Raul Sesbreño v. CA, Gian, Branzuela, Ypil, Bacayo et. al.

Facts:

- This case involves 52 employees which sued the Province of Cebu and then Gov. Rene Espina for
reinstatement and backwages in which petitioner became their counsel.
- 32 of these employees signed 2 documents agreeing to pay petitioner 30% atty’s fees and 20%
as expenses to be taken from their back wages.
- RTC ordered Cebu Prov. to reinstate and pay the back salaries of the employees but the
employees waived their right to reinstatement in a compromise agreement. Cebu released 2.3
million as “Partial Satisfaction of Judgment” due to the employees representing their backwages
among others
- Later on, 10 employees (respondents), filed before the RTC asserting that they agreed to pay
petitioner 40% to be taken only from their back salaries.
- RTC fixed petitioner’s fees 60% of all monies paid to the employees (40% Attys fees, 20%
expenses) – lowered to 50% upon motion for reconsideration by respondent employees
- Not satisfied, Petitioner appealed to CA claiming: (1) additional fees for legal services before the
SC, (2) reimbursement for expenses and a clear statement that the fee be likewise taken from
retirement pay awarded to his clients
- CA – did not agree and reduced petitioner’s attorney’s fee to 20% of all back salaries
- Hence petition claiming: (1) 50% should be upheld for being consistent with prevailing case law
and the contract of professional services between the parties

Issues: Whether the CA erred in reducing petitioner’s attorney’s fees?

Ruling: NO

- 50% of all monies w/c the employees received is excessive and unconscionable, not to say,
contrary to the contract of professional services. The fees were to be taken from the back
salaries only not based on all monies to be awarded to private respondents. A stipulation on a
lawyer's compensation in a contract ordinarily controls the amount of fees, unless the court
finds such stipulated amount unreasonable or unconscionable.
- Stipulated attorney's fees are unconscionable whenever the amount of the fee contracted for,
standing alone and unexplained would be sufficient to show that an unfair advantage had been
taken of the client, or that a legal fraud had been perpetrated on him.
- CA correctly ruled that 50% fee to petitioner is unconscionable. The ratio makes the practice of
law a commercial venture, rather than a noble profession. Also, the 52 employees were
dismissed from employment, their means of livelihood.
- What a lawyer may charge and receive as attorney's fees is always subject to judicial control.
Courts may always ascertain, if the attorney's fees are found to be excessive, what is reasonable
under the circumstances. Quantum meruit, meaning "as much as he deserves," is used as the
basis for determining the lawyer's professional fees in the absence of a contract. Factors such as
the time spent and extent of services rendered; novelty and difficulty of the questions involved;
importance of the subject matter; skill demanded; probability of losing other employment as a
result of acceptance of the proffered cause; customary charges for similar services; amount
involved in the controversy and the benefits resulting to the client; certainty of compensation;
 character of employment; and professional standing of the lawyer, are considered in
determining his fees. (CANON 20 Rule 20.01)
- However, the 20% award pertains only to the 10 private respondents herein. Petitioner has
already been compensated in the amount of 50% of all monies received, by the rest of his clients
in the case below.