Republic of the Philippines On 21 September 1979, FASGI instituted an action against PAWI and FPS for
SUPREME COURT breach of contract and recovery of damages in the amount of US$2,316,591.00
Manila
THIRD DIVISION
G.R. No. 137378 October 12, 2000
PHILIPPINE ALUMINUM WHEELS, INC., petitioner,
vs.
FASGI ENTERPRISES, INC., respondent.
DECISION
VITUG, J.:
On 01 June 1978, FASGI Enterprises Incorporated (“FASGI”), a corporation
organized and existing under and by virtue of the laws of the State of California,
United States of America, entered into a distributorship arrangement with
Philippine Aluminum Wheels, Incorporated (“PAWI”), a Philippine corporation,
and Fratelli Pedrini Sarezzo S.P.A. (“FPS”), an Italian corporation. The
agreement provided for the purchase, importation and distributorship in the
United States of aluminum wheels manufactured by PAWI. Pursuant to the
contract, PAWI shipped to FASGI a total of eight thousand five hundred ninety
four (8,594) wheels, with an FOB value of US$216,444.30 at the time of
shipment, the first batch arriving in two containers and the second in three
containers. Thereabouts, FASGI paid PAWI the FOB value of the wheels.
Unfortunately, FASGI later found the shipment to be defective and in non-
compliance with stated requirements, viz;
“A. contrary to the terms of the Distributorship Agreement and in violation of
U.S. law, the country of origin (the Philippines) was not stamped on the wheels;
“B. the wheels did not have weight load limits stamped on them as required to
avoid mounting on excessively heavy vehicles, resulting in risk of damage or
bodily injury to consumers arising from possible shattering of the wheels;
“C. many of the wheels did not have an indication as to which models of
automobile they would fit;
“D. many of the wheels did not fit the model automobiles for which they were
purportedly designed;
“E. some of the wheels did not fit any model automobile in use in the United
States;
“F. most of the boxes in which the wheels were packed indicated that the wheels
were approved by the Specialty Equipment Manufacturer’s Association
(hereafter, `SEMA’); in fact no SEMA approval has been obtained and this
indication was therefore false and could result in fraud upon retail customers
purchasing the wheels.”1
before the United States District Court for the Central District of California. In
January 1980, during the pendency of the case, the parties entered into a
settlement, entitled “Transaction” with the corresponding Italian translation
“Convenzione Transsativa,” where it was stipulated that FPS and PAWI would
accept the return of not less than 8,100 wheels after restoring to FASGI the
purchase price of US$268,750.00 via four (4) irrevocable letters of credit (“LC”).
The rescission of the contract of distributorship was to be effected within the
period starting January up until April 1980.2
In a telex message, dated 02 March 1980, PAWI president Romeo Rojas
expressed the company’s inability to comply with the foregoing agreement and
proposed a revised schedule of payment. The message, in part, read:
“We are most anxious in fulfilling all our obligations under compromise
agreement executed by our Mr. Giancarlo Dallera and your Van Curen. We have
tried our best to comply with our commitments, however, because of the
situation as mentioned in the foregoing and currency regulations and restrictions
imposed by our government on the outflow, of foreign currency from our
country, we are constrained to request for a revised schedule of shipment and
opening of L/Cs.
“After consulting with our bank and government monetary agencies and on the
assumption that we submit the required pro-forma invoices we can open the
letters of credit in your favor under the following schedule:
“A) First L/C – it will be issued in April 1980 payable 90 days thereafter
“B) Second L/C – it will be issued in June 1980 payable 90 days thereafter
“C) Third L/C – it will be issued in August 1980 payable 90 days thereafter
“D) Fourth L/C – it will be issued in November 1980 payable 90 days thereafter
“We understand your situation regarding the lease of your warehouse. For this
reason, we are willing to defray the extra storage charges resulting from this
new schedule. If you cannot renew the lease [of] your present warehouse,
perhaps you can arrange to transfer to another warehouse and storage charges
transfer thereon will be for our account. We hope you understand our position.
The delay and the revised schedules were caused by circumstances totally
beyond our control.”3
On 21 April 1980, again through a telex message, PAWI informed FASGI that it
was impossible to open a letter of credit on or before April 1980 but assured
that it would do its best to comply with the suggested schedule of payments.4 In
its telex reply of 29 April 1980, FASGI insisted that PAWI should meet the terms
of the proposed schedule of payments, specifically its undertaking to open the
first LC within April of 1980, and that “If the letter of credit is not opened by
April 30, 1980, then x x x [it would] immediately take all necessary legal action
to protect [its] position.”5
Despite its assurances, and FASGI’s insistence, PAWI failed to open the first LC
in April 1980 allegedly due to Central Bank “inquiries and restrictions,”
prompting FASGI to pursue its complaint for damages against PAWI before the
California district court. Pre-trial conference was held on 24 November 1980. In
the interim, the parties, realizing the protracted process of litigation, resolved to
enter into another arrangement, this time entitled “Supplemental Settlement
Agreement,” on 26 November 1980. In substance, the covenant provided that
FASGI would deliver to PAWI a container of wheels for every LC opened and
paid by PAWI:
“3. Agreement
“3.1 Sellers agree to pay FASGI Two Hundred Sixty-Eight Thousand, Seven
Hundred Fifty and 00/100 Dollars ($268,750.00), plus interest and storage costs
as described below. Sellers shall pay such amount by delivering to FASGI the
following four (4) irrevocable letters of credit, confirmed by Crocker Bank, Main
Branch, Fresno, California, as set forth below:
“(i) on or before June 30, 1980, a documentary letter of credit in the amount of
(a) Sixty-Five Thousand, Three Hundred Sixty-nine and 00/100 Dollars
($65,369.00), (b) plus interest on that amount at the annual rate of 16.25%
from January 1, 1980 until July 31, 1980, (c) plus Two Thousand Nine Hundred
Forty Dollars and 00/100 ($2,940.00) and (d) with interest on that sum at the
annual rate of 16.25% from May 1, 1980 to July 31, 1980, payable on or after
August 31, 1980;
“(ii) on or before September 1, 1980, a documentary letter of credit in the
amount of (a) Sixty-Seven Thousand, Seven Hundred Ninety-Three Dollars and
Sixty-Seven Cents ($67,793.67) plus (b) Two Thousand, Nine Hundred Forty
and 00/100 Dollars ($2,940.00), plus (c) interest at an annual rate equal to the
prime rate of Crocker Bank, San Francisco, in effect from time to time, plus two
percent on the amount in (a) from January 1, 1980 until December 21, 1980,
and on the amount set forth in (b) from May 1, 1980 until December 21, 1980,
payable ninety days after the date of the bill of lading under the letter of credit;
“(iii) on or before November 1, 1980, a documentary letter of credit in the
amount of (a) Sixty-Seven Thousand, Seven Hundred Ninety-Three Dollars and
Sixty-Seven Cents ($67,793.67) plus (b) Two Thousand, Nine Hundred Forty
and 00/100 Dollars ($2,490.00), plus (c) interest at an annual rate equal to the
prime rate of Crocker Bank, San Francisco, in effect from time to time, plus two
percent on the amount in (a) from January 1, 1980 until February 21, 1981, and
on the amount set forth in (b) from May 1, 1980 until February 21, 1981,
payable ninety days after the date of the bill of lading under the latter of credit;
“(iv) on or before January 1, 1981, a documentary letter of credit in the amount
of (a) Sixty-Seven Thousand, Seven Hundred Ninety-Three Dollars and Sixty-
Seven Cents ($67,793.67) plus (b) Five Thousand, Eight Hundred Eighty and
00/100 Dollars ($5,880.00), plus (c) interest at an annual rate equal to the
prime rate of Crocker Bank, San Francisco, in effect from time to time, plus two
percent on the amount in (a) from January 1, 1980 until April 21, 1981, and on
the amount set forth in (b) from May 1, 1980 until April 21, 1981, payable
ninety days after the date of the bill of lading under the latter of credit.”6
Anent the wheels still in the custody of FASGI, the supplemental settlement
agreement provided that –
“3.4 (a) Upon execution of this Supplemental Settlement Agreement, the
obligations of FASGI to store or maintain the Containers and Wheels shall be
limited to (i) storing the Wheels and Containers in their present warehouse
location and (ii) maintaining in effect FASGI’s current insurance in favor of
FASGI, insuring against usual commercial risks for such storage in the principal
amount of the Letters of Credit described in Paragraph 3.1. FASGI shall bear no
liability, responsibility or risk for uninsurable risks or casualties to the
Containers or Wheels.
“x x x xxx xxx
“(e) From and after February 28, 1981, unless delivery of the Letters of Credit
are delayed past such date pursuant to the penultimate Paragraph 3.1, in which
case from and after such later date, FASGI shall have no obligation to maintain,
store or deliver any of the Containers or Wheels.”7
The deal allowed FASGI to enter before the California court the foregoing
stipulations in the event of the failure of PAWI to make good the scheduled
payments; thus –
“3.5 Concurrently with execution and delivery hereof, the parties have executed
and delivered a Mutual Release (the `Mutual Release’), and a Stipulation for
Judgment (the `Stipulation for Judgment’) with respect to the Action. In the
event of breach of this Supplemental Settlement Agreement by Sellers, FASGI
shall have the right to apply immediately to the Court for entry of Judgment
pursuant to the Stipulation for Judgment in the full amount thereof, less credit
for any payments made by Sellers pursuant to this Supplemental Settlement
Agreement. FASGI shall have the right thereafter to enforce the Judgment
against PAWI and FPS in the United States and in any other country where
assets of FPS or PAWI may be located, and FPS and PAWI hereby waive all
defenses in any such country to execution or enforcement of the Judgment by
FASGI. Specifically, FPS and PAWI each consent to the jurisdiction of the Italian
and Philippine courts in any action brought by FASGI to seek a judgment in
those countries based upon a judgment against FPS or PAWI in the Action.”8
In accordance with the aforementioned paragraph 3.5 of the agreement, the
parties made the following stipulation before the California court:
“The undersigned parties hereto, having entered into a Supplemental
Settlement Agreement in this action,
“IT IS HEREBY STIPULATED by and between plaintiff FASGI Enterprises, Inc.
(`FASGI’) and defendants Philippine Aluminum Wheels, Inc., (`PAWI’), and each
of them, that judgment may be entered in favor of plaintiff FASGI and against
PAWI, in the amount of Two Hundred Eighty Three Thousand Four Hundred
Eighty And 01/100ths Dollars ($283,480.01).
“Plaintiff FASGI shall also be entitled to its costs of suit, and to reasonable
attorneys’ fees as determined by the Court added to the above judgment
amount.”9
The foregoing supplemental settlement agreement, as well as the motion for the
entry of judgment, was executed by FASGI president Elena Buholzer and PAWI
counsel Mr. Thomas Ready.
PAWI, again, proved to be remiss in its obligation under the supplemental
settlement agreement. While it opened the first LC on 19 June 1980, it,
however, only paid on it nine (9) months after, or on 20 March 1981, when the
letters of credit by then were supposed to have all been already posted. This
lapse, notwithstanding, FASGI promptly shipped to PAWI the first container of
wheels. Again, despite the delay incurred by PAWI on the second LC, FASGI
readily delivered the second container. Later, PAWI totally defaulted in opening
and paying the third and the fourth LCs, scheduled to be opened on or before,
respectively, 01 September 1980 and 01 November 1980, and each to be paid
ninety (90) days after the date of the bill of lading under the LC. As so
expressed in their affidavits, FASGI counsel Frank Ker and FASGI president
Elena Buholzer were more inclined to believe that PAWI’s failure to pay was due
not to any restriction by the Central Bank or any other cause than its inability to
pay. These doubts were based on the telex message of PAWI president Romeo
Rojas who attached a copy of a communication from the Central Bank notifying
PAWI of the bank’s approval of PAWI’s request to open LCs to cover payment for
the re-importation of the wheels. The communication having been sent to FASGI
before the supplemental settlement agreement was executed, FASGI speculated
that at the time PAWI subsequently entered into the supplemental settlement
agreement, its request to open LCs had already been approved by the Central
Bank. Irked by PAWI’s persistent default, FASGI filed with the US District Court
of the Central District of California the following stipulation for judgment against
PAWI.
“PLEASE TAKE NOTICE that on May 17, 1982 at 10:00 A.M. in the Courtroom of
the Honorable Laughlin E. Waters of the above Court, plaintiff FASGI
ENTERPRISES, INC. (hereinafter `FASGI’) will move the Court for entry of
Judgment against defendant PHILIPPINE ALUMINUM WHEELS, INC. (hereinafter
`PAWI’), pursuant to the Stipulation for Judgment filed concurrently herewith,
executed on behalf of FASGI and PAWI by their respective attorneys, acting as
their authorized agents.
“Judgment will be sought in the total amount of P252,850.60, including principal
and interest accrued through May 17, 1982, plus the sum of $17,500.00 as
reasonable attorneys’ fees for plaintiff in prosecuting this action.
“The Motion will be made under Rule 54 of the Federal Rules of Civil Procedure,
pursuant to and based upon the Stipulation for Judgment, the Supplemental
Settlement Agreement filed herein on or about November 21, 1980, the
Memorandum of Points and Authorities and Affidavits of Elena Buholzer, Franck
G. Ker and Stan Cornwell all filed herewith, and upon all the records, files and
pleadings in this action.
“The Motion is made on the grounds that defendant PAWI has breached its
obligations as set forth in the Supplemental Settlement Agreement, and that the
Supplemental Settlement Agreement expressly permits FASGI to enter the
Stipulation for Judgment in the event that PAWI has not performed under the
Supplemental Settlement Agreement.”10
On 24 August 1982, FASGI filed a notice of entry of judgment. A certificate of
finality of judgment was issued, on 07 September 1982, by the US District
Judge of the District Court for the Central District of California. PAWI, by this
time, was approximately twenty (20) months in arrears in its obligation under
the supplemental settlement agreement.
Unable to obtain satisfaction of the final judgment within the United States,
FASGI filed a complaint for “enforcement of foreign judgment” in February
1983, before the Regional Trial Court, Branch 61, of Makati, Philippines. The
Makati court, however, in an order of 11 September 1990, dismissed the case,
thereby denying the enforcement of the foreign judgment within Philippine
jurisdiction, on the ground that the decree was tainted with collusion, fraud, and
clear mistake of law and fact.11 The lower court ruled that the foreign judgment
ignored the reciprocal obligations of the parties. While the assailed foreign
judgment ordered the return by PAWI of the purchase amount, no similar order
was made requiring FASGI to return to PAWI the third and fourth containers of
wheels.12 This situation, the trial court maintained, amounted to an unjust
enrichment on the part of FASGI. Furthermore, the trial court said, the
supplemental settlement agreement and the subsequent motion for entry of
judgment upon which the California court had based its judgment were a nullity
for having been entered into by Mr. Thomas Ready, counsel for PAWI, without
the latter’s authorization.
FASGI appealed the decision of the trial court to the Court of Appeals. In a
decision,13 dated 30 July 1997, the appellate court reversed the decision of the
trial court and ordered the full enforcement of the California judgment.
Hence this appeal.
Generally, in the absence of a special compact, no sovereign is bound to give
effect within its dominion to a judgment rendered by a tribunal of another
country;14 however, the rules of comity, utility and convenience of nations have
established a usage among civilized states by which final judgments of foreign
courts of competent jurisdiction are reciprocally respected and rendered
efficacious under certain conditions that may vary in different countries.15
In this jurisdiction, a valid judgment rendered by a foreign tribunal may be
recognized insofar as the immediate parties and the underlying cause of action
are concerned so long as it is convincingly shown that there has been an
opportunity for a full and fair hearing before a court of competent jurisdiction;
that trial upon regular proceedings has been conducted, following due citation or
voluntary appearance of the defendant and under a system of jurisprudence
likely to secure an impartial administration of justice; and that there is nothing
to indicate either a prejudice in court and in the system of laws under which it is
sitting or fraud in procuring the judgment.16 A foreign judgment is presumed to
be valid and binding in the country from which it comes, until a contrary
showing, on the basis of a presumption of regularity of proceedings and the
giving of due notice in the foreign forum. Rule 39, section 48 of the Rules of
Court of the Philippines provides:
Sec. 48. Effect of foreign judgments or final orders – The effect of a judgment
or final order of a tribunal of a foreign country, having jurisdiction to render the
judgment or final order is as follows:
xxxx
(b) In case of a judgment or final order against a person, the judgment or final
order is presumptive evidence of a right as between the parties and their
successors-in-interest by a subsequent title.
In either case, the judgment or final order may be repelled by evidence a want
of jurisdiction, want of notice to the party, collusion, fraud, or clear mistake of
law or fact.
In Soorajmull Nagarmull vs. Binalbagan-Isabela Sugar Co. Inc.,17 one of the
early Philippine cases on the enforcement of foreign judgments, this Court has
ruled that a judgment for a sum of money rendered in a foreign court is
presumptive evidence of a right between the parties and their successors-in-
interest by subsequent title, but when suit for its enforcement is brought in a
Philippine court, such judgment may be repelled by evidence of want of
jurisdiction, want of notice to the party, collusion, fraud or clear mistake of law
or fact. In Northwest Orient Airlines, Inc., vs. Court of Appeals, 18 the Court has
said that a party attacking a foreign judgment is tasked with the burden of
overcoming its presumptive validity.
PAWI claims that its counsel, Mr. Ready, has acted without its authority. Verily,
in this jurisdiction, it is clear that an attorney cannot, without a client’s
authorization, settle the action or subject matter of the litigation even when he
honestly believes that such a settlement will best serve his client’s interest.19
In the instant case, the supplemental settlement agreement was signed by the
parties, including Mr. Thomas Ready, on 06 October 1980. The agreement was
lodged in the California case on 26 November 1980 or two (2) days after the
pre-trial conference held on 24 November 1980. If Mr. Ready was indeed not
authorized by PAWI to enter into the supplemental settlement agreement, PAWI
could have forthwith signified to FASGI a disclaimer of the settlement. Instead,
more than a year after the execution of the supplemental settlement
agreement, particularly on 09 October 1981, PAWI President Romeo S. Rojas
sent a communication to Elena Buholzer of FASGI that failed to mention Mr.
Ready’s supposed lack of authority. On the contrary, the letter confirmed the
terms of the agreement when Mr. Rojas sought forbearance for the impending
delay in the opening of the first letter of credit under the schedule stipulated in
the agreement.
It is an accepted rule that when a client, upon becoming aware of the
compromise and the judgment thereon, fails to promptly repudiate the action of
his attorney, he will not afterwards be heard to complain about it.20
Nor could PAWI claim any prejudice by the settlement. PAWI was spared from
possibly paying FASGI substantial amounts of damages and incurring heavy
litigation expenses normally generated in a full-blown trial. PAWI, under the
agreement was afforded time to reimburse FASGI the price it had paid for the
defective wheels. PAWI, should not, after its opportunity to enjoy the benefits of
the agreement, be allowed to later disown the arrangement when the terms
thereof ultimately would prove to operate against its hopeful expectations.
PAWI assailed not only Mr. Ready’s authority to sign on its behalf the
Supplemental Settlement Agreement but denounced likewise his authority to
enter into a stipulation for judgment before the California court on 06 August
1982 on the ground that it had by then already terminated the former’s
services. For his part, Mr. Ready admitted that while he did receive a request
from Manuel Singson of PAWI to withdraw from the motion of judgment, the
request unfortunately came too late. In an explanatory telex, Mr. Ready told Mr.
Singson that under American Judicial Procedures when a motion for judgment
had already been filed a counsel would not be permitted to withdraw unilaterally
without a court order. From the time the stipulation for judgment was entered
into on 26 April 1982 until the certificate of finality of judgment was issued by
the California court on 07 September 1982, no notification was issued by PAWI
to FASGI regarding its termination of Mr. Ready’s services. If PAWI were indeed
hoodwinked by Mr. Ready who purportedly acted in collusion with FASGI, it
should have aptly raised the issue before the forum which issued the judgment
in line with the principle of international comity that a court of another
jurisdiction should refrain, as a matter of propriety and fairness, from so
assuming the power of passing judgment on the correctness of the application
of law and the evaluation of the facts of the judgment issued by another
tribunal.21
Fraud, to hinder the enforcement within this jurisdiction of a foreign judgment,
must be extrinsic, i.e., fraud based on facts not controverted or resolved in the
case where judgment is rendered,22 or that which would go to the jurisdiction of
the court or would deprive the party against whom judgment is rendered a
chance to defend the action to which he has a meritorious case or defense. In
fine, intrinsic fraud, that is, fraud which goes to the very existence of the cause
of action – such as fraud in obtaining the consent to a contract – is deemed
already adjudged, and it, therefore, cannot militate against the recognition or
enforcement of the foreign judgment.23
Even while the US judgment was against both FPS and PAWI, FASGI had every
right to seek enforcement of the judgment solely against PAWI or, for that
matter, only against FPS. FASGI, in its complaint, explained:
“17. There exists, and at all times relevant herein there existed, a unity of
interest and ownership between defendant PAWI and defendant FPS, in that
they are owned and controlled by the same shareholders and managers, such
that any individuality and separateness between these defendants has ceased, if
it ever existed, and defendant FPS is the alter ego of defendant PAWI. The two
entities are used interchangeably by their shareholders and managers, and
plaintiff has found it impossible to ascertain with which entity it is dealing at any
one time. Adherence to the fiction of separate existence of these defendant
corporations would permit an abuse of the corporate privilege and would
promote injustice against this plaintiff because assets can easily be shifted
between the two companies thereby frustrating plaintiff’s attempts to collect on
any judgment rendered by this Court.”24 A.C. No. 9881 June 4, 2014
(Formerly CBD 10-2607)
Paragraph 14 of the Supplemental Settlement Agreement fixed the liability of
PAWI and FPS to be “joint and several” or solidary. The enforcement of the
ATTY. ALAN F. PAGUIA, Petitioner,
judgment against PAWI alone would not, of course, preclude it from pursuing
vs.
and recovering whatever contributory liability FPS might have pursuant to their ATTY. MANUEL T. MOLINA, Respondent.
own agreement.
PAWI would argue that it was incumbent upon FASGI to first return the second RESOLUTION
and the third containers of defective wheels before it could be required to return
to FASGI the purchase price therefor,25 relying on their original agreement (the
SERENO, CJ:
“Transaction”).26 Unfortunately, PAWI defaulted on its covenants thereunder
that thereby occasioned the subsequent execution of the supplemental
settlement agreement. This time the parties agreed, under paragraph For resolution by this Court is the dismissal by the Integrated Bar of the
3.4(e)27 thereof, that any further default by PAWI would release FASGI from any Philippines (IBP) Board of Governors of the administrative Complaint for
obligation to maintain, store or deliver the rejected wheels. The supplemental DISHONESTY against respondent, Atty. Manuel Molina. Atty. Molina allegedly
settlement agreement evidently superseded, at the very least on this point, the advised his clients to enforce a contract on the complainant's client who had
previous arrangements made by the parties. never been a party to the agreement.

PAWI cannot, by this petition for review, seek refuge over a business dealing
and decision gone awry. Neither do the courts function to relieve a party from
the effects of an unwise or unfavorable contract freely entered into. As has so
aptly been explained by the appellate court, the over-all picture might, indeed,
appear to be onerous to PAWI but it should bear emphasis that the settlement
which has become the basis for the foreign judgment has not been the start of a
business venture but the end of a failed one, and each party, naturally, has had
to negotiate from either position of strength or weakness depending on its own
perception of who might have to bear the blame for the failure and the
consequence of loss.28
Altogether, the Court finds no reversible error on the part of the appellate court
in its appealed judgment.
WHEREFORE, the decision of the Court of Appeals is AFFIRMED. No costs.
SO ORDERED.
The facts are as follows:
The case involves a conflict between neighbors in a four-unit compound named
"Times Square" at Times Street, Quezon City. The neighbors are the following:
1) Mr. And Mrs. Gregorio M. Abreu, clients of Atty. Paguia; 2) Mr. And Mrs.
Wilson Lim, clients of respondent Molina; 3) Dr. and Mrs. Eduardo Yap; and Dr.
Belinda San Juan.
The clients of Atty. Molina entered into a contract with the other unit owners
save for Mr. Abreu. The agreement, covered by a document titled "Times
Square Preamble," establishes a set of internal rules for the neighbors on
matters such as the use of the common right of way to the exit gate,
assignment of parking areas, and security. Mr. Abreu, the client of complainant,
Atty. Paguia, was not a party to the contract since the former did not agree with
the terms concerning the parking arrangements.
On 4 February 2010, Atty. Paguia filed a Complaint for Dishonesty1 with the IBP
Commission on Bar Discipline against Atty. Molina2 for allegedly giving legal
advice to the latter’s clients to the effect that the Times Square Preamble was
binding on Mr. Abreu, who was never a party to the contract.
In his Answer,3 Atty. Molina downplayed the case as a petty quarrel among
neighbors. He maintained that the Times Square Preamble4 was entered into for
purposes of maintaining order in the residential compound. All homeowners,
except Mr. Abreu, signed the document.5
Respondent further stated in his Answer that Mr. and Mrs. Gregorio Abreu filed
two cases against his clients, Mr. And Mrs. William Lim, on the belief that Mr.
Abreu was not bound by the Times Square Preamble. The first case, was filed
with the Housing and Land Use Regulatory Board (HLURB), which was an action
to declare the Times Square Preamble invalid. The second suit was an action for
declaratory relief. Both cases, according to respondent, were dismissed.6
Respondent further claimed that another case had been filed in court, this time
by his client, the Lims. They were prompted to file a suit since Mr. Abreu had
allegedly taken matters into his own hands by placing two vehicles directly in
front of the gate of the Lims, thus blocking the latter’s egress to Times Street.
The Lims filed with the Regional Trial Court, Branch 96, Quezon City, a
Complaint for Injunction and Damages, coupled with a prayer for the immediate
issuance of a Temporary Restraining Order and/or Preliminary Injunction, which
was docketed as Civil Case No. Q-08-63579. According to respondent, the RTC
granted the relief prayed for in an Order dated 12 December 2008.7
Atty. Molina concluded that the above facts sufficiently served as his answer to
the Complaint.
On 3 August 2010, Investigating Commissioner Victor C. Fernandez rendered a
Report and Recommendation. He recommended dismissal for lack of merit,
based on the following grounds: 1) the complaint consisted only of bare
allegations; and 2) even assuming that respondent Molina gave an erroneous
legal advice, he could not be held accountable in the absence of proof of malice
or bad faith.8
On 14 May 2011, the IBP Board of Governors passed Resolution No. XIX-2011-
210, adopting and approving the Report and Recommendation of the
Investigating Commissioner.9
Atty. Paguia filed a Motion for Reconsideration dated 2 August 2011, but was
denied by the IBP Board of Governors on 29 December 2012.10 Notices of the
denial were received by the parties on 21 March 2013.11
No petition for review has been filed with this Court.
It is worth noting that a case is deemed terminated if the complainant does not
file a petition with the Supreme Court within fifteen (15) days from notice of the
Board’s resolution. This rule is derived from Section 12(c) of Rule 139-B, which
states:
(c) If the respondent is exonerated by the Board or the disciplinary sanction
imposed by it is less than suspension or disbarment (such as admonition,
reprimand, or fine) it shall issue a decision exonerating respondent or imposing
such sanction. The case shall be deemed terminated unless upon petition of the
complainant or other interested party filed with the Supreme Court within fifteen
(15) days from notice of the Board’s resolution, the Supreme Court orders
otherwise. (Underscoring supplied)
In this case, Atty. Paguia received notice of the Board’s resolution on 21 March
2013, as evidenced by a registry return receipt. To this date, this Court has yet
to receive a petition for review from Atty. Paguia. Thus, for his failure to file a
petition for review with the Court within 15 days, this case is deemed
terminated pursuant to the above mentioned Section 12(c).
Nevertheless, we have gone over the records but we have no reason to deviate
from the findings of the IBP Board of Governors.
When it comes to administrative cases against lawyers, two things are to be
considered: quantum of proof, which requires clearly preponderant evidence;
and burden of proof, which is on the complainant.12
In the present case, we find that the Complaint is without factual basis.
Complainant Atty. Paguia charges Atty. Molina with providing legal advice to the
latter’s clients to the effect that the Times Square Preamble is binding on
complainant’s client, Mr. Abreu, who was not a signatory to the agreement. The
allegation of giving legal advice, however, was not substantiated in this case,
either in the complaint or in the corresponding hearings. Nowhere do the
records state that Atty. Paguia saw respondent giving the legal advice to the
clients of the latter. Bare allegations are not proof.13
Even if we assume that Atty. Molina did provide his clients legal advice, he still
cannot be held administratively liable without any showing that his act was
attended with bad faith or malice. The rule on mistakes committed by lawyers in
the exercise of their profession is as follows:
An attorney-at-law is not expected to know all the law. For an honest mistake or
error, an attorney is not liable. Chief Justice Abbott said that, no attorney is
bound to know all the law; God forbid that it should be imagined that an
attorney or a counsel, or even a judge, is bound to know all the law. x x x.14
The default rule is presumption of good faith. On the other hand, bad faith is
never presumed.1âwphi1 It is a conclusion to be drawn from facts. Its
determination is thus a question of fact and is evidentiary.15 There is no
evidence, though, to show that the legal advice, assuming it was indeed given,
was coupled with bad faith, malice, or ill-will. The presumption of good faith,
therefore, stands in this case.
The foregoing considered, complainant failed to prove his case by clear
preponderance of evidence.
WHEREFORE, the Resolution of the IBP Board of Governors adopting and
approving the Decision of the Investigating Commissioner is hereby AFFIRMED.
SO ORDERED.
A.C. No. 6677 June 10, 2014
EUPROCINA I. CRISOSTOMO, MARILYN L. SOLIS, EVELYN MARQUIZO,
ROSEMARIE BALATUCAN, MILDRED BATANG, MARILEN MINERALES, and
MELINDA D. SIOTING, Complainants,
vs.
ATTY. PHILIP Z. A. NAZARENO, Respondent.
DECISION
PERLAS-BERNABE, J.:
For the Court's resolution is an administrative complaint1 filed by complainants
Euprocina I. Crisostomo (Crisostomo), Marilyn L. Solis (Solis), Evelyn Marquizo
(Marquizo), Rosemarie Balatucan (Balatucan), Mildred Batang (Batang), Marilen
Minerales (Minerales), and Melinda D. Sioting (Sioting) against respondent Atty.
Philip Z. A. Nazareno (Atty. Nazareno), charging him with making false
declarations in the certifications against forum shopping subject of this case in
disregard of Section 5, Rule 7 of the Rules of Court, and malpractice as a notary
public in violation of the Code of Professional Responsibility.
The Facts
Sometime in 2001, complainants individually purchased housing units (subject
properties) in Patricia South Villa Subdivision, Anabu-II, Imus, Cavite, from
Rudex International Development Corp. (Rudex).2 In view of several
inadequacies and construction defects3 in the housing units and the subdivision
itself, complainants sought the rescission of their respective contracts to sell
before the Housing and Land Use Regulatory Board (HLURB), seeking the refund
of the monthly amortizations they had paid.4 The first batch of rescission cases
was filed by herein complainants Sioting5 on May 24, 2002, and Crisostomo6 and
Marquizo7 on June 10, 2002, while the second batch of rescission cases was filed
by complainants Balatucan8 on March 3, 2003, Solis9 and Ederlinda M.
Villanueva10 (represented by Minerales) on May 12, 2003, and Batang11 on July
29, 2003. In all the foregoing rescission cases, Rudex was represented by
herein respondent Atty. Nazareno.
Judgments of default were eventually rendered against Rudex in the first batch
of rescission cases.12 Sometime in August 2003, Rudex filed three (3) petitions
for review13 before the HLURB assailing the same. In the certifications against
forum shopping attached to the said petitions, Rudex, through its President
Ruben P. Baes, and legal counsel Atty. Nazareno, stated that it has not
commenced or has knowledge of any similar action or proceeding involving the
same issues pending before any court, tribunal or agency14 – this,
notwithstanding the fact that Rudex, under the representation of Atty.
Nazareno, previously filed an ejectment case on September 9, 2002 against
Sioting and her husband, Rodrigo Sioting (Sps. Sioting), before the Municipal
Trial Court of Imus, Cavite (MTC).15
On January 29, 2004, Rudex, again represented by Atty. Nazareno, filed another
complaint16 against Sps. Sioting before the HLURB for the rescission of their
contract to sell and the latter’s ejectment, similar to its pending September 9,
2002 ejectment complaint. Yet, in the certification against forum shopping
attached thereto executed by the Head of its Credit and Collection department,
Norilyn D. Unisan,17 Rudex declared that it has not commenced or is not aware
of any action or proceeding involving the same issues pending before any court,
tribunal or agency.18 The said certification was notarized by Atty. Nazareno
himself.19
On April 1, 2004, six (6) similar complaints20 for rescission of contracts to sell
and ejectment, plus damages for non-payment of amortizations due, were filed
by Atty. Nazareno, on behalf of Rudex, against the other complainants before
the HLURB. The certifications against forum shopping attached thereto likewise
stated that Rudex has not commenced or has any knowledge of any similar
pending action before any court, tribunal or agency.21
On February 21, 2005, complainants jointly filed the present administrative
complaint for disbarment against Atty. Nazareno, claiming that in the
certifications against forum shopping attached to the complaints for rescission
and ejectment of Rudex filed while Atty. Nazareno was its counsel, the latter
made false declarations therein that no similar actions or proceedings have been
commenced by Rudex or remained pending before any other court, tribunal or
agency when, in fact, similar actions or proceedings for rescission had been filed
by herein complainants before the HLURB against Rudex and Atty. Nazareno,
and an ejectment complaint was filed by Rudex, represented by Atty. Nazareno,
against Sps. Sioting. In addition, complainants asserted that Atty. Nazareno
committed malpractice as a notary public since he only assigned one (1)
document number (i.e., Doc. No. 1968) in all the certifications against forum
shopping that were separately attached to the six (6) April 1, 2004 complaints
for rescission and ejectment.22
Despite notice, Atty. Nazareno failed to file his comment and refute the
administrative charges against him.23
In the interim, the HLURB, in the Resolutions dated April 14, 2005 24and May
12, 2005,25 dismissed Rudex’s complaints for rescission and ejectment26 on the
ground that its statements in the certifications against forum shopping attached
thereto were false due to the existence of similar pending cases in violation of
Section 5,Rule 7 of the Rules of Court.
The IBP’s Report and Recommendation
In a Report and Recommendation27 dated March 8, 2012, Integrated Bar of the
Philippines (IBP) Investigating Commissioner Oliver A. Cachapero recommended
the suspension of Atty. Nazareno for a period of six (6) months for his
administrative violations.
The Investigating Commissioner found, among others, that there were
unassailable proofs that the certification against forum shopping attached to
Rudex’s ejectment complaint against Sps. Sioting had been erroneously
declared, considering that at the time Rudex filed the said complaint in
September 2002, Sps. Sioting’s rescission complaint against Rudex, filed on May
24, 2002, was already pending. Hence, it was incumbent upon Rudex to have
declared its existence, more so, since both complaints involve the same
transaction and essential facts, and a decision on the rescission complaint would
amount to res judicata on the ejectment complaint.28 In this relation, the
Investigating Commissioner observed that Atty. Nazareno cannot claim
innocence of his omission since he was not only Rudex’s counsel but the
notarizing officer as well. Having knowingly made false entries in the subject
certifications against forum shopping, the Investigating Commissioner
recommended that Atty. Nazareno be held administratively liable and thereby
penalized with six (6) months suspension.29
In a Resolution30 dated April 15, 2013, the IBP Board of Governors adopted and
approved the Investigating Commissioner’s Report and Recommendation, but
modified the recommended penalty from a suspension of six (6) months to only
one (1) month.
The Issue Before the Court
The essential issue in this case is whether or not Atty. Nazareno should be held
administratively liable and accordingly suspended for a period of one (1) month.
The Court’s Ruling
The Court affirms the IBP’s findings with modification as to the penalty imposed.
Separate from the proscription against forum shopping31 is the violation of the
certification requirement against forum shopping, which was distinguished in the
case of Sps. Ong v. CA32 as follows:
The distinction between the prohibition against forum shopping and the
certification requirement should by now be too elementary to be misunderstood.
To reiterate, compliance with the certification against forum shopping is
separate from and independent of the avoidance of the act of forum shopping
itself. There is a difference in the treatment between failure to comply with the
certification requirement and violation of the prohibition against forum shopping
not only in terms of imposable sanctions but also in the manner of enforcing
them. The former constitutes sufficient cause for the dismissal without prejudice
to the filing of the complaint or initiatory pleading upon motion and after
hearing, while the latter is a ground for summary dismissal thereof and for
direct contempt. x x x.33
Under Section 5, Rule 7 of the Rules of Court, the submission of false entries in
a certification against forum shopping constitutes indirect or direct contempt of
court, and subjects the erring counsel to the corresponding administrative and
criminal actions, viz.:
Section 5. Certification against forum shopping. — The plaintiff or principal party
shall certify under oath in the complaint or other initiatory pleading asserting a
claim for relief, or in a sworn certification annexed thereto and simultaneously
filed therewith: (a) that he has not theretofore commenced any action or filed
any claim involving the same issues in any court, tribunal or quasi-judicial
agency and, to the best of his knowledge, no such other action or claim is
pending therein; (b) if there is such other pending action or claim, a complete
statement of the present status thereof; and (c) if he should thereafter learn
that the same or similar action or claim has been filed or is pending, he shall
report that fact within five (5) days therefrom to the court wherein his aforesaid
complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere
amendment of the complaint or other initiatory pleading but shall be cause for
the dismissal of the case without prejudice, unless otherwise provided, upon
motion and after hearing. The submission of a false certification or non-
compliance with any of the undertakings therein shall constitute indirect
contempt of court, without prejudice to the corresponding administrative and
criminal actions. If the acts of the party or his counsel clearly constitute willful
and deliberate forum shopping, the same shall be ground for summary dismissal
with prejudice and shall constitute direct contempt, as well as a cause for
administrative sanctions. (Emphases supplied)
In the realm of legal ethics, said infraction may be considered as a violation of
Rule 1.01, Canon 1 and Rule 10.01, Canon 10 of the Code of Professional
Responsibility (Code) which read as follows:
CANON 1 – A LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS OF
THE LANDAND PROMOTE RESPECT FOR LAW AND LEGAL PROCESSES.
Rule 1.01 - A lawyer shall not engage in unlawful, dishonest, immoral or
deceitful conduct.
xxxx
CANON 10 – A LAWYER OWES CANDOR, FAIRNESS AND GOOD FAITH TO THE
COURT.
Rule 10.01 - A lawyer shall not do any falsehood, nor consent to the doing of
any in Court; nor shall he mislead, or allow the Court to be misled by any
artifice.
In this case, it has been established that Atty. Nazareno made false declarations
in the certifications against forum shopping attached to Rudex’s pleadings, for
which he should be held administratively liable.
Records show that Atty. Nazareno, acting as Rudex’s counsel, filed, in August
2003, petitions for review assailing the judgments of default rendered in the
first batch of rescission cases without disclosing in the certifications against
forum shopping the existence of the ejectment case it filed against Sps. Sioting
which involves an issue related to the complainants’ rescission cases. Further,
on January 29, 2004, Rudex, represented by Atty. Nazareno, filed a complaint
for rescission and ejectment against Sps. Sioting without disclosing in the
certifications against forum shopping the existence of Sioting’s May 24, 2002
rescission complaint against Rudex as well as Rudex’s own September 9, 2002
ejectment complaint also against Sps. Sioting. Finally, on April 1, 2004,Atty.
Nazareno, once more filed rescission and ejectment complaints against the
other complainants in this case without disclosing in the certifications against
forum shopping the existence of complainants’ own complaints for rescission.
Owing to the evident similarity of the issues involved in each set of cases, Atty.
Nazareno – as mandated by the Rules of Court and more pertinently, the canons
of the Code – should have truthfully declared the existence of the pending
related cases in the certifications against forum shopping attached to the
pertinent pleadings. Considering that Atty. Nazareno did not even bother to
refute the charges against him despite due notice, the Court finds no cogent
reason to deviate from the IBP’s resolution on his administrative
liability.1âwphi1 However, as for the penalty to be imposed, the Court deems it
proper to modify the IBP’s finding on this score.
In Molina v. Atty. Magat,34 a penalty of six (6) months suspension from the
practice of law was imposed against the lawyer therein who was shown to have
deliberately made false and untruthful statements in one of his pleadings. Given
that Atty. Nazareno’s infractions are of a similar nature, but recognizing further
that he, as may be gleaned from the foregoing discussion, had repetitively
committed the same, the Court hereby suspends him from the practice of law
for a period of one (1) year.
Separately, the Court further finds Atty. Nazareno guilty of malpractice as a
notary public, considering that he assigned only one document number (i.e.,
Doc. No. 1968) to the certifications against forum shopping attached to the six
(6) April 1, 2004 complaints for rescission and ejectment despite the fact that
each of them should have been treated as a separate notarial act. It is a
standing rule that for every notarial act, the notary shall record in the notarial
register at the time of the notarization, among others, the entry and page
number of the document notarized, and that he shall give to each instrument or
document executed, sworn to, or acknowledged before him a number
corresponding to the one in his register.35 Evidently, Atty. Nazareno did not
comply with the foregoing rule.
Worse, Atty. Nazareno notarized the certifications against forum shopping
attached to all the aforementioned complaints, fully aware that they identically
asserted a material falsehood, i.e., that Rudex had not commenced any actions
or proceedings or was not aware of any pending actions or proceedings
involving the same issues in any other forum. The administrative liability of an
erring notary public in this respect was clearly delineated as a violation of Rule
1.01,Canon 1 of the Code in the case of Heirs of the Late Spouses Villanueva v.
Atty. Beradio,36 to wit:
Where admittedly the notary public has personal knowledge of a false statement
or information contained in the instrument to be notarized, yet proceeds to affix
his or her notarial seal on it, the Court must not hesitate to discipline the notary
public accordingly as the circumstances of the case may dictate. Otherwise, the
integrity and sanctity of the notarization process may be undermined and public
confidence on notarial documents diminished. In this case, respondent’s conduct
amounted to a breach of Canon 1 of the Code of Professional Responsibility,
which requires lawyers to obey the laws of the land and promote respect for the
law and legal processes. Respondent also violated Rule 1.01 of the Code which
proscribes lawyers from engaging in unlawful, dishonest, immoral, or deceitful
conduct.37 (Emphasis supplied)
large must be able to rely upon he acknowledgment executed by a notary public
and appended to a private instrument.
xxxx
When a notary public certifies to the due execution and delivery of the
document under his hand and seal he gives the document the force of evidence.
Indeed, one of the purposes of requiring documents to be acknowledged before
a notary public, in addition to the solemnity which should surround the
execution and delivery of documents, is to authorize such documents to be
given without further proof of their execution and delivery. Where the notary
public is a lawyer, a graver responsibility is placed upon him by reason of his
solemn oath to obey the laws and to do no falsehood or consent to the doing of
any. Failing in this, he must accept the consequences of his unwarranted
actions.
WHEREFORE, respondent Atty. Philip Z. A. Nazareno is found GUILTY of making
false declarations in the certifications against forum shopping subject of this
case, as well as malpractice as a notary public. Accordingly, he is SUSPENDED
from the practice of law for a period of one (1) year, effective upon his receipt
of this Decision, with a STERN WARNING that a repetition of the same or similar
acts will be dealt with more severely. Further, he is PERMANENTLY
DISQUALIFIED from being commissioned as a notary public and, his notarial
commission, if currently existing, is hereby REVOKED.
Let copies of this Decision be furnished the Office of the Bar Confidant, to be
appended to respondent's personal record as attorney.1âwphi1 Likewise, copies
shall be furnished to the Integrated Bar of the Philippines and all courts in the
country for their information and guidance.

In said case, the lawyer who knowingly notarized a document containing false
SO ORDERED.
statements had his notarial commission revoked and was disqualified from being
commissioned as such for a period of one (1) year. Thus, for his malpractice as
a notary public, the Court is wont to additionally impose the same penalties of
such nature against him. However, due to the multiplicity of his infractions on
this front, coupled with his willful malfeasance in discharging the office, the
Court deems it proper to revoke his existing commission and permanently
disqualify him from being commissioned as a notary public. Indeed, respondent
ought to be reminded that:38

Notarization is not an empty, meaningless, routinary act. It is invested with

substantive public interest, such that only those who are qualified or authorized
may act as notaries public. Notarization converts a private document into a
public document thus making that document admissible in evidence without
further proof of its authenticity. A notarial document is by law entitled to full
faith and credit upon its face. Courts, administrative agencies and the public at

A.C. No. 10576 January 14, 2015
ARCATOMY S. GUARIN, Complainant,
vs.
ATTY. CHRISTINE A.C. LIMPIN, Respondent.
DECISION
VILLARAMA, JR., J.:
Before us is a complaint1 for disbarment filed by Arcatomy S. Guarin against
Atty. Christine Antenor-Cruz Limpin for allegedly filing a false General
Information Sheet (GIS) with the Securities and Exchange Commission (SEC)
thus violating Canon 12 and Rule 1.013 of the Code of Professional Responsibility
(CPR).
The facts are culled from the pleadings.
In 2004, Guarin was hired by Mr. Celso G. de los Angeles as Chief Operating
Officer and thereafter as President of OneCard Company, Inc., a member of the
Legacy Group of Companies. He resigned from his post effective August 11,
2008 and transferred to St. Luke's Medical Center as the Vice President for
Finance.
On November 27, 2008, Atty. Limpin, the Corporate Secretary of Legacy Card,
Inc. (LCI), another corporation under the Legacy Group, filed with the SEC a
GIS for LCI for "updating purposes". The GIS4 identified Guarin as Chairman of
the Board of Directors (BOD) and President.
Mired with allegations of anomalous business transactions and practices, on
December 18, 2008, LCI applied for voluntary dissolution with the SEC.
On July 22, 2009, Guarin filed this complaint with the Integrated Bar of the
Philippines Commission on Bar Discipline (IBP CBD) claiming that Atty. Limpin
violated Canon 1 and Rule 1.01 of the CPR by knowingly listing him as a
stockholder, Chairman of the Board and President of LCI when she knew that he
had already resigned and had never held any share nor was he elected as
chairperson of the BOD or been President of LCI. He also never received any
notice of meeting or agenda where his appointment as Chairman would be taken
up. He has never accepted any appointment as Chairman and President of LCI.
Atty. Limpin admits that she filed the GIS with the SEC listing Guarin as a
stockholder, the Chairman of the BOD and President of LCI. She argued that the
GIS was provisional to comply with SEC requirements. It would have been
corrected in the future but unfortunately LCI filed for voluntary dissolution
shortly thereafter. She averred that the GIS was made and submitted in good
faith and that her certification served to attest to the information from the last
BOD meeting held on March 3, 2008.5
She asserted that Guarin knew that he was a stockholder. Atty. Limpin said that
on October 13, 2008, she sent Guarin a text message and asked him to meet
with her so hemay sign a Deed of Assignment concerning shareholdings. Guarin
responded in the affirmative and said that he would meet with her on Friday,
October 17, 2008. Guarin, however, neglected to show up at the arranged time
and place for reasons unknown to Atty. Limpin. On the strength of Guarin’s
positive reply, Atty. Limpin filed the GIS on November 27, 2008.
To belie the claim that LCI never held any board meeting, Atty. Limpin
presented Secretary’s Certificates dated May 16, 20066 , May 22, 20067 , and
June 13, 20078 bearing Guarin’s signature.
Moreover, Atty. Limpin stated that there were pending criminal complaints
against the directors and officers of LCI, where she and Guarin are co-
respondents: Senator Roxas, et al. v. Celso de los Angeles, et al.9 and SEC v.
Legacy Card, Inc.10 In those proceedings, Guarin raised as a defense that the
November 27, 2008 GIS was spurious and/or perjured. She averred that this
Court held that "when the criminal prosecution based on the same act charged
is still pending in court, any administrative disciplinary proceedings for the same
act must await the outcome of the criminal case to avoid contradictory
findings."11 During the mandatory preliminary conference, however, both parties
stipulated that the complaint filed by Senator Roxas was dismissed as to
Guarin.12
Lastly, Atty. Limpin contends that Guarin failed to present sufficient evidence to
warrant disbarment.1âwphi1 She stated that merely presenting the GIS does
not constitute as proof of any unethical conduct, harassment and malpractice.
In its Report,13 the IBP CBD found that Atty. Limpin violated Canon 1, Rules
1.01 and 1.0214 of the CPR and thus recommended that she be suspended from
the practice of law for three months. It noted that based on the submissions of
the parties, Guarin was never a stockholder of LCI consequently making him
ineligible tobe a member of the BOD. Neither was there proof that Guarin acted
as the President of LCI but was a mere signatory of LCI’s bank accounts. This
made the verified statement of Atty. Limpin untrue.15
Moreover, it was noted that only Mr. Celso de los Angeles had the authority to
appoint or designate directors or officers of Legacy. Atty. Limpin was aware that
this procedure was not legally permissible. Despite knowing this to be irregular,
she allowed herself to be dictated upon and falsely certified that Guarin was a
stockholder, chairman and president of the company. The Secretary’s
Certificates with Guarin’s signature Atty. Limpin presented were of no moment
since inthese Guarin merely acceded to become a signatory of bank accounts
and these do not show that Guarin was a stockholder.
The IBP Board of Governors in its April 15, 2013 Resolution16 adopted in totothe
CBD Report. Atty. Limpin moved for reconsideration17 but was denied in the
March 21, 2014 Resolution18 of the IBP Board of Governors.
We adopt the report and recommendation of the IBP. Atty. Limpin has violated
Canon 1, Rule 1.01and Rule 1.02 of the CPR.
Members of the bar are reminded that their first duty is to comply with the rules
of procedure, ratherthan seek exceptions as loopholes.19 A lawyer who assists a
client in a dishonest scheme or who connives in violating the law commits an act
which justifies disciplinary action against the lawyer.20
Disbarment proceedings are sui generisand can proceed independently of civil
and criminal cases.1âwphi1 As Justice Malcolm stated "[t]he serious
consequences of disbarment or suspension should follow only where there is a
clear preponderance of evidence against the respondent. The presumption is
that the attorney is innocent of the charges pr[o]ferred and has performed his
duty as an officer of the court in accordance with his oath."21
Grounds for such administrative action against a lawyer may be found in Section
27,22 Rule 138 of the Rules of Court. Among these are (1) the use of any deceit,
malpractice, or other gross misconduct in such office and (2) any violation of
the oath which he is required to take before the admission to practice.
After going through the submissions and stipulations of the parties, we agree
with the IBP that there is no indication that Guarin held any share to the
corporation and that he is therefore ineligible to hold a seat in the BOD and be
the president of the company.23 It is undisputed that Atty. Limpin filed and
certified that Guarin was a stockholder of LCI in the GIS. While she posits that
she had made the same in good faith, her certification also contained a
stipulation that she made a due verification of the statements contained therein.
That Atty. Limpin believed that Guarin would sign a Deed of Assignment is
inconsequential: he never signed the instrument. We also note that there was
no submission which would support the allegation that Guarin was in fact a
stockholder. We thus find that in filing a GIS that contained false information,
Atty. Limpin committed an infraction which did not conform to her oath as a
lawyer in accord with Canon 1 and Rule 1.01 of the CPR.1âwphi1
We also agree with the IBP that in allowing herself to be swayed by the business
practice of having Mr. de los Angeles appoint the members of the BOD and
officers of the corporation despite the rules enunciated in the Corporation Code
with respect to the election of such officers, Atty. Limpin has transgressed Rule
1.02 of the CPR.
However, considering the seriousness of Atty. Limpin's action m submitting a
false document we see it fit to increase the recommended penalty to six months
suspension from the practice of law.
WHEREFORE, we find respondent Atty. Christine A.C. Limpin GUILTY of violation
of Canon 1, Rule 1.01 and Rule 1.02 of the Code of Professional Responsibility.
Accordingly, we SUSPEND respondent Atty. Christine A.C. Limpin from the
practice of law for SIX (6) MONTHS effective upon finality of this Decision, with
a warning that a repetition of the same or similar act in the future will be dealt
with more severely.
Let copies of this Decision be furnished the Office of the Bar Confidant to be
appended to respondent's personal record as an attorney, the Integrated Bar of
the Philippines, the Department of Justice, and all courts in the country for their
information and guidance.
SO ORDERED.
A.C. No. 7973 and A.C. No. 10457 February 3, 2015
MELVYN G. GARCIA, Complainant,
vs.
ATTY. RAUL H. SESBRENO, Respondent.
DECISION
PER CURIAM:
Two complaints for disbarment were filed by Dr. Melvyn G. Garcia (Garcia)
against Atty. Raul H. Sesbrefio (Sesbrefio). The two cases, docketed as A.C. No.
7973 and A.C. No. 10457, were consolidated in the Court's Resolution dated 30
September 2014.
A.C. No. 7973
On 30 July 2008, Garcia filed a complaint for disbarment against Sesbreño
before the Office of the Bar Confidant. The case was docketed as A.C. No. 7973.
Garcia alleged that in 1965, he married Virginia Alcantara in Cebu. They had two
children, Maria Margarita and Angie Ruth. In 1971, he and Virginia separated.
He became a dentist and practiced his profession in Cabanatuan City. Garcia
alleged that in1992, Virginia filed a petition for the annulment of their marriage,
which was eventually granted.
Garcia alleged that in 2005 while he was in Japan, Sesbreño, representing Maria
Margarita and Angie Ruth, filed an action for support against him and his sister
Milagros Garcia Soliman. At the time of the filing of the case, Maria Margarita
was already 39 years old while Angie Ruth was 35 years old. The case was
dismissed. In 2007, Garcia returned from Japan. When Sesbreño and Garcia’s
children learned abouthis return, Sesbreño filed a Second Amended Complaint
against him. Garcia alleged that he learned that Sesbreño was convicted by the
Regional Trial Court of Cebu City, Branch 18, for Homicide in Criminal Case No.
CBU-31733. Garcia alleged that Sesbreño is only on parole. Garcia alleged that
homicide is a crime against moral turpitude; and thus, Sesbreño should not be
allowed to continue his practice of law.
In his Comment, Sesbreño alleged that on 15 August 2008, Garcia filed a similar
complaint against him before the Integrated Bar of the Philippines, Commission
on Bar Discipline (IBP-CBD), docketed as CBC Case No. 08-2273. Sesbreño
alleged that Garcia’s complaint was motivated by resentment and desire for
revenge because he acted as pro bono counsel for Maria Margarita and Angie
Ruth.
In the Court’s Resolution dated 18 January 2010, the Court referred A.C. No.
7973 to the IBP for investigation, report and recommendation.
A.C. No. 10457 (CBC Case No. 08-2273)
A day prior to the filing of A.C. No. 7973, or on 29 July 2008, Garcia filed a
complaint for disbarment against Sesbreño before the IBP-CBD. He alleged that
Sesbreño is practicing law despite his previous conviction for homicide in
Criminal Case No. CBU-31733, and despite the facts that he is only on parole
and that he has not fully served his sentence. Garcia alleged that Sesbreño
violated Section 27, Rule 138 of the Rules of Court by continuing to engage in
the practice of law despite his conviction of a crime involving moral turpitude.
Upon the directive of the IBP-CBD, Garcia submitted his verified complaint
against Sesbreño alleging basically the same facts he alleged in A.C. No. 7973.
In his answer to the complaint, Sesbreño alleged that his sentence was
commuted and the phrase "with the inherent accessory penalties provided by
law" was deleted. Sesbreño argued that even if the accessory penalty was not
deleted, the disqualification applies only during the term of the sentence.
Sesbreño further alleged that homicide does not involve moral turpitude.
Sesbreño claimed that Garcia’s complaint was motivated by extreme malice, bad
faith, and desire to retaliate against him for representing Garcia’s daughters in
court.
The IBP-CBD consolidated A.C. No. 7973 with CBD Case No. 08-2273. The
parties agreed on the sole issue to be resolved: whether moral turpitude is
involved in a conviction for homicide. The IBP-CBD ruled that the Regional Trial
Court of Cebu found Sesbreño guilty of murder and sentenced him to suffer the
penalty of reclusion perpetua. On appeal, this Court downgraded the crime to
homicide and sentenced Sesbreño to suffer the penalty of imprisonment for 9
years and 1 day of prision mayor as minimum to 16 years and 4 months of
reclusion temporalas maximum. The IBP-CBD found that Sesbreño was released
from confinement on 27 July 2001 following his acceptance of the conditions of
his parole on 10 July 2001.
The IBP-CBD ruled that conviction for a crime involving moral turpitude is a
ground for disbarment or suspension. Citing International Rice Research
Institute v. National Labor Relations Commission,1 the IBPCBD further ruled that
homicide may or may not involve moral turpitude depending on the degree of
the crime. The IBP-CBD reviewed the decision of this Court convicting Sesbreño
for the crime of homicide, and found that the circumstances leading to the death
of the victim involved moral turpitude. The IBP-CBD stated:
Neither victim Luciano Amparadon or his companion Christopher Yapchangco
was shown to be a foe of respondent and neither had the victim Luciano nor his
companion Christopher shown to have wronged the respondent. They simply
happened to be at the wrong place and time the early morning of June 3, 1993.
The circumstances leading to the death of Luciano solely caused by respondent,
bear the earmarks of moral turpitude. Paraphrasing what the Supreme Court
observed in Soriano v. Dizon, supra, the respondent, by his conduct, displayed
extreme arrogance and feeling of self-importance. Respondent acted like a god
who deserved not to be slighted by a couple of drunks who may have shattered
the stillness of the early morning with their boisterous antics, natural display of
loud bravado of drunken men who had one too many. Respondent’s inordinate
over reaction to the ramblings of drunken men who were not even directed at
respondent reflected poorly on his fitness to be a member of the legal
profession. Respondent was not only vindictive without a cause; he was cruel
with a misplaced sense of superiority.2
Following the ruling of this Court in Soriano v. Atty. Dizon3 where the
respondent was disbarred for having been convicted of frustrated homicide, the
IBP-CBD recommended that Sesbreño be disbarred and his name stricken from
the Roll of Attorneys.
In its Resolution No. XX-2013-19 dated 12 February 2013, the IBP Board of
Governors adopted and approved the Report and Recommendation of the IBP-
CBD.
On 6 May 2013, Sesbreño filed a motion for reconsideration before the IBP-CBD.
Sesbreño alleged that the IBP-CBD misunderstood and misapplied Soriano v.
Atty. Dizon. He alleged that the attendant circumstances in Sorianoare
disparate, distinct, and different from his case. He further alleged that there was
no condition set on the grant of executive clemency to him; and thus, he was
restored to his full civil and political rights. Finally, Sesbreño alleged that after
his wife died in an ambush, he already stopped appearing as private prosecutor
in the case for bigamy against Garcia and that he already advised his clients to
settle their other cases. He alleged that Garcia already withdrew the complaints
against him.
On 11 February 2014, the IBP Board of Governors passed Resolution No. XX-
2014-31 denying Sesbreño’s motion for reconsideration. The IBPCBD
transmitted the records of the case to the Office of the Bar Confidant on 20 May
2014. CBD Case No. 08-2273 was redocketed as A.C. No. 10457. In the Court’s
Resolution dated 30 September 2014, the Court consolidated A.C. No. 7973 and
A.C. No. 10457.
The only issue in these cases is whether conviction for the crime of homicide
involves moral turpitude.
We adopt the findings and recommendation of the IBP-CBD and approve
Resolution No. XX-2013-19 dated 12 February 2013 and Resolution No. XX-
2014-31 dated 11 February 2014 of the IBP Board of Governors.
Section 27, Rule 138 of the Rules of Court states that a member of the bar may
be disbarred or suspended as attorney by this Court by reason of his conviction
of a crime involving moral turpitude. This Court has ruled that disbarment is the
appropriate penalty for conviction by final judgment for a crime involving moral
turpitude.4 Moral turpitude is an act of baseness, vileness, or depravity in the
private duties which a man owes to his fellow men or to society in general,
contraryto justice, honesty, modesty, or good morals.5
The question of whether conviction for homicide involves moral turpitude was
discussed by this Court in International Rice Research Institute v. NLRC6 where
it ruled:
This is not to say that all convictions of the crime of homicide do not involve
moral turpitude.1âwphi1 Homicide may or may not involve moral turpitude
depending on the degree of the crime. Moral turpitude is not involved in every
criminal act and is not shown by every known and intentional violation of
statute, but whether any particular conviction involves moral turpitude may be a
question of fact and frequently depends on all the surrounding circumstances.
While x x x generally but not always, crimes mala in seinvolve moral turpitude,
while crimes mala prohibitado not, it cannot always be ascertained whether
moral turpitude does or does not exist by classifying a crime as malum in se or
as malum prohibitum, since there are crimes which are mala in se and yet rarely
involve moral turpitude and there are crimes which involve moral turpitude and
are mala prohibita only. It follows therefore, that moral turpitude is somewhat a
vague and indefinite term, the meaning of which must be left to the process of
judicial inclusion or exclusion as the cases are reached.7
In People v. Sesbreño,8 the Court found Sesbreño guilty of homicide and ruled:
WHEREFORE, the assailed decision of the Regional Trial Court of Cebu City,
Branch 18, in Criminal Case No. CBU-31733 is hereby MODIFIED. Appellant Raul
H. Sesbreñois hereby found GUILTY of HOMICIDE and hereby sentenced to
suffer a prison term of 9 years and 1 day of prision mayor, as a minimum, to 16
years and 4 months of reclusion temporal, as a maximum, with accessory
penalties provided by law, to indemnify the heirs of the deceased Luciano
Amparado in the amount of ₱50,000.00 and to pay the costs.
SO ORDERED.9
We reviewed the Decision of this Court and we agree with the IBPCBD that the
circumstances show the presence of moral turpitude.
The Decision showed that the victim Luciano Amparado (Amparado) and his
companion Christopher Yapchangco (Yapchangco) were walking and just passed
by Sesbreño’s house when the latter, without any provocation from the former,
went out of his house, aimed his rifle, and started firing at them. According to
Yapchangco, theywere about five meters, more or less, from the gate of
Sesbreño when they heard the screeching sound of the gate and when they
turned around, they saw Sesbreño aiming his rifle at them. Yapchangco and
Amparado ran away but Amparado was hit. An eyewitness, Rizaldy Rabanes
(Rabanes), recalled that he heard shots and opened the window of his house.
He saw Yapchangco and Amparado running away while Sesbreño was firing his
firearm rapidly, hitting Rabanes’ house in the process. Another witness, Edwin
Parune, saw Amparado fall down after being shot, then saw Sesbreño in the
middle of the street, carrying a long firearm, and walking back towards the gate
of his house. The IBP-CBD correctly stated that Amparado and Yapchangco were
just at the wrong place and time. They did not do anything that justified the
indiscriminate firing done by Sesbreño that eventually led to the death of
Amparado.
We cannot accept Sesbreño’s argument that the executive clemency restored
his full civil and political rights. Sesbreño cited In re Atty. Parcasio 10 to bolster
his argument. In thatcase, Atty. Parcasio was granted "an absolute and
unconditional pardon"11 which restored his "full civil and political rights,"12 a
circumstance not present inthese cases. Here, the Order of Commutation13 did
not state that the pardon was absolute and unconditional. The accessory
penalties were not mentioned when the original sentence was recited in the
Order of Commutation and they were also not mentioned in stating the
commuted sentence. It only states: By virtue of the authority conferred upon
me by the Constitution and upon the recommendation of the Board of Pardons
and Parole, the original sentence of prisoner RAUL SESBREÑO Y HERDA
convicted by the Regional Trial Court, Cebu City and Supreme Court and
sentenced to an indeterminate prison term of from 9 years and 1 day to 16
years and 4 months imprisonment and to pay an indemnity of ₱50,000.00 is/are
hereby commuted to an indeterminate prison term of from 7 years and 6
months to 10 years imprisonment and to pay an indemnity of ₱50,000.00.14
Again, there was no mention that the executive clemency was absolute and
unconditional and restored Sesbreño to his full civil and political rights.
There are four acts of executive clemency that the President can extend: the
President can grant reprieves, commutations, pardons, and remit fines and
forfeitures, after conviction by final judgment.15 In this case, the executive
clemency merely "commuted to an indeterminate prison term of 7 years and 6
months to 10 years imprisonment" the penalty imposed on Sesbrefio.
Commutation is a mere reduction of penalty.16 Commutation only partially
extinguished criminal liability.17 The penalty for Sesbrefio' s crime was never
wiped out. He served the commuted or reduced penalty, for which reason he
was released from prison. More importantly, the Final Release and
Discharge18 stated that "[i]t is understood that such x x x accessory penalties of
the law as have not been expressly remitted herein shall subsist." Hence, the
Parcasio case has no application here. Even if Sesbrefio has been granted
pardon, there is nothing in the records that shows that it was a full and
unconditional pardon. In addition, the practice of law is not a right but a
privilege.19 It is granted only to those possessing good moral character.20 A
violation of the high moral standards of the legal profession justifies the
imposition of the appropriate penalty against a lawyer, including the penalty of
disbarment.21
WHEREFORE, respondent Raul H. Sesbrefio is DISBARRED effective immediately
upon his receipt of this Decision.
Let copies of this Decision be furnished the Office of the Bar Confidant, the
Integrated Bar of the Philippines for distribution to all its chapters, and the
Office of the Court Administrator for dissemination to all courts all over the
country. Let a copy of this Decision be attached to the personal records of
respondent.
SO ORDERED.
A.C. NO. 10050 December 3, 2013
VICTORIA C. HEENAN, Complainant,
vs.
ATTY. ERLINA ESPEJO, Respondent.
DECISION
VELASCO, JR., J.:
This resolves the administrative complaint filed by Victoria Heenan (Victoria)
against Atty. Erlina Espejo (Atty. Espejo) before the Commission on Bar
Discipline (CBD) of the Integrated Bar of the Philippines (IBP) for violation of
lawyer’s oath, docketed as CBD Case No. 10-2631.
The Facts
Sometime in January 2009, Victoria met Atty. Espejo through her godmother,
Corazon Eusebio (Corazon). Following the introduction, Corazon told Victoria
that Atty. Espejo was her lawyer in need of money and wanted to borrow two
hundred fifty thousand pesos (PhP 250,000) from her (Victoria). Shortly
thereafter, Victoria went to the house of Corazon for a meeting with Atty. Espejo
where they discussed the terms of the loan. Since Atty. Espejo was introduced
to her as her godmother’s lawyer, Victoria found no reason to distrust the
former. Hence, during the same meeting, Victoria agreed to accomodate Atty.
Espejo and there and then handed to the latter the amount of PhP 250,000. To
secure the payment of the loan, Atty. Espejo simultaneously issued and turned
over to Victoria a check1dated February 2, 2009 for two hundred seventy-five
thousand pesos (PhP 275,000) covering the loan amount and agreed interest.
On due date, Atty. Espejo requested Victoria to delay the deposit of the check
for the reason that she was still waiting for the release of the proceeds of a bank
loan to fund the check. However, after a couple of months of waiting, Victoria
received no word from Atty. Espejo as to whether or not the check was already
funded enough. In July 2009, Victoria received an Espejo-issued check dated
July 10, 2009 in the amount of fifty thousand pesos (PhP 50,000)2 representing
the interest which accrued due to the late payment of the principal obligation.
Victoria deposited the said check but, to her dismay, the check bounced due to
insufficiency of funds. Atty. Espejo failed to pay despite Victoria’s repeated
demands. Worried that she would not be able to recover the amount thus lent,
Victoria decided to deposit to her account the first check in the amount of PhP
275,000, but without notifying Atty. Espejo of the fact. However, the said check
was also dishonored due to insufficiency of funds. Victoria thereafter became
more aggressive in her efforts to recover her money. She, for instance,
personally handed to Atty. Espejo a demand letter dated August 3, 2009.3
When Atty. Espejo still refused to pay, Victoria filed a criminal complaint against
Atty. Espejo on August 18, 2009 for violation of Batas Pambansa Blg. 22 and
Estafa under Article 315 of the Revised Penal Code, as amended, before the
Quezon City Prosecutor’s Office.4
Atty. Espejo disregarded the notices and subpoenas issued by the Quezon City
Prosecutor’s Office which she personally received and continued to ignore
Victoria’s demands. She attended only one (1) scheduled preliminary
investigation where she promised to pay her loan obligation.5
In November 2009, Atty. Espejo issued another check dated December 8, 2009
in the amount of two hundred seventy five thousand pesos (PhP 275,000.).
However, to Victoria’s chagrin, the said check was again dishonored due to
insufficiency of funds.6 Atty. Espejo did not file any counter-affidavit or pleading
to answer the charges against her. On November 17, 2009, the case was
submitted for resolution without Atty. Espejo’s participation.7Victoria thereafter
filed the instant administrative case against Atty. Espejo before the CBD. On
March 1, 2010, the CBD, through Director for Bar Discipline Alicia A. Risos-Vidal,
issued an Order8 directing Atty. Espejo to submit her Answer to Victoria’s
administrative complaint failing which would render her in default. The warning,
notwithstanding, Atty. Espejo did not submit any Answer. On May 5, 2010, IBP
Commissioner Rebecca Villanueva-Malala (Commissioner Villanueva-Malala)
notified the parties to appear for a mandatory conference set on June 2, 2010.
The notice stated that non-appearance of either of the parties shall be deemed a
waiver of her right to participate in further proceedings.9
At the mandatory conference, only Victoria appeared.10
Thus, Commissioner Villanueva-Malala issued an Order11 noting Atty. Espejo’s
failure to appear during the mandatory conference and her failure to file an
Answer. Accordingly, Atty. Espejo was declared in default. Victoria, on the other
hand, was directed to file her verified position paper, which she filed on June 11,
2010.12
Findings and Recommendation of the IBP
In its Report and Recommendation13 dated July 15, 2010, the CBD
recommended the suspension of Atty. Espejo from the practice of law and as a
member of the Bar for a period of five (5) years.
The CBD reasoned:
The failure of a lawyer to answer the complaint for disbarment despite due
notice and to appear on the scheduled hearings set, shows his flouting
resistance to lawful orders of the court and illustrates his deficiency for his oath
of office as a lawyer, which deserves disciplinary sanction.
Moreover, respondent[’s] acts of issuing checks with insufficient funds and
despite repeated demands [she] failed to comply with her obligation and her
disregard and failure to appear for preliminary investigation and to submit her
counter-affidavit to answer the charges against her for Estafa and Violation of
BP 22, constitute grave misconduct that also warrant disciplinary action against
respondent.
On December 14, 2012, the Board of Governors passed a Resolution14 adopting
the Report and Recommendation of the CBD with the modification lowering Atty.
Espejo’s suspension from five (5) years to two (2) years. Atty. Espejo was also
ordered to return to Victoria the amount of PhP 250,000 within thirty (30) days
from receipt of notice with legal interest reckoned from the time the demand
was made. The Resolution reads:
RESOLVED to ADOPT and APPROVE, as it is hereby unanimously ADOPTED and
APPROVED, with modification, the Report and Recommendation of the
Investigating Commissioner in the above-entitled case, herein made part of this
Resolution as Annex "A", and finding the recommendation fully supported by the
evidence on record and applicable laws and rules, and considering respondent’s
grave misconduct, Atty. Erlinda Espejo is hereby SUSPENDED from the practice
of law for two (2) years and Ordered to Return to complainant the amount of
Two Hundred Fifty Thousand (₱250,000.00) Pesos within thirty (30) days from
receipt of notice with legal interest reckoned from the time the demand was
made.
On August 8, 2013, the CBD transmitted to this Court the Notice of the
Resolution pertaining to Resolution No. XX-2012-419 along with the records of
this case.15
The Court’s Ruling
We sustain the findings of the IBP and adopt its recommendation in
part.1âwphi1 Atty. Espejo did not deny obtaining a loan from Victoria or
traverse allegations that she issued unfunded checks to pay her obligation. It
has already been settled that the deliberate failure to pay just debts and the
issuance of worthless checks constitute gross misconduct, for which a lawyer
may be sanctioned.16
Verily, lawyers must at all times faithfully perform their duties to society, to the
bar, to the courts and to their clients. In Tomlin II v. Moya II, We explained that
the prompt payment of financial obligations is one of the duties of a lawyer,
thus:
In the present case, respondent admitted his monetary obligations to the
complaint but offered no justifiable reason for his continued refusal to pay.
Complainant made several demands, both verbal and written, but respondent
just ignored them and even made himself scarce. Although he acknowledged his
financial obligations to complainant, respondent never offered nor made
arrangements to pay his debt. On the contrary, he refused to recognize any
wrong doing nor shown remorse for issuing worthless checks, an act
constituting gross misconduct. Respondent must be reminded that it is his duty
as a lawyer to faithfully perform at all times his duties to society, to the bar, to
the courts and to his clients. As part of his duties, he must promptly pay his
financial obligations.17
The fact that Atty. Espejo obtained the loan and issued the worthless checks in
her private capacity and not as an attorney of Victoria is of no moment. As We
have held in several cases, a lawyer may be disciplined not only for malpractice
and dishonesty in his profession but also for gross misconduct outside of his
professional capacity. While the Court may not ordinarily discipline a lawyer for
misconduct committed in his non- professional or private capacity, the Court
may be justified in suspending or removing him as an attorney where his
misconduct outside of the lawyer’s professional dealings is so gross in character
as to show him morally unfit and unworthy of the privilege which his licenses
and the law confer.18
In Wilkie v. Limos, We reiterated that the issuance of a series of worthless
checks, which is exactly what Atty. Espejo committed in this case, manifests a
lawyer’s low regard for her commitment to her oath, for which she may be
disciplined. Thus:
We have held that the issuance of checks which were later dishonored for
having been drawn against a closed account indicates a lawyer’s unfitness for
the trust and confidence reposed on her. It shows a lack of personal honesty
and good moral character as to render her unworthy of public confidence. The
issuance of a series of worthless checks also shows the remorseless attitude of
respondent, unmindful to the deleterious effects of such act to the public
interest and public order. It also manifests a lawyer’s low regard to her
commitment to the oath she has taken when she joined her peers, seriously and
irreparably tarnishing the image of the profession she should hold in high
esteem.
xxxx
In Barrios v. Martinez, we disbarred the respondent who issued worthless
checks for which he was convicted in the criminal case filed against him. In Lao
v. Medel, we held that the deliberate failure to pay just debts and the issuance
of worthless checks constitute gross misconduct, for which a lawyer may be
sanctioned with one-year suspension from the practice of law. The same
sanction was imposed on the respondent-lawyer in Rangwani v. Dino having
been found guilty of gross misconduct for issuing bad checks in payment of a
piece of property the title of which was only entrusted to him by the
complainant.19
Further, the misconduct of Atty. Espejo is aggravated by her unjustified refusal
to obey the orders of the IBP directing her to file an answer to the complaint of
Victoria and to appear at the scheduled mandatory conference. This constitutes
blatant disrespect for the IBP which amounts to conduct unbecoming a lawyer.
In Almendarez, Jr. v. Langit, We held that a lawyer must maintain respect not
only for the courts, but also for judicial officers and other duly constituted
authorities, including the IBP:
The misconduct of respondent is aggravated by his unjustified refusal to heed
the orders of the IBP requiring him to file an answer to the complaint-affidavit
and, afterwards, to appear at the mandatory conference. Although respondent
did not appear at the conference, the IBP gave him another chance to defend
himself through a position paper. Still, respondent ignored this directive,
exhibiting a blatant disrespect for authority. Indeed, he is justly charged with
conduct unbecoming a lawyer, for a lawyer is expected to uphold the law and
promote respect for legal processes. Further, a lawyer must observe and
maintain respect not only to the courts, but also to judicial officers and other
duly constituted authorities, including the IBP. Under Rule 139-B of the Rules of
Court, the Court has empowered the IBP to conduct proceedings for the
disbarment, suspension, or discipline of attorneys.20
Undoubtedly, Atty. Espejo’s issuance of worthless checks and her blatant refusal
to heed the directives of the Quezon City Prosecutor’s Office and the IBP
contravene Canon 1, Rule 1.01; Canon 7, Rule 7.03; and Canon 11 of the Code
of Professional Responsibility, which provide:
CANON 1 – A LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS OF
THE LAND AND PROMOTE RESPECT FOR THE LAW AND LEGAL PROCESSES. Rule
1.01. – A lawyer shall not engage in unlawful, dishonest, immoral or deceitful
conduct. 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. Rule 7.03 – A lawyer shall not engage in conduct that
adversely reflects on his fitness to practice law, nor shall he, whether in public
or private life, behave in a scandalous manner to the discredit of the legal
profession. CANON 11 – A LAWYER SHALL OBSERVE AND MAINTAIN THE
RESPECT DUE TO THE COURTS AND TO JUDICIAL OFFICES AND SHOULD
INSIST ON SIMILAR CONDUCT BY OTHERS.
We find the penalty of suspension from the practice of law for two (2) years, as
recommended by the IBP, commensurate under the circumstances. We,
however, cannot sustain the IBP’s recommendation ordering Atty. Espejo to
return the money she borrowed from Victoria. In disciplinary proceedings
against lawyers, the only issue is whether the officer of the court is still fit to be
allowed to continue as a member of the Bar. Our only concern is the
determination of respondent’s administrative liability. Our findings have no
material bearing on other judicial action which the parties may to choose me
against each other. Furthermore, disciplinary proceedings against lawyers do
not involve a trial of an action, but rather investigations by the Court into the
conduct of one of its officers. The only question for determination in these
proceedings is whether or not the attorney is still fit to be allowed to continue as
a member of the Bar. Thus, this Court cannot rule on the issue of the amount of
money that should be returned to the complainant.22
WHEREFORE, We find Atty. Erlinda B. Espejo GUILTY of gross misconduct and
violating Canons 1, 7 and 11 of the Code of Professional Responsibility.
We SUSPEND respondent from the practice of law for two (2) years affective
immediately.
Let copies of this Decision be furnished the Office of the Court Administrator for
dissemination to all courts, the Integrated Bar of the Philippines and the Office
of the Bar Confidant and recorded in the personal files of respondent.
SO ORDERED.
A.C. No. 6760 January 30, 2013
ANASTACIO N. TEODORO III, Complainant,
vs.
ATTY. ROMEO S. GONZALES, Respondent.
DECISION
BRION, J.:
We resolve this disbarment complaint against Atty. Romeo S. Gonzales for
violation of the Code of Professional Responsibility for the forum shopping he
allegedly committed.
In his complaint,1 Anastacio N. Teodoro Ill related that Atty. Gonzales acted as
counsel of Araceli Teodoro-Marcial in two civil cases that the latter filed against
him. The first ccise, Special Proceeding No. 99-95587,2 involved the settlement
of the intestate estate of Manuela Teodoro. While the settlement proceeding was
pending, Atty. Gonzales assisted
Teodord-Marcial in filing Civil Case No. 00-99207,3 for Annulment of Document,
Reconveyance and Damages, without indicating the special proceeding earlier
tiled. The tiling of the civil cases, according to Anastacio, was a deliberate act of
forum shopping that warrants the disbarment of Atty. Gonzales.
Atty. Gonzales admitted that he assisted Teodoro-Marcial in tiling the two cases.
He asserted, however,, that he did not violate the forum shopping rule as the
cases were not identical in terms of parties, subject matter and remedies. Atty.
Gonzales also opined that the complainant only filed the disbarment case to
harass him.4
The Investigating Commissioner’s Findings
In our Resolution5 dated March 13, 2006, we referred the disbarment complaint
to the Commission on Bar Discipline of the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation. In his Report and
Recommendation6 dated July 5, 2010, Commissioner Caesar R. Dulay found
Atty. Gonzales administratively liable for forum shopping.
According to Commissioner Dulay, both Special Proceeding No. 99-95587 and
Civil Case No. 00-99207 hinged on the same substantial issue, i.e., on whether
Manuela held the Malate property in trust for Carmen Teodoro-Reyes, Donato T.
Teodoro, Jorge I. Teodoro and Teodoro-Marcial.
In Special Proceeding No. 99-95587, Carmen, Donato, Jorge I. Teodoro, Jorge
T. Teodoro and Teodoro-Marcial claimed that they are the heirs of Manuela.
During her lifetime, Manuela was the registered owner of a parcel of land
located in Malate, Manila. According to the heirs, Manuela held the lot in trust
for them, but she sold it to Anastacio and Rogelio Ng. Thus, the heirs prayed for
the issuance of letters of administration so that Manuela’s properties could be
inventoried and settled in accordance with law.
In Civil Case No. 00-99207, the heirs of Manuela claimed to be the beneficiaries
of a trust held by Manuela over the same parcel of land contested in Special
Proceeding No. 99-95587. They alleged that during her lifetime, Manuela sold a
portion of this land to Anastacio. They asked the trial court to annul the Deed of
Absolute Sale executed by Manuela; to cancel the resulting Transfer Certificate
of Title in the name of Anastacio; and to issue a new one in their names.
The commissioner found that a ruling in either case would result in res judicata
over the other. Thus, Atty. Gonzales committed forum shopping when he
instituted Civil Case No. 00-99207 without indicating that Special Proceeding
No. 99-95587 was still pending. In committing forum shopping, Atty. Gonzales
disregarded the Supreme Court Circular prohibiting forum shopping and thus
violated Canon 1 of the Code of Professional Responsibility.
Commissioner Dulay recommended that Atty. Gonzales be suspended for one
month from the practice of law, with a warning that a repetition of a similar
offense would merit a more severe penalty.
The Board of Governors of the IBP reversed the commissioner’s
recommendation. In a resolution7 dated December 10, 2011, the Board of
Governors dismissed the case against Atty. Gonzales for lack of merit.
The Issue
The case directly poses to us the question of whether Atty. Gonzales committed
forum shopping and thereby violated the Code of Professional Responsibility.
The Court’s Ruling
We agree with the findings of the commissioner and accordingly reverse the
resolution of the IBP Board of Governors, but we modify the commissioner’s
recommended penalty to censure and a warning that another violation would
merit a more severe penalty.
Forum shopping exists when, as a result of an adverse decision in one forum, or
in anticipation thereof, a party seeks a favorable opinion in another forum
through means other than appeal or certiorari.8
There is forum shopping when the elements of litis pendencia are present or
where a final judgment in one case will amount to res judicata in another. They
are as follows: (a) identity of parties, or at least such parties that represent the
same interests in both actions, (b) identity of rights or causes of action, and (c)
identity of relief sought.9
Under this test, we find that Atty. Gonzales committed forum shopping when he
filed Civil Case No. 00-99207 while Special Proceeding No. 99-95587 was
pending.
Identity of Parties
An identity of parties exists in Special Proceeding No. 99-95587 and Civil Case
No. 00-99207. In both cases, the initiating parties are the same, to wit:
Carmen, Donato, Teodoro-Marcial, Jorge I. Teodoro, Rowena Teodoro, Abigail
Teodoro and Jorge T. Teodoro. They represented the same interest in both
cases. All claimed to be the legitimate heirs of Manuela and co-owners of the
land that she held in trust for them.
Meanwhile, Anastacio, the oppositor in Special Proceeding No. 99-95587, is also
the sole defendant in Civil Case No. 00-99207. In both cases, he espoused the
same interest, as transferee-owner of the lot allegedly held in trust by Manuela.
Identity of causes of action
The test of identity of causes of action does not depend on the form of an action
taken, but on whether the same evidence would support and establish the
former and the present causes of action.10 The heirs of Manuela cannot avoid
the application of res judicata by simply varying the form of their action or by
adopting a different method of presenting it.11
In Special Proceeding No. 99-95587, the trial court held that it had no
jurisdiction over the case, as Manuela left no properties at the time of her
death. The lot in Malate, Manila, which was the sole property that the heirs of
Manuela claim should be included in her estate, has been sold to Rogelio and
Anastacio when Manuela was still alive. The trial court did not give credence to
their claim that Manuela held the property in trust for them.
Meanwhile, in Civil Case No. 00-99207, the trial court issued an order granting
Anastacio’s Motion for Demurrer to Evidence. It held that the heirs of Manuela
had been unable to prove their claim that Manuela held the lot in trust for their
benefit. Neither were they able to prove that the sale of a portion of the lot to
Anastacio was void.
In both cases, the issue of whether Manuela held the lot in Malate, Manila in
trust had to be decided by the trial court. The initiating parties’ claim in the two
cases depended on the existence of the trust Manuela allegedly held in their
favor. Thus, the evidence necessary to prove their claim was the same.
Identity of relief sought
In Special Proceeding No. 99-95587, the heirs of Manuela prayed for the
issuance of letters of administration, the liquidation of Manuela’s estate, and its
distribution among her legal heirs.
Meanwhile, in Civil Case No. 00-99207, the heirs of Manuela asked for the
annulment of the deed of absolute sale Manuela executed in favor of Anastacio.
They likewise asked the court to cancel the resulting Transfer Certificate of Title
issued in favor of the latter, and to issue a new one in their names.
While the reliefs prayed for in the initiatory pleadings of the two cases are
different in form, a ruling in one case would have resolved the other, and vice
versa. To illustrate, had the lot been declared as part of the estate of Manuela in
Special Proceeding No. 99-95587, there would have been no need for a decision
annulling the sale in Civil Case No. 00-99207. Conversely, had the sale in Civil
Case No. 00-99207 been annulled, then the property would go back to the
hands of the heirs of Manuela. Placing the property under administration, as
prayed for in Special Proceeding No. 99-95587, would have been unnecessary.
Thus, the relief prayed for, the facts upon which it is based, and the parties are
substantially similar in the two cases. Since the elements of litis pendentia and
res judicata are present, Atty. Gonzales committed forum shopping when he
filed Civil Case No. 00-99207 without indicating that Special Proceeding No. 99-
95587 was still pending.
As Commissioner Dulay observed:
Respondent was fully aware, since he was the counsel for both cases, that he
raised the issue of trust with respect to the Malate property in the 1999 Letters
of Administration case and that he was raising the same similar issue of trust in
the 2000 annulment case xxx
To advise his client therefore to execute the affidavit of non-forum shopping for
the second case (annulment case) and state that there is no pending case
involving the same or similar issue would constitute misconduct which should be
subject to disciplinary action. It was his duty to advise his client properly, and
his failure to do so, in fact his deliberate assertion that there was no falsity in
the affidavit is indicative of a predisposition to take lightly his duty as a lawyer
to promote respect and obedience to the law.12
"Lawyers should be reminded that their primary duty is to assist the courts in
the administration of justice. Any conduct that tends to delay, impede or
obstruct the administration of justice contravenes this obligation."13
The Court has repeatedly warned lawyers against resorting to forum shopping
since the practice clogs the Court dockets and can lead to conflicting
rulings.14 Willful and deliberate forum shopping has been made punishable
either as direct or indirect contempt of court in SC
Administrative Circular No. 04-94 dated April 1, 1994.15
In engaging in forum shopping, Atty. Gonzales violated Canon 1 of the Code of
Professional Responsibility which directs lawyers to obey the laws of the land
and promote respect for the law and legal processes. He also disregarded his
duty to assist in the speedy and efficient administration of justice,16 and the
prohibition against unduly delaying a case by misusing court processes.17
To our mind, however, the supreme penalty of disbarment would be very harsh
in light of all the circumstances of this case. Neither is the commissioner’s
recommended penalty of suspension consistent with prior rulings of the Court.
In Guanzon, Vda. de, etc. v. Judge Yrad, Jr., etc., et al.18 we severely censured
Renecio Espiritu, the counsel who filed a petition in the Court of Appeals thirty-
three days after a similar petition had been filed with the Supreme Court. We
also found him guilty of direct contempt.
The present case finds favorable comparison with Guanzon. Like Espiritu, Atty.
Gonzales misused court processes in contravention of the express rule against
forum shopping. We held then that Espiritu should be penalized and we imposed
the penalty of censure —the penalty usually imposed for an isolated act of
misconduct of a lesser nature.19
Lawyers are also censured for minor infractions against the lawyer’s duty to the
Court or the client.20 As earlier stated, Atty. Gonzales’ act of forum shopping
disregarded his duty to obey and promote respect for the law and legal
processes, as well as the prohibition against unduly delaying a case by misusing
court processes.21 It also violated his duty as an officer of the court to assist in
the speedy and efficient administration of justice.22
WHEREFORE, we find the basis for the complaint meritorious and accordingly
CENSURE Atty. Romeo S. Gonzales for resorting to forum shopping. He is
WARNED that any future violation of his duties as a lawyer will be dealt with
more severely. A copy of this reprimand should be attached to Atty. Romeo S.
Gonzales’ personal file in the Office of the Bar Confidant.
SO ORDERED. The Factual Antecedents

Complainant Florencio A. Saladaga and respondent Atty. Arturo B. Astorga

entered into a "Deed of Sale with Right to Repurchase" on December 2, 1981
where respondent sold (with rightof repurchase) to complainant a parcel of
coconut land located at Barangay Bunga, Baybay, Leyte covered by Transfer
Certificate of Title (TCT) No. T-662 for ₱15,000.00. Under the said deed,
respondent represented that he has "the perfect right to dispose as owner in fee
simple" the subject property and that the said property is "free from all liens
and encumbrances."3 The deed also provided that respondent, as vendor a
retro, had two years within which to repurchase the property, and if not
repurchased within the said period, "the parties shall renew [the]
instrument/agreement."4

Respondent failed to exercise his right of repurchase within the period provided
in the deed, and no renewal of the contract was made even after complainant
sent respondent a final demand dated May 10, 1984 for the latter to repurchase
the property. Complainant remained in peaceful possession of the property until
December 1989 when he received letters from the Rural Bank of Albuera
(Leyte), Inc. (RBAI) informing him that the property was mortgaged by
A.C. No. 4697 November 25, 2014 respondent to RBAI, that the bank had subsequently foreclosed on the property,
and that complainant should therefore vacate the property.5
FLORENCIO A. SALADAGA, Complainant,
vs. Complainant was alarmed and made aninvestigation. He learned the following:
ATTY. ARTURO B. ASTORGA, Respondent.
(1) TCT No. T-662 was already cancelled by TCT No. T-3211 in the
x-----------------------x name of Philippine National Bank (PNB) as early as November 17, 1972
after foreclosure proceedings;
A.C. No. 4728
(2) TCT No. T-3211 was cancelled by TCT No. T-7235 in the names of
FLORENCIO A. SALADAGA, Complainant, respondent and his wife on January 4, 1982 pursuant to a deed of sale
vs. dated March 27,1979 between PNB and respondent;
ATTY. ARTURO B. ASTORGA, Respondent.
(3) Respondent mortgaged the subject property to RBAI on March 14,
DECISION 1984, RBAI foreclosed on the property, and subsequently obtained TCT
No. TP-10635 on March 27, 1991.6 Complainant was subsequently
dispossessed of the property by RBAI.7
LEONARDO-DE CASTRO, J.:

Aggrieved, complainant instituted a criminal complaint for estafa against

Membership in the legal profession is a high personal privilege burdened with
respondent with the Office of the Provincial Prosecutor of Leyte, docketed as I.S.
conditions,1 including continuing fidelity to the law and constant possession of
No. 95-144. The Provincial Prosecutor of Leyte approved the Resolution8dated
moral fitness. Lawyers, as guardians of the law, play a vital role in the
April 21, 1995 in I.S. No. 95-144 finding that "[t]he facts of [the] case are
preservation of society, and a consequent obligation of lawyers is to maintain
sufficient to engender a well-founded belief that Estafa x x x has been
the highest standards of ethical conduct.2 Failure to live by the standards of the
committed and that respondent herein is probably guilty thereof."9 Accordingly,
legal profession and to discharge the burden of the privilege conferred on one as
an Information10 dated January 8,1996 was filed before the Municipal Trial Court
a member of the bar warrant the suspension or revocation of that privilege.
(MTC) of Baybay, Leyte, formally charging respondent with the crime of estafa
under Article 316, paragraphs 1 and 2 of the Revised Penal Code,11committed as
follows:
On March 14, 1984, accused representing himself as the owner of a parcel of
land known as Lot No. 7661 of the Baybay Cadastre, mortgaged the same to the
Rural Bank of Albuera, Albuera, Leyte, within the jurisdiction of this Honorable
Court, knowing fully well that the possessor and owner at that time was private
complainant Florencio Saladaga by virtue of a Pacto de Retro Sale which
accused executed in favor of private complainant on 2nd December, 1981,
without first redeeming/repurchasing the same. [P]rivate complainant knowing
of accused[’s] unlawful act only on or about the last week of February, 1991
when the rural bank dispossessed him of the property, the mortgage having
been foreclosed, private complainant thereby suffered damages and was
prejudiced by accused[’s] unlawful transaction and misrepresentation.
The aforementioned estafa case against respondent was docketed as Criminal
Case No. 3112-A.
Complainant likewise instituted the instant administrative cases against
respondent by filing before this Court an Affidavit-Complaint12 dated January 28,
1997 and Supplemental Complaint13 dated February 27, 1997, which were
docketed as A.C. No. 4697 and A.C. No. 4728, respectively. In both complaints,
complainant sought the disbarment of respondent.
The administrative cases were referred to the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation.14
In his Consolidated Answer15 dated August 16, 2003 filed before the IBP,
respondent denied that his agreement with complainant was a pacto de
retrosale. He claimed that it was an equitable mortgage and that, if only
complainant rendered an accounting of his benefits from the produce of the
land, the total amount would have exceeded ₱15,000.00.
Report and Recommendation of the Investigating Commissioner and Resolution
of the IBP Board of Governors
In a Report and Recommendation16 dated April 29, 2005, the Investigating
Commissioner of the IBP’s Commission on Bar Discipline found that respondent
was in bad faith when he dealt with complainant and executed the "Deed of Sale
with Right to Repurchase" but later on claimed that the agreement was one of
equitable mortgage. Respondent was also guilty of deceit or fraud when he
represented in the "Deed of Sale with Right to Repurchase" dated December 2,
1981 that the property was covered by TCT No. T-662, even giving complainant
the owner’s copy of the said certificate of title, when the said TCT had already
been cancelled on November 17, 1972 by TCT No. T-3211 in the name of
Philippine National Bank (PNB). Respondent made matters even worse, when he
had TCT No. T-3211 cancelled with the issuance of TCT No. T-7235 under his
and his wife’s name on January 4,1982 without informing complainant. This was
compounded by respondent’s subsequent mortgage of the property to RBAI,
which led to the acquisition of the property by RBAI and the dispossession
thereof of complainant. Thus, the Investigating Commissioner recommended
that respondent be (1) suspended from the practice of law for one year, with
warning that a similar misdeed in the future shall be dealt with more severity,
and (2) ordered to return the sum of ₱15,000.00, the amount he received as
consideration for the pacto de retrosale, with interest at the legal rate.
Considering respondent’s "commission of unlawful acts, especially crimes
involving moral turpitude, actsof dishonesty, grossly immoral conduct and
deceit," the IBP Board of Governors adopted and approved the Investigating
Commissioner’s Report and Recommendation with modification as follows:
respondent is(1) suspended from the practice of law for two years, with warning
that a similar misdeed in the future shall be dealt with more severity, and (2)
ordered to return the sum of ₱15,000.00 received in consideration of the pacto
de retrosale, with legal interest.17
The Court’s Ruling
The Court agrees with the recommendation of the IBP Board of Governors to
suspend respondent from the practice of law for two years, but it refrains from
ordering respondent to return the ₱15,000.00 consideration, plus interest.
Respondent does not deny executing the "Deed of Sale with Right to
Repurchase" dated December 2, 1981 in favor of complainant. However,
respondent insists that the deed is not one of sale with pacto de retro, but one
of equitable mortgage. Thus, respondent argues that he still had the legal right
to mortgage the subject property to other persons. Respondent additionally
asserts that complainant should render an accounting of the produce the latter
had collected from the said property, which would already exceed the
₱15,000.00 consideration stated in the deed.
There is no merit in respondent’s defense.
Regardless of whether the written contract between respondent and
complainant is actually one of sale with pacto de retroor of equitable mortgage,
respondent’s actuations in his transaction with complainant, as well as in the
present administrative cases, clearly show a disregard for the highest standards
of legal proficiency, morality, honesty, integrity, and fair dealing required from
lawyers, for which respondent should be held administratively liable.
When respondent was admitted to the legal profession, he took an oath where
he undertook to "obey the laws," "do no falsehood," and "conduct [him]self as a
lawyer according to the best of [his] knowledge and discretion."18 He gravely
violated his oath.
The Investigating Commissioner correctly found, and the IBP Board of
Governors rightly agreed, that respondent caused the ambiguity or vagueness in
the "Deed of Sale with Right to Repurchase" as he was the one who prepared or
drafted the said instrument. Respondent could have simply denominated the
instrument as a deed of mortgage and referred to himself and complainant as
"mortgagor" and "mortgagee," respectively, rather than as "vendor a retro" and
"vendee a retro." If only respondent had been more circumspect and careful in
the drafting and preparation of the deed, then the controversy between him and
complainant could havebeen avoided or, at the very least, easily resolved. His
imprecise and misleading wording of the said deed on its face betrayed lack
oflegal competence on his part. He thereby fell short of his oath to "conduct
[him]self as a lawyer according to the best of [his] knowledge and discretion."
More significantly, respondent transgressed the laws and the fundamental tenet
of human relations asembodied in Article 19 of the Civil Code:
Art. 19. Every person must, in the exercise of his rights and in the performance
of his duties, act with justice, give everyone his due, and observe honesty and
good faith.
Respondent, as owner of the property, had the right to mortgage it to
complainant but, as a lawyer, he should have seen to it that his agreement with
complainant is embodied in an instrument that clearly expresses the intent of
the contracting parties. A lawyer who drafts a contract must see to it that the
agreement faithfully and clearly reflects the intention of the contracting parties.
Otherwise, the respective rights and obligations of the contracting parties will be
uncertain, which opens the door to legal disputes between the said parties.
Indeed, the uncertainty caused by respondent’s poor formulation of the "Deed
of Sale with Right to Repurchase" was a significant factor in the legal
controversy between respondent and complainant. Such poor formulation
reflects at the very least negatively on the legal competence of respondent.
Under Section 63 of the Land Registration Act,19 the law in effect at the time the
PNB acquired the subject property and obtained TCT No. T-3211 in its name in
1972, where a decree in favor of a purchaser who acquires mortgaged property
in foreclosure proceedings becomes final, such purchaser becomes entitled to
the issuance of a new certificate of title in his name and a memorandum thereof
shall be "indorsed upon the mortgagor’s original certificate."20 TCT No. T-662,
which respondent gave complainant when they entered into the "Deed of Sale
with Right to Repurchase" dated December 2, 1981, does not bearsuch
memorandum but only a memorandum on the mortgage of the property to PNB
in 1963 and the subsequent amendment of the mortgage.
Respondent dealt with complainant with bad faith, falsehood, and deceit when
he entered into the "Deed of Sale with Right to Repurchase" dated December 2,
1981 with the latter. He made it appear that the property was covered by TCT
No. T-662 under his name, even giving complainant the owner’s copy of the said
certificate oftitle, when the truth is that the said TCT had already been cancelled
some nine years earlier by TCT No. T-3211 in the name of PNB. He did not
evencare to correct the wrong statement in the deed when he was subsequently
issued a new copy of TCT No. T-7235 on January 4, 1982,21 or barely a month
after the execution of the said deed. All told, respondent clearly committed an
act of gross dishonesty and deceit against complainant.
Canon 1 and Rule 1.01 of the Codeof Professional Responsibility provide:
CANON 1 – A lawyer shall uphold the constitution, obey the laws of the land and
promote respect for law and legal processes.
Rule 1.01 – A lawyer shall not engage in unlawful, dishonest, immoral or
deceitful conduct. Under Canon 1, a lawyer is not only mandated to personally
obey the laws and the legal processes, he is moreover expected to inspire
respect and obedience thereto. On the other hand, Rule 1.01 states the norm of
conduct that is expected of all lawyers.22
Any act or omission that is contrary to, prohibited or unauthorized by, in
defiance of, disobedient to, or disregards the law is "unlawful." "Unlawful"
conduct does not necessarily imply the element of criminality although the
concept is broad enough to include such element.23
To be "dishonest" means the disposition to lie, cheat, deceive, defraud or
betray; be untrustworthy; lacking inintegrity, honesty, probity, integrity in
principle, fairness and straightforwardness. On the other hand, conduct that is
"deceitful" means as follows:
[Having] the proclivity for fraudulent and deceptive misrepresentation, artifice
or device that is used upon another who is ignorant of the true facts, to the
prejudice and damage of the party imposed upon. In order to be deceitful, the
person must either have knowledge of the falsity or acted in reckless and
conscious ignorance thereof, especially if the parties are not on equal terms,
and was done with the intent that the aggrieved party act thereon, and the
latter indeed acted in reliance of the false statement or deed in the manner
contemplated to his injury.24 The actions of respondent in connection with the
execution of the "Deed of Sale with Right to Repurchase" clearly fall within the
concept of unlawful, dishonest, and deceitful conduct. They violate Article 19 of
the Civil Code. They show a disregard for Section 63 of the Land Registration
Act. They also reflect bad faith, dishonesty, and deceit on respondent’s part.
Thus, respondent deserves to be sanctioned.
Respondent’s breach of his oath, violation of the laws, lack of good faith, and
dishonesty are compounded by his gross disregard of this Court’s directives, as
well as the orders of the IBP’s Investigating Commissioner (who was acting as
an agent of this Court pursuant to the Court’s referral of these cases to the IBP
for investigation, report and recommendation), which caused delay in the
resolution of these administrative cases.
In particular, the Court required respondent to comment on complainant’s
Affidavit-Complaint in A.C. No. 4697 and Supplemental Complaint in A.C. No.
4728 on March 12, 1997 and June 25, 1997, respectively.25 While he requested
for several extensions of time within which to submit his comment, no such
comment was submitted prompting the Court to require him in a Resolution
dated February 4,1998 to (1) show cause why he should not be disciplinarily
dealt with or held in contempt for such failure, and (2) submit the consolidated
comment.26 Respondent neither showed cause why he should not be
disciplinarily dealt with or held in contempt for such failure, nor submitted the
consolidated comment.
When these cases were referred to the IBP and during the proceedings before
the IBP’s Investigating Commissioner, respondent was again required several
times to submit his consolidated answer. He only complied on August 28, 2003,
or more than six years after this Court originally required him to do so. The
Investigating Commissioner also directed the parties to submit their respective
position papers. Despite having been given several opportunities to submit the
same, respondent did not file any position paper.27
Respondent’s disregard of the directives of this Court and of the Investigating
Commissioner, which caused undue delay in these administrative cases,
contravenes the following provisions of the Code of Professional Responsibility:
CANON 11 – A lawyer shall observe and maintain the respect due to the courts
and to judicial officers and should insist on similar conduct by others.
xxxx
CANON 12 – A lawyer shall exert every effort and consider it his duty to assist in
the speedy and efficient administration of justice.
xxxx
Rule 12.03 – A lawyer shall not, after obtaining extensions of time to file
pleadings, memoranda or briefs, let the period lapse without submitting the
same or offering an explanation for his failure to do so.
Rule 12.04 – A lawyer shall not unduly delay a case, impede the execution of a
judgment or misuse court processes.
Respondent’s infractions are aggravated by the fact that he has already been
imposed a disciplinary sanction before.1âwphi1 In Nuñez v. Atty.
Astorga,28 respondent was held liable for conduct unbecoming an attorney for
which he was fined ₱2,000.00.
Given the foregoing, the suspension of respondent from the practice of law for
two years, as recommended by the IBP Board of Governors, is proper.
The Court, however, will not adopt the recommendation of the IBP to order
respondent to return the sum of ₱15,000.00 he received from complainant
under the "Deed of Sale with Right to Repurchase." This is a civil liability best
determined and awarded in a civil case rather than the present administrative
cases.
In Roa v. Moreno,29 the Court pronounced that "[i]n disciplinary proceedings
against lawyers, the only issue is whether the officer of the court is still fit to be
allowed to continue as a member of the Bar. Our only concern is the
determination of respondent’s administrative liability. Our findings have no
material bearing on other judicial action which the parties may choose to file
against each other."While the respondent lawyer’s wrongful actuations may give
rise at the same time to criminal, civil, and administrative liabilities, each must
be determined in the appropriate case; and every case must be resolved in
accordance with the facts and the law applicable and the quantum of proof
required in each. Section 5,30 in relation to Sections 131 and 2,32 Rule 133 of the
Rules of Court states that in administrative cases, such as the ones atbar, only
substantial evidence is required, not proof beyond reasonable doubt as in
criminal cases, or preponderance of evidence asin civil cases. Substantial
evidence is that amount of relevant evidence which a reasonable mind might
accept as adequate to justify a conclusion.33
The Court notes that based on the same factual antecedents as the present
administrative cases, complainant instituted a criminal case for estafa against
respondent, docketed as Criminal Case No. 3112-A, before the MTC. When a
criminal action is instituted, the civil action for the recovery of civil liability
arising from the offense charged shall be deemed instituted with the criminal
action unless the offended party waives the civil action, reserves the right to
institute it separately or institutes the civil action prior to the criminal
action.34 Unless the complainant waived the civil action, reserved the right to
institute it separately, or instituted the civil action prior to the criminal action,
then his civil action for the recovery of civil liability arising from the estafa
committed by respondent is deemed instituted with Criminal Case No. 3112-A.
The civil liability that complainant may recover in Criminal Case No. 3112-A
includes restitution; reparation of the damage caused him; and/or
indemnification for consequential damages,35which may already cover the
₱15,000.00 consideration complainant had paid for the subject property.
WHEREFORE, respondent is hereby found GUILTY of the following: breach of the
Lawyer’s Oath; unlawful, dishonest, and deceitful conduct; and disrespect for
the Court and causing undue delay of these cases, for which he is SUSPENDED
from the practice of law for a period of two (2) years, reckoned from receipt of
this Decision, with WARNING that a similar misconduct in the future shall be
dealt with more severely.
Let a copy of this Decision be furnished the Office of the Bar Confidant and the
Integrated Bar of the Philippines for their information and guidance. The Court
Administrator is directed to circulate this Decision to all courts in the country.
SO ORDERED.
A.C. No. 10579 December 10, 2014
ERLINDA FOSTER, Complainant,
vs.
ATTY. JAIME V. AGTANG, Respondent.
DECISION
PER CURIAM:
This refers to the Resolution1 of the Board of Governors (BOG) – Integrated Bar
of the Philippines (IBP), dated March 23, 2014, affirming with modification the
findings of the Investigating Commissioner, who recommended the suspension
of respondent Atty. Jaime V. Agtang (respondent) from the practice of law for
one (1) year for ethical impropriety and ordered the payment of his unpaid
obligations to complainant.
From the records, it appears that the IBP, thru its Commission on Bar Discipline
(CBD),received a complaint2, dated May 31, 2011, filed by Erlinda Foster
(complainant) against respondent for “unlawful, dishonest, immoral and
deceitful”3 acts as a lawyer.
In its July 1, 2011 Order,4 the IBP-CBD directed respondent to file his Answer
within 15 days from receipt of the order. Respondent failed to do so and
complainant sent a query as to the status of her complaint. On October 10,
2011, the Investigating Commissioner issued the Order 5 setting the case for
mandatory conference/hearing on November 16, 2011. It was only on
November 11, 2011, or five (5) days before the scheduled conference when
respondent filed his verified Answer.6
During the conference, only the complainant together with her husband
appeared. She submitted a set of documents contained in a folder, copies of
which were furnished the respondent. The Investigating
Commissioner7 indicated that the said documents would be reviewed and the
parties would be informed if there was a need for clarificatory questioning;
otherwise, the case would be submitted for resolution based on the documents
on file. The Minutes8 of the mandatory conference showed that respondent
arrived at 11:10 o’clock in the morning or after the proceeding was terminated.
On December 12, 2011, the complainant filed her Reply to respondent’s Answer.
On April 18, 2012, complainant submitted copies of the January 24, 2012
Decisions9 of the Municipal Trial Court in Small Claims Case Nos. 2011-0077 and
2011-0079, ordering respondent [defendant therein] to pay complainant and
her husband the sum of P100,000.00 and P22,000.00, respectively, with
interest at the rate of 12% per annum from December 8, 2011 until fully paid,
plus cost of suit.10
Complainant’s Position
From the records, it appears that complainant was referred to respondent in
connection with her legal problem regarding a deed of absolute sale she entered
into with Tierra Realty, which respondent had notarized. After their discussion,
complainant agreed to engage his legal services for the filing of the appropriate
case in court, for which they signed a contract. Complainant paid
respondent P20,000.00 as acceptance fee and P5,000.00 for incidental
expenses.11
On September 28, 2009, respondent wrote a letter 12 to Tropical Villas
Subdivision in relation to the legal problem referred by complainant. He then
visited the latter in her home and asked for a loan of P100,000.00, payable in
sixty (60) days, for the repair of his car. Complainant, having trust and
confidence on respondent being her lawyer, agreed to lend the amount without
interest. A promissory note13 evidenced the loan.
In November 2009, complainant became aware that Tierra Realty was
attempting to transfer to its name a lot she had previously purchased. She
referred the matter to respondent who recommended the immediate filing of a
case for reformation of contract with damages. On November 8, 2009,
respondent requested and thereafter received from complainant the amount
of P150,000.00, as filing fee.14 When asked about the exorbitant amount,
respondent cited the high value of the land and the sheriffs’ travel expenses and
accommodations in Manila, for the service of the summons to the defendant
corporation. Later, complainant confirmed that the fees paid for the filing of Civil
Case No. 14791-65, entitled Erlinda Foster v. Tierra Realty and Development
Corporation, only amounted to P22,410.00 per trial court records.15
During a conversation with the Registrar of Deeds, complainant also discovered
that respondent was the one who notarized the document being questioned in
the civil case she filed. When asked about this, respondent merely replied that
he would take a collaborating counsel to handle complainant’s case. Upon
reading a copy of the complaint filed by respondent with the trial court,
complainant noticed that: 1] the major differences in the documents issued by
Tierra Realty were not alleged; 2] the contract to buy and sell and the deed of
conditional sale were not attached thereto; 3] the complaint discussed the
method of payment which was not the point of contention in the case; and 4]
the very anomalies she complained of were not mentioned. Respondent,
however, assured her that those matters could be brought up during the
hearings.
On April 23, 2010, respondent wrote to complainant, requesting that the latter
extend to him the amount of P70,000.00 or P50,000.00 “in the moment of
urgency or emergency.”16 Complainant obliged the request and gave respondent
the sum of P22,000.00.
On August 31, 2010, respondent came to complainant’s house and demanded
the sum of P50,000.00, purportedly to be given to the judge in exchange for a
favorable ruling. Complainant expressed her misgivings on this proposition but
she eventually gave the amount of P25,000.00 which was covered by a
receipt,17 stating that “it is understood that the balance of P25,000.00 shall be
paid later after favorable judgment for plaintiff Erlinda Foster.” On November 2,
2010, respondent insisted that the remaining amount be given by complainant
prior to the next hearing of the case, because the judge was allegedly asking for
the balance. Yet again, complainant handed to respondent the amount
of P25,000.00.18
On September 29, 2010, complainant’s case was dismissed. Not having been
notified by respondent, complainant learned of the dismissal on December 14,
2010, when she personally checked the status of the case with the court. She
went to the office of respondent, but he was not there. Instead, one of the office
staff gave her a copy of the order of dismissal.
On December 15, 2010, respondent visited complainant and gave her a copy of
the motion for reconsideration. On January 15, 2011, complainant went to see
respondent and requested him to prepare a reply to the comment filed by Tierra
Realty on the motion for reconsideration; to include additional facts because the
Land Registration Authority would not accept the documents unless these were
amended; and to make the additional averment that the defendant was using
false documents.
On January 18, 2011, respondent’s driver delivered to complainant a copy of the
reply with a message from him that the matters she requested to be included
were mentioned therein. Upon reading the same, however, complainant
discovered that these matters were not so included. On the same occasion, the
driver also asked for P2,500.00 on respondent’s directive for the reimbursement
of the value of a bottle of wine given to the judge as a present. Complainant
was also told that oral arguments on the case had been set the following
month.19
On February 2, 2011, complainant decided to terminate the services of
respondent as her counsel and wrote him a letter of termination, 20 after her
friend gave her copies of documents showing that respondent had been
acquainted with Tierra Realty since December 2007. Subsequently, complainant
wrote to respondent, requesting him to pay her the amounts he received from
her less the contract fee and the actual cost of the filing fees. Respondent never
replied.
Respondent’s Position
In his Answer,21 respondent alleged that he was 72 years old and had been
engaged in the practice of law since March 1972, and was President of the IBP
Ilocos Norte Chapter from 1998 to 1999. He admitted the fact that he notarized
the Deed of Absolute Sale subject of complainant’s case, but he qualified that he
was not paid his notarial fees therefor. He likewise admitted acting as counsel
for complainant for which he claimed to have received P10,000.00 as
acceptance fee and P5,000.00 for incidental fees. Anent the loan
of P100,000.00, respondent averred that it was complainant, at the behest of
her husband, who willingly offered the amount to him for his patience in visiting
them at home and for his services. The transaction was declared as “no loan”
and he was told not to worry about its payment. As regards the amount
of P150,000.00 he received for filing fees, respondent claimed that the said
amount was suggested by the complainant herself who was persistent in
covering the incidental expenses in the handling of the case. He denied having
said that the sheriffs of the court would need the money for their hotel
accommodations. Complainant’s husband approved of the amount. In the same
vein, respondent denied having asked for a loan of P50,000.00 and having
received P22,000.00 from complainant. He also denied having told her that the
case would be discussed with the judge who would rule in their favor at the very
next hearing. Instead, it was complainant who was bothered by the possibility
that the other party would befriend the judge. He never said that he would
personally present a bottle of wine to the judge.
Further, respondent belied the Registrar’s comment as to his representation of
Tierra Realty in the past. Respondent saw nothing wrong in this situation since
complainant was fully aware that another counsel was assisting him in the
handling of cases. Having been fully informed of the nature of her cause of
action and the consequences of the suit, complainant was aware of the
applicable law on reformation of contracts. Finally, by way of counterclaim,
respondent demanded just compensation for the services he had rendered in
other cases for the complainant.
Reply of Complainant
In her Reply,22 complainant mainly countered respondent’s defenses by making
reference to the receipts in her possession, all evidencing that respondent
accepted the amounts mentioned in the complaint. Complainant also
emphasized that respondent and Tierra Realty had relations long before she met
him. While respondent was employed as Provincial Legal Officer of the Provincial
Government of Ilocos Norte, he was involved in the preparation of several
documents involving Flying V, an oil company owned by Ernest Villavicencio,
who likewise owned Tierra Realty. Complainant insisted that the amount
of P100,000.00 she extended to respondent was never considered as “no loan.”
On June 26, 2012, complainant furnished the Investigating Commissioner copies
of the Resolution, dated June 20, 2012, issued by the Office of the City
Prosecutor of Laoag City, finding probable cause against respondent for estafa.23
Findings and Recommendation of the IBP
In its July 3, 2012 Report and Recommendation,24 the Investigating
Commissioner found respondent guilty of ethical impropriety and recommended
his suspension from the practice of law for one (1) year.
In its September 28, 2013 Resolution, the IBP-BOG adopted and approved with
modification the recommendation of suspension by the Investigating
Commissioner and ordered respondent to return to complainant: 1) his loan
of P122,000.00; and 2) the balance of the filing fee amounting to P127,590.00.
Respondent received a copy of the said resolution on January 16, 2014 to which
he filed a motion for reconsideration.25 Complainant filed her opposition thereto,
informing the IBP-BOG that an information charging respondent for estafa had
already been filed in court and that a corresponding order for his arrest had
been issued.26
In its March 23, 2014 Resolution, the IBP-BOG denied respondent’s motion for
reconsideration but modified the penalty of his suspension from the practice of
law by reducing it from one (1) year to three (3) months. Respondent was
likewise ordered to return the balance of the filing fee received from
complainant amounting to P127,590.00.
No petition for review was filed with the Court.
The only issue in this case is whether respondent violated the Code of
Professional Responsibility (CPR).
The Court’s Ruling
The Court sustains the findings and recommendation of the Investigating
Commissioner with respect to respondent’s violation of Rules 1 and 16 of the
CPR. The Court, however, modifies the conclusion on his alleged violation of
Rule 15, on representing conflicting interests. The Court also differs on the
penalty.
Rule 1.0, Canon 1 of the CPR, provides that “[a] lawyer shall not engage in
unlawful, dishonest, immoral or deceitful conduct.” It is well established that a
lawyer’s conduct is “not confined to the performance of his professional duties.
A lawyer may be disciplined for misconduct committed either in his professional
or private capacity. The test is whether his conduct shows him to be wanting in
moral character, honesty, probity, and good demeanor, or whether it renders
him unworthy to continue as an officer of the court.”27
In this case, respondent is guilty of engaging in dishonest and deceitful conduct,
both in his professional and private capacity. As a lawyer, he clearly misled
complainant into believing that the filing fees for her case were worth more than
the prescribed amount in the rules, due to feigned reasons such as the high
value of the land involved and the extra expenses to be incurred by court
employees. In other words, he resorted to overpricing, an act customarily
related to depravity and dishonesty. He demanded the amount of P150,000.00
as filing fee, when in truth, the same amounted only to P22,410.00. His defense
that it was complainant who suggested that amount deserves no iota of
credence. For one, it is highly improbable that complainant, who was then
plagued with the rigors of litigation, would propose such amount that would
further burden her financial resources. Assuming that the complainant was more
than willing to shell out an exorbitant amount just to initiate her complaint with
the trial court, still, respondent should not have accepted the excessive amount.
As a lawyer, he is not only expected to be knowledgeable in the matter of filing
fees, but he is likewise duty-bound to disclose to his client the actual amount
due, consistent with the values of honesty and good faith expected of all
members of the legal profession.
Moreover, the “fiduciary nature of the relationship between the counsel and his
client imposes on the lawyer the duty to account for the money or property
collected or received for or from his client.”28 Money entrusted to a lawyer for a
specific purpose but not used for the purpose should be immediately returned. A
lawyer’s failure to return upon demand the funds held by him on behalf of his
client gives rise to the presumption that he has appropriated the same for his
own use in violation of the trust reposed in him by his client. Such act is a gross
violation of general morality as well as of professional ethics. It impairs public
confidence in the legal profession and deserves punishment.29
It is clear that respondent failed to fulfill this duty. As pointed out, he received
various amounts from complainant but he could not account for all of them.
Worse, he could not deny the authenticity of the receipts presented by
complainant. Upon demand, he failed to return the excess money from the
alleged filing fees and other expenses. His possession gives rise to the
presumption that he has misappropriated it for his own use to the prejudice of,
and in violation of the trust reposed in him by, the client. 30 When a lawyer
receives money from the client for a particular purpose, the lawyer is bound to
render an accounting to the client showing that the money was spent for the
intended purpose. Consequently, if the lawyer does not use the money for the
intended purpose, the lawyer must immediately return the money to the
client.31 Somewhat showing a propensity to demand excessive and unwarranted
amounts from his client, respondent displayed a reprehensible conduct when he
asked for the amount of P50,000.00 as “representation expenses” allegedly for
the benefit of the judge handling the case, in exchange for a favorable decision.
Respondent himself signed a receipt showing that he initially took the amount of
P 25,000.00 and, worse, he subsequently demanded and received the other half
of the amount at the time the case had already been dismissed. Undoubtedly,
this act is tantamount to gross misconduct that necessarily warrants the
supreme penalty of disbarment. The act of demanding a sum of money from his
client, purportedly to be used as a bribe to ensure a positive outcome of a case,
is not only an abuse of his client’s trust but an overt act of undermining the
trust and faith of the public in the legal profession and the entire Judiciary. This
is the height of indecency. As officers of the court, lawyers owe their utmost
fidelity to public service and the administration of justice. In no way should a
lawyer indulge in any act that would damage the image of judges, lest the
public’s perception of the dispensation of justice be overshadowed by iniquitous
doubts. The denial of respondent and his claim that the amount was given
gratuitously would not excuse him from any liability. The absence of proof that
the said amount was indeed used as a bribe is of no moment. To tolerate
respondent’s actuations would seriously erode the public’s trust in the courts.
As it turned out, complainant’s case was dismissed as early as September 29,
2010. At this juncture, respondent proved himself to be negligent in his duty as
he failed to inform his client of the status of the case, and left the client to
personally inquire with the court. Surely, respondent was not only guilty of
misconduct but was also remiss in his duty to his client.
Respondent’s unbecoming conduct towards complainant did not stop here.
Records reveal that he likewise violated Rule 16.04, Canon 16 of the CPR, which
states that “[a] lawyer shall not borrow money from his client unless the client’s
interests are fully protected by the nature of the case or by independent advice.
Neither shall a lawyer lend money to a client except, when in the interest of
justice, he has to advance necessary expenses in a legal matter he is handling
for the client.” In his private capacity, he requested from his client, not just one,
but two loans of considerable amounts. The first time, he visited his client in her
home and borrowed P100,000.00 for the repair of his car; and the next time, he
implored her to extend to him a loan of P70,000.00 or P50,000.00 “in the
moment of urgency or emergency” but was only given P22,000.00 by
complainant. These transactions were evidenced by promissory notes and
receipts, the authenticity of which was never questioned by respondent. These
acts were committed by respondent in his private capacity, seemingly unrelated
to his relationship with complainant, but were indubitably acquiesced to by
complainant because of the trust and confidence reposed in him as a lawyer.
Nowhere in the records, particularly in the defenses raised by respondent, was it
implied that these loans fell within the exceptions provided by the rules. The
loans of P100,000.00 and P22,000.00 were surely not protected by the nature
of the case or by independent advice. Respondent’s assertion that the amounts
were given to him out of the liberality of complainant and were, thus,
considered as “no loan,” does not justify his inappropriate behavior. The acts of
requesting and receiving money as loans from his client and thereafter failing to
pay the same are indicative of his lack of integrity and sense of fair dealing. Up
to the present, respondent has not yet paid his obligations to complainant.
Time and again, the Court has consistently held that deliberate failure to pay
just debts constitutes gross misconduct, for which a lawyer may be sanctioned
with suspension from the practice of law. Lawyers are instruments for the
administration of justice and vanguards of our legal system. They are expected
to maintain not only legal proficiency, but also a high standard of morality,
honesty, integrity and fair dealing so that the people’s faith and confidence in
the judicial system is ensured. They must, at all times, faithfully perform their
duties to society, to the bar, the courts and their clients, which include prompt
payment of financial obligations.32
Verily, when the Code or the Rules speaks of “conduct” or “misconduct,” the
reference is not confined to one’s behavior exhibited in connection with the
performance of the lawyer’s professional duties, but also covers any misconduct
which, albeit unrelated to the actual practice of his profession, would show him
to be unfit for the office and unworthy of the privileges which his license and the
law vest him with. Unfortunately, respondent must be found guilty of
misconduct on both scores.
With respect to respondent’s alleged representation of conflicting interests, the
Court finds it proper to modify the findings of the Investigating Commissioner
who concluded that complainant presented insufficient evidence of respondent’s
“lawyering” for the opposing party, Tierra Realty.
Rule 15.03, Canon 15 of the CPR, provides that “[a] lawyer shall not represent
conflicting interest except by written consent of all concerned given after a full
disclosure of the facts.” The relationship between a lawyer and his/her client
should ideally be imbued with the highest level of trust and confidence. This is
the standard of confidentiality that must prevail to promote a full disclosure of
the client’s most confidential information to his/her lawyer for an unhampered
exchange of information between them. Needless to state, a client can only
entrust confidential information to his/her lawyer based on an expectation from
the lawyer of utmost secrecy and discretion; the lawyer, for his part, is duty-
bound to observe candor, fairness and loyalty in all dealings and transactions
with the client. Part of the lawyer’s duty in this regard is to avoid representing
conflicting interests.”33 Thus, even if lucrative fees offered by prospective clients
are at stake, a lawyer must decline professional employment if the same would
trigger the violation of the prohibition against conflict of interest. The only
exception provided in the rules is a written consent from all the parties after full
disclosure.
The Court deviates from the findings of the IBP. There is substantial evidence to
hold respondent liable for representing conflicting interests in handling the case
of complainant against Tierra Realty, a corporation to which he had rendered
services in the past. The Court cannot ignore the fact that respondent admitted
to having notarized the deed of sale, which was the very document being
questioned in complainant’s case. While the Investigating Commissioner found
that the complaint in Civil Case No. 14791-65 did not question the validity of the
said contract, and that only the intentions of the parties as to some provisions
thereof were challenged, the Court still finds that the purpose for which the
proscription was made exists. The Court cannot brush aside the dissatisfied
observations of the complainant as to the allegations lacking in the complaint
against Tierra Realty and the clear admission of respondent that he was the one
who notarized the assailed document. Regardless of whether it was the validity
of the entire document or the intention of the parties as to some of its
provisions raised, respondent fell short of prudence in action when he accepted
complainant’s case, knowing fully that he was involved in the execution of the
very transaction under question. Neither his unpaid notarial fees nor the
participation of a collaborating counsel would excuse him from such indiscretion.
It is apparent that respondent was retained by clients who had close dealings
with each other. More significantly, there is no record of any written consent
from any of the parties involved.
The representation of conflicting interests is prohibited “not only because the
relation of attorney and client is one of trust and confidence of the highest
degree, but also because of the principles of public policy and good taste. An
attorney has the duty to deserve the fullest confidence of his client and
represent him with undivided loyalty. Once this confidence is abused or violated
the entire profession suffers.”34
Penalties and Pecuniary Liabilities
A member of the Bar may be penalized, even disbarred or suspended from his
office as an attorney, for violation of the lawyer’s oath and/or for breach of the
ethics of the legal profession as embodied in the CPR.35 For the practice of law is
“a profession, a form of public trust, the performance of which is entrusted to
those who are qualified and who possess good moral character.”36 The
appropriate penalty for an errant lawyer depends on the exercise of sound
judicial discretion based on the surrounding facts.37
Under Section 27, Rule 138 of the Revised Rules of Court, a member of the Bar
may be disbarred or suspended on any of the following grounds: (1) deceit; (2)
malpractice or other gross misconduct in office; (3) grossly immoral conduct;
(4) conviction of a crime involving moral turpitude; (5) violation of the lawyer’s
oath; (6) willful disobedience of any lawful order of a superior court; and (7)
willful appearance as an attorney for a party without authority. A lawyer may be
disbarred or suspended for misconduct, whether in his professional or private
capacity, which shows him to be wanting in moral character, honesty, probity
and good demeanor, or unworthy to continue as an officer of the court.
Here, respondent demonstrated not just a negligent disregard of his duties as a
lawyer but a wanton betrayal of the trust of his client and, in general, the
public. Accordingly, the Court finds that the suspension for three (3) months
recommended by the IBP-BOG is not sufficient punishment for the unacceptable
acts and omissions of respondent. The acts of the respondent constitute
malpractice and gross misconduct in his office as attorney. His incompetence
and appalling indifference to his duty to his client, the courts and society render
him unfit to continue discharging the trust reposed in him as a member of the
Bar.
For taking advantage of the unfortunate situation of the complainant, for
engaging in dishonest and deceitful conduct, for maligning the judge and the
Judiciary, for undermining the trust and faith of the public in the legal profession
and the entire judiciary, and for representing conflicting interests, respondent
deserves no less than the penalty of disbarment.38
Notably, the Court cannot order respondent to return the money he borrowed
from complainant in his private capacity. In Tria-Samonte v. Obias,39 the Court
held that it cannot order the lawyer to return money to complainant if he or she
acted in a private capacity because its findings in administrative cases have no
bearing on liabilities which have no intrinsic link to the lawyer’s professional
engagement. In disciplinary proceedings against lawyers, the only issue is
whether the officer of the court is still fit to be allowed to continue as a member
of the Bar. The only concern of the Court is the determination of respondent’s
administrative liability. Its findings have no material bearing on other judicial
actions which the parties may choose against each other.
To rule otherwise would in effect deprive respondent of his right to appeal since
administrative cases are filed directly with the Court. Furthermore, the quantum
of evidence required in civil cases is different from the quantum of evidence
required in administrative cases. In civil cases, preponderance of evidence is
required. Preponderance of evidence is “a phrase which, in the last analysis,
means probability of the truth. It is evidence which is more convincing to the
court as worthier of belief than that which is offered in opposition thereto.”40 In
administrative cases, only substantial evidence is needed. Substantial evidence,
which is more than a mere scintilla but is such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion, would
suffice to hold one administratively liable.41 Furthermore, the Court has to
consider the prescriptive period applicable to civil cases in contrast to
administrative cases which are, as a rule, imprescriptible.42
Thus, the IBP-BOG was correct in ordering respondent to return the amount
of P127,590.00 representing the balance of the filing fees he received from
complainant, as this was intimately related to the lawyer client relationship
between them. Similar to this is the amount of P50,000.00 which respondent
received from complainant, as representation expenses for the handling of the
civil case and for the purported purchase of a bottle of wine for the judge. These
were connected to his professional relationship with the complainant. While
respondent’s deplorable act of requesting the said amount for the benefit of the
judge is stained with mendacity, respondent should be ordered to return the
same as it was borne out of their professional relationship. As to his other
obligations, respondent was already adjudged as liable for the personal loans he
contracted with complainant, per the small claims cases filed against him.
All told, in the exercise of its disciplinary powers, “the Court merely calls upon a
member of the Bar to account for his actuations as an officer of the Court with
the end in view of preserving the purity of the legal profession.”43 The Court
likewise aims to ensure the proper and honest administration of justice by
“purging the profession of members who, by their misconduct, have proven
themselves no longer worthy to be entrusted with the duties and responsibilities
of an attorney.”44
WHEREFORE, finding the respondent, Atty. Jaime V. Agtang, GUILTY of gross
misconduct in violation of the Code of Professional Responsibility, the Court
hereby DISBARS him from the practice of law and ORDERS him to pay the
complainant, Erlinda Foster, the amounts of P127,590.00, P50,000.00
and P2,500.00. Let a copy of this Decision be sent to the Office of the Bar
Confidant, the Integrated Bar of the Philippines and the Office of the Court
Administrator to be circulated to ail courts.
SO ORDERED.