REVEALING CLIENTS SECRETS

A lawyer is bound to comply with Canon 21 of the Code of Professional

Responsibility which state that:
A lawyer shall preserve the confidences and secrets of his
client even after the attorney-client relation is terminated.
The reason for the prohibition is found in the relation of attorney and client, which is
one of trust and confidence of the highest degree. A lawyer becomes familiar with all
the facts connected with his clients case. He learns from his client the weak points of
the action as well as the strong ones. Such knowledge must be considered sacred and
guarded with care.
Rule 21.01 - A lawyer shall not reveal the confidences or secrets of his client except:
a) When authorized by the client after acquianting him of the consequences of the
disclosure;
b)
When
required
by
law;
c) When necessary to collect his fees or to defend himself, his employees or
associates or by judicial action.
When properly authorized after having been fully informed of the
consequences to reveal his confidences / secrets, then there is a valid
waiver.
Rule 21.02 - A lawyer shall not, to the disadvantage of his client, use information
acquired in the course of employment, nor shall he use the same to his own
advantage or that of a third person, unless the client with full knowledge of the
circumstances consents thereto.
Rule 21.03 - A lawyer shall not, without the written consent of his client, give
information from his files to an outside agency seeking such information for
auditing, statistical, bookkeeping, accounting, data processing, or any similar
purpose.
Rule 21.04 - A lawyer may disclose the affairs of a client of the firm to partners or
associates thereof unless prohibited by the client.
Rule 21.05 - A lawyer shall adopt such measures as may be required to prevent
those whose services are utilized by him, from disclosing or using confidences or
secrets of the client.

Rule 21.06 - A lawyer shall avoid indiscreet conversation about a clients affairs
even with members of his family.
Rule 21.07 - A lawyer shall not reveal that he has been consulted about a particular
case except to avoid possible conflict of interest.

An attorney is to keep inviolate his clients secrets or confidence and not to abuse
them. Thus, the duty of a lawyer to preserve his clients secrets and confidence
outlasts the termination of the attorney-clients relationship, and continues even
after the clients death.

Mercado versus Vitriolo

Facts: Rosa Mercado is seeking for the disbarment of Atty. Julito
Vitriolo as he allegedly maliciously filed a criminal case for falsification
of public documents against her thereby violating the attorney client
privilege. It appears that Vitriolo filed a case against complainant as
she apparently made false entries in the certificate of live birth of her
children. More specifically she allegedly indicated that she is married
to a certain Ferdinand Fernandez when in fact her real husband is
Ruben Mercado. Mercado claims that by filing the complaint the
attorney client privilege has been violated. Mercado filed a case for
Vitriolos disbarment.
Issue: Whether or not the respondent violated the rule on privileged
communication between attorney-client when he filed the criminal
case for falsification
Held: No. The evidence on record fails to substantiate complainants
allegations. Complainant did not even specify the alleged
communication disclosed by the respondents. All her claims were
couched in general terms and lacked specificity. Indeed the complaint
failed to attend the hearings at the IBP. Without any testimony from
the complainant as to the specific confidential information allegedly
divulged by respondent without her consent, it would be difficult if not
impossible to determine if there was any violation of the rule on
privileged communication. Such information is a crucial link in

establishing a breach of the rule on privileged communication between

attorney and client. It is not enough to merely assert the attorney client
privilege. The burden of proving that the privilege applies is placed
upon the party asserting the privilege.
In engaging the services of an attorney, the client reposes on him special powers of
trust and confidence. Their relationship is strictly personal and highly confidential
and fiduciary. The relation is of such delicate, exacting and confidential nature
that is required by necessity and public interest. [15] Only by such confidentiality and
protection will a person be encouraged to repose his confidence in an attorney.
The hypothesis is that abstinence from seeking legal advice in a good cause is an
evil which is fatal to the administration of justice. [16] Thus, the preservation and
protection of that relation will encourage a client to entrust his legal problems to an
attorney, which is of paramount importance to the administration of justice. [17] One
rule adopted to serve this purpose is the attorney-client privilege: an attorney is to
keep inviolate his clients secrets or confidence and not to abuse them. [18] Thus, the
duty of a lawyer to preserve his clients secrets and confidence outlasts the
termination of the attorney-client relationship,[19] and continues even after the
clients death.[20] It is the glory of the legal profession that its fidelity to its client
can be depended on, and that a man may safely go to a lawyer and converse with
him upon his rights or supposed rights in any litigation with .absolute assurance
that the lawyers tongue is tied from ever disclosing it. [21] With full disclosure of the
facts of the case by the client to his attorney, adequate legal representation will
result in the ascertainment and enforcement of rights or the prosecution or defense
of the clients cause.
It is essential to establish the existence of the privilege. Hence, the factors to be
considered are as follows:
(1)

There exists an attorney-client relationship, or a prospective

attorney-client relationship, and it is by reason of this
relationship that the client made the communication.

Matters disclosed by a prospective client to a lawyer are protected by the rule on

privileged communication even if the prospective client does not thereafter retain
the lawyer or the latter declines the employment. [23] The reason for this is to make
the prospective client free to discuss whatever he wishes with the lawyer without fear

that what he tells the lawyer will be divulged or used against him, and for the lawyer
to be equally free to obtain information from the prospective client.
(2) The client made the communication in confidence.
The mere relation of attorney and client does not raise a presumption of
confidentiality.[26] The client must intend the communication to be confidential.[27]
A confidential communication refers to information transmitted by voluntary act of
disclosure between attorney and client in confidence and by means which, so far as
the client is aware, discloses the information to no third person other than one
reasonably necessary for the transmission of the information or the accomplishment
of the purpose for which it was given.[28]
Our jurisprudence on the matter rests on quiescent ground. Thus, a compromise
agreement prepared by a lawyer pursuant to the instruction of his client and
delivered to the opposing party,[29] an offer and counter-offer for settlement, [30] or a
document given by a client to his counsel not in his professional capacity, [31] are not
privileged communications, the element of confidentiality not being present. [32]
(3) The legal advice must be sought from the attorney in his
professional capacity.
The communication made by a client to his attorney must not be intended for
mere information, but for the purpose of seeking legal advice from his attorney as to
his rights or obligations. The communication must have been transmitted by a client
to his attorney for the purpose of seeking legal advice. [34]
If the client seeks an accounting service, [35] or business or personal assistance, [36] and
not legal advice, the privilege does not attach to a communication disclosed for such
purpose.
Applying all these rules to the case at bar, we hold that the evidence on record
fails to substantiate complainants allegations. We note that complainant did not
even specify the alleged communication in confidence disclosed by respondent. All
her claims were couched in general terms and lacked specificity. She contends that
respondent violated the rule on privileged communication when he instituted a
criminal action against her for falsification of public documents because the criminal
complaint disclosed facts relating to the civil case for annulment then handled by
respondent. She did not, however, spell out these facts which will determine the
merit of her complaint. The Court cannot be involved in a guessing game as to the
existence of facts which the complainant must prove.

 Confidential information. It is settled that the mere relation of attorney and client
does not raise a presumption of confidentiality. The client must intend the
communication to be confidential. Since the proposed amendments to the by-laws
must be approved by at least a majority of the stockholders, and copies of the
amended by-laws must be filed with the SEC, the information could not have been
intended to be confidential. Thus, the disclosure made by respondent during the
stockholders meeting could not be considered a violation of his clients secrets and
confidence within the contemplation of Canon 21 of the Code of Professional
Responsibility. Rebecca J. Palm vs.Atty. Felipe Iledan, Jr., A.C. No. 8242, October
2, 2009.
ALM v. ILEDAN, JR.
FACTS: The case is a disbarment proceeding filed by Rebecca J. Palm
(complainant) against Atty. Felipe Iledan, Jr. (respondent) for revealing information
obtained in the course of an attorney-client relationship and for representing an
interest which conflicted with that of his former client, Comtech Worldwide
Solutions Philippines, Inc. (Comtech).Complainant is the President of Comtech, a
corporation engaged in the business of computer software development. From
February 2003 to November 2003, respondent served as Comtechs
retained corporate counsel for the amount of P6,000 per month as retainer fee.
From September to October 2003,complainant personally met with respondent to
review corporate matters, including potential amendments to the corporate by-laws.
In a meeting held on 1 October 2003, respondent suggested that Comtech amend its
corporate
by-laws
to
allow
participation
during
board
meetings,
through teleconference, of members of the Board of Directors who were outside the
Philippines.Prior to the completion of the amendments of the corporate by-laws,
complainant became uncomfortable with the close relationship between respondent
and Elda Soledad (Soledad), a former officer and director of Comtech, who resigned
and who was suspected of releasing unauthorized disbursements of corporate funds.
Thus, Comtech decided to terminate its retainer agreement with respondent effective
November 2003.
In a stockholders meeting held on 10 January 2004, respondent attended as
proxy for Gary Harrison (Harrison). Steven C. Palm (Steven) and Deanna L. Palm,
members of the Board of Directors,were present through teleconference. When the
meeting was called to order, respondent objected to the meeting for lack of quorum.
Respondent asserted that Steven and Deanna Palm could not participate in the
meeting because the corporate by-laws had not yet been amended to allow
teleconferencing.
Comtechs new counsel sent a demand letter to Soledad to return or account for
the amount of P90,466.10 representing her unauthorized disbursements when she
was the Corporate Treasurer of Comtech. On 22 April 2004, Comtech received

Soledads reply, signed by respondent. In July 2004, due to Soledads failure to

comply with Comtech's written demands, Comtech filed a complaint for
Estafa against Soledad before the Makati Prosecutors Office. In the proceedings
before the City Prosecution Office of Makati, respondent appeared as Soledads
counsel.
ISSUE: Whether or not respondent violated the Confidentiality of Lawyer-Client
Relationship .
HELD: No. Violation of the Confidentiality of Lawyer-Client Relationship Canon 21
of the Code of Professional Responsibility provides: Canon 21. A lawyer shall
preserve the confidence and secrets of his client even after the attorneyclient relationship is terminated. (Emphasis supplied) We agree with the IBP that in
the course of complainants consultations, respondent obtained the information
about the need to amend the corporate by-laws to allow board members outside
the Philippines to participate in board meetings through teleconferencing.
Respondent himself admitted this in his Answer.
However, what transpired on 10 January 2004 was not a board meeting but a
stockholders meeting. Respondent attended the meeting as proxy for Harrison. The
physical presence of a stockholder is not necessary i n a stockholders meeting
because a member may vote by proxy unless otherwise provided in the articles of
incorporation or by-laws. Hence, there was no need for Steven and Deanna Palm
to participate through teleconferencing as they could just have sent their proxies to
the meeting.
In addition, although the information about the necessity to amend the corporate
by-laws may have been given to respondent, it could not be considered a confidential
information. The amendment, repeal or adoption of new by-laws may be effected
by "the board of directors or trustees, by a majority vote thereof, and the owners of at
least a majority of the outstanding capital stock, or at least a majority of members of
a non-stock corporation."9 It means the stockholders are aware of the proposed
amendments to the by-laws. While the power may be delegated to the board of
directors or trustees, there is nothing in the records to show that a delegation was
made in the present case. Further, whenever any amendment or adoption of new bylaws is made, copies of the amendments or the new by-laws are filed with
the Securities and Exchange Commission (SEC) and attached to the original articles
of incorporation and by-laws.10 The documents are public records and could not be
considered confidential.1avvphi1It is settled that the mere relation of attorney and
client does not raise a presumption of confidentiality.11 The client must intend the
communication to be confidential.12 Since the proposed amendments must be

approved by at least a majority of the stockholders, and copies of the amended

by- laws must be filed with the SEC, the information could not have been intended to
be confidential. Thus, the disclosure made by respondent during the stockholders
meeting could not be considered a violation of his clients secrets and confidence
within the contemplation of Canon 21 of the Code of Professional
Responsibility.WHEREFORE, we DISMISS the complaint against Atty. Felipe
Iledan, Jr. for lack of merit.