibility, the appropriate Canon now is:
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.
The Solicitor General further found that the respondent assisted Roberto San Juan in the preparation of the
counter-affidavit, 12 submitted in defense of the latter in the accusation of estafa filed against San Juan by LFC As a
matter of fact, the respondent signed the jurat of the San Juan counter-affidavit he (respondent) helped prepare. It
is also a fact that the respondent investigated this same charge of estafa while he was still the lawyer of the
complainant and San Juan still likewise an employee of LFC
Again, we concur with the findings and evaluation of the Office of the Solicitor General:
. . . Respondent, however, tried to extricate himself from his predicament by testifying that the
counteraffidavit was prepared by a lawyer-friend, Atty. Joselito R. Enriquez, who had his (respondent's)
name typed on it; that after reading it, he called up Atty. Enriquez so that he will delete his name and
signature thereon; that he instructed San Juan to bring the counteraffidavit to Atty. Enriquez so that he
will delete his name and signature, but San Juan did not obey him; and that San Juan filed the
counteraffidavit with the office of the Provincial Fiscal with his name and signature still on it (tsn. pp. 47-
51, Dec. 9, 1985).
It is submitted that, apart from being a mere afterthought, respondent's explanation is

incredible.1wphi1 His foregoing testimony is not reflected in his comment on the complaint . . . 13
We are convinced that the respondent had betrayed the confidences of the complainant, his former client.
. . . An attorney owes loyalty to his client not only in the case in which he has represented him but also
after the relation of attorney and client has terminated, and it is not a good practice to permit him
afterwards to defend in another case other persons against his former client under the pretext that the
case is distinct from and independent of the former case. 14
WHEREFORE, premises considered, the respondent is found guilty of both the charge of negligence, a
transgression of Rule 18.03, Canon 18, and the charge of betrayal of his former client's confidences, in violation of
Canon 17 of the Code of Professional Responsibility.
The respondent is hereby SUSPENDED from the practice of law for a period of six (6) months.
Let this Decision be entered in the personal records of the respondent and copies thereof furnished to all courts
and IBP chapters.SO ORDERED.

SUPREME COURT
Manila
EN BANC
A.C. No. 6664 July 16, 2013
FERDINAND A. SAMSON, Complainant,

vs.
ATTY. EDGARDO O. ERA, Respondent.
DECISION
BERSAMIN, J.:
An attorney who wittingly represents and serves conflicting interests may be suspended from the practice of law,
or even disbarred when circumstances so warrant.
Antecedents
Ferdinand A. Samson has brought this complaint for disbarment charging respondent Atty. Edgardo O. Era with
violation of his trust and confidence of a client by representing the interest of Emilia C. Sison, his present client, in
a manner that blatantly conflicted with his interest.
Samson and his relatives were among the investors who fell prey to the pyramiding scam perpetrated by ICS
Exports, Inc. Exporter, Importer, and Multi-Level Marketing Business (ICS Corporation), a corporation whose
corporate officers were led by Sison. The other officers were Ireneo C. Sison, William C. Sison, Mimosa H. Zamudio,
Mirasol H. Aguilar and Jhun Sison.
Samson engaged Atty. Era to represent and assist him and his relatives in the criminal prosecution of Sison and her
group. Pursuant to the engagement, Atty. Era prepared the demand letter dated July 19, 2002 demanding the
return or refund of the money subject of their complaints. He also prepared the complaint-affidavit that Samson
signed and swore to on July 26, 2002. Subsequently, the complaint-affidavit charging Sison and the other
corporate officials of ICS Corporation with several counts of estafa1was presented to the Office of the City
Prosecutor of Quezon City (OCPQC). After the preliminary investigation, the OCPQC formally charged Sison and the
others with several counts of estafa in the Regional Trial Court, Branch 96 (RTC), in Quezon City. 2
In April 2003, Atty. Era called a meeting with Samson and his relatives to discuss the possibility of an amicable
settlement with Sison and her cohorts. He told Samson and the others that undergoing a trial of the cases would
just be a waste of time, money and effort for them, and that they could settle the cases with Sison and her group,
with him guaranteeing the turnover to them of a certain property located in Antipolo City belonging to ICS
Corporation in exchange for their desistance. They acceded and executed the affidavit of desistance he prepared,
and in turn they received a deed of assignment covering land registered under Transfer Certificate of Title No. R-
4475 executed by Sison in behalf of ICS Corporation.3
Samson and his relatives later demanded from Atty. Era that they be given instead a deed of absolute sale to
enable them to liquidate the property among themselves. It took some period of negotiations between them and
Atty. Era before the latter delivered to them on November 27, 2003 five copies of a deed of absolute sale involving
the property. However, Atty. Era told them that whether or not the title of the property had been encumbered or
free from lien or defect would no longer be his responsibility. He further told them that as far as he was concerned
he had already accomplished his professional responsibility towards them upon the amicable settlement of the
cases between them and ICS Corporation.4
When Samson and his co-complainants verified the title of the property at the Registry of Deeds and the Assessors
Office of Antipolo City, they were dismayed to learn that they could not liquidate the property because it was no
longer registered under the name of ICS Corporation but was already under the name of Bank Wise Inc. 5Upon their
urging, Atty. Era negotiated as their counsel with ICS Corporation.
Due to the silence of Atty. Era for sometime thereafter, Samson and his group wrote to him on September 8, 2004
to remind him about his guarantee and the promise to settle the issues with Sison and her cohorts. But they did
not hear from Atty. Era at all.6
During the hearings in the RTC, Atty. Era did not anymore appear for Samson and his group. This forced them to
engage another lawyer. They were shocked to find out later on, however, that Atty. Era had already been entering
his appearance as the counsel for Sison in her other criminal cases in the other branches of the RTC in Quezon City
involving the same pyramiding scam that she and her ICS Corporation had perpetrated.7 In this regard, they
established Atty. Eras legal representation of Sison by submitting several certified copies of the minutes of the
proceedings in the criminal cases involving Sison and her group issued by Branch 102 and Branch 220 of the RTC in
Quezon City showing that Atty. Era had appeared as the counsel of Sison in the cases for estafa pending and being
tried in said courts.8 They also submitted a certification issued on November 3, 2004 indicating that Atty. Era had
visited Sison, an inmate in the Female Dormitory in Camp Karingal, Sikatuna Village, Quezon City as borne out by
the blotter logbook of that unit.9
On January 20, 2005, Samson executed an affidavit alleging the foregoing antecedents, and praying for Atty. Eras
disbarment on the ground of his violation of the trust, confidence and respect reposed in him as their counsel. 10
Upon being required by the Court to comment on the complaint against him within 10 days from notice, Atty. Era
several times sought the extension of his period to file the comment to supposedly enable him to collate
documents relevant to his comment.11 The Court granted his request and allowed him an extension totaling 40
days. But despite the lapse of the extended period, he did not file his comment.
On September 27, 2005, Samson reiterated his complaint for disbarment against Atty. Era.12
By its resolution dated March 1, 2006,13 the Court required Atty. Era to show cause why he should not be
disciplinarily dealt with or held in contempt for such failure to submit his comment.
In the comment that he subsequently filed on April 11, 2006 in the Office of the Bar Confidant,14 Atty. Era alleged
that the conclusion on April 23, 2002 of the compromise settlement between Samson and his group, on one hand,
and Sison and her ICS Corporation, on the other, had terminated the lawyer-client relationship between him and
Samson and his group; and that on September 1, 2003, he had been appointed as counsel de officio for Sison by
Branch 102 of the RTC in Quezon City only for purposes of her arraignment.
On July 17, 2006, the Court referred the case to the Integrated Bar of the Philippines (IBP) for investigation, report
and recommendation.15
In his report and recommendation dated October 1, 2007, 16 the Investigating Commissioner of the IBP Commission
on Bar Discipline (IBPCBD) found Atty. Era guilty of misconduct for representing conflicting interests, for failing to
serve his clients with competence and diligence, and for failing to champion his clients cause with wholehearted
fidelity, care and devotion.
The Investigating Commissioner observed that the evidence did not sustain Atty. Eras claim that his legal services
as counsel for Samson and his group had terminated on April 23, 2003 upon the execution of the compromise
settlement of the criminal cases; that he even admitted during the mandatory conference that there was no
formal termination of his legal services;17 that his professional obligation towards Samson and his group as his
clients did not end upon execution of the settlement agreement, because he remained duty-bound to see to it that
the settlement was duly implemented; that he also had the obligation to appear in the criminal cases until their
termination; and that his acceptance of the engagement to appear in behalf of Sison invited suspicion of his
double-dealing and unfaithfulness.
The Investigating Commissioner recommended that Atty. Era be suspended from the practice of law for six
months, viz:
From the foregoing, it is clear that respondent is guilty of misconduct for representing conflicting interests, failing
to serve his client, complainant herein, with competence and diligence and champion the latters cause with
wholehearted fidelity, care and devotion. It is respectfully recommended that respondent be SUSPENDED from the
practice of law for a period of six (6) months and WARNED that a repetition of the same or similar act would merit
a more severe penalty.18
In Resolution No. XVIII-2007-195 passed on October 19, 2007,19 the IBP Board of Governors adopted and approved
the report and recommendation of the Investigating Commissioner of the IBP-CBD, with the modification that Atty.
Era be suspended from the practice of law for two years.
On June 9, 2012, the IBP Board of Governors passed Resolution No. XX-2012-180,20 denying Atty. Eras motion for
reconsideration and affirming Resolution No. XVIII-2007-195.
The IBP Board of Governors then forwarded the case to the Court pursuant to Section 12(b), Rule 139-B of the
Rules of Court.21
On October 17, 2012, Atty. Era filed a Manifestation and Motion (With Leave of Court). 22 However, on November
26, 2012, the Court merely noted the manifestation, and denied the motion for its lack of merit. 23
Ruling
We affirm the findings of the IBP.

In his petition for disbarment, Samson charged Atty. Era with violating Canon 15 of the Code of Professional
Responsibility for representing conflicting interests by accepting the responsibility of representing Sison in the
cases similar to those in which he had undertaken to represent Samson and his group, notwithstanding that Sison
was the very same person whom Samson and his group had accused with Atty. Eras legal assistance. He had
drafted the demand letters and the complaint-affidavit that became the bases for the filing of the estafa charges
against Sison and the others in the RTC in Quezon City.
Atty. Eras contention that the lawyer-client relationship ended when Samson and his group entered into the
compromise settlement with Sison on April 23, 2002 was unwarranted. The lawyer-client relationship did not
terminate as of then, for the fact remained that he still needed to oversee the implementation of the settlement
as well as to proceed with the criminal cases until they were dismissed or otherwise concluded by the trial court. It
is also relevant to indicate that the execution of a compromise settlement in the criminal cases did not ipso facto
cause the termination of the cases not only because the approval of the compromise by the trial court was still
required, but also because the compromise would have applied only to the civil aspect, and excluded the criminal
aspect pursuant to Article 2034 of the Civil Code. 24
Rule 15.03, Canon 15 of the Code of Professional Responsibility provides that: "A lawyer shall not represent
conflicting interests except by written consent of all concerned given after a full disclosure of the facts." Atty. Era
thus owed to Samson and his group entire devotion to their genuine interest, and warm zeal in the maintenance
and defense of their rights.25 He was expected to exert his best efforts and ability to preserve the clients cause, for
the unwavering loyalty displayed to his clients likewise served the ends of justice. 26
In Hornilla v. Atty. Salunat,27 the Court discussed the concept of conflict of interest in this wise:
There is conflict of interest 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 lawyers duty to fight for an issue or claim, but it is his duty
to oppose it for the other client. In brief, 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 thereof.28
The prohibition against conflict of interest rests on five rationales, rendered as follows:
x x x. 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. x x x.
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 lawyers professional judgment or
inhibits a lawyer from working with appropriate vigor in the clients behalf, the clients expectation of effective
representation x x x could be compromised.
Third, a client has a legal right to have the lawyer safeguard the clients confidential information
xxx.1wphi1 Preventing use of confidential client information against the interests of the client, either to benefit
the lawyers 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 to
the lawyer xxx.
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 x x x.29
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.30 The rule is
grounded in the fiduciary obligation of loyalty.31 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.1wphi1 It behooves lawyers not only to keep inviolate the clients 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 paramount in the administration of justice. 32 The nature of that relationship is, therefore,
one of trust and confidence of the highest degree.33
Contrary to Atty. Eras ill-conceived attempt to explain his disloyalty to Samson and his group, 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 clients 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 clients confidences acquired in the previous
relation.34 In this regard, Canon 17 of the Code of Professional Responsibility 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 lawyers highest and most unquestioned duty is to protect the client at all hazards and costs even to
himself.35The protection given to the client is perpetual and does not cease with the termination of the litigation,
nor is it affected by the clients 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. 36
In the absence of the express consent from Samson and his group after full disclosure to them of the conflict of
interest, therefore, the most ethical thing for Atty. Era to have done was either to outrightly decline representing
and entering his appearance as counsel for Sison, or to advice Sison to engage another lawyer for herself.
Unfortunately, he did neither, and should now suffer the proper sanction.
WHEREFORE, the Court FINDS and PRONOUNCES Atty. EDGARDO O. ERA guilty of violating Rule 15.03 of Canon 15,
and Canon 17 of the Code of Professional Responsibility; and SUSPENDS him from the practice of law for two 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 0. ERA and entered m 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.

SUPREME COURT
Manila
SECOND DIVISION
Adm. Case No. 6475 January 30, 2013
FE A. YLAYA, Complainant,
vs.
ATTY. GLENN CARLOS GACOTT, Respondent.
DECISION
BRION, J.:
For the Court's consideration is the disbarment complaint1 tiled by Fe A. Ylaya (complainant) against Atty. Glenn
Carlos Gacott (respondent) who allegedly deceived the complainant and her late husband, Laurentino L. Ylaya, into
signing a "preparatory" Deed of Sale that the respondent converted into a Deed of Absolute Sale in favor of his
relatives.
After the submission of the respondent's comment to the complaint, the Court referred the complaint to the
Commission on Bar Discipline ofthe Integrated Bar of the Philippines (IBP) for investigation, evaluation and
recommendation.
The complainant alleged that she and her late husband are the registered owners of two (2) parcels of land
covered by Transfer Certificate of Title ( TCT) Nos. 162632 and 162633 located at Barangay Sta. Lourdes, Puerto
Princesa City. Prior to the acquisition of these properties, TCT No. 162632 (property) was already the subject of
expropriation proceedings filed by the City Government of Puerto Princesa (City Government) on May 23, 1996
against its former registered owner, Cirilo Arellano. The expropriation case was filed with the Regional Trial Court
(RTC) of Palawan and Puerto Princesa, Branch 95, and was docketed as Civil Case No. 2902. The RTC already fixed
the price and issued an order for the City Government to deposit P6,000,000.00 as just compensation for the
property.2
The respondent briefly represented the complainant and her late husband in the expropriation case as intervenors
for being the new registered owners of the property. The complainant alleged that the respondent convinced
them to sign a "preparatory deed of sale" for the sale of the property, but he left blank the space for the name of
the buyer and for the amount of consideration. The respondent further alleged that the deed would be used in the
sale to the City Government when the RTC issues the order to transfer the titles.3 The respondent then
fraudulently without their knowledge and consent, and contrary to their understanding converted the
"preparatory deed of sale" into a Deed of Absolute Sale dated June 4, 2001, 4 selling the subject property to
Reynold So and Sylvia Carlos So for P200,000.00.5
The complainant denied that she and Laurentino were paid the P200,000.00 purchase price or that they would sell
the property "for such a measly sum" when they stood to get at least P6,000,000.00 as just compensation.6
The complainant also claimed that the respondent notarized the Deed of Absolute Sale dated June 4, 2001 even
though Reynold and Sylvia (his mothers sister) are his uncle and his aunt, respectively. 7
The respondent denied all the allegations in the complaint. 8

The respondent argued that the complainants greed to get the just Compensation 9 caused her to file this
"baseless, unfounded and malicious" disbarment case. 10 He claimed that the sale was their voluntary transaction
and that he "simply ratified the document."11 He also claimed that Reynold and Laurentino had originally jointly
purchased the properties from Cirilo Arellano on July 10, 2000; that they were co-owners for some time; and that
Laurentino subsequently sold his share to Reynold under a Deed of Absolute Sale dated June 4, 2001. 12
The respondent specifically denied asking the complainant and her late husband to execute any "preparatory deed
of sale" in favor of the City Government.13 He also denied that the Deed of Absolute Sale contained blanks when
they signed it.14 That he filed for the spouses Ylaya and Reynold an opposition to the just compensation the RTC
fixed proved that there was no agreement to use the document for the expropriation case. 15 He also argued that it
was clear from the document that the intended buyer was a natural person, not a juridical person, because there
were spaces for the buyers legal age, marital status, and citizenship, 16 and he was even constrained to file a
subsequent Motion to Intervene on behalf of Reynold because the complainant "maliciously retained" the TCTs to
the subject properties after borrowing them from his office.17 Lastly, he denied violating the Rules on Notarial
Practice.18
On September 4, 2006, the respondent filed a Motion to Resolve or Decide the Case dated August 24, 2006 praying
for the early resolution of the complaint.19
On December 5, 2006, the complainant filed an Ex Parte Motion to Withdraw the Verified Complaint and To
Dismiss the Case dated November 14, 2006.20
On February 28, 2008, the complainant executed an Affidavit21 affirming and confirming the existence,
genuineness and due execution of the Deed of Absolute Sale notarized on March 6, 2000; 22 the Memorandum of
Agreement (MOA) dated April 19, 2000;23 and the Deed of Absolute Sale notarized in 2001.24 The respondent
submitted this Affidavit to the IBP as an attachment to his Motion for Reconsideration of April 21, 2008. 25
The IBPs Findings
In her Report and Recommendation dated November 19, 2007, IBP Commissioner Anna Caridad Sazon-Dupaya
found the respondent administratively liable for violating Canon 1, Rule 1.01 (A lawyer shall not engage in
unlawful, dishonest, immoral or deceitful conduct) and Canon 16 ("A lawyer shall hold in trust all moneys and
properties of his client that may come into his possession) of the Code of Professional Responsibility, and Section
3(c), Rule IV of A.M. No. 02-8-13-SC (2004 Rules on Notarial Practice).26 She recommended his suspension from the
practice of law for a period of six (6) months.27
In its Resolution No. XVIII-2007-30228 dated December 14, 2007, the IBP Board of Governors adopted the IBP
Commissioners finding, but increased the penalty imposed to two (2) years suspension and a warning:
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 respondents violations of Canon 1, [Rule] 1.01 and Canon 16 of the
Code of Professional Responsibility and Rule IV, Sec. 39(c) of A.M. No. 02-8-13-SC (2004 Rules on Notarial Practice),
Atty. Glenn Carlos Gacott is hereby SUSPENDED from practice of law for two (2) years with a Warning that
commission of a similar offense will be dealt with more severely. [emphases supplied]
On May 8, 2008, the respondent filed a Motion for Reconsideration dated April 21, 2008, attaching, among others,
a copy of the complainants Affidavit dated February 27, 2008, admitting the existence, genuineness and due
execution of the Deed of Absolute Sale between Cirilo and Laurentino; the MOA between Laurentino and Reynold;
the Deed of Absolute Sale between Laurentino and Reynold; and the Compromise Agreement between Reynold
and the complainant dated November 14, 2006 for the expropriation case. 29
On September 4, 2008, the respondent filed a Manifestation with the Supreme Court, requesting that the IBP be
directed to resolve his Motion for Reconsideration.30
By Resolution No. XIX-2010-545 dated October 8, 2010,31 the IBP Board of Governors denied the respondents
Motion for Reconsideration for failing to raise any new substantial matter or any cogent reason to warrant a
reversal or even a modification of its Resolution No. XVIII-2007-302.32
On March 14, 2012, the respondent filed a Petition for Review (on appeal) assailing the IBPs findings, as follows:33
a) In conveniently concluding that the Deed of Absolute Sale was pre-signed and fraudulently notarized
without requiring Fe Ylaya to adduce evidence in a formal hearing thus, violated the respondents right to
due process as he was not able to cross-examine her. This is not to mention that the complainant failed to
offer corroborative proof to prove her bare allegations;
b) In sweepingly and arbitrarily disregarded/skirted (sic) the public documents (MOA and 2 other DOAS)
duly executed by the parties therein and notarized by the respondent;
c) In totally ignoring the complainants Affidavit admitting the genuineness and due execution of the Deed
of Absolute Sale in issue;
d) In arbitrarily concluding the absence of co-ownership by Reynold So and Fe Ylaya of the subject lots
despite the existence of a notarized MOA clearly showing the co-ownership of Ylaya and So; and
e) In finding the respondent/appellants act of notarizing the DOAS as contrary to the notarial rules.
The Issues
From the assigned errors, the complainant poses the following issues:
(1) whether the IBP violated the respondents right to due process; and
(2) whether the evidence presented supports a finding that the respondent is administratively liable for
violating Canon 1, Rule 1.01 and Canon 16 of the Code of Professional Responsibility, and Section 3(c),
Rule IV of A.M. No. 02-8-13-SC.
The Courts Ruling
We set aside the findings and recommendations of the IBP Commissioner and those of the IBP Board of Governors
finding the respondent liable for violating Canon 1, Rules 1.01 and Section 3(c), Rule IV of A.M. No. 02-8-13-SC.34
We however hold the respondent liable for violating Canon 16 of the Code of Professional Responsibility for being
remiss in his obligation to hold in trust his clients properties. We likewise find him liable for violation of (1) Canon
15, Rule 15.03 for representing conflicting interests without the written consent of the represented parties, thus,
violating the rule on conflict of interests; and (2) Canon 18, Rule 18.03 for neglecting a legal matter entrusted to
him.
a. Due process violation
The most basic tenet of due process is the right to be heard. Denial of due process means the total lack of
opportunity to be heard or to have ones day in court. As a rule, no denial of due process takes place where a party
has been given an opportunity to be heard and to present his case;35 what is prohibited is the absolute lack of
opportunity to be heard.
The respondent claims that the IBP violated his right to due process because he was not given the "amplest
opportunity to defend himself, to cross examine the witness complainant, to object to the admissibility of
documents or present controverting evidence"36 when the IBP rendered its conclusion without requiring the
complainant to adduce evidence in a formal hearing and despite the absence of corroborative proof. He insists
that these defects rendered the complainants allegations as hearsay, and the IBPs report, recommendation or
resolution null and void.
Although the respondent failed to have a face-to-face confrontation with the complainant when she failed to
appear at the required mandatory conference on October 6, 2005,37 the records reveal that the respondent fully
participated during the entire proceedings and submitted numerous pleadings, including evidence, before the IBP.
He was even allowed to file a motion for reconsideration supported by his submitted evidence, which motion the
IBP considered and ruled upon in its Resolution No. XIX-2010-545 dated October 8, 2010.38
In Alliance of Democratic Free Labor Organization v. Laguesma, 39 we held that due process, as applied to
administrative proceedings, is the opportunity to explain ones side. In Samalio v. Court of Appeals, 40 due process
in an administrative context does not require trial-type proceedings similar to those in courts of justice. Where the
opportunity to be heard, either through oral arguments or through pleadings, is accorded, no denial of procedural
due process takes place. The requirements of due process are satisfied where the parties are afforded a fair and
reasonable opportunity to explain their side of the controversy at hand.
Similarly, in A.Z. Arnaiz Realty, Inc. v. Office of the President, 41 we held that "due process, as a constitutional
precept, does not always, and in all situations, require a trial-type proceeding. Litigants may be heard through
pleadings, written explanations, position papers, memoranda or oral arguments. The standard of due process that
must be met in administrative tribunals allows a certain degree of latitude[, provided that] fairness is not ignored.
It is, therefore, not legally objectionable for being violative of due process, for an administrative agency to resolve
a case based solely on position papers, affidavits or documentary evidence submitted by the parties." 42
In this case, the respondents failure to cross-examine the complainant is not a sufficient ground to support the
claim that he had not been afforded due process. The respondent was heard through his pleadings, his submission
of alleged controverting evidence, and his oral testimony during the October 6, 2005 mandatory conference. These
pleadings, evidence and testimony were received and considered by the IBP Commissioner when she arrived at her
findings and recommendation, and were the bases for the IBP Boards Resolution.
Moreover, "any seeming defect in the observance of due process is cured by the filing of a motion for
reconsideration. A denia of due process cannot be successfully invoked by a party who has had the opportunity to
be heard on his motion for reconsideration. Undoubtedly in this case, the requirement of the law was afforded to
the respondent."43
We also note that the respondent, on a Motion to Resolve or Decide the Case dated August 24, 2006, submitted
his case to the IBP for its resolution without any further hearings. The motion, filed almost one year after the
mandatory conference on October 6, 2005, significantly did not contain any statement regarding a denial of due
process. In effect, the respondent himself waived his cross-examination of the complainant when he asked the IBP
Board of Governors to resolve the case based on the pleadings and the evidence on record. To quote his own
submission:
1. On June 30, 2004, a complaint was filed in this case;
2. On October 19, 2004, the respondent filed his comment with all its attachments denying all the
allegations in the complaint;
3. On June 23, 2005, the respondent filed his position paper. On April 28, 2006, the respondent also filed
his supplemental position paper. By contrast, up to this date, the complainant/petitioner has not filed her
verified position paper thus, waived her right to file the same;
4. There being no other genuine issues to be heard in this case as all the defenses and counter-arguments
are supported by documentary evidence, it is most respectfully prayed that the instant case be resolved
on its merits or be ordered dismissed for lack of merit without further hearing;
5. Further, considering that there is an on-going case in Branch 52 of the Regional Trial Court of Palawan
in Civil Case No. 2902 for Expropriation involving the same property, and such fact was deliberately
omitted by the complainant in her Verified Complaint as shown in the certification of non-forum
shopping, the outright dismissal of this case is warranted, hence, this motion; and
6. This is meant to expedite the termination of this case.44 (underscore ours; italics supplied)
Finally, we note Section 11, Rule 139-B of the Rules of Court which provides that:
No defect in a complaint, notice, answer, or in the proceeding or the Investigators Report shall be considered as
substantial unless the Board of Governors, upon considering the whole record, finds that such defect has resulted
or may result in a miscarriage of justice, in which event the
Board shall take such remedial action as the circumstances may warrant, including invalidation of the entire
proceedings.
In this case, the IBP Commissioners findings were twice reviewed by the IBP Board of Governors the first review
resulted in Resolution No. XVIII-2007-30245 dated December 14, 2007, affirming the IBP Commissioners findings,
but modifying the penalty; the second review resulted in Resolution No. XIX-2010-545 dated October 8,
2010,46denying the respondents motion for reconsideration. In both instances, the IBP Board of Governors found
no defect or miscarriage of justice warranting a remedial action or the invalidation of the proceedings.
We emphasize that disciplinary proceedings against lawyers are sui generis in that they are neither purely civil nor
purely criminal; they involve investigations by the Court into the conduct of one of its officers, 47 not the trial of an
action or a suit.
Disciplinary proceedings against lawyers are sui generis. Neither purely civil nor purely criminal, they do not
involve a trial of an action or a suit, but is rather an investigation by the Court into the conduct of one of its
officers. Not being intended to inflict punishment, it is in no sense a criminal prosecution. Accordingly, there is
neither a plaintiff nor a prosecutor therein. It may be initiated by the Court motu proprio. Public interest is its
primary objective, and the real question for determination is whether or not the attorney is still a fit person to be
allowed the privileges as such. Hence, 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 and the proper and honest administration of justice by purging the profession of
members who by their misconduct have proved themselves no longer worthy to be entrusted with the duties and
responsibilities pertaining to the office of an attorney. In such posture, there can thus be no occasion to speak of a
complainant or a prosecutor. [emphases deleted]
The complainant in disbarment cases is not a direct party to the case but a witness who brought the matter to the
attention of the Court.48 Flowing from its sui generis character, it is not mandatory to have a formal hearing in
which the complainant must adduce evidence.
From all these, we find it clear that the complainant is not indispensable to the disciplinary proceedings and her
failure to appear for cross-examination or to provide corroborative evidence of her allegations is of no merit. What
is important is whether, upon due investigation, the IBP
Board of Governors finds sufficient evidence of the respondents misconduct to warrant the exercise of its
disciplinary powers.
b. Merits of the Complaint
"In administrative cases against lawyers, the quantum of proof required is preponderance of evidence which the
complainant has the burden to discharge."49 Preponderance of evidence means that the evidence adduced by one
side is, as a whole, superior to or has a greater weight than that of the other. It means evidence which is more
convincing to the court as worthy of belief compared to the presented contrary evidence.
Under Section 1, Rule 133 of the Rules of Court, in determining whether preponderance of evidence exists, the
court may consider the following: (a) all the facts and circumstances of the case; (b) the witnesses manner of
testifying, their intelligence, their means and opportunity of knowing the facts to which they are testifying, the
nature of the facts to which they testify, and the probability or improbability of their testimony; (c) the witnesses
interest or want of interest, and also their personal credibility so far as the same may ultimately appear in the trial;
and (d) the number of witnesses, although it does not mean that preponderance is necessarily with the greater
number.50 By law, a lawyer enjoys the legal presumption that he is innocent of the charges against him until the
contrary is proven, and that as an officer of the court, he is presumed to have performed his duties in accordance
with his oath.51
The IBP Commissioner set out her findings as follows:
The undersigned, after a careful evaluation of the evidence presented by both parties, finds that the charges of the
complainant against the respondent are worthy of belief based on the following:
First, the allegation of the respondent that Reynold So was actually co-owner of spouses Ylanas (sic) in the
properties subject of the Deed of Sale between Felix Arellano and Spouses Ylanas (sic) is hard to believe despite
the presentation of the Memorandum of Agreement.
It is elementary in Rules of Evidence that when the contents of a written document are put in issue, the best
evidence would be the document itself. In the Deed of Sale between Felix Arellano and Spouses Ylanas (sic), the
buyer of the subject properties is only Laurentino L. Ylaya married to Fe A. Ylaya. The document does not state that
Reynold So was likewise a buyer together with Laurentino Ylaya, or that the former paid half of the purchase price.
Also, it is hard for this Commission to believe that Reynold So, assisted by a lawyer at that and who allegedly paid
half of the purchase price, would not insist for the inclusion of his name in the Deed of Sale as well as the Transfer
Certificate of Title subsequently issued.
The Memorandum of Agreement between the spouses Ylaya and Reynold So produced by the respondent cannot
overturn the belief of this Commission considering that the Memorandum of Agreement was executed more than
a month AFTER the Deed of Sale between Felix Arellano and the Ylayas was notarized. This is not to mention the
fact that the complainant denied ever having executed the Memorandum of Agreement. A close examination of
the signatories in the said Memorandum of Agreement would reveal that indeed, the alleged signatures of the
complainant and her husband are not the same with their signatures in other documents.
Assuming, for the sake of argument, that the Memorandum of Agreement is valid, thereby making Laurentino
Ylaya and co-owner Reynold So co-owners of the subject properties (Please see Annex "B" of respondents
Comment), this Commission finds it hard to believe Laurentino Ylaya would sell it to Reynold So for P200,000 x x x
when his minimum expenses for the purchase thereof is already P225,000.00 and he was expecting to
receive P7,000,000.00, more or less. That would mean that if Reynold So and the complainant were co-owners,
the P7,000,000.00 would then be equally divided among them at P3,500,000.00 each, far above the P200,000.00
selling price reflected in the pre-signed Deed of Sale.
As to the second issue, this Commission believes that the respondent committed serious error in notarizing the
Deed of Sale and the Memorandum of Agreement between his uncle Reynold So and Laurentino Ylaya based on
Rule IV, Section 3 (c) of A.M. No. 02-8-13-SC which provides as follows:
"Sec. 3. Disqualifications a notary public is disqualified from performing a notarial act if he:
(a) x x x.
(b) x x x.
(c) is a spouse, common-law partner, ancestor, descendant, or relative by affinity or consanguinity of the
principal within the fourth civil degree."
The defense therefore of the respondent that he did not violate the aforementioned Rule becausehis uncle
Reynold So, the buyer is not the principal in the Subject Deed of Sale but the seller Laurentino Ylaya (please see
page 3 of the respondents Supplemental Position Paper) is misplaced. Clearly, both the buyer and the seller in the
instant case are considered principals in the contract entered into.
Furthermore, if we are to consider the argument of the respondent that his uncle was not a principal so as to apply
the afore-quoted provision of the Rules, the respondent still violated the Rules when he notarized the subject
Memorandum of Agreement between Laurentino Ylaya and his uncle Reynold So. Clearly, both complainant and
Reynold So were principal parties in the said Memorandum of Agreement. 52
The respondent argues that the IBP Commissioners findings are contrary to the presented evidence, specifically to
the MOA executed by Laurentino and Reynold acknowledging the existence of a co-ownership;53 to the
complainants Ex Parte Motion to Withdraw the Verified Complaint and To Dismiss the Case dated November 14,
2006 where she stated that the parties have entered into a compromise agreement in Civil Case No. 2902, and that
the disbarment complaint arose from a misunderstanding, miscommunication and improper appreciation of
facts;54 to her Affidavit dated February 27, 200855 affirming and confirming the existence, genuineness and due
execution of the Deed of Absolute Sale notarized on March 6, 2000;56 and to the Deed of Absolute Sale notarized
in 2001.57
In all, the respondent claims that these cited pieces of evidence prove that this administrative complaint against
him is fabricated, false and untrue. He also points to Atty. Robert Peneyra, the complainants counsel in this
administrative case, as the hand behind the complaint.58 According to the respondent, Atty. Peneyra harbors ill-will
against him and his family after his father filed several administrative cases against Atty. Peneyra, one of which
resulted in the imposition of a warning and a reprimand on Atty. Peneyra. 59
Reynold, in his Affidavit dated October 11, 2004, confirms that there was a co-ownership between him and
Laurentino; that Laurentino decided to sell his half of the property to Reynold because he (Laurentino) had been
sickly and in dire need of money to pay for his medical bills; that Laurentino agreed to the price of P200,000.00 as
this was almost the same value of his investment when he and Reynold jointly acquired the property; and that the
sale to Reynold was with the agreement and consent of the complainant who voluntarily signed the Deed of Sale.60
After examining the whole record of the case, we agree with the respondent and find the evidence insufficient to
prove the charge that he violated Canon 1, Rule 1.01 of the Code of Professional Responsibility and Section 3(c),
Rule IV of A.M. No. 02-8-13-SC. Specifically, (1) the evidence against the respondent fails to show the alleged
fraudulent and deceitful acts he has taken to mislead the complainant and her husband into signing a "preparatory
deed of sale" and the conversion into a Deed of Absolute Sale dated June 4, 2001 in favor of Reynold; and (2) no
prohibition exists against the notarization of a document in which any of the parties interested is the notarys
relative within the 4th civil degree, by affinity or consanguinity, at that time the respondent notarized the
documents.
In her Report and Recommendation,61 the IBP Commissioner concluded that the respondent is liable for deceit and
fraud because he failed to prove the existence of a co-ownership between Laurentino and Reynold; in her opinion,
the signatures of the complainant and of her husband on the MOA "are not the same with their signatures in other
documents."62
We do not agree with this finding. While the facts of this case may raise some questions regarding the
respondents legal practice, we nevertheless found nothing constituting clear evidence of the respondents specific
acts of fraud and deceit. His failure to prove the existence of a co-ownership does not lead us to the conclusion
that the MOA and the Deed of Absolute Sale dated June 4, 2001 are spurious and that the respondent was
responsible for creating these spurious documents. We are further persuaded, after noting that in disregarding the
MOA, the IBP Commissioner failed to specify what differences she observed in the spouses Ylayas signatures in
the MOA and what documents were used in comparison.
Apart from her allegations, the complainants pieces of evidence consist of TCT Nos. 162632 and 162633; 63 her
Motion for Leave to Intervene in Civil Case No. 2902 dated May 17, 2000; 64 the RTC order in Civil Case No. 2902
dated November 6, 2000 fixing the price of just compensation;65 the Deed of Absolute Sale dated June 4,
2001;66the spouses Ylayas Verified Manifestation dated September 2, 2002, filed with the RTC in Civil Case No.
2902, assailing the Motion to Deposit Just Compensation filed by the respondent on behalf of Reynold and
manifesting the sale between Laurentino and Reynold;67 the Provincial Prosecutors Subpoena to the complainant
in connection with the respondents complaint for libel;68 the respondents complaint for libel against the
complainant dated August 27, 2003;69 the complainants Counter Affidavit dated March 26, 2004 against the
charge of libel;70and the respondents letter to the Provincial Attorney of Palawan dated April 5, 2004, requesting
for "official information regarding the actual attendance of Atty. ROBERT Y. PENEYRA" at an MCLE seminar. 71
We do not see these documentary pieces of evidence as proof of specific acts constituting deceit or fraud on the
respondents part. The documents by themselves are neutral and, at the most, show the breakdown of the
attorney-client relationship between the respondent and the complainant. It is one thing to allege deceit and
misconduct, and it is another to demonstrate by evidence the specific acts constituting these allegations. 72
We reiterate that in disbarment proceedings, the burden of proof is on the complainant; the Court exercises its
disciplinary power only if the complainant establishes her case by clear, convincing, and satisfactory
evidence.73Preponderance of evidence means that the evidence adduced by one side is, as a whole, superior to or
has a greater weight than that of the other party. When the pieces of evidence of the parties are evenly balanced
or when doubt exists on the preponderance of evidence, the equipoise rule dictates that the decision be against
the party carrying the burden of proof.74
In this case, we find that the complainants evidence and the records of the case do not show the respondents
deliberate fraudulent and deceitful acts. In the absence of such proof, the complaint for fraud and deceit under
Canon 1, Rule 1.01 of the Code of Professional Responsibility must perforce be dismissed.
We note that the respondent has not squarely addressed the issue of his relationship with Reynold, whom the
complainant alleges to be the respondents uncle because Reynold is married to the respondents maternal
aunt.75 However, this is of no moment as the respondent cannot be held liable for violating Section 3(c), Rule IV of
A.M. No. 02-8-13-SC because the Deed of Absolute Sale dated June 4, 2001 76 and the MOA dated April 19,
200077 were notarized by the respondent prior to the effectivity of A.M. No. 02-8-13-SC on July 6, 2004. The
notarial law in force in the years 2000 - 2001 was Chapter 11 of Act No. 2711 (the Revised Administrative Code of
1917) which did not contain the present prohibition against notarizing documents where the parties are related to
the notary public within the 4th civil degree, by affinity or consanguinity. Thus, we must likewise dismiss the
charge for violation of A.M. No. 02-8-13-SC.
c. Liability under Canons 15, 16 and 18 We find the respondent liable under Canon 15, Rule 15.03 for representing
conflicting interests without the written consent of all concerned, particularly the complainant; under Canon 16 for
being remiss in his obligation to hold in trust his clients properties; and under Canon 18, Rule 18.03 for neglecting
a legal matter entrusted to him.
Canon 15, Rule 15.03 states:
A lawyer shall not represent conflicting interests except by written consent of all concerned given after a full
disclosure of the facts. [emphasis ours]
The relationship between a lawyer and his client should ideally be imbued with the highest level of trust and
confidence. Necessity and public interest require that this be so. Part of the lawyers duty to his client is to avoid
representing conflicting interests. He is duty bound to decline professional employment, no matter how attractive
the fee offered may be, if its acceptance involves a violation of the proscription against conflict of interest, or any
of the rules of professional conduct. Thus, a lawyer may not accept a retainer from a defendant after he has given
professional advice to the plaintiff concerning his claim; nor can he accept employment from another in a matter
adversely affecting any interest of his former client. It is his duty to decline employment in any of these and similar
circumstances in view of the rule prohibiting representation of conflicting interests. 78
The proscription against representation of conflicting interest 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, 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."79 The sole exception is provided in Canon 15, Rule 15.03 of the Code of Professional Responsibility if
there is a written consent from all the parties after full disclosure.
Based on the records, we find substantial evidence to hold the respondent liable for violating Canon 15, Rule 15.03
of the Code of Professional Responsibility. The facts of this case show that the respondent retained clients who
had close dealings with each other. The respondent admits to acting as legal counsel for Cirilo Arellano, the
spouses Ylaya and Reynold at one point during the proceedings in Civil Case No. 2902. 80 Subsequently, he
represented only Reynold in the same proceedings,81 asserting Reynolds ownership over the property against all
other claims, including that of the spouses Ylaya.82
We find no record of any written consent from any of the parties involved and we cannot give the respondent the
benefit of the doubt in this regard. We find it clear from the facts of this case that the respondent retained
Reynold as his client and actively opposed the interests of his former client, the complainant. He thus violated
Canon 15, Rule 15.03 of the Code of Professional Responsibility.
We affirm the IBP Commissioners finding that the respondent violated Canon 16. The respondent admits to losing
certificates of land titles that were entrusted to his care by Reynold. 83 According to the respondent, the
complainant "maliciously retained" the TCTs over the properties sold by Laurentino to Reynold after she borrowed
them from his office.84 Reynold confirms that the TCTs were taken by the complainant from the respondents law
office.85
The respondent is reminded that his duty under Canon 16 is to "hold in trust all moneys and properties of his client
that may come into his possession." Allowing a party to take the original TCTs of properties owned by another an
act that could result in damage should merit a finding of legal malpractice. While we note that it was his legal
staff who allowed the complainant to borrow the TCTs and it does not appear that the respondent was aware or
present when the complainant borrowed the TCTs, 86 we nevertheless hold the respondent liable, as the TCTs were
entrusted to his care and custody; he failed to exercise due diligence in caring for his clients properties that were
in his custody.
We likewise find the respondent liable for violating Canon 18, Rule 18.03 for neglecting a legal matter entrusted to
him. Despite the respondents admission that he represented the complainant and her late husband in Civil Case
No. 2902 and that he purportedly filed a Motion for Leave to Intervene in their behalf, the records show that he
never filed such a motion for the spouses Ylaya. The complainant herself states that she and her late husband were
forced to file the Motion for Leave to Intervene on their own behalf. The records of the case, which include the
Motion for Leave to Intervene filed by the spouses Ylaya, support this conclusion.87
Canon 18, Rule 18.03 requires that a lawyer "shall not neglect a legal matter entrusted to him, and his negligence
in connection [therewith] shall render him liable." What amounts to carelessness or negligence in a lawyers
discharge of his duty to his client is incapable of an exact formulation, but the Court has consistently held that the
mere failure of a lawyer to perform the obligations due his client is per se a violation. 88
In Canoy v. Ortiz,89 we held that a lawyers failure to file a position paper was per se a violation of Rule 18.03 of the
Code of Professional Responsibility. Similar to Canoy, the respondent clearly failed in this case in his duty to his
client when, without any explanation, he failed to file the Motion for Leave to Intervene on behalf of the spouses
Ylaya. Under the circumstances, we find that there was want of diligence; without sufficient justification, this is
sufficient to hold the respondent liable for violating Canon 18, Rule 18.03 of the Code of Professional
Responsibility.
d. The Complainants Ex Parte Motion to Withdraw the Verified Complaint and to Dismiss the Case and her
Affidavit
We are aware of the complainants Ex Parte Motion to Withdraw the Verified Complaint and To Dismiss the Case
dated November 14, 200690 and her Affidavit91 affirming and confirming the existence, genuineness and due
execution of the Deed of Absolute Sale notarized on March 6, 2000. 92 The complainant explains that the parties
have entered into a compromise agreement in Civil Case No. 2902, and that this disbarment complaint was filed
because of a "misunderstanding, miscommunication and improper appreciation of facts"; 93 she erroneously
accused the respondent of ill motives and bad intentions, but after being enlightened, she is convinced that he has
no personal or pecuniary interests over the properties in Civil Case No. 2902; that such misunderstanding was due
to her unfamiliarity with the transactions of her late husband during his lifetime. 94 The complainant now pleads for
the respondents forgiveness, stating that he has been her and her late husbands lawyer for over a decade and
affirms her trust and confidence in him.95 We take note that under their Compromise Agreement dated November
14, 2006 for the expropriation case,96 the complainant and Reynold equally share the just compensation, which
have since increased to P10,000,000.00.
While the submitted Ex Parte Motion to Withdraw the Verified Complaint and to Dismiss the Case and the Affidavit
appear to exonerate the respondent, complete exoneration is not the necessary legal effect as the submitted
motion and affidavit are immaterial for purposes of the present proceedings. Section 5, Rule 139-B of the Rules of
Court states that, "No investigation shall be interrupted or terminated by reason of the desistance, settlement,
compromise, restitution, withdrawal of charges, or failure of the complainant to prosecute the same."
In Angalan v. Delante,97 despite the Affidavit of Desistance, we disbarred the respondent therein for taking
advantage of his clients and for transferring the title of their property to his name. In Bautista v. Bernabe, 98 we
revoked the lawyers notarial commission, disqualified him from reappointment as a notary public for two years,
and suspended him from the practice of law for one year for notarizing a document without requiring the affiant
to personally appear before him. In this cited case, we said:
Complainants desistance or withdrawal of the complaint does not exonerate respondent or put an end to the
administrative proceedings. A case of suspension or disbarment may proceed regardless of interest or lack of
interest of the complainant. What matters is whether, on the basis of the facts borne out by the record, the charge
of deceit and grossly immoral conduct has been proven. This rule is premised on the nature of disciplinary
proceedings. A proceeding for suspension or disbarment is not a civil action where the complainant is a plaintiff
and the respondent lawyer is a defendant. Disciplinary proceedings involve no private interest and afford no
redress for private grievance. They are undertaken and prosecuted solely for the public welfare. They are
undertaken for the purpose of preserving courts of justice from the official ministration of persons unfit to practice
in them. The attorney is called to answer to the court for his conduct as an officer of the court. The complainant or
the person who called the attention of the court to the attorneys alleged misconduct is in no sense a party, and
has generally no interest in the outcome except as all good citizens may have in the proper administration of
justice.99
In sum, in administrative proceedings against lawyers, the complainants desistance or withdrawal does not
terminate the proceedings. This is particularly true in the present case where pecuniary consideration has been
given to the complainant as a consideration for her desistance. We note in this regard that she would
receive P5,000,000.00, or half of the just compensation under the Compromise Agreement, 100 and thus agreed to
withdraw all charges against the respondent.101 From this perspective, we consider the complainants desistance
to be suspect; it is not grounded on the fact that the respondent did not commit any actual misconduct; rather,
because of the consideration, the complainant is now amenable to the position of the respondent and/or Reynold.
e. Procedural aspect
We remind all parties that resolutions from the IBP Board of Governors are merely recommendatory and do not
attain finality without a final action from this Court. Section 12, Rule 139-B is clear on this point that:
Section 12. Review and decision by the Board of Governors.
xxxx
(b) If the Board, by the vote of a majority of its total membership, determines that the respondent should be
suspended from the practice of law or disbarred, it shall issue a resolution setting forth its findings and
recommendations which, together with the whole record of the case, shall forthwith be transmitted to the
Supreme Court for final action.1wphi1
The Supreme Court exercises exclusive jurisdiction to regulate the practice of law.102 It exercises such disciplinary
functions through the IBP, but it does not relinquish its duty to form its own judgment. Disbarment proceedings
are exercised under the sole jurisdiction of the Supreme Court, and the IBPs recommendations imposing the
penalty of suspension from the practice of law or disbarment are always subject to this Courts review and
approval.
The Penalty
In Solidon v. Macalalad,103 we imposed the penalty of suspension of six ( 6) months from the practice of law on the
respondent therein for his violation of Canon 18, Rule 18.03 and Canon 16, Rule 16.01 of the Code of Professional
Responsibility. In Josefina M. Anion v. Atty. Clemencio Sabitsana, Jr., 104 we suspended the respondent therein
from the practice of law for one (1) year, for violating Canon 15, Rule 15.03 of the Code of Professional
Responsibility. Under the circumstances, we find a one (1) year suspension to be a sufficient and appropriate
sanction against the respondent.
WHEREFORE, premises considered, we set aside Resolution No. XVIII-.2007-302 dated December 14, 2007 and
Resolution No. XIX-2010-545 dated October 8, 2010 of the IBP Board of Governors, and find respondent Atty.
Glenn Carlos Gacott GUILTY of violating Rule 15.03 of Canon 15, Canon 16, and Rule 18.03 of Canon 18 of the Code
of Professional Responsibility. As a penalty, he is SUSPENDED from the practice of law for one (1) year, with a
WARNING that a repetition of the same or similar act will be dealt with more severely.
SO ORDERED.
ARTURO D. BRION
Associate Justice

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1 | PALE |2SYLLABUS | CANON 10-17

Republic of the Philippines

G.R. No. L-25291 January 30, 1971

Lacsina, Lontok and Perez and Luis F. Aquino for petitioners.

Francisco de los Reyes for respondent Court of Industrial Relations.

Araneta, Mendoza and Papa for other respondents.

We recognize it is your privilege both to strike and to conduct picketing.

2. Take your meals within the office.

4. Enjoy free coffee and occasional movies.

5. Be paid overtime for work performed in excess of eight hours.

6. Be sure arrangements will be made for your families.

The first day of the strike was last 21 May 1958.

Before, the decisions was yours to make.

TO: BUREAU OF LABOR RELATIONS

THE INSULAR LIFE ASSURANCE CO., LTD.

THE FGU INSURANCE GROUP

INSULAR LIFE BUILDING ADMINISTRATION

for the following reason: DEADLOCK IN COLLECTIVE BARGAINING...

Delayed reinstatement is a form of discrimination in rehiring, as is having the machinery of

Kindly acknowledge receipt of the check we are sending herewith.

Very truly yours,

(Sgd.) JOSE M. OLBES

... Says the Supreme Court in the following decisions:

In a proceeding for unfair labor practice, involving a determination as to

Zaldivar, J., took no part.

Republic of the Philippines

G.R. No. L-27072 January 9, 1970

SURIGAO MINERAL RESERVATION BOARD, ET AL., petitioners,

Hearing on this contempt incident was had on March 3, 1969.

xxx xxx xxx

the clerk at the date of

For the reasons given, this Court hereby finds:

Reyes, J.B.L., Dizon, Makalintal, Zaldivar and Fernando, JJ., concur.

Concepcion C.J., Castro, Teehankee and Barredo, JJ., took no part.

Republic of the Philippines

A.C. No. 8954 November 13, 2013

DEL CASTILLO, J.:

At this juncture, it is well to remind respondent that:

MARIANO C. DEL CASTILLO

A.C. No. 9116, March 12, 2014

NESTOR B. FIGUERAS AND BIENVENIDO VICTORIA, JR., Complainants, v. ATTY. DIOSDADO B.

VILLARAMA, JR., J.:

The facts are as follows:chanRoblesVirtualawlibrary

Republic of the Philippines

A.C. No. 376 April 30, 1963

JOSEFINA ROYONG, complainant,

xxx xxx xxx

FINDINGS AND COMMENT

xxx xxx xxx

Republic of the Philippines

A.C. No. 10135 January 15, 2014

EDGARDO AREOLA, Complainant,

The Courts Ruling

Republic of the Philippines

A.C. No. 9395 November 12, 2014

DARIA O. DAGING, Complainant,

DEL CASTILLO, J.:

MARIANO C. DEL CASTILLO

Republic of the Philippines

A.C. No. 9976 June 25, 2014

ALMIRA C. FORONDA, Complainant,

The Courts Ruling

Further, in Wilkie v. Atty. Limos,46 the Court held, to wit: