A.C. No.
3701 March 28, 1995 Similarly, when the same transaction became the subject of an
PHILIPPINE NATIONAL BANK, complainant,
vs.
ATTY. TELESFORO S. CEDO, respondent.
RESOLUTION
BIDIN, J.:
In a verified letter-complaint dated August 15, 1991, complainant
Philippine National Bank charged respondent Atty. Telesforo S. Cedo,
former Asst. Vice-President of the Asset Management Group of
complainant bank with violation of Canon 6, Rule 6.03 of the Code
of Professional Responsibility, thus:
A lawyer shall not, after leaving government
service, accept engagement or employment in
connection with any matter in which he had
intervened while in said service.
by appearing as counsel for individuals who had transactions with
complainant bank in which respondent during his employment with
aforesaid bank, had intervened.
Complainant averred that while respondent was still in its employ, he
participated in arranging the sale of steel sheets (denominated as Lots
54-M and 55-M) in favor of Milagros Ong Siy for P200,000. He even
"noted" the gate passes issued by his subordinate, Mr. Emmanuel
Elefan, in favor of Mrs. Ong Siy authorizing the pull-out of the steel
sheets from the DMC Man Division Compound. When a civil action
arose out of this transaction between Mrs. Ong Siy and
complainant bank before the Regional Trial Court of Makati, Branch
146, respondent who had since left the employ of complainant bank,
appeared as one of the counsels of Mrs. Ong Siy.
administrative case filed by complainant bank against his former
subordinate Emmanuel Elefan, for grave misconduct and dishonesty,
respondent appeared as counsel for Elefan only to be later disqualified
by the Civil Service Commission.
Moreover, while respondent was still the Asst. Vice President of
complainants Asset Management Group, he intervened in the handling
of the loan account of the spouses Ponciano and Eufemia Almeda
with complainant bank by writing demand letters to the couple. When
a civil action ensued between complainant bank and the Almeda
spouses as a result of this loan account, the latter were represented by
the law firm "Cedo, Ferrer, Maynigo & Associates" of which respondent
is one of the Senior Partners.
In his Comment on the complaint, respondent admitted that he
appeared as counsel for Mrs. Ong Siy but only with respect to the
execution pending appeal of the RTC decision. He alleged that he did
not participate in the litigation of the case before the trial court. With
respect to the case of the Almeda spouses, respondent alleged that he
never appeared as counsel for them. He contended that while the law
firm "Cedo Ferrer, Maynigo & Associates" is designated as counsel of
record, the case is actually handled only by Atty. Pedro Ferrer.
Respondent averred that he did not enter into a general partnership
with Atty. Pedro Ferrer nor with the other lawyers named therein. They
are only using the aforesaid name to designate a law firm maintained
by lawyers, who although not partners, maintain one office as well as
one clerical and supporting staff. Each one of them handles their own
cases independently and individually receives the revenues therefrom
which are not shared among them.
During the investigation conducted by the IBP, it was discovered
that respondent was previously fined by this Court in the amount of
P1,000.00 in connection with G.R. No. 94456 entitled "Milagros Ong Siy
vs. Hon. Salvador Tensuan, et al." for forum shopping, where
respondent appeared as counsel for petitioner Milagros Ong Siy
"through the law firm of Cedo Ferrer Maynigo and Associates."
The IBP further found that the charges herein against
respondent were fully substantiated. Respondent's averment that
the law firm handling the case of the Almeda spouses is not a
partnership deserves scant consideration in the light of the attestation
of complainant's counsel, Atty. Pedro Singson, that in one of the
hearings of the Almeda spouses' case, respondent attended the same
with his partner Atty. Ferrer, and although he did not enter his
appearance, he was practically dictating to Atty. Ferrer what to say and
argue before the court. Furthermore, during the hearing of the
application for a writ of injunction in the same case, respondent
impliedly admitted being the partner of Atty. Ferrer, when it was made
of record that respondent was working in the same office as Atty.
Ferrer.
Moreover, the IBP noted that assuming the alleged set-up of
the firm is true, it is in itself a violation of the Code of
Professional Responsibility (Rule 15.02) since the clients
secrets and confidential records and information are exposed
to the other lawyers and staff members at all times.
From the foregoing, the IBP found a deliberate intent on the
part of respondent to devise ways and means to attract as
clients former borrowers of complainant bank since he was in
the best position to see the legal weaknesses of his former
employer, a convincing factor for the said clients to seek his
professional service. In sum, the IBP saw a deliberate sacrifice
by respondent of his ethics in consideration of the money he
expected to earn.
The IBP thus recommended the suspension of respondent from the
practice of law for 3 years.
In addition to the findings of the IBP, this Court finds this occasion
appropriate to emphasize the paramount importance of
avoiding the representation of conflicting interests. In the
similar case of Pasay Law and Conscience Union, Inc. vs. Paz, (95 SCRA
24 [1980]) where a former Legal Officer and Legal Prosecutor of PARGO
who participated in the investigation of the Anti-Graft case against
Mayor Pablo Cuneta later on acted as counsel for the said Mayor in the
same anti-graft case, this Court, citing Nombrado vs. Hernandez (26
SCRA 13 119681) ruled:
"Communications between attorney and client are, in
a great number of litigations, a complicated affair,
consisting of entangled relevant and irrelevant, secret
and well-known facts. In the complexity of what is said
in the course of dealings between an attorney and
client, inquiry of the nature suggested would lead to
the revelation, in advance of the trial, of other matters
that might only further prejudice the complainant's
cause."
Whatever may be said as to whether or not
respondent utilized against his former client
information given to him in a professional capacity,
the mere fact of their previous relationship should
have precluded him from appearing as counsel for the
other side in the forcible entry case. In the case
of Hilado vs. David, supra, this Tribunal further said:
Hence the necessity of setting the existence of
the bare relationship of attorney and client as
the yardstick for testing incompatibility of
interests. This stern rule is designed not alone
to prevent the dishonest practitioner from
fraudulent conduct, but as well to protect the
honest lawyer from unfounded suspicion of
unprofessional practice. . . . It is founded on
principles of public policy, of good taste.
The foregoing disquisition on conflicting interest applies with equal
force and effect to respondent in the case at bar. Having been an
executive of complainant bank, respondent now seeks to
litigate as counsel for the opposite side, a case against his
former employer involving a transaction which he formerly
handled while still an employee of complainant, in violation of
Canon 6 of the Canons of Professional Ethics on adverse influence and
conflicting interests, to wit:
Court resolves to SUSPEND respondent ATTY. TELESFORO S.
CEDO from the practice of law for THREE (3) YEARS, effective
immediately.
 under complainants name, with the respondent as a
QUIAMBAO v BAMBA s i l e n t p a r t n e r r e p r e s e n t e d b y h i s a s s o c i a t e A t t y.
In this administrative case for d i s b a rm e n t , Gerardo P. Hernandez . While serving as legal
c o m p l a i n a n t Fe l i c i t a s S . Q u i a m b a o c h a rg e s re s p o n d e n t counsel for AIB and a silent partner of QRMSI, he
A t t y. N e s t o r A. B a m b a w i t h v i o l a t i o n o f t h e C o d e o f convinced complainants brother Leodegario
P ro f e s s i o n a l Re s p o n s i b i l i t y f o r re p re s e n t i n g c o n fl i c t i n g Q u i a m b a o t o o r g a n i z e a n o t h e r s e c u r i t y a g e n c y, S a n
i n t e re s t s w h e n t h e l a t t e r fi l e d a c a s e a g a i n s t h e r w h i l e h e E s t e b a n S e c u r i t y S e r v i c e s , I n c . ( S E SS I ) w h e re h e ( t h e
w a s a t t h a t t i m e re p re s e n t i n g h e r i n a n o t h e r c a s e , a n d f o r re s p o n d e n t ) s e r v e d a s i t s i n c o r p o r a t o r , d i re c t o r , a n d
committing other acts of disloyalty and double-dealing. p re s i d e n t . T h e re s p o n d e n t a n d L e o d e g a r i o t h e n i l l e g a l l y
diverted the funds of AIB to fund the incorporation of
Fro m J u n e 2 0 0 0 t o J a n u a r y 2 0 0 1 , t h e c o m p l a i n a n t S E S S I , a n d l i ke w i s e p l a n n e d t o e v e n t u a l l y c l o s e d o w n t h e
w a s t h e p re s i d e n t a n d m a n a g i n g d i re c t o r o f A l l i e d operations of AIB and transfer the business to SESSI.
Investigation B u re a u , Inc. (AIB), a f a m i l y- o w n e d
corporation engaged in p ro v i d i n g security and Respondent: T h e re s p o n d e n t a l s o d e n i e s t h a t h e
i n v e s t i g a t i o n s e r v i c e s . S h e a v e r s t h a t s h e p ro c u re d t h e c o n v i n c e d c o m p l a i n a n t s b ro t h e r Le o d e g a r i o t o o rg a n i z e
l e g a l s e r v i c e s o f t h e re s p o n d e n t n o t o n l y f o r t h e a n o t h e r s e c u r i t y a g e n c y a n d t h a t t h e f u n d s o f A I B w e re
c o r p o r a t e a ff a i r s o f A I B b u t a l s o f o r h e r p e r s o n a l c a s e . unlawfully diverted to SESSI. It was to complement the
Pa r t i c u l a r l y, t h e r e s p o n d e n t a c t e d a s h e r c o u n s e l o f business of AIB, which was then in danger of collapse,
record in an ejectment case against Spouses t h a t S E S S I w a s e s t a b l i s h e d . Le o d e g a r i o s w i f e a n d h e r s o n
S a n t i a g o a n d F l o r i t a To r r o b a fi l e d b y h e r o n 2 9 h a v e t h e e ff e c t i v e c o n t ro l o v e r S E S S I . Re s p o n d e n t s
D e c e m b e r 2 0 0 0 b e f o r e t h e M e t r o p o l i t a n Tr i a l C o u r t s u b s c r i b e d s h a re h o l d i n g s i n S E S S I c o m p r i s e o n l y 8 0 0
( M e T C ) o f Pa r a a q u e C i t y, w h i c h w a s d o c ke t e d a s s h a re s o u t o f 1 2 , 5 0 0 s u b s c r i b e d s h a re s . H e s e r v e s A I B
Civil Case No. 11928. She paid attorneys fees for a n d S E S S I i n d i ff e re n t c a p a c i t i e s : a s l e g a l c o u n s e l o f t h e
respondents legal services in that case. [1] About six f o rm e r a n d a s p re s i d e n t o f t h e l a t t e r. H e p l e a s t h a t h e
months after she resigned as AIB president, or on 14 w a s d u t y- b o u n d t o h a n d l e a l l t h e c a s e s re f e rre d t o h i m b y
J u n e 2 0 0 1 , t h e r e s p o n d e n t fi l e d o n b e h a l f o f A I B a A I B , i n c l u d i n g t h e p e r s o n a l c a s e s o f i t s o ffi c e r s w h i c h h a d
complaint for replevin and damages against her n o c o n n e c t i o n t o i t s c o r p o r a t e a ff a i r s .
before the MeTC of Quezon City for the purpose of
recovering from her the car of AIB assigned to her R u l i n g : Ru l e 1 5 . 0 3 , C a n o n 5 o f t h e C o d e o f Pro f e s s i o n a l
as a service vehicle. This he did without Re s p o n s i b i l i t y p ro v i d e s : A l a w y e r s h a l l n o t re p r e s e n t
withdrawing as counsel of record in the ejectment c o n fl i c t i n g i n t e re s t s ex c e p t b y w r i t t e n c o n s e n t o f a l l
case, which was then still pending. c o n c e rn e d g i v e n a f t e r a f u l l d i s c l o s u re o f t h e f a c t s . T h i s
p ro h i b i t i o n i s f o u n d e d o n p r i n c i p l e s o f p u b l i c p o l i c y a n d
g o o d t a s t e . [ 8 ] I n t h e c o u r s e o f a l a w y e r- c l i e n t re l a t i o n s h i p ,
She avers that the respondent proposed to her that t h e l a w y e r l e a rn s a l l t h e f a c t s c o n n e c t e d w i t h t h e c l i e n t s
she organize her own security agency and that he c a s e , i n c l u d i n g t h e w e a k a n d s t ro n g p o i n t s o f t h e c a s e .
would assist her in its organization, causing her to T h e n a t u re o f t h a t re l a t i o n s h i p i s , t h e r e f o re , o n e o f t r u s t
r e s i g n a s p r e s i d e n t o f A I B . T h e re s p o n d e n t i n d e e d a n d c o n fi d e n c e o f t h e h i g h e s t d e g re e . [ 9 ] I t b e h o o v e s
a s s i s t e d h e r i n D e c e m b e r 2 0 0 0 i n t h e f o rm a t i o n o f l a w y e r s n o t o n l y t o ke e p i n v i o l a t e t h e c l i e n t s c o n fi d e n c e ,
another security agency, Quiambao Risk Management b u t a l s o t o a v o i d t h e a p p e a r a n c e o f t re a c h e r y a n d d o u b l e -
Specialists, Inc., (QRMSI), which was later registered dealing for only then can litigants be encouraged to
e n t r u s t t h e i r s e c re t s t o t h e i r l a w y e r s , w h i c h i s of S u r p r i s i n g l y , d e s p i t e h i s a p p re h e n s i o n o r a w a re n e s s o f a
paramount importance in the administration of justice. p o s s i b l e c o n fl i c t o f i n t e re s t s h o u l d h e j o i n Q R M S I , t h e
re s p o n d e n t later allowed himself to become an
Te s t s : I n b ro a d t e rm s , l a w y e r s a re d e e m e d t o re p re s e n t i n c o r p o r a t o r , s t o c k h o l d e r , a n d p re s i d e n t o f S E S S I , w h i c h
c o n fl i c t i n g i n t e re s t s w h e n , i n b e h a l f o f o n e c l i e n t , i t i s i s a l s o a s e c u r i t y a g e n c y. H e j u s t i fi e d h i s a c t b y c l a i m i n g
their duty to contend for that which duty to another client t h a t t h a t w h i l e b o t h A I B a n d S E S S I a re e n g a g e d i n
re q u i re s t h e m t o o p p o s e . s e c u r i t y a g e n c y b u s i n e s s , h e i s s e r v i n g i n d i ff e re n t
capacities.
- w h e t h e r t h e a c c e p t a n c e o f a n e w re l a t i o n w o u l d
p re v e n t t h e f u l l d i s c h a rg e o f t h e l a w y e r s d u t y Fu r t h e rm o re , i t m u s t b e n o t e d t h a t Re p u b l i c Ac t N o. 5 4 8 7 ,
o f u n d i v i d e d fi d e l i t y a n d l o y a l t y t o t h e c l i e n t o r otherwise known as the Private Security Agency Law ,
invite suspicion of unfaithfulness or double- p ro h i b i t s a p e r s o n f ro m o rg a n i z i n g o r h a v i n g a n i n t e re s t
d e a l i n g i n t h e p e r f o rm a n c e o f t h a t d u t y. i n m o re t h a n o n e s e c u r i t y a g e n c y.
- whether the lawyer would be called upon in the
n e w re l a t i o n t o u s e a g a i n s t a f o rm e r c l i e n t a n y W H E R E F O R E , re s p o n d e n t At t y. N e s t o r A . B a m b a i s h e re b y
c o n fi d e n t i a l i n f o rm a t i o n a c q u i re d t h ro u g h t h e i r h e l d G U I LT Y o f v i o l a t i o n o f Ru l e 1 5 . 0 3 o f C a n o n 1 5 a n d
c o n n e c t i o n o r p re v i o u s e m p l o y m e n t Ru l e 1 . 0 2 o f C a n o n 1 o f t h e C o d e o f Pro f e s s i o n a l
Re s p o n s i b i l i t y. H e i s S U S P E N D E D f ro m t h e p r a c t i c e o f l a w
f o r a p e r i o d o f O N E ( 1 ) Y E A R e ff e c t i v e f ro m re c e i p t o f
In this case, it is undisputed that at the time the t h i s Re s o l u t i o n , w i t h a w a rn i n g t h a t a s i m i l a r i n f r a c t i o n i n
re s p o n d e n t fi l e d t h e re p l e v i n c a s e o n b e h a l f o f A I B h e w a s t h e f u t u re s h a l l b e d e a l t w i t h m o re s e v e re l y
s t i l l t h e c o u n s e l o f re c o rd o f t h e c o m p l a i n a n t i n t h e
p e n d i n g e j e c t m e n t c a s e . We d o n o t s u s t a i n re s p o n d e n t s
t h e o r y t h a t s i n c e t h e e j e c t m e n t c a s e a n d t h e re p l e v i n
c a s e a re u n re l a t e d c a s e s f r a u g h t w i t h d i ff e re n t i s s u e s , A.C. No. 9537 June 10, 2013
parties, and subject matters, the p ro h i b i t i o n is (Formerly CBD Case No. 09-2489)
i n a p p l i c a b l e . H i s re p re s e n t a t i o n o f o p p o s i n g c l i e n t s i n
b o t h c a s e s , t h o u g h u n re l a t e d , o b v i o u s l y c o n s t i t u t e s DR. TERESITA LEE, Complainant,
c o n fl i c t o f i n t e re s t o r , a t t h e l e a s t , i n v i t e s s u s p i c i o n o f vs.
double-dealing. ATTY. AMADOR L. SIMANDO, Respondent.

Ad d i t i o n a l l y , i n h i s p o s i t i o n p a p e r , t h e re s p o n d e n t a l l e g e s PERALTA, J.:
t h a t w h e n t h e c o m p l a i n a n t i n v i t e d t h e re s p o n d e n t t o j o i n
Q R M S I , h e v e h e m e n t l y re f u s e d t o j o i n t h e m d u e t o h i s
RULING
p e rc e p t i o n o f c o n fl i c t i n g i n t e r e s t a s h e w a s t h e n ( a n d
s t i l l i s a t p re s e n t ) t h e L e g a l C o u n s e l o f A I B , w h i c h i s a l s o
a s e c u r i t y a g e n c y. [ 2 0 ] To b o l s t e r h i s a l l e g a t i o n , h e i n v o ke d We reverse the ruling of the IBP Board of Governors (dismissal of the
t h e a ffi d a v i t s o f c o m p l a i n a n t s w i t n e s s e s w h i c h c o n t a i n e d case upon motion for reconsideration by Atty. Simando with the IBP
s t a t e m e n t s o f h i s a p p re h e n s i o n o f c o n fl i c t o f i n t e r e s t Board of Governors).
should he join QRMSI.[21]
Jurisprudence has provided three tests in determining whether
a lawyer is guilty of representing conflicting interest:
One test is whether a lawyer is duty-bound to fight for an issue or claim
in behalf of one client and, at the same time, to oppose that claim for
the other client. Thus, if a lawyers argument for one client has to be
opposed by that same lawyer in arguing for the other client, there is a
violation of the rule.
Another test of inconsistency of interests is whether the acceptance of
a new relation would prevent the full discharge of the lawyers duty of
undivided fidelity and loyalty to the client or invite suspicion of
unfaithfulness or double-dealing in the performance of that duty. Still
another test is whether the lawyer would be called upon in the new
relation to use against a former client any confidential information
acquired through their connection or previous employment. 19
In the instant case, we find substantial evidence to support
respondent's violation of the above parameters, as established by the
following circumstances on record:
First, it is undisputed that there was a lawyer-client relationship
between complainant and Atty. Simando as evidenced by the retainer
fees received by respondent and the latter's representation in certain
legal matters pertaining to complainant's business;
Second, Atty. Simando admitted that Mejorado is another client of him
albeit in a case claiming rewards against the Bureau of Customs;
Third, Atty. Simando admitted that he was the one who introduced
complainant and Mejorado to each other for the purpose of entering
into a financial transaction while having knowledge that complainant's
interests could possibly run in conflict with Mejorado's interests which
ironically such client's interests, he is duty-bound to protect;
Fourth, despite the knowledge of the conflicting interests between his
two clients, respondent consented in the parties' agreement and even
signed as co-maker to the loan agreement;
Fifth, respondent's knowledge of the conflicting interests between his
two clients was demonstrated further by his own actions, when he:
(a) failed to act on Mejorado's failure to pay his obligation to
complainant despite the latter's instruction to do so;
(b) denied liability despite signing as co-maker in the
receipts/promissory notes arising from the loan agreement
between his two clients;
(c) rebutted complainant's allegations against Mejorado and
him, and even divulged informations he acquired while he was
still complainant's lawyer.
Clearly, it is improper for respondent to appear as counsel for one
party (complainant as creditor) against the adverse party (Mejorado as
debtor) who is also his client, since a lawyer is prohibited from
representing conflicting interests. He may not, without being guilty of
professional misconduct, act as counsel for a person whose interest
conflict with that of his present or former client.
Respondent's assertion that there is no conflict of interest
because complainant and respondent are his clients in
unrelated cases fails to convince. His representation of
opposing clients in both cases, though unrelated, obviously
constitutes conflict of interest or, at the least, invites suspicion
of double-dealing.20 Moreover, with the subject loan agreement
entered into by the complainant and Mejorado, who are both
his clients, readily shows an apparent conflict of interest,
moreso when he signed as co-maker.
In the process of determining whether there is a conflict of
interest, an important criterion is probability, not certainty, of
conflict.21
We likewise note that respondent offered several excuses in order to
avoid payment of his liability.1wphi1 First, in his Answer to
complainant's demand letter, he claimed there was novation which
extinguished his liability; Secondly, he claimed that the amount
received by Mejorado for which he signed as co-maker was merely an
investment and not a loan. Finally, he alleged that it was agreed that
the investment with profits will be paid only after Mejorado receives
the payment for his claim for reward which complainant violated when
she presented the checks for payment prematurely. These actuations
of Atty. Simando do not speak well of his reputation as a lawyer. 22
Finally, we likewise find respondent guilty of violating Rule
21.01 of the Code of Professional Responsibility.23 In his last-
ditch effort to impeach the credibility of complainant, he divulged
informations24 which he acquired in confidence during the existence of
their lawyer-client relationship.
We held in Nombrado v. Hernandez 25 that the termination of the
relation of attorney and client provides no justification for a lawyer to
represent an interest adverse to or in conflict with that of the former
client. The reason for the rule is that the clients confidence once
reposed cannot be divested by the expiration of the
professional employment. Consequently, a lawyer should not, even
after the severance of the relation with his client, do anything which
will injuriously affect his former client in any matter in which he
previously represented him nor should he disclose or use any of the
client's confidences acquired in the previous relation.
Accordingly, we reiterate that lawyers are enjoined to look at any
representation situation from "the point of view that there are possible
conflicts," and further, "to think in terms of impaired loyalty" that is to
evaluate if his representation in any way will impair loyalty to a client. 26
WHEREFORE, premises considered, this Court resolves to ADOPT the
findings and recommendation of the IBP in Resolution No. XIX-20 10-
733 suspending respondent Atty. Amador L. Simando for six
( 6) months from the practice of law, with a WARNING that a
repetition of the same or similar offense will warrant a more
severe penalty.
ROGELIO R. SANTOS, SR. v ATTY. RODOLFO C. BELTRAN
SYNOPSIS
Spouses Filomeno Santiago Santos, Sr. and Benita Roxas
Rodriguez had ten children, namely, Romeo, Filomeno, Jr., Arturo,
Erlinda, Ma. Alicia, Arcely, Renato, Alberto and Benito and complainant
Rogelio Santos, Sr. After the death of Filomeno, Benita donated
their two residential lots situated at 11 Javier Baritan, Malabon,
Metro Manila, consisting of 489 and 333.4 square meters, respectively,
and covered by Transfer Certificates of Titles (TCT) Nos. R-18060 and
R-18061, including the ancestral house situated thereon, in favor of
the nine children, except complainant. Respondent lawyer
notarized the Deed of Donation.[2]
Benita Rodriguez died. Complainant and his brother, Alberto,
were appointed administrators[3] in the intestate proceeding for
the settlement of the spouses estate, docketed as SP. Proc. No. 516-AF,
entitled In the Matter of the Intestate Estate of Spouses Filomeno
Santiago Santos, Sr. and Benita Roxas Rodriguez, filed before the
Regional Trial Court of Cabanatuan City, Branch 26 thereof.
Complainant filed a verified complaint against respondent lawyer
Rodolfo C.Beltran before the Integrated Bar of the Philippines
Commission on Bar Discipline (IBP-CBD), alleging that when
respondent notarized a Deed of Donation executed by his
mother in favor of her nine children, except complainant, the
siblings did not personally appear before him. Complainant
submitted the affidavit executed by his brothers Benito and Renato
attesting to the fact that they signed the Deed of Donation not in the
law office of the respondent but in their houses at Villa Benita
Subdivision. Complainant contended that respondent notarized
the Deed of Donation in disregard of Article 904 of the Civil
Code. Complainant further alleged that respondent
represented conflicting interest when he entered his
appearance as defense counsel in an ejectment case in which
his former client, Erlinda R. Santos-Crawford, was the plaintiff.
The Supreme Court found respondent guilty of representing conflicting
interest Canon 15 Rule 15.03. According to the Court, there is
conflict of interest when a lawyer represents inconsistent interests of
two or more opposing parties. In the case at bar, Civil Case No.12105
for ejectment was filed by Arcely Y. Santos in behalf of Erlinda Santos-
Crawford against complainant and Renato Santos. Respondent,
however, appeared as counsel for Evalyn Valino, Norberto Valino and
Danilo Agsaway in Civil Case No. 14823 for ejectment filed by
complainant as attorney-in-fact of Erlinda Santos-Crawford. Civil Case
No. 14823, although litigated by complainant, was actually brought in
behalf of and to protect the interest of Erlinda Santos-Crawford.
Respondent's act of representing the parties against whom his other
client, Erlinda Santos-Crawford, filed suit constituted conflict of
interest. Respondent was suspended from the practice of law
for a period of one (1) year and sternly warned that a
commission of the same or similar act in the future will be
dealt with more severely.
The Court, however, ruled that complainant failed to controvert by
clear and convincing evidence the evidentiary weight with respect to
its due execution and presumption of regularity conferred upon a
notarized document and documents acknowledged before a notary
public. Instead, the quantum of evidence showed that
complainant's siblings appeared before the respondent as
notary public and in fact, signed the deed. The claim of Renato
and Benito Santos in their affidavit that they did not sign the document
in the law office of the respondent but in their houses at Villa Benita
Subdivision is admissible only against them. To aver that it was
physically impossible to sign the deeds in the law office was
untenable for the reason that there are many ports in the country
through which the siblings may be able to enter and get to appear in
the law office. The discrepancy in the date stamped in the Deed
and the date when complainants siblings obtained their CTCs
had been substantially explained in the affidavit executed by the
secretary of the law office, Mely Lachica.
Furthermore, anent the charge that respondent acquired
properties under litigation in violation of Article 1491[18] of the
Civil Code, records show that respondent acquired the property from
Faberns Inc., and not from Spouses Filemon and Benita Santos.
Complainants allegation that respondent as director of Villa Benita
Management and Development Corporation fraudulently caused the
transfer of titles of properties, specifically parcels of lands owned by
the family corporation, Faberns Inc., by executing a management and
development contract, lacks basis. Respondent may not be held
accountable based on mere allegation that through insidious
machinations he deprived Spouses Filomeno and Benita Santos, now
their estate, of the properties. Surmises, suspicion and conjectures are
not bases of culpability.
DAGING v DAVIS
Daria owns and operates the Nashville Country Music Lounge in Baguio
City from a space leased from Benjie (Pinlac). She then received a
Retainer Proposal from the Davis & Sabling Law Office of which Atty. Riz
(Davis) is one of the partners, which resulted in the signing of a
Retainer Agreement with the law office on March 7, 2005. For
failure to pay her rentals, Benjie terminated the lease. Benjie,
together with Novie (Balageo) and Riz then proceeded to the bar,
inventoried the equipments therein, and informed Daria that Novie will
take over the operation of the bar. According to Daria, Atty. Riz acted
as business manager of the bar which they renamed as Amarillo
Music Bar. Daria then filed an ejectment case against Benjie and
Novie before Municipal Trial Court in Cities (MTCC), with the law office
as her counsel as their Retainer Agreement was still subsisting.
However, Atty. Riz appeared as counsel for Novie in the case,
and filed in her behalf, an Answer with Opposition to the
Prayer for Issuance Of A Writ Of Preliminary Injunction. It was
then that she filed the administrative case case against Atty.
Riz. In his Comment, he denied participating in the takeover of Darias
business or acting as business manager thereof. Benjie informed him
that Darias business was terminated and turned over to Novie, and he
allowed one of his staff to accompany them in the inventory of
equipment. He insisted it was Atty. Amos Sabling who initiated
the Retainer proposal as well as who Daria consulted with her
business. He never gained any information or knowledge about
Darias business. He admitted having represented Novie but denied
taking advantage of the Retainer Agreement between the law office
and Daria. He subsequently withdrew his appearance in the
case and the case was subsequently dismissed for lack of
jurisdiction.
The Investigationg Commissioner recommended that Riz be suspended
from the practice of law for one year, for betrayal of his clients trust
and for misuse of information gained from his client to the
disadvantage of Daria and the advantage of another. The IBP Board
initially approved the recommendation of the Investigating
Commissioner but modified it to six months suspension upon motion of
Atty. Riz.
RULING
It is undisputed that complainant entered into a Retainer Agreement
dated March 7, 2005 with respondents law firm. This agreement was
signed by the respondent and attached to the records 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. 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.
In Quiambao v. Atty. Bamba, this Court emphasized that lawyers are
expected 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 of paramount importance in the administration of justice.
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, reiterated in Gonzales v.
Atty. Cabucana, Jr., this 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,
respondents argument that he never took advantage of any
information acquired by his law firm 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. We thus
adopt the recommendation of the IBP 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.
LETICIA GONZALES v ATTY. MARCELINO CABUCANA
On January 8, 2004, Gonzales filed a petition before the Integrated Bar
of the Philippines (IBP) alleging that: she was the complainant in a
case for sum of money and damages filed before the Municipal
Trial Court in Cities (MTCC) of Santiago City, docketed as Civil
Case No. 1-567 where she was represented by the law firm
CABUCANA, CABUCANA, DE GUZMAN AND CABUCANA LAW
OFFICE, with Atty. Edmar Cabucana handling the case and herein
respondent as an associate/partner; on February 26, 2001, a decision
was rendered in the civil case ordering the losing party to pay
Gonzales the amount of P17,310.00 with interest and
P6,000.00 as attorneys fees; Sheriff Romeo Gatcheco, failed to
fully implement the writ of execution issued in connection with the
judgment which prompted Gonzales to file a complaint against the said
sheriff with this Court; in September 2003, Sheriff Gatcheco and his
wife went to the house of Gonzales; they harassed Gonzales
and asked her to execute an affidavit of desistance regarding
her complaint before this Court; Gonzales thereafter filed against the
Gatchecos criminal cases for trespass, grave threats, grave oral
defamation, simple coercion and unjust vexation;
notwithstanding the pendency of Civil Case No. 1-567, where
respondents law firm was still representing Gonzales, herein
respondent represented the Gatchecos in the cases filed by
Gonzales against the said spouses; respondent should be
disbarred from the practice of law since respondents acceptance of the
cases of the Gatchecos violates the lawyer-client relationship between
complainant and respondents law firm and renders respondent liable
under the Code of Professional Responsibility (CPR) particularly Rules
10.01,[1] 13.01,[2] 15.02,[3] 15.03,[4] 21.01[5] and 21.02.
RULING
Before going to the merits, let it be clarified that contrary to the report
of Commissioner Reyes, respondent did not only represent the
Gatcheco spouses in the administrative case filed by Gonzales against
them. As respondent himself narrated in his Position Paper, he likewise
acted as their counsel in the criminal cases filed by Gonzales against
them.
With that settled, we find respondent guilty of violating Rule
15.03 of Canon 15 of the Code of Professional Responsibility, to wit:
Rule 15.03 A lawyer shall not represent conflicting interest
except by written consent of all concerned given after a full
disclosure of the facts. It is well-settled that a lawyer is barred from
representing conflicting interests except by written consent of all
concerned given after a full disclosure of the facts.
Respondent further argued that it was his brother who
represented Gonzales in the civil case and not him, thus, there could
be no conflict of interests. We do not agree. As respondent admitted, it
was their law firm which represented Gonzales in the civil case. Such
being the case, the rule against representing conflicting interests
applies. As we explained in the case of Hilado vs. David:[31]
[W]e cannot sanction his taking up the cause of the adversary
of the party who had sought and obtained legal advice from his
firm.
In the same manner, his claim that he could not turn down the spouses
as no other lawyer is willing to take their case cannot prosper as it is
settled that while there may be instances where lawyers cannot
decline representation they cannot be made to labor under conflict of
interest between a present client and a prospective one. [34] Granting
also that there really was no other lawyer who could handle
the spouses case other than him, still he should have observed
the requirements laid down by the rules by conferring with the
prospective client to ascertain as soon as practicable whether
the matter would involve a conflict with another client then
seek the written consent of all concerned after a full disclosure
of the facts.[35] These respondent failed to do thus exposing himself to
the charge of double-dealing.
Merits: We shall consider however as mitigating circumstances
the fact that he is representing the Gatcheco spouses pro
bono and that it was his firm and not respondent personally,
which handled the civil case of Gonzales. As recounted by
complainant herself, Atty. Edmar Cabucana signed the civil case of
complainant by stating first the name of the law firm CABUCANA,
CABUCANA, DE GUZMAN AND CABUCANA LAW OFFICE, under which,
his name and signature appear; while herein respondent signed the
pleadings for the Gatcheco spouses only with his name, [39] without any
mention of the law firm. We also note the observation of the IBP
Commissioner Reyes that there was no malice and bad faith in
respondents acceptance of the Gatchecos cases as shown by
the move of complainant to withdraw the case.
APPROVED with MODIFICATION that respondent Atty. Marcelino
Cabucana, Jr. is FINED the amount of Two Thousand Pesos (P2,000.00)
with a STERN WARNING.
JOSEPHINE OROLA v ATTY. JOSEPH ADOR RAMOS
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.
In the settlement of Trinidads estate, pending before the Regional Trial
Court of Roxas City, Branch 18 (RTC) and docketed as Special RULING
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 The Court concurs with the IBPs finding that respondent violated Rule
Josephine, Myrna, Manuel, Mary Angelyn, and Marjorie (Heirs of 15.03 of the Code, but reduced the recommended period of suspension
Trinidad); (b) Atty. Ely F. Azarraga, Jr. (Atty. Azarraga) as counsel for and to three (3) months.
in behalf of Maricar, Karen, and the other heirs 4 of the late Antonio
(Heirs of Antonio), with respondent as collaborating counsel; and Rule 15.03 of the Code reads:
(c) Atty. Aquiliana Brotarlo as counsel for and in behalf of Emilio, the
initially appointed administrator of Trinidads estate. In the course of CANON 15 A LAWYER SHALL OBSERVE CANDOR, FAIRNESS
the proceedings, the Heirs of Trinidad and the Heirs of Antonio AND LOYALTY IN ALL HIS DEALINGS AND TRANSACTIONS WITH
moved for the removal of Emilio as administrator and, in his HIS CLIENTS.
stead, sought the appointment of the latters son, Manuel
Records reveal that respondent was the collaborating counsel
Orola, which the RTC granted in an Order 5 dated September 20, 2007
not only for Maricar as claimed by him, but for all the Heirs of
(RTC Order). Subsequently, or on October 10, 2007, respondent
Antonio in Special Proceeding No. V-3639. In the course
filed an Entry of Appearance as collaborating counsel for Emilio
thereof, the Heirs of Trinidad and the Heirs of Antonio
in the same case and moved for the reconsideration of the RTC
succeeded in removing Emilio as administrator for having
Order.6cralaw virtualaw library
committed acts prejudicial to their interests. Hence, when
respondent proceeded to represent Emilio for the purpose of
Due to the respondents new engagement, complainants filed
seeking his reinstatement as administrator in the same case,
the instant disbarment complaint before the Integrated Bar of
he clearly worked against the very interest of the Heirs of
the Philippines (IBP), claiming that he violated: (a) Rule 15.03
Antonio particularly, Karen in violation of the above-stated
of the Code, as he undertook to represent conflicting interests in the
rule.
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
Respondent's justification that no confidential information was
Heirs of Antonio.8 Complainants further claimed that while
relayed to him cannot fully exculpate him for the charges
Maricar, the surviving spouse of Antonio and the mother of
against him since the rule on conflict of interests, as
Karen, consented to the withdrawal of respondents
enunciated in Hornilla, provides an absolute prohibition from
appearance, the same was obtained only on October 18, 2007,
representation with respect to opposing parties in the same
or after he had already entered his appearance for Emilio on
case. In other words, a lawyer cannot change his representation from
October 10, 2007.9 In this accord, respondent failed to disclose such
one party to the latters opponent in the same case. That respondents
fact to all the affected heirs and, as such, was not able to obtain their
previous appearances for and in behalf of the Heirs of Antonio was only
written consent as required under the Rules.
a friendly accommodation cannot equally be given any credence since
The IBP Board of Governors adopted and approved with the aforesaid rule holds even if the inconsistency is remote or merely
modification the aforementioned report in its Resolution No. XVIII-2008- probable or even if the lawyer has acted in good faith and with no
64123 dated December 11, 2008 (Resolution No. XVIII-2008-641), intention to represent conflicting interests.31cralawlibrary
finding the same to be fully supported by the evidence on record and
Neither can respondent's asseveration that his engagement by
the applicable laws and rules but imposed against respondent the
Emilio was more of a mediator than a litigator and for the
penalty of six (6) months suspension from the practice of law.
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 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.
Accordingly, he is hereby SUSPENDED from the practice of law for a
period of three (3) months, with WARNING.
LYDIA CASTRO-JUSTO v ATTY. GALING
Complainant Justo alleged that sometime in April 2003, she
engaged the services of respondent Atty. Galing in connection
with dishonored checks issued by Manila City Councilor Arlene
W. Koa (Ms. Koa). After she paid his professional fees, the
respondent drafted and sent a letter to Ms. Koa demanding
payment of the checks.[3] Respondent advised complainant to
wait for the lapse of the period indicated in the demand letter
before filing her complaint.
On 10 July 2003, complainant filed a criminal complaint against
Ms. Koa for estafa and violation of Batas Pambansa Blg. 22
before the Office of the City Prosecutor of Manila.[4]
On 27 July 2003, she received a copy of a Motion for
Consolidation[5] filed by respondent for and on behalf of Ms.
Koa, the accused in the criminal cases, and the latters
daughter Karen Torralba (Ms. Torralba). Further, on 8 August
2003, respondent appeared as counsel for Ms. Koa before the
prosecutor of Manila.
Complainant submits that by representing conflicting interests,
respondent violated the Code of Professional Responsibility.
RULING
We agree with the Report and Recommendation of the
Investigating Commissioner,[9] as adopted by the Board of
Governors of the IBP.
It was established that in April 2003, respondent was approached
by complainant regarding the dishonored checks issued by Manila
City Councilor Koa.
It was also established that on 25 July 2003, a Motion for
Consolidation was filed by respondent in I.S. No. 03G-19484-86
entitled Lydia Justo vs. Arlene Koa and I.S. No. 03G-19582-84 entitled
Lani C. Justo vs. Karen Torralba. Respondent stated that the movants in
these cases are mother and daughter while complainants are likewise
mother and daughter and that these cases arose out from the same
transaction. Thus, movants and complainants will be adducing the
same sets of evidence and witnesses.
Respondent argued that no lawyer-client relationship existed
between him and complainant because there was no
professional fee paid for the services he rendered. Moreover, he
argued that he drafted the demand letter only as a personal favor to
complainant who is a close friend (considering that the movants have
been comares for 30 years already). We are not persuaded. A lawyer-
client relationship can exist notwithstanding the close friendship
between complainant and respondent. The relationship was
established the moment complainant sought legal advice from
respondent regarding the dishonored checks. By drafting the
demand letter respondent further affirmed such
relationship. The fact that the demand letter was not utilized in the
criminal complaint filed and that respondent was not eventually
engaged by complainant to represent her in the criminal cases is of no
moment. As observed by the Investigating Commissioner, by
referring to complainant Justo as my client in the demand
letter sent to the defaulting debtor [10], respondent admitted
the existence of the lawyer-client relationship.
Likewise, the non-payment of professional fee will not
exculpate respondent from liability. Absence of monetary
consideration does not exempt lawyers from complying with the
prohibition against pursuing cases with conflicting interests.
Under Rule 15.03, Canon 15 of the Code of Professional
Responsibility, [a] lawyer shall not represent conflicting interests
except by written consent of all concerned given after a full disclosure
of the facts. Respondent was therefore bound to refrain from
representing parties with conflicting interests in a controversy. By
doing so, without showing any proof that he had obtained the written
consent of the conflicting parties, respondent should be sanctioned.
The excuse proffered by respondent that it was not him but
Atty. Ao who was eventually engaged by complainant will not
exonerate him from the clear violation of Rule 15.03 of the Code of
Professional Responsibility. The take- over of a clients cause of
action by another lawyer does not give the former lawyer the
right to represent the opposing party. It is not only malpractice
but also constitutes a violation of the confidence resulting from the
attorney-client relationship.
Accordingly, the Court resolved to SUSPEND Atty. Rodolfo T. Galing
from the practice of law for one (1) year, with a WARNING.
UNITY FISHING v ATTY. MACALINO
All told, respondent filed six (6) motions for extension of time
to file Answer and up to this time, which is almost seven (7)
years from the time the Honorable Supreme Court required
respondent to file his answer to the complaint, respondent has
not filed any answer,[10] on account of which the investigating
commissioner considered the case as now ready for resolution. [11]
ANTECEDENT FACTS: Frabal Fishing and Ice Plant Corporation
(hereinafter, Frabal) was the owner of a parcel of land located
along Ramon Magsaysay Boulevard, Sta. Mesa, Manila which
was leased to Wheels Distributors, Inc. (hereinafter, Wheels), an
authorized dealer of cars and motor vehicles of various make;
A dispute arose between Frabal and Wheels regarding the
terms and conditions of the lease contract. The dispute
eventually led to a lawsuit. Frabal hired the services of
respondent Atty. Danilo G. Macalino as counsel for the purpose
of representing its interest in the said lawsuit;
Frabal merged and was absorbed by Petitioner corporation on
February 12, 1991, with the former conveying, assigning and
transferring all its business assets and liabilities to the latter,
including all judicial and extra-judicial claims. Hence, Petitioner was
substituted in lieu of Frabal in the formers lawsuit with Wheels;
As Petitioners legal counsel, Respondent advised Petitioner to
severe all contractual relationship with Wheels as a step
towards eventually evicting the latter from the property they
were occupying;
Hence, upon advice of Respondent, the contract of lease
between Frabal and Wheels was terminated. Respondent
likewise advised Petitioner to return the guarantee deposit
equivalent to two (2) months rental or the amount
of P50,000.00 to Wheels;
On March 2, 1988, Petitioner prepared Metrobank Check No.
MB350288 dated March 8, 1988 for the amount of P50,000.00.
The check was crossed and made payable to the Wheels
Distributors, Inc.
Respondent volunteered to bring the check to the office of
Wheels himself and to make them accept it. Hence, on March
3, 1988, Respondent sent his representative to Petitioners
office to get the said check;
Respondents representative duly received the said check from
Petitioner, as proof of which he signed Check Voucher No. 3-
012 (Annex B);
Thereafter, Respondent represented to Petitioner that he was
able to deliver the check to Wheels Distributors, Inc.;
The suit between Petitioner and Wheels continued for several
years. In the meantime, Petitioner changed counsels, replacing
Respondent with someone else;
Finally, sometime in May 1994, the suit ended in amicable
settlement. In the process of negotiating the terms and
conditions of the settlement, Wheels informed Petitioner that
it never received the fund (sic) guarantee deposit in the
amount of P50,000.00;
Petitioner was shocked to learn this piece of information from Wheels
Distributors as all along Respondent had represented to Petitioner that
Wheels has already received the guarantee deposit of P50,000.00;
Petitioner searched its files for the subject check. After locating the
check, Petitioner noted that at the back of the check was a rubber
stamp marking indicating that it was deposited with the United
Savings Bank Head Office on May 13, 1988 to Account No. CA-
483-3. United Savings Bank has since been acquired by the
United Coconut Planters Bank (UCPB) and is now known as
UCPB Savings Bank;
Petitioner checked with Wheels Distributors from whom it later
learned that the latter never maintained an account with the
United Savings Bank, now the UCPB Savings Bank;
Petitioner wrote to Respondent on May 19, 1994 to explain
why the check in issue never reached Wheels Distributors and
how it was endorsed and encashed despite the fact that it was
a crossed check (Copy of said letter is Annex C);
Despite receipt of said letter, however, Respondent never responded
nor attempted to explain his side to what strongly appears to be a
gross misappropriation of the money for his own personal use;
Hence, Petitioner was constrained to institute an action for damages
against Respondent Danilo G. Macalino as well as UCPB Savings
Bank with the Regional Trial Court of Malabon, Branch 72
where the same is now docketed as Civil Case No. 2382-MN.
RULING
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 Canon of Professional Ethics is even more explicit when it states:
The lawyer should refrain from any action whereby for his personal
benefit or gain he abuses or takes advantages of the confidence
reposed in him by his client.
Money of the client or collected for the client or other trust
property coming into the possession of the lawyer should be
reported and accounted for promptly, and should not under
any circumstances be commingled with his own or be used by
him. (par. 11)
It is clear, therefore, that respondent, by depositing the check
in his own account and subsequently deceiving his client into
believing that he delivered the same to Wheels is undoubtedly
guilty of deceit, malpractice, gross misconduct and unethical behavior.
He caused dishonor, not merely to himself but to the noble profession
to which he belongs.
What is more, respondents repeated failures to comply
with the orders of the Court requiring him to comment on the
complaint indicate a high degree of irresponsibility on his part.
We have no hesitance, then, in confirming the resolution passed by the
IBP Board of Governors suspending respondent from the practice of law
for one (1) year. We could have taken a more drastic action
against respondent, but considering that he has no prior
administrative record, it is our sentiment that the recommended
penalty serves the purpose of protecting the interest of the public and
the legal profession.
He is hereby SUSPENDED from the practice of law for a period
of one (1) year effective immediately, with a STERN WARNING
that a repetition of the same or similar acts shall be dealt with more
severely. He is likewise ordered to return the sum of P50,000 to
complainant within ten (10) hereof.
SPOUSES CONCEPCION v ATTY. ELMER DELA ROSA
In their Verified Complaint, complainants alleged that from 1997 2 until
August 2008,3 respondent served as their retained lawyer and counsel.
In this capacity, respondent handled many of their cases and was
consulted on various legal matters, among others, the prospect of
opening a pawnshop business towards the end of 2005. Said
business, however, failed to
materialize.4chanRoblesvirtualLawlibrar
Aware of the fact that complainants had money intact from
their failed business venture, respondent, on March 23, 2006,
called Henry to borrow the amount of P2,500,000.00, which he
promised to return, with interest, five (5) days thereafter. Henry
consulted his wife, Blesilda, who, believing that respondent would be
soon returning the money, agreed to lend the aforesaid sum to
respondent. She thereby issued three (3) EastWest Bank checks 5 in
respondents name:6chanRoblesvirtualLawlibrary
Upon receiving the checks, respondent signed a piece of paper
containing: (a) photocopies of the checks; and (b) an acknowledgment
that he received the originals of the checks and that he agreed to
return the P2,500,000.00, plus monthly interest of five percent (5%),
within five (5) days.7 In the afternoon of March 23, 2006, the
foregoing checks were personally encashed by
respondent.8chanRoblesvirtualLawlibrary
On March 28, 2006, or the day respondent promised to return
the money, he failed to pay complainants. Thus, in April 2006,
complainants began demanding payment but respondent
merely made repeated promises to pay soon. On July 7, 2008,
Blesilda sent a demand letter 9 to respondent, which the latter did not
heed.10 On August 4, 2008, complainants, through their new counsel,
Atty. Kathryn Jessica dela Serna, sent another demand letter11 to
respondent.12 In his Reply,13 the latter denied borrowing any
money from the complainants. Instead, respondent claimed
that a certain Jean Charles Nault (Nault), one of his other
clients, was the real debtor. Complainants brought the matter to
the Office of the Lupong Tagapamayapa in Barangay Balulang,
Cagayan de Oro City. The parties, however, failed to reach a
settlement.14chanRoblesvirtualLawlibrary
On January 11, 2010, the IBP-Misamis Oriental Chapter received
complainants letter-complaint15charging respondent with
violation of Rule 16.04 of the CPR. The rule prohibits lawyers from
borrowing money from clients unless the latters interests are fully
protected by the nature of the case or by independent advice.
In his Comment,17 respondent denied borrowing P2,500,000.00 from
complainants, insisting that Nault was the real debtor. 18 He also
claimed that complainants had been attempting to collect from Nault
and that he was engaged for that specific
purpose.19chanRoblesvirtualLawlibrary
In their letter-reply,20 complainants maintained that they extended the
loan to respondent alone, as evidenced by the checks issued in the
latters name. They categorically denied knowing Nault and
pointed out that it defies common sense for them to extend an
unsecured loan in the amount of P2,500,000.00 to a person
they do not even know. Complainants also submitted a copy of the
Answer to Third Party Complaint21 which Nault filed as third-party
defendant in a related collection case instituted by the complainants
against respondent.22 In said pleading, Nault explicitly denied knowing
complainants and alleged that it was respondent who incurred the
subject loan from them.23chanRoblesvirtualLawlibrary
On November 23, 2010, the IBP-Misamis Oriental Chapter
endorsed the letter-complaint to the IBP-Commission on Bar
Discipline (CBD),24 which was later docketed as CBD Case No. 11-
2883.25 In the course of the proceedings, respondent failed to appear
during the scheduled mandatory conferences.26 Hence, the same were
terminated and the parties were directed to submit their respective
position papers.27 Respondent, however, did not submit any.cra
RULING
Finding the recommendation to be fully supported by the eVidence on
record and by the applicable laws and rule, the IBP Board of Governors
adopted and approved the Investigating Commissioners Report in
Resolution No. XX-2013-617 dated May 11, 2013, 38 but reduced the
penalty against the respondent to indefinite suspension from
the practice of law and ordered the return of the
P2,500,000.00 to the complainants with legal interest, instead
of stipulated interest.
Respondent sought a reconsideration.
Respondents receipt of the P2,500,000.00 loan from complainants is
amply supported by substantial evidence.
Respondents theory that Nault is the real debtor hardly inspires belief.
While respondent submitted a document purporting to be Naults
acknowledgment of his debt to the complainants, Nault, in his Answer
to Third Party Complaint, categorically denied knowing the
complainants and incurring the same obligation
Moreover, as correctly pointed out by complainants, it would be
illogical for them to extend a P2,500,000.00 loan without any collateral
or security to a person they do not even know. On the other hand,
complainants were able to submit documents showing respondents
receipt of the checks and their encashment, as well as his agreement
to return the P2,500,000.00 plus interest. This is bolstered by the fact
that the loan transaction was entered into during the existence of a
lawyer-client relationship between him and complainants, 45 allowing
the former to wield a greater influence over the latter in view of the
trust and confidence inherently imbued in such relationship.
CANON 16 A lawyer shall hold in trust all moneys and
properties of his clients that may come into his possession.
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.
CANON 7 - A LAWYER SHALL AT ALL TIMES UPHOLD THE
INTEGRITY AND DIGNITY OF THE LEGAL PROFESSION AND
SUPPORT THE ACTIVITIES OF THE INTEGRATED BAR.
In unduly borrowing money from the complainants and by
blatantly refusing to pay the same, respondent abused the
trust and confidence reposed in him by his clients, and, in so
doing, failed to uphold the integrity and dignity of the legal
profession. Thus, he should be equally held administratively liable on
this score.
The Court also deems it appropriate to modify the IBPs Resolution
insofar as it orders respondent to return to complainants the amount of
P2,500,000.00 and the legal interest thereon. It is settled that 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.52 In such cases, the Courts only concern is the
determination of respondents administrative liability; it
should not involve his civil liability for money received from his
client in a transaction separate, distinct, and not intrinsically
linked to his professional engagement.
WHEREFORE, respondent Atty. Elmer A. dela Rosa is found guilty of
violating Canon 7 and Rule 16.04, Canon 16 of the Code of Professional
Responsibility. Accordingly, he is hereby SUSPENDED from the
practice of law for a period of three (3) years effective upon finality
of this Decision, with a stern warning.
DANIEL LEMOINE v ATTY. AMADEO E. BALON, JR.
In early 1998, complainant filed a car insurance claim with
the Metropolitan Insurance Company (Metropolitan Insurance),
the insurer of his vehicle which was lost. As complainant
encountered problems in pursuing his claim which was initially
rejected,[2] his friend, a certain Jesus Jess Garcia (Garcia),
arranged for the engagement of respondents services.
By letter[3] of October 21, 1998 addressed to Elde Management,
Inc., ATTN: Mr. Daniel Lemoine, under whose care complainant could be
reached, respondent advised complainant, whom he had not before
met, that for his legal services he was charging 25% of the actual
amount being recovered. . . payable upon successful recovery; an
advance payment of P50,000.00 to be charged [to complainant] to be
deducted from whatever amount [would] be successfully collected;
P1,000.00 as appearance and conference fee for each and every court
hearings, conferences outside our law office and meetings before the
Office of the Insurance Commission which will be also charged to our
25% recovery fee; and legal expenses such as but not limited to filing
fee, messengerial and postage expenses . . . and other miscellaneous
but related expenses, to be charged to complainants account which
would be reimbursed upon presentation of statement of account.
The letter-proposal of respondent regarding attorneys
fees does not bear complainants conformity, he not having
agreed therewith.
It appears that Metropolitan Insurance finally offered to settle
complainants claim, for by letter [4] of December 9, 1998 addressed to
it, respondent confirmed his acceptance of its offer to settle the claim
of complainant in an ex-gratia basis of 75% of his policy coverage
which is therefore FIVE HUNDRED TWENTY FIVE THOUSAND
(P525,000.00) PESOS.
A day or a few days before December 23, 1998 when
complainant left for France,[5] he, on the advice of respondent,
signed an already prepared undated Special Power of
Attorney[6]authorizing respondent and/or Garcia to bring any action
against Metropolitan Insurance for the satisfaction of complainants
claim as well as to negotiate, sign, compromise[,] encash and receive
payment from it. The Special Power of Attorney was later dated
December 23, 1998 on which same date Metropolitan Insurance
issued a Chinabank Check No. 841172 payable to
complainant in the amount of P525,000.00 as full settlement of
the claim.[7] The check was received by respondent.
In the meantime, complainant returned to the Philippines in early
January 1999 but left again on the 24th of the same month. [8] On
inquiry about the status of his claim, Garcia echoed to
complainant what respondent had written him (Garcia) in
respondents letter[9] of March 26, 1999 that the claim was still
pending with Metropolitan Insurance and that it was still
subject of negotiations in which Metropolitan Insurance
offered to settle it for P350,000.00 representing fifty percent
thereof. In the same letter to
Garcia, respondent suggested the acceptance of theoffer of settlement
to avoid a protracted litigation.
On December 6, 1999, on complainants personal visit to
the office of Metropolitan Insurance, he was informed that his
claim had long been settled via a December 23, 1998 check
given to respondent the year before. [10] Complainant lost no time
in going to the law office of respondent who was not around, however,
but whom he was able to talk by telephone during which he demanded
that he turn over the proceeds of his claim.[11]
 Respondent thereupon faxed to complainant a December
7, 1999 letter[12] wherein he acknowledged having in his
possession the proceeds of the encashed check which he
retained, however, as attorneys lien pending complainants
payment of his attorneys fee, equivalent to fifty percent
(50%) of entire amount collected. In the same letter, respondent
protested what he branded as the uncivilized and unprofessional
behavior complainant reportedly demonstrated at respondents office.
Respondent winded up his letter as
As despite written demands,[13] respondent refused to turn
over the proceeds of the insurance claim and to acknowledge
the unreasonableness of the attorneys fees he was
demanding, complainant instituted the administrative action
at bar on December 17, 1999.
In his Complaint-Affidavit, complainant alleged that [i]t appears
that there was irregularity with the check, it having been issued
payable to him, but and/or AMADEO BALON was therein intercalated
after his (complainants) name.[14]
Maintaining that respondent was entitled to only P50,000.00 in
attorneys fees,[15] complainant decried respondents continued
possession of the proceeds of his claim [16]and his misrepresentations
that the recovery thereof was fraught with difficulties.[17]
In his Counter-Affidavit[18] of February 18, 2000, respondent
asserted that his continued retention of the proceeds of
complainants claim is in lawful exercise of his lien for unpaid
attorneys fees.
Respondent also highlighted the value of the time and
efforts he extended in pursuing complainants claim and the
expenses he incurred in connection therewith. He went on to
assert that his inability to contact complainant whose whereabouts he
did not know prompted him to encash the check and keep the
proceeds thereof in conformity with the Special Power of Attorney
executed in his favor.[21]
During the hearings conducted by the IBP Investigator,
complainant echoed his allegations in his Complaint-Affidavit
and stressed that he turned down as unreasonable
respondents proposal in his October 21, 1998 letter that he be
paid 25% of the actual amount collected for his legal services.
[22]
And he presented documentary evidence, including the March 26,
1999letter of respondent informing his co-attorney-in-fact Garcia of the
supposedly still unrecovered claim and suggesting acceptance of the
purported offer of Metropolitan Insurance to settle complainants claim
at P350,000.00.
Explaining how his above-mentioned March 26, 1999 letter
to Garcia came about, respondent declared that it was made
upon Garcias request, intended for a certain Joel Ramiscal
(Ramiscal) who was said to be Garcias business partner. [23]
Respondent later submitted a June 13, 2001 Supplement[24] to his
Counter-Affidavit reiterating his explanation that it was on Garcias
express request that he wrote the March 26, 1999letter, which was
directed to the fax number of Ramiscal.
Additionally, respondent declared that in the first week
of May 1999, on the representation of Garcia that he had
talked to complainant about respondents retention of fifty
percent (50%) of the insurance proceeds for professional fees
less expenses,[25] he gave Garcia, on a staggered basis, the
total amount of P233,000.00 which, so respondent averred, is the
amount of insurance claim complainant is entitled to receive less
attorneys fees and expenses
Explaining why no written memorandum of the turn over of
various payments to Garcia was made, respondent alleged that there
was no need therefor since he very well knew Garcia who is a co-
Rotarian and co-attorney-in-fact and whom he really dealt with
regarding complainants claim.[29]
Respondent furthermore declared that he rejected
complainants offer to pay him P50,000.00 for his services,
insisting that since there had been no clear-cut agreement on
his professional fees and it was through him that Metropolitan
Insurance favorably reconsidered its initial rejection of
complainants claim, he is entitled to a contingent fee of 50% of
the net proceeds thereof.
Finally, respondent declared that he, in connection with
his follow-up of the insurance claim, incurred representation
expenses of P35,000.00, entertainment and other representation
expenses on various occasions of P10,000.00, and transportation and
gasoline expenses and parking fees of P5,000.00; [31] and that his
retention of complainants money was justified in light of his
apprehension that complainant, being an alien without a valid working
permit in the Philippines, might leave the country anytime without
settling his professional fees.[32]
The Investigating Commissioner, by Report and
Recommendation[33] of October 26, 2001, found respondent
guilty of misconduct and recommended that he be disbarred
and directed to immediately turn over to complainant the sum
of P475,000.00 representing the amount of the P525,000.00
insurance claim less respondents professional fees of
P50,000.00, as proposed by complainant.
The Board of Govenors of the Integrated Bar of the Philippines,
acting on the Investigators Report.
RULING
This Court is in full accord with the findings of the IBP Investigator
that respondent violated the following provisions of the Code of
Professional Responsibility, to wit:
RULE 1.01 - A lawyer shall not engage in unlawful, dishonest, immoral
or deceitful conduct.
xxx
CANON 15 - A lawyer shall observe candor, fairness and loyalty in all
his dealings and transactions with his clients.
RULE 15.06 - A lawyer shall not state or imply that he is able to
influence any public official, tribunal or legislative body.
xxx
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.
xxx
CANON 17 - A lawyer owes fidelity to the cause of his client and he
shall be mindful of the trust and confidence in him.
xxx
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 clients request
for information.
xxx
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 advantage or that of a third person, unless the client with
full knowledge of the circumstances consents thereto.
WHEREFORE, respondent Atty. Amadeo E. Balon, Jr., is found GUILTY of
malpractice, deceit and gross misconduct in the practice of his
profession as a lawyer and he is hereby DISBARRED.
NELIA P. DE CHAVEZ-BLANCO v ATTY. JAIME B. LUMASAG, JR.
Through her attorney-in-fact, Atty. Eugenia J. Muoz,
complainant alleged in her Complaint [2] that she was a resident
of the United States of America together with her husband,
Mario Blanco. She also stated that she owned two (2) adjacent
parcels of land in Quezon City, each with an area of 400 square
meters, covered by Transfer Certificates of Title (TCT) Nos. 22162 and
22163 registered in her name. In a document dated 20 November Complainant also averred that the Special Power of Attorney

1989, she authorized respondent, who were her husbands first cousin, dated 16 January 1989, which respondent had used to sell the

to sell said lots.[3] In a letter dated 20 March 1990, respondent lots is a forgery and a falsified document, as the signature

reported that he had sold only one lot for the price therein were not the real signatures of complainant and her

of P320,000.00 and therefrom he deducted P38,130.00 for taxes spouse. In addition, they could not have acknowledged the document

and commissions. And, allegedly, per complainants before a notary, as they were not in the Philippines at the time.[6]

instructions, he remitted the remaining balance For his part, respondent vehemently denied all the accusations of

of P281,900.00 to a certain Belen Johnnes. [4]

deceit, dishonesty and gross misconduct. [7]

In 1995, complainant was informed by respondent that the Respondent countered that Mario Blanco was the true

other lot remained unsold due to the presence of squatters on owner of the properties, which had to be titled in complainants

the property. name, as Mario Blanco was a U.S. citizen. Mario Blanco had

In December 1998, Mario Blanco discovered that in truth, the requested him to look for a buyer of the properties and, in the course

two (2) lots had been sold on 11 March 1990 to the spouses of selling them, respondent claimed that he had only transacted with

Celso and Consolacion Martinez for the price of P1,120,000.00, the former and never with complainant. Respondent averred that he

and that new titles had been issued to the transferees. Mario had been authorized in November 1989 to sell the property, through a

Blanco confronted respondent with these facts in a letter, but the latter Special Power of Attorney, for a price of not less than P250,000.00 net

disregarded the same. Thus, in May 1999, complainant, through Atty. for the owner.[8]

Muoz sent a demand letter to respondent directing him to remit and Respondent also alleged that the deed of absolute sale

turn over to her the entire proceeds of the sale of the properties. if the two (2) lots had been executed on 19 March 1990 but,

Soon thereafter, respondent admitted the sale of the properties and his only one lot was initially paid in the amount of P281,980.00,

receipt of its proceeds, but he never tendered or offered to which he immediately remitted to Mario Blanco. The payment

tender the same to complainant. Despite repeated and for the other lot was withheld, pending the relocation of the

continued demands, respondent has since not remitted the squatters who had been occupying the premises. And when

amount equivalent to P838,100.00 (P278,000.00 for the first respondent had finally collected the proceeds of the second lot

parcel of land and P560,000.00 for the second).[5] more than three (3) years after, he asked Mario Blanco if the

former could use the amount for a real estate venture whose
 Rule 1.01A lawyer shall not engage in
profit, if successful, he would share with the latter. Mario unlawful, dishonest and immoral or deceitful
conduct.
Blanco allegedly did not think twice and consented to the
There is no need to stretch ones imagination to arrive at an
proposal. The venture, however, did not push through.[9]
inevitable conclusion that respondent committed dishonesty and
Respondent strongly maintained that the two (2) lots
abused the confidence reposed in him by the complainant and her
had been sold for only P563,960.00.[10]
spouse.
Accordingly, the IBP Commissioner recommended that,
Records show that two lots had been sold by
in view of the fact that respondent was already 72 years old, he
respondent as evidenced by the Deed of Absolute Sale of 11
be meted out the penalty of suspension of one (1)-year
March 1990. Respondent, however, taking advantage of the absence
suspension, not disbarment as had been prayed for and not 5
of complainant and her spouse from the Philippines and their complete
year-suspension as had been earlier resolved by the IBP Board
trust in him, deceitfully informed them in a letter dated 20 March
of Governors. Moreover, the IBP Commissioner recommended that
1990 that he had sold only one.. And despite repeated
respondent be ordered to deliver to Complainant the amount
demands, to date, there is no showing that the outstanding
of P240,000.00 plus the legal interest rate of 6% per annum computed
amount has been paid. Thus, respondents deceitful conduct warrants
from March 1990. On 31 May 2007, the IBP Board of Governors passed
disciplinary sanction and a directive for the remittance of the remaining
Resolution No. XVII-2007-222 adopting and approving the Report and
proceeds is in order.
Recommendation of the IBP Commissioner.[13]
As to the charge of falsification, the Court agrees with
The Court agrees with the findings and conclusion of the
the IBP that the same appears to be unsubstantiated. Settled is
IBP, but a reduction of the recommended penalty is called for, following
the rule that, in administrative proceedings, the burden of
the dictum that the appropriate penalty for an errant lawyer depends
proof that the respondent committed the acts complained of
on the exercise of sound judicial discretion based on the surrounding
rests on the complainant (only Xerox copy of the documents
facts.[14]
was there).
A lawyer may be disciplined for any conduct, in his professional
WHEREFORE, in view of the foregoing, respondent Atty. Jaime
or private capacity, that renders him unfit to continue to be an officer of
Lumasag, Jr. is SUSPENDED from the practice of law for a period
the court. Canon 1 of the Code of Professional Responsibility commands
of SIX (6) MONTHS, effective immediately, with a warning that a
all lawyers to uphold at all times the dignity and integrity of the legal
repetition of the same or a similar act will be dealt with more
profession. Specifically, Rule 1.01 thereof provides:
severely. Further, respondent is ordered to deliver to admitted that he "did commit an act bordering on grave misconduct, if

complainant the amount of P240,000.00 plus legal interest rate of not outright violation of his attorney's oath". 4

6% per annum computed from March 1990.

CYNTHIA B. ROSACIA v ATTY. BENJAMIN B. BULALACAO However, respondent is pleading for the Court's compassion

On June 1, 1990, by virtue of a written Agreement (Exh. "3-a"), and leniency to reduce the IBP recommended three months

respondent Atty. Benjamin B. Bulalacao was hired as retained counsel suspension to either fine or admonition with the following

of a corporation by the name of Tacma Phils., Inc. proffered grounds: that he is relatively new in the profession

On October 31, 1990, the lawyer-client relationship between the having been admitted to the Philippine Bar on April 10, 1990 at

respondent and Tacma Phils., Inc. was severed as shown by the age of 46 when the complained conduct was committed on

another agreement of even date. August 1991; that he is of humble beginnings and his

On July, 1991, or after almost nine (9) months from the date suspension will deprive his family of its only source of

respondent's retainer agreement with Tacma, Phils., Inc. was livelihood he being the sole bread winner in the family; that he

terminated, several employees of the corporation consulted has fully realized his mistake and the gravity of his offense for

the respondent for the purpose of filing an action for illegal which he is fully repentant; that he has severed his attorney-

dismissal. Thereafter, he agreed to handle the case for the said client relationship with the employees of Tacma, Phils., Inc. by

employees as against Tacma, Phils., Inc. by filing a complaint before inhibiting himself and withdrawing his appearance as counsel

the National Labor Relations Commission, and appearing in their in the labor case against Tacma, Phils., Inc.; and that he

behalf. pledges not to commit the same mistake and to henceforth

RULING strictly adhere to the professional standards set forth by the

The sole issue to be addressed is whether or not respondent Code of Professional Responsibility.

breached his oath of office for representing the employees of The Court reiterates that an attorney owes loyalty to his client

his former client, Tacma, Phils., Inc., after the termination of not only in the case in which he has represented him but also

their attorney-client relationship. We agree with the findings of the after the relation of attorney and client has terminated as it is

IBP that respondent breached his oath of office. Respondent does not not good practice to permit him afterwards to defend in

now dispute this. In fact, in his motion for reconsideration, respondent another case other person against his former client under the

pretext that the case is distinct from, and independent of the former

case. 5 It behooves respondent 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 attorneys which is of paramount importance in the
administration of justice.
Respondent's plea for leniency cannot be granted. We note that
respondent is new in the profession as he was just admitted to the
Philippine Bar on April 10, 1990, when the breach of his oath of office
occurred more than a year after. Having just hurdled the bar
examinations which included an examination in legal ethics, surely the
precepts of the Code of Professional Responsibility to keep inviolate the
client's trust and confidence even after the attorney-client relation is
terminated 10 must have been still fresh in his mind.
ACCORDINGLY, respondent is hereby SUSPENDED from the
practice of law for three months.
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.
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).
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).
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).
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
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.
RULING
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,
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.
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
We are convinced that the respondent had betrayed the confidences of
the complainant, his former client.
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.

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