G.R. No.

100113 September 3, 1991

RENATO CAYETANO, petitioner,
vs.
CHRISTIAN MONSO, HON. !O"ITO R. SA#ONGA, COMMISSION ON
A$$OINTMENT, %n& HON. G'I##ERMO CARAG'E, in (is )%p%)it* %s
Se)ret%r* o+ ,-&.et %n& M%n%.ement, respon&ents.
Renato L. Cayetano for and in his own behalf.
Sabina E. Acut, Jr. and Mylene Garcia-Albano co-counsel for petitioner.

PARAS, !./p
We are faced here with a controversy of far-reaching proportions. While
ostensibly only legal issues are involved, the ourt!s decision in this case would
indubitably have a profound effect on the political aspect of our national
e"istence.
#he $%&' onstitution provides in Section $ ($), Article *+-,
#here shall be a o--ission on Elections co-posed of a hair-an and si"
o--issioners who shall be natural-born citi.ens of the /hilippines and, at the
ti-e of their appoint-ent, at least thirty-five years of age, holders of a college
degree, and -ust not have been candidates for any elective position in the
i--ediately preceding -elections. 0owever, a -a1ority thereof, including the
hair-an, shall be -e-bers of the /hilippine 2ar who have been engaged in the
practice of law for at least ten years. (E-phasis supplied)
#he afore3uoted provision is patterned after Section l(l), Article +**- of the $%'4
onstitution which si-ilarly provides,
#here shall be an independent o--ission on Elections co-posed of a
hair-an and eight o--issioners who shall be natural-born citi.ens of the
/hilippines and, at the ti-e of their appoint-ent, at least thirty-five years of age
and holders of a college degree. 0owever, a -a1ority thereof, including the
hair-an, shall be -e-bers of the /hilippine 2ar who have been engaged in
the practice of law for at least ten years.! (E-phasis supplied)
5egrettably, however, there see-s to be no 1urisprudence as to what constitutes
practice of law as a legal 3ualification to an appointive office.
Black defines "practice of law" as:
The rendition of services requiring the knowledge and the application of
legal principles and technique to serve the interest of another with his
consent. t is not li!ited to appearing in court, or advising and assisting in
the conduct of litigation, "ut e!"races the preparation of pleadings, and
other papers incident to actions and special proceedings, conve#ancing,
the preparation of legal instru!ents of all kinds, and the giving of all legal
advice to clients. t e!"races all advice to clients and all actions taken for
the! in !atters connected with the law. An attorne# engages in the
practice of law "# !aintaining an office where he is held out to "e$an
attorne#, using a letterhead descri"ing hi!self as an attorne#, counseling
clients in legal !atters, negotiating with opposing counsel a"out pending
litigation, and fi%ing and collecting fees for services rendered "# his
associate. &,0%)12s #%3 i)tion%r*, 'rd ed.(
#he practice of law is not li-ited to the conduct of cases in court. (Land Title
Abstract and Trust Co. v. Dworken,$6% 7hio St. 64, $%4 8.E. 9:;) A person is
also considered to be in the practice of law when he,
... for valuable consideration engages in the business of advising person, fir-s,
associations or corporations as to their rights under the law, or appears in a
representative capacity as an advocate in proceedings pending or prospective,
before any court, co--issioner, referee, board, body, co--ittee, or co--ission
constituted by law or authori.ed to settle controversies and there, in such
representative capacity perfor-s any act or acts for the purpose of obtaining or
defending the rights of their clients under the law. )therwise stated, one who,
in a representative capacit#, engages in the "usiness of advising clients as
to their rights under the law, or while so engaged perfor!s an# act or acts
either in court or outside of court for that purpose, is engaged in the
practice of law. &St%te e4. re0. M)1ittri)1 v..C.S. -&0e* %n& Co., *+, S.-. ,d
./0, '1+ 2o. .0,(
#his ourt in the case of Philippine Lawyers Association v.Agrava, ($;: /hil.
$'4,$'9-$'') stated,
The practice of law is not li-ited to the conduct of cases or litigation in court< it
e-braces the preparation of pleadings and other papers incident to actions and
special proceedings, the -anage-ent of such actions and proceedings on behalf
of clients before 1udges and courts, and in addition, conveying. *n general, all
advice to clients, and all action ta=en for the- in -attersconnected with the law
incorporation services, assess-ent and conde-nation services conte-plating an
appearance before a 1udicial body, the foreclosure of a -ortgage, enforce-ent of
a creditor!s clai- in ban=ruptcy and insolvency proceedings, and conducting
proceedings in attach-ent, and in -atters of estate and guardianship have been
held to constitute law practice, as do the preparation and drafting of legal
instru-ents, where the work done involves the deterination by the trained legal
ind of the legal effect of facts and conditions. (: A-. Jr. p. 696, 694). (E-phasis
supplied)
Practice of law under -ode- conditions consists in no s-all part of wor=
perfor-ed outside of any court and having no i--ediate relation to proceedings
in court. *t e-braces conveyancing, the giving of legal advice on a large variety
of sub1ects, and the preparation and e"ecution of legal instru-ents covering an
e"tensive field of business and trust relations and other affairs. Although these
transactions ay have no direct connection with court proceedings, they are
always sub!ect to becoe involved in litigation. #hey re3uire in -any aspects a
high degree of legal s=ill, a wide e"perience with -en and affairs, and great
capacity for adaptation to difficult and co-ple" situations. #hese custo-ary
functions of an attorney or counselor at law bear an inti-ate relation to the
ad-inistration of 1ustice by the courts. 8o valid distinction, so far as concerns the
3uestion set forth in the order, can be drawn between that part of the wor= of the
lawyer which involves appearance in court and that part which involves advice
and drafting of instru-ents in his office. *t is of i-portance to the welfare of the
public that these -anifold custo-ary functions be perfor-ed by persons
possessed of ade3uate learning and s=ill, of sound -oral character, and acting at
all ti-es under the heavy trust obligations to clients which rests upon all
attorneys. (Moran, Coents on the Rules of Court, >ol. 4 ?$%:4 ed.@ , p. 99:-
999, citing "n re #pinion of the $ustices ?Mass.@, $%A 8.E. 4$4, 3uoted in Rhode
"s. %ar Assoc. v. Autoobile &ervice Assoc. ?5.*.@ $'% A. $4%,$AA). (E-phasis
ours)
The 3niversit# of the Philippines 4aw 5enter in conducting orientation
"riefing for new law#ers &*/61$*/60( listed the di!ensions of the practice of
law in even "roader ter!s as advocac#, counselling and pu"lic service.
7ne -ay be a practicing attorney in following any line of e-ploy-ent in the
profession. *f what he does e"acts =nowledge of the law and is of a =ind usual for
attorneys engaging in the active practice of their profession, and he follows so-e
one or -ore lines of e-ploy-ent such as this he is a practicing attorney at law
within the -eaning of the statute. (%arr v. Cardell, $:: 8W 4$6)
Practice of law !eans an# activit#, in or out of court, which requires the
application of law, legal procedure, knowledge, training and e%perience.
"To engage in the practice of law is to perfor! those acts which are
characteristics of the profession. 7enerall#, to practice law is to give notice
or render an# kind of service, which device or service requires the use in
an# degree of legal knowledge or skill." &*** A4R ,'(
#he following records of the $%&9 onstitutional o--ission show that it has
adopted a liberal interpretation of the ter- Bpractice of law.B
M5. C7D. 2efore we suspend the session, -ay * -a=e a -anifestation which *
forgot to do during our review of the provisions on the o--ission on Audit. May
* be allowed to -a=e a very brief state-entE
#0E /5ES*F*8G 7CC*E5 (Mr. Ja-ir).
#he o--issioner will please proceed.
M5. C7D. This has to do with the 'ualifications of the ebers of the
Coission on Audit. Aong others, the 'ualifications provided for by &ection "
is that (They ust be )ebers of the Philippine %ar( * " a 'uoting fro the
provision * (who have been engaged in the practice of law for at least ten
years(.
#o avoid any -isunderstanding which would result in e"cluding -e-bers of the
2ar who are now e-ployed in the 7A or o--ission on Audit, we would like to
ake the clarification that this provision on 'ualifications regarding ebers of
the %ar does not necessarily refer or involve actual practice of law outside the
C#A +e have to interpret this to ean that as long as the lawyers who are
eployed in the C#A are using their legal knowledge or legal talent in their
respective work within C#A, then they are 'ualified to be considered for
appointent as ebers or coissioners, even chairan, of the Coission
on Audit.
#his has been discussed by the o--ittee on onstitutional o--issions and
Agencies and we dee- it i-portant to ta=e it up on the floor so that this
interpretation -ay be -ade available whenever this provision on the
3ualifications as regards -e-bers of the /hilippine 2ar engaging in the practice
of law for at least ten years is ta=en up.
M5. 7/GE. Will o--issioner Co. yield to 1ust one 3uestion.
M5. C7D. Hes, Mr. /residing 7fficer.
M5. 7/GE. "s he, in effect, saying that service in the C#A by a lawyer is
e'uivalent to the re'uireent of a law practice that is set forth in the Article on
the Coission on Audit,
M5. C7D. +e ust consider the fact that the work of C#A, although it is
auditing, will necessarily involve legal work- it will involve legal work. And,
therefore, lawyers who are eployed in C#A now would have the necessary
'ualifications in accordance with the Provision on 'ualifications under our
provisions on the Coission on Audit. And, therefore, the answer is yes.
M5. 7/GE. Hes. So that the construction given to this is that this is e3uivalent to
the practice of law.
M5. C7D. .es, )r. Presiding #fficer.
M5. 7/GE. Thank you.
... ( E-phasis supplied)
Section $($), Article *+-F of the $%&' onstitution, provides, a-ong others, that
the hair-an and two o--issioners of the o--ission on Audit (7A) should
either be certified public accountants with not less than ten years of auditing
practice, or -e-bers of the /hilippine 2ar who have been engaged in the
practice of law for at least ten years. (e-phasis supplied)
orollary to this is the ter- Bprivate practitionerB and which is in -any ways
synony-ous with the word Blawyer.B #oday, although -any lawyers do not
engage in private practice, it is still a fact that the -a1ority of lawyers are private
practitioners. (Gary Munne=e, #pportunities in Law Careers ?>GM areer
0ori.ons, *llinois@, ?$%&9@, p. $:).
At this point, it -ight be helpful to define private practice. #he ter-, as co--only
understood, -eans Ban individual or organi.ation engaged in the business of
delivering legal services.B ("bid.). Gawyers who practice alone are often called
Bsole practitioners.B Groups of lawyers are called Bfir-s.B #he fir- is usually a
partnership and -e-bers of the fir- are the partners. So-e fir-s -ay be
organi.ed as professional corporations and the -e-bers called shareholders. *n
either case, the -e-bers of the fir- are the e"perienced attorneys. *n -ost
fir-s, there are younger or -ore ine"perienced salaried attorneyscalled
Bassociates.B ("bid.).
#he test that defines law practice by loo=ing to traditional areas of law practice is
essentially tautologous, unhelpful defining the practice of law as that which
lawyers do. (harles W. Wolfra-, )odern Legal /thics ?West /ublishing o.,
Minnesota, $%&9@, p. :%4). #he practice of law is defined as the perfor-ance of
any acts . . . in or out of court, co--only understood to be the practice of law.
(&tate %ar Ass0n v. Connecticut %ank 1 Trust Co., $A: onn. 666, $A; A.6d &94,
&'; ?$%:&@ ?3uoting 2rievance Co. v. Payne, $6& onn. 46:, 66 A.6d 964,
969 ?$%A$@). 2ecause lawyers perfor- al-ost every function =nown in the
co--ercial and govern-ental real-, such a definition would obviously be too
global to be wor=able.(Wolfra-, op. cit.).
#he appearance of a lawyer in litigation in behalf of a client is at once the -ost
publicly fa-iliar role for lawyers as well as an unco--on role for the average
lawyer. Most lawyers spend little ti-e in courtroo-s, and a large percentage
spend their entire practice without litigating a case. ("bid., p. :%4). 8onetheless,
-any lawyers do continue to litigate and the litigating lawyer!s role colors -uch of
both the public i-age and the self perception of the legal profession. ("bid.).
*n this regard thus, the do-inance of litigation in the public -ind reflects history,
not reality. ("bid.). Why is this soE 5ecall that the late Ale"ander Syip, a
corporate lawyer, once articulated on the i-portance of a lawyer as a business
counselor in this wise, BEven today, there are still uninfor-ed lay-en whose
concept of an attorney is one who principally tries cases before the courts. #he
-e-bers of the bench and bar and the infor-ed lay-en such as business-en,
=now that in -ost developed societies today, substantially -ore legal wor= is
transacted in law offices than in the courtroo-s. General practitioners of law who
do both litigation and non-litigation wor= also =now that in -ost cases they find
the-selves spending -ore ti-e doing what ?is@ loosely desccribe?d@ as business
counseling than in trying cases. #he business lawyer has been described as the
planner, the diagnostician and the trial lawyer, the surgeon. *?t@ need not ?be@
stress?ed@ that in law, as in -edicine, surgery should be avoided where internal
-edicine can be effective.B (%usiness &tar, Borporate Cinance Gaw,B Jan. $$,
$%&%, p. A).
*n the course of a wor=ing day the average general practitioner wig engage in a
nu-ber of legal tas=s, each involving different legal doctrines, legal s=ills, legal
processes, legal institutions, clients, and other interested parties. Even the
increasing nu-bers of lawyers in speciali.ed practice wig usually perfor- at least
so-e legal services outside their specialty. And even within a narrow specialty
such as ta" practice, a lawyer will shift fro- one legal tas= or role such as advice-
giving to an i-portantly different one such as representing a client before an
ad-inistrative agency. (Wolfra-, supra, p. 9&').
2y no -eans will -ost of this wor= involve litigation, unless the lawyer is one of
the relatively rare types I a litigator who speciali.es in this wor= to the e"clusion
of -uch else. *nstead, the wor= will re3uire the lawyer to have -astered the full
range of traditional lawyer s=ills of client counselling, advice-giving, docu-ent
drafting, and negotiation. And increasingly lawyers find that the new s=ills of
evaluation and -ediation are both effective for -any clients and a source of
e-ploy-ent. ("bid.).
Most lawyers will engage in non-litigation legal wor= or in litigation wor= that is
constrained in very i-portant ways, at least theoretically, so as to re-ove fro- it
so-e of the salient features of adversarial litigation. 7f these special roles, the
-ost pro-inent is that of prosecutor. *n so-e lawyers! wor= the constraints are
i-posed both by the nature of the client and by the way in which the lawyer is
organi.ed into a social unit to perfor- that wor=. #he -ost co--on of these
roles are those of corporate practice and govern-ent legal service. ("bid.).
*n several issues of the %usiness &tar, a business daily, herein below 3uoted are
e-erging trends in corporate law practice, a departure fro- the traditional
concept of practice of law.
We are e"periencing today what truly -ay be called a revolutionary
transfor-ation in corporate law practice. Gawyers and other professional groups,
in particular those -e-bers participating in various legal-policy decisional
conte"ts, are finding that understanding the -a1or e-erging trends in corporation
law is indispensable to intelligent decision--a=ing.
onstructive ad1ust-ent to -a1or corporate proble-s of today re3uires an
accurate understanding of the nature and i-plications of the corporate law
research function acco-panied by an accelerating rate of infor-ation
accu-ulation. #he recognition of the need for such i-proved corporate legal
policy for-ulation, particularly B-odel--a=ingB and Bcontingency planning,B has
i-pressed upon us the inade3uacy of traditional procedures in -any decisional
conte"ts.
*n a co-ple" legal proble- the -ass of infor-ation to be processed, the sorting
and weighing of significant conditional factors, the appraisal of -a1or trends, the
necessity of esti-ating the conse3uences of given courses of action, and the
need for fast decision and response in situations of acute danger have pro-pted
the use of sophisticated concepts of infor-ation flow theory, operational analysis,
auto-atic data processing, and electronic co-puting e3uip-ent.
Jnderstandably, an i-proved decisional structure -ust stress the predictive
co-ponent of the policy--a=ing process, wherein a B-odelB, of the decisional
conte"t or a seg-ent thereof is developed to test pro1ected alternative courses of
action in ter-s of futuristic effects flowing therefro-.
Although -e-bers of the legal profession are regularly engaged in predicting
and pro1ecting the trends of the law, the sub1ect of corporate finance law has
received relatively little organi.ed and for-ali.ed attention in the philosophy of
advancing corporate legal education. 8onetheless, a cross-disciplinary approach
to legal research has beco-e a vital necessity.
ertainly, the general orientation for productive contributions by those trained
pri-arily in the law can be i-proved through an early introduction to -ulti-
variable decisional conte"t and the various approaches for handling such
proble-s. Gawyers, particularly with either a -aster!s or doctorate degree in
business ad-inistration or -anage-ent, functioning at the legal policy level of
decision--a=ing now have so-e appreciation for the concepts and analytical
techni3ues of other professions which are currently engaged in si-ilar types of
co-ple" decision--a=ing.
#ruth to tell, -any situations involving corporate finance proble-s would re3uire
the services of an astute attorney because of the co-ple" legal i-plications that
arise fro- each and every necessary step in securing and -aintaining the
business issue raised. (%usiness &tar, Borporate Cinance Gaw,B Jan. $$, $%&%,
p. A).
*n our litigation-prone country, a corporate lawyer is assiduously referred to as
the Babogado de ca-panilla.B 0e is the Bbig-ti-eB lawyer, earning big -oney and
with a clientele co-posed of the tycoons and -agnates of business and industry.
Fespite the growing nu-ber of corporate lawyers, -any people could not e"plain
what it is that a corporate lawyer does. Cor one, the nu-ber of attorneys
e-ployed by a single corporation will vary with the si.e and type of the
corporation. Many s-aller and so-e large corporations far- out all their legal
proble-s to private law fir-s. Many others have in-house counsel only for certain
-atters. 7ther corporation have a staff large enough to handle -ost legal
proble-s in-house.
A corporate lawyer, for all intents and purposes, is a lawyer who handles the legal
affairs of a corporation. 0is areas of concern or 1urisdiction -ay include, inter
alia, corporate legal research, ta" laws research, acting out as corporate
secretary (in board -eetings), appearances in both courts and other ad1udicatory
agencies (including the Securities and E"change o--ission), and in other
capacities which re3uire an ability to deal with the law.
At any rate, a corporate lawyer -ay assu-e responsibilities other than the legal
affairs of the business of the corporation he is representing. These include such
atters as deterining policy and becoing involved in anageent.
( E-phasis supplied.)
*n a big co-pany, for e"a-ple, one -ay have a feeling of being isolated fro- the
action, or not understanding how one!s wor= actually fits into the wor= of the
orgarni.ation. #his can be frustrating to so-eone who needs to see the results of
his wor= first hand. *n short, a corporate lawyer is so-eti-es offered this fortune
to be -ore closely involved in the running of the business.
Moreover, a corporate lawyer!s services -ay so-eti-es be engaged by a
-ultinational corporation (M8). So-e large M8s provide one of the few
opportunities available to corporate lawyers to enter the international law field.
After all, international law is practiced in a relatively s-all nu-ber of co-panies
and law fir-s. 2ecause wor=ing in a foreign country is perceived by -any as
gla-orous, tills is an area coveted by corporate lawyers. *n -ost cases, however,
the overseas 1obs go to e"perienced attorneys while the younger attorneys do
their Binternational practiceB in law libraries. (%usiness &tar, Borporate Gaw
/ractice,B May 6:,$%%;, p. A).
#his brings us to the inevitable, i.e., the role of the lawyer in the real- of finance.
#o borrow the lines of 0arvard-educated lawyer 2ruce Wassertein, to wit, BA bad
lawyer is one who fails to spot proble-s, a good lawyer is one who perceives the
difficulties, and the e"cellent lawyer is one who sur-ounts the-.B (%usiness &tar,
Borporate Cinance Gaw,B Jan. $$, $%&%, p. A).
#oday, the study of corporate law practice direly needs a Bshot in the ar-,B so to
spea=. 8o longer are we tal=ing of the traditional law teaching -ethod of
confining the sub1ect study to the orporation ode and the Securities ode but
an incursion as well into the intertwining -odern -anage-ent issues.
Such corporate legal -anage-ent issues deal pri-arily with three (4) types of
learning, ($) ac3uisition of insights into current advances which are of particular
significance to the corporate counsel< (6) an introduction to usable disciplinary
s=ins applicable to a corporate counsel!s -anage-ent responsibilities< and (4) a
devotion to the organi.ation and -anage-ent of the legal function itself.
#hese three sub1ect areas -ay be thought of as intersecting circles, with a
shared area lin=ing the-. 7therwise =nown as Bintersecting -anagerial
1urisprudence,B it for-s a unifying the-e for the corporate counsel!s total
learning.
So-e current advances in behavior and policy sciences affect the counsel!s role.
Cor that -atter, the corporate lawyer reviews the globali.ation process, including
the resulting strategic repositioning that the fir-s he provides counsel for are
re3uired to -a=e, and the need to thin= about a corporation!s< strategy at -ultiple
levels. #he salience of the nation-state is being reduced as fir-s deal both with
global -ultinational entities and si-ultaneously with sub-national govern-ental
units. Cir-s increasingly collaborate not only with public entities but with each
other I often with those who are co-petitors in other arenas.
Also, the nature of the lawyer0s participation in decision3aking within the
corporation is rapidly changing. The ode corporate lawyer has gained a new
role as a stakeholder * in soe cases participating in the organi4ation and
operations of governance through participation on boards and other decision3
aking roles. 7ften these new patterns develop alongside e"isting legal
institutions and laws are perceived as barriers. #hese trends are co-plicated as
corporations organi.e for global operations. ( E-phasis supplied)
The practising lawyer of today is failiar as well with governental policies
toward the prootion and anageent of technology. 5ew collaborative
arrangeents for prooting specific technologies or copetitiveness ore
generally re'uire approaches fro industry that differ fro older, ore
adversarial relationships and traditional fors of seeking to influence
governental policies. And there are lessons to be learned fro- other countries.
*n Europe, /sprit, /ureka and Race are e"a-ples of collaborative efforts
between govern-ental and business Japan!s )"T" is world fa-ous. (E-phasis
supplied)
Collowing the concept of boundary spanning, the office of the orporate ounsel
co-prises a distinct group within the -anagerial structure of all =inds of
organi.ations. Effectiveness of both long-ter- and te-porary groups within
organi.ations has been found to be related to indentifiable factors in the group-
conte"t interaction such as the groups actively revising their =nowledge of the
environ-ent coordinating wor= with outsiders, pro-oting tea- achieve-ents
within the organi.ation. *n general, such e"ternal activities are better predictors of
tea- perfor-ance than internal group processes.
"n a crisis situation, the legal anagerial capabilities of the corporate lawyer vis3
a3vis the anagerial ettle of corporations are challenged. urrent research is
see=ing ways both to anticipate effective -anagerial procedures and to
understand relationships of financial liability and insurance considerations.
(E-phasis supplied)
5egarding the s=ills to apply by the corporate counsel, three factors are apropos,
6irst &yste Dynaics. #he field of syste-s dyna-ics has been found an
effective tool for new -anagerial thin=ing regarding both planning and pressing
i--ediate proble-s. An understanding of the role of feedbac= loops, inventory
levels, and rates of flow, enable users to si-ulate all sorts of syste-atic proble-s
I physical, econo-ic, -anagerial, social, and psychological. 5ew prograing
techni'ues now ake the syste dynaics principles ore accessible to
anagers * including corporate counsels. (E-phasis supplied)
&econd Decision Analysis. This enables users to ake better decisions involving
cople7ity and uncertainty. "n the conte7t of a law departent, it can be used to
appraise the settleent value of litigation, aid in negotiation settleent, and
inii4e the cost and risk involved in anaging a portfolio of cases. (E-phasis
supplied)
Third )odeling for 5egotiation )anageent. o-puter-based -odels can be
used directly by parties and -ediators in all lands of negotiations. All integrated
set of such tools provide coherent and effective negotiation support, including
hands-on on instruction in these techni3ues. A si-ulation case of an international
1oint venture -ay be used to illustrate the point.
?2e this as it -ay,@ the organi.ation and -anage-ent of the legal function,
concern three pointed areas of consideration, thus,
Preventive Lawyering. /lanning by lawyers re3uires special s=ills that co-prise a
-a1or part of the general counsel!s responsibilities. #hey differ fro- those of
re-edial law. /reventive lawyering is concerned with -ini-i.ing the ris=s of legal
trouble and -a"i-i.ing legal rights for such legal entities at that ti-e when
transactional or si-ilar facts are being considered and -ade.
)anagerial $urisprudence. #his is the fra-ewor= within which are underta=en
those activities of the fir- to which legal conse3uences attach. *t needs to be
directly supportive of this nation!s evolving econo-ic and organi.ational fabric as
fir-s change to stay co-petitive in a global, interdependent environ-ent. #he
practice and theory of BlawB is not ade3uate today to facilitate the relationships
needed in trying to -a=e a global econo-y wor=.
#rgani4ation and 6unctioning of the Corporate Counsel0s #ffice. #he general
counsel has e-erged in the last decade as one of the -ost vibrant subsets of the
legal profession. #he corporate counsel hear responsibility for =ey aspects of the
fir-!s strategic issues, including structuring its global operations, -anaging
i-proved relationships with an increasingly diversified body of e-ployees,
-anaging e"panded liability e"posure, creating new and varied interactions with
public decision--a=ers, coping internally with -ore co-ple" -a=e or by
decisions.
#his whole e"ercise drives ho-e the thesis that =nowing corporate law is not
enough to -a=e one a good general corporate counsel nor to give hi- a full
sense of how the legal syste- shapes corporate activities. And even if the
corporate lawyer!s ai- is not the understand all of the law!s effects on corporate
activities, he -ust, at the very least, also gain a wor=ing =nowledge of the
-anage-ent issues if only to be able to grasp not only the basic legal
Bconstitution! or -a=eup of the -ode- corporation. B%usiness &tarB, B#he
orporate ounsel,B April $;, $%%$, p. A).
#he challenge for lawyers (both of the bar and the bench) is to have -ore than a
passing =nowledge of financial law affecting each aspect of their wor=. Het, -any
would ad-it to ignorance of vast tracts of the financial law territory. What
transpires ne"t is a dile--a of professional security, Will the lawyer ad-it
ignorance and ris= opprobriu-E< or will he feign understanding and ris=
e"posureE (%usiness &tar, Borporate Cinance law,B Jan. $$, $%&%, p. A).
5espondent hristian Monsod was no-inated by /resident ora.on . A3uino
to the position of hair-an of the 7MEGE in a letter received by the
Secretariat of the o--ission on Appoint-ents on April 6:, $%%$. /etitioner
opposed the no-ination because allegedly Monsod does not possess the
re3uired 3ualification of having been engaged in the practice of law for at least
ten years.
7n June :, $%%$, the o--ission on Appoint-ents confir-ed the no-ination of
Monsod as hair-an of the 7MEGE. 7n June $&, $%%$, he too= his oath of
office. 7n the sa-e day, he assu-ed office as hair-an of the 7MEGE.
hallenging the validity of the confir-ation by the o--ission on Appoint-ents
of Monsod!s no-ination, petitioner as a citi.en and ta"payer, filed the instant
petition for certiorari and /rohibition praying that said confir-ation and the
conse3uent appoint-ent of Monsod as hair-an of the o--ission on
Elections be declared null and void.
Atty. hristian Monsod is a -e-ber of the /hilippine 2ar, having passed the bar
e"a-inations of $%9; with a grade of &9-::K. 0e has been a dues paying
-e-ber of the *ntegrated 2ar of the /hilippines since its inception in $%'6-'4. 0e
has also been paying his professional license fees as lawyer for -ore than ten
years. (p. $6A, 5ollo)
After graduating fro- the ollege of Gaw (J./.) and having hurdled the bar, Atty.
)onsod worked in the law office of his father. Furing his stint in the World 2an=
Group ($%94-$%';), )onsod worked as an operations officer for about two years
in Costa Rica and Panaa, which involved getting ac'uainted with the laws of
eber3countries negotiating loans and coordinating legal, econoic, and
pro!ect work of the %ank. 8pon returning to the Philippines in 9:;<, he worked
with the )eralco 2roup, served as chief e7ecutive officer of an investent bank
and subse'uently of a business congloerate, and since 9:=>, has rendered
services to various copanies as a legal and econoic consultant or chief
e7ecutive officer. As forer &ecretary32eneral ?9:=>@ and 5ational Chairan
?9:=;@ of 5A)6R/L. )onsod0s work involved being knowledgeable in election
law. Ae appeared for 5A)6R/L in its accreditation hearings before the
Coelec. "n the field of advocacy, )onsod, in his personal capacity and as
forer Co3Chairan of the %ishops %usinessen0s Conference for Auan
Developent, has worked with the under privileged sectors, such as the farer
and urban poor groups, in initiating, lobbying for and engaging in affirative
action for the agrarian refor law and lately the urban land refor bill. )onsod
also ade use of his legal knowledge as a eber of the Davide Coission, a
'uast !udicial body, which conducted nuerous hearings ?9::<@ and as a
eber of the Constitutional Coission ?9:=>39:=;@, and Chairan of its
Coittee on Accountability of Public #fficers, for which he was cited by the
President of the Coission, $ustice Cecilia )uBo43Pala for (innuerable
aendents to reconcile governent functions with individual freedos and
public accountability and the party3list syste for the Aouse of Representative.
?pp. 9C=39C: Rollo@ ? /phasis supplied@
Just a word about the work of a negotiating tea of which Atty. Monsod used to
be a -e-ber.
*n a loan agree-ent, for instance, a negotiating panel acts as a tea-, and which
is ade3uately constituted to -eet the various contingencies that arise during a
negotiation. 2esides top officials of the 2orrower concerned, there are the legal
officer (such as the legal counsel), the finance -anager, and an operations
officer (such as an official involved in negotiating the contracts) who co-prise the
-e-bers of the tea-. (Guiller-o >. Soliven, BGoan 8egotiating Strategies for
Feveloping ountry 2orrowers,B Staff /aper 8o. 6, entral 2an= of the
/hilippines, Manila, $%&6, p. $$). (E-phasis supplied)
After a fashion, the loan agree-ent is li=e a country!s onstitution< it lays down
the law as far as the loan transaction is concerned. #hus, the -eat of any Goan
Agree-ent can be co-part-entali.ed into five (:) funda-ental parts, ($)
business ter-s< (6) borrower!s representation< (4) conditions of closing< (A)
covenants< and (:) events of default. ("bid., p. $4).
*n the sa-e vein, lawyers play an iportant role in any debt restructuring
progra. Cor aside fro- perfor-ing the tas=s of legislative drafting and legal
advising, they score national develop-ent policies as =ey factors in -aintaining
their countries! sovereignty. (ondensed fro- the wor= paper, entitled BWanted,
Fevelop-ent Gawyers for Feveloping 8ations,B sub-itted by G. Michael 0ager,
regional legal adviser of the Jnited States Agency for *nternational Fevelop-ent,
during the Session on Gaw for the Fevelop-ent of 8ations at the Abid1an World
onference in *vory oast, sponsored by the World /eace #hrough Gaw enter
on August 69-4$, $%'4). ( E-phasis supplied)
Loan concessions and coproises, perhaps even ore so than purely
renegotiation policies, deand e7pertise in the law of contracts, in legislation and
agreeent drafting and in renegotiation. 8ecessarily, a sovereign lawyer -ay
wor= with an international business specialist or an econo-ist in the for-ulation
of a -odel loan agree-ent. Febt restructuring contract agree-ents contain such
a -i"ture of technical language that they should be carefully drafted and signed
only with the advise of co-petent counsel in con1unction with the guidance of
ade3uate technical support personnel. (&ee "nternational Law Aspects of the
Philippine /7ternal Debts, an unpublished dissertation, J.S.#. Graduate School
of Gaw, $%&', p. 46$). ( E-phasis supplied)
A critical aspect of sovereign debt restructuringLcontract construction is the set of
ter-s and conditions which deter-ines the contractual re-edies for a failure to
perfor- one or -ore ele-ents of the contract. A good agree-ent -ust not only
define the responsibilities of both parties, but -ust also state the recourse open
to either party when the other fails to discharge an obligation. Cor a co-pleat
debt restructuring represents a devotion to that principle which in the ulti-ate
analysis is sine 'ua non for foreign loan agree-ents-an adherence to the rule of
law in do-estic and international affairs of whose =ind J.S. Supre-e ourt
Justice 7liver Wendell 0ol-es, Jr. once said, B#hey carry no banners, they beat
no dru-s< but where they are, -en learn that bustle and bush are not the e3ual
of 3uiet genius and serene -astery.B (See 5icardo J. 5o-ulo, B#he 5ole of
Gawyers in Coreign *nvest-ents,B *ntegrated 2ar of the /hilippine Journal, >ol.
$:, 8os. 4 and A, #hird and Courth Muarters, $%'', p. 69:).
"nterpreted in the light of the various definitions of the ter Practice of law(.
particularly the odern concept of law practice, and taking into consideration the
liberal construction intended by the fraers of the Constitution, Atty. )onsod0s
past work e7periences as a lawyer3econoist, a lawyer3anager, a lawyer3
entrepreneur of industry, a lawyer3negotiator of contracts, and a lawyer3legislator
of both the rich and the poor * verily ore than satisfy the constitutional
re'uireent * that he has been engaged in the practice of law for at least ten
years.
2esides in the leading case of Luego v. Civil &ervice Coission, $A4 S5A
46', the ourt said,
Appointent is an essentially discretionary power and -ust be perfor-ed by the
officer in which it is vested according to his best lights, the only condition being
that the appointee should possess the 3ualifications re3uired by law. *f he does,
then the appoint-ent cannot be faulted on the ground that there are others better
3ualified who should have been preferred. This is a political 'uestion involving
considerations of wisdo which only the appointing authority can decide.
(e-phasis supplied)
8o less e-phatic was the ourt in the case of (Central %ank v. Civil &ervice
Coission, $'$ S5A 'AA) where it stated,
*t is well-settled that when the appointee is 3ualified, as in this case, and all the
other legal re3uire-ents are satisfied, the o--ission has no alternative but to
attest to the appoint-ent in accordance with the ivil Service Gaw. #he
o--ission has no authority to revo=e an appoint-ent on the ground that
another person is -ore 3ualified for a particular position. *t also has no authority
to direct the appoint-ent of a substitute of its choice. #o do so would be an
encroachent on the discretion vested upon the appointing authority. An
appointent is essentially within the discretionary power of whosoever it is
vested, sub!ect to the only condition that the appointee should possess the
'ualifications re'uired by law. ( E-phasis supplied)
#he appointing process in a regular appoint-ent as in the case at bar, consists of
four (A) stages, ($) no-ination< (6) confir-ation by the o--ission on
Appoint-ents< (4) issuance of a co--ission (in the /hilippines, upon sub-ission
by the o--ission on Appoint-ents of its certificate of confir-ation, the
/resident issues the per-anent appoint-ent< and (A) acceptance e.g., oath-
ta=ing, posting of bond, etc. . . . (Lacson v. Roero, 8o. G-4;&$, 7ctober $A,
$%A%< Gon.ales, Gaw on /ublic 7fficers, p. 6;;)
#he power of the o--ission on Appoint-ents to give its consent to the
no-ination of Monsod as hair-an of the o--ission on Elections is -andated
by Section $(6) Sub-Article , Article *+ of the onstitution which provides,
#he hair-an and the o--isioners shall be appointed by the /resident with
the consent of the o--ission on Appoint-ents for a ter- of seven years
without reappoint-ent. 7f those first appointed, three Me-bers shall hold office
for seven years, two Me-bers for five years, and the last Me-bers for three
years, without reappoint-ent. Appoint-ent to any vacancy shall be only for the
une"pired ter- of the predecessor. *n no case shall any Me-ber be appointed or
designated in a te-porary or acting capacity.
Anent Justice #eodoro /adilla!s separate opinion, suffice it to say that his
definition of the practice of law is the traditional or stereotyped notion of law
practice, as distinguished fro- the odern concept of the practice of law, which
-odern connotation is e7actly what was intended by the einent fraers of the
9:=; Constitution. Moreover, Justice /adilla!s definition would re3uire generally a
habitual law practice, perhaps practised two or three ti-es a wee= and would
outlaw say, law practice once or twice a year for ten consecutive years. learly,
this is far fro- the constitutional intent.
Jpon the other hand, the separate opinion of Justice *sagani ru. states that in
-y written opinion, * -ade use of a definition of law practice which really -eans
nothing because the definition says that law practice B . . . is what people
ordinarily -ean by the practice of law.B #rue * cited the definition but only by way
of sarcas- as evident fro- -y state-ent that the definition of law practice by
Btraditional areas of law practice is essentially tautologousB or defining a phrase
by -eans of the phrase itself that is being defined.
Justice ru. goes on to say in substance that since the law covers al-ost all
situations, -ost individuals, in -a=ing use of the law, or in advising others on
what the law -eans, are actually practicing law. *n that sense, perhaps, but we
should not lose sight of the fact that Mr. Monsod is a lawyer, a eber of the
Philippine %ar, who has been practising law for over ten years. #his is different
fro- the acts of persons practising law, without first becoing lawyers.
Justice ru. also says that the Supre-e ourt can even dis3ualify an elected
/resident of the /hilippines, say, on the ground that he lac=s one or -ore
3ualifications. #his -atter, * greatly doubt. Cor one thing, how can an action or
petition be brought against the /residentE And even assu-ing that he is indeed
dis3ualified, how can the action be entertained since he is the incu-bent
/residentE
We now proceed,
#he o--ission on the basis of evidence sub-itted doling the public hearings
on Monsod!s confir-ation, i-plicitly deter-ined that he possessed the necessary
3ualifications as re3uired by law. #he 1udg-ent rendered by the o--ission in
the e"ercise of such an ac=nowledged power is beyond 1udicial interference
e"cept only upon a clear showing of a grave abuse of discretion a-ounting to
lac= or e"cess of 1urisdiction. (Art. >***, Sec. $ onstitution). #hus, only where
such grave abuse of discretion is clearly shown shall the ourt interfere with the
o--ission!s 1udg-ent. *n the instant case, there is no occasion for the e"ercise
of the ourt!s corrective power, since no abuse, -uch less a grave abuse of
discretion, that would a-ount to lac= or e"cess of 1urisdiction and would warrant
the issuance of the writs prayed, for has been clearly shown.
Additionally, consider the following,
($) *f the o--ission on Appoint-ents re!ects a no-inee by the /resident, -ay
the Supre-e ourt reverse the o--ission, and thus in effect confir the
appoint-entE learly, the answer is in the negative.
(6) *n the sa-e vein, -ay the ourt re!ect the no-inee, who- the o--ission
has confiredE #he answer is li=ewise clear.
(4) *f the Jnited States Senate (which is the confir-ing body in the J.S.
ongress) decides to confira /residential no-inee, it would be incredible that
the J.S. Supre-e ourt would still reverse the J.S. Senate.
Cinally, one significant legal -a"i- is,
We -ust interpret not by the letter that =illeth, but by the spirit that giveth life.
#a=e this hypothetical case of Sa-son and Felilah. 7nce, the procurator of
Judea as=ed Felilah (who was Sa-son!s beloved) for help in capturing Sa-son.
Felilah agreed on condition that I
8o blade shall touch his s=in<
8o blood shall flow fro- his veins.
When Sa-son (his long hair cut by Felilah) was captured, the procurator placed
an iron rod burning white-hot two or three inches away fro- in front of Sa-son!s
eyes. #his blinded the -an. Jpon hearing of what had happened to her beloved,
Felilah was beside herself with anger, and fu-ing with righteous fury, accused
the procurator of reneging on his word. #he procurator cal-ly replied, BFid any
blade touch his s=inE Fid any blood flow fro- his veinsEB #he procurator was
clearly relying on the letter, not the spirit of the agree-ent.
*n view of the foregoing, this petition is hereby F*SM*SSEF.
S7 75FE5EF.
6ernan, C.$., 2riBo3A'uino and )edialdea, $$., concur.
6eliciano, $., " certify that he voted to disiss the petition. ?6ernan, C.$.@
&ariento, $., is on leave.
Regalado, and Davide, $r., $., took no part.