GENATO vs ATTY ESSEX SILAPAN

DOCTRINE: The lawyer’s duty to maintain inviolate his client’s confidence is perpetual. It outlasts even the lawyer’s
employment. He may not do anything which will injuriously affect his former client nor may he at any time disclose or use
against him any knowledge or information acquired by virtue of professional relationship. Neither does not cease with the
termination of the litigation nor is it affected by the party’s ceasing to employ the attorney and retaining another, or by any other
change of relation between them. It even survives the death of the client.

FACTS: Atty. Silapan rented a small commercial space (as his law office) in Genato's building in Quezon City. Atty. Dacanay,
Genato's retained lawyer, accommodated Silapan in the building and even made him handle some of Genato's cases.

Silapan borrowed from Genato P200K which he intended to use as DP for the purchase of a new car. In return, Silapan issued a
postdated check of approx. P177K to cover for 6 months interest of the loan. Moreover, he mortgaged to Genato his house and lot
in QC. In 1993, Silapan introduced to Genato a certain Romero, who wanted to borrow money from him as well.

Subsequently, Silapan failed to pay the amortization of the car. The financing firm, City Trust Company, which financed the
payment of the car, demanded from Genato the payment of the car. Genato tried to encash the postdated check, but it was
dishonored due to closed account.

Genato filed a BP 22 case against Silapan and a foreclosure case of the real estate mortgage.

In the foreclosure case, respondent alleged that:

- Before paying for the next installment on his car, Silapan asked Genato to execute a Deed of Sale transferring
ownership of the car to him. However, Genato said that he will do so after the termination of his criminal case,
where he wanted Silapan, his former counsel, to offer bribe money to the members of the review committee of
DOJ. He also wanted Silapan to offer bribe money to the prosecutor assigned and to the presiding Judge.

Complainant charged that in making such allegations, respondent is guilty of breaking their confidential lawyer-client
relationship and should be held administratively liable therefor.

RESPONDENT: He claimed to have made these statements in the course of judicial proceedings to defend his case and discredit
complainant's credibility by establishing his criminal propensity to commit fraud, tell lies and violate laws.

ISSUE: whether respondent committed a breach of trust and confidence by imputing to complainant illegal practices and
disclosing complainant's alleged intention to bribe government officials in connection with a pending case.

RULING: YES. Canon 17 of the Code of Professional Responsibility provides that a lawyer owes fidelity to the cause of his
client and shall be mindful of the trust and confidence reposed on him. The long-established rule is that an attorney is not
permitted to disclose communications made to him in his professional character by a client, unless the latter consents. This
obligation to preserve the confidences and secrets of a client arises at the inception of their relationship.3 The protection given to
the client is perpetual and does not cease with the termination of the litigation, nor is it affected by the party's ceasing to employ
the attorney and retaining another, or by any other change of relation between them. It even survives the death of the client.4

Respondent's explanation that it was necessary for him to make the disclosures in his pleadings fails to satisfy us. The disclosures
were not indispensable to protect his rights as they were not pertinent to the foreclosure case. It was improper for the respondent
to use it against the complainant in the foreclosure case as it was not the subject matter of litigation therein and respondent's
professional competence and legal advice were not being attacked in said case.

“It must be stressed, however, that the privilege against disclosure of confidential communications or information is limited
only to communications which are legitimately and properly within the scope of a lawful employment of a lawyer. It does
not extend to those made in contemplation of a crime or perpetration of a fraud. If the unlawful purpose is avowed, as in
this case, the complainant’s alleged intention to bribe government officials in relation to his case, the communication is not
covered by the privilege as the client does not consult the lawyer professionally. It is not within the profession of a lawyer to
advise a client as to how he may commit a crime as a lawyer is not a gun for hire. Thus, the attomey-client privilege does
not attach, there being no professional employment in the strict sense.”
It is well-settled that in order that a communication between a lawyer and his client may be privileged, it must be for a
lawful purpose or in furtherance of a lawful end. The existence of an unlawful purpose prevents the privilege from
attaching.

SUSPENDED – 6 MONTHS

REGALA vs SANDIGANBAYAN

DOCTRINE: The attorney-client privilege extends to non-disclosure of the name of the client, where a strong possibility exists
that revealing the client’s name would implicate the client in the very activity for which he sought the client’s advice; or where
the disclosure would open the client to civil liability. Suing the lawyer to force him to disclose the identity of his client in any of
these instances is improper and the suit, upon motion, may be dismissed on such ground.

FACTS: This involves a complaint filed by the RP against Eduardo Cojuangco Jr, as one of the principal defendants,
for the recovery of alleged ill-gotten wealth.

Among the defendants named in the case are herein petitioners Teodoro Regala, Edgardo J.
Angara, Avelino V. Cruz, Jose C. Concepcion, Rogelio A. Vinluan, Victor P. Lazatin, Eduardo U.
Escueta and Paraja G. Hayudini, and herein private respondent Raul S. Roco, who all were then
partners of the law firm Angara, Abello, Concepcion, Regala and Cruz Law Offices (hereinafter
referred to as the ACCRA Law Firm).

ACCRA Law Firm performed legal services for its clients, which included, among others, the
organization and acquisition of business associations and/or organizations, with the correlative and
incidental services where its members acted as incorporators, or simply, as stockholders. More
specifically, in the performance of these services, the members of the law firm delivered to its client
documents which substantiate the client's equity holdings, i.e., stock certificates endorsed in blank
representing the shares registered in the client's name, and a blank deed of trust or assignment
covering said shares. In the course of their dealings with their clients, the members of the law firm
acquire information relative to the assets of clients as well as their personal and business
circumstances. As members of the ACCRA Law Firm, petitioners and private respondent Raul Roco
admit that they assisted in the organization and acquisition of the companies included in Civil Case
No. 0033, and in keeping with the office practice, ACCRA lawyers acted as nominees-stockholders
of the said corporations involved in sequestration proceedings. 2

The PCGG excluded private respondent Raul S. Roco from the complaint as party-defendant, on his
undertaking that he will reveal the identity of the principal/s for whom he acted as
nominee/stockholder in the companies involved in PCGG Case No. 33. 4

Petitioners were included in the Third Amended Complaint on the strength of the following
allegations:

14. Defendants Eduardo Cojuangco, Jr., Edgardo J. Angara, Jose C. Concepcion,

Teodoro Regala, Avelino V. Cruz, Rogelio A. Vinluan, Eduardo U. Escueta, Paraja G.
Hayudini and Raul Roco of the Angara Concepcion Cruz Regala and Abello law
offices (ACCRA) plotted, devised, schemed conspired and confederated with each
other in setting up, through the use of the coconut levy funds, the financial and
corporate framework and structures that led to the establishment of UCPB, UNICOM,
COCOLIFE, COCOMARK, CIC, and more than twenty other coconut levy funded
 corporations, including the acquisition of San Miguel Corporation shares and its
institutionalization through presidential directives of the coconut monopoly.

Through insidious means and machinations, ACCRA, being the wholly-owned

investment arm, ACCRA Investments Corporation, became the holder of
approximately fifteen million shares representing roughly 3.3% of the total
outstanding capital stock of UCPB as of 31 March 1987. This ranks ACCRA
Investments Corporation number 44 among the top 100 biggest stockholders of
UCPB which has approximately 1,400,000 shareholders. On the other hand,
corporate books show the name Edgardo J. Angara as holding
approximately 3,744 shares as of February, 1984. 5

In their answer to the Expanded Amended Complaint, petitioners ACCRA lawyers alleged that:

4.4 Defendants-ACCRA lawyers' participation in the acts with which their

codefendants are charged, was in furtherance of legitimate lawyering.

4.4.1 In the course of rendering professional and legal services to

clients, defendants-ACCRA lawyers, Jose C. Concepcion, Teodoro
D. Regala, Rogelio A. Vinluan and Eduardo U. Escueta, became
holders of shares of stock in the corporations listed under their
respective names in Annex "A" of the expanded Amended Complaint
as incorporating or acquiring stockholders only and, as such, they do
not claim any proprietary interest in the said shares of stock.

4.5 Defendant ACCRA-lawyer Avelino V. Cruz was one of the incorporators in 1976
of Mermaid Marketing Corporation, which was organized for legitimate business
purposes not related to the allegations of the expanded Amended Complaint.
However, he has long ago transferred any material interest therein and therefore
denies that the "shares" appearing in his name in Annex "A" of the expanded
Amended Complaint are his assets. 6

Petitioners ACCRA lawyers filed their counter motion, stating that respondent PCGG similarly grant
the same treatment to them (exclusion as parties-defendants) as accorded private respondent Roco.

Respondent PCGG set the following conditions precedent for the exclusion of petitioners, namely:
(a) the disclosure of the identity of its clients; (b) submission of documents substantiating the lawyer-
client relationship; and (c) the submission of the deeds of assignments petitioners executed in favor
of its client covering their respective shareholdings.

Respondent Sandiganbayan denied the exclusion of petitioners in PCGG Case No. 33, for their
refusal to comply with the conditions required by respondent PCGG.

PETITIONER: Petitioners argue they are prohibited from revealing the identity of their principal under their sworn mandate and
fiduciary duty as lawyers to uphold at all times the confidentiality of information obtained during such lawyer-client relationship.
PCGG: Respondent PCGG, through its counsel, refutes petitioners' contention, alleging that the revelation of the identity of the
client is not within the ambit of the lawyer-client confidentiality privilege, nor are the documents it required (deeds of
assignment) protected, because they are evidence of nominee status.

ISSUE: Can the lawyers in this case invoke attorney-client privilege and refuse to divulge the identity of their clients and their
knowledge of his/their transactions? YES.

RULING:

As a matter of public policy, a client's identity should not be shrouded in mystery. Under this premise, the general rule in our
jurisdiction as well as in the United States is that a lawyer may not invoke the privilege and refuse to divulge the name or
identity of this client. The reasons advanced for the general rule are well established. First, the court has a right to know that the
client whose privileged information is sought to be protected is flesh and blood. Second, the privilege begins to exist only after
the attorney-client relationship has been established. The attorney-client privilege does not attach until there is a client. Third, the
privilege generally pertains to the subject matter of the relationship.

Exceptions:

1) Client identity is privileged where a strong probability exists that revealing the client's name would implicate that
client in the very activity for which he sought the lawyer's advice.

2) Where disclosure would open the client to civil liability; his identity is privileged.

3) Where the government's lawyers have no case against an attorney's client unless, by revealing the client's
name, the said name would furnish the only link that would form the chain of testimony necessary to convict an
individual of a crime, the client's name is privileged.

Basically, information relating to the identity of a client may fall within the ambit of the privilege when the
client's name itself has an independent significance, such that disclosure would then reveal client confidences.

√ The circumstances clearly reveal that the instant case falls under at least two exceptions to the general rule.

First, disclosure of the alleged client's name would lead to establish said client's connection with the very fact in issue of the case,
which is privileged information, because the privilege, as stated earlier, protects the subject matter or the substance. There is no
question that the preparation of the (documents requested by PCGG) documents was part and parcel of petitioners' legal service
to their clients. More important, it constituted an integral part of their duties as lawyers. Petitioners, therefore, have a legitimate
fear that identifying their clients would implicate them in the very activity for which legal advice had been sought, i.e., the
alleged accumulation of ill-gotten wealth in the aforementioned corporations.

Second, revelation of the client's name would obviously provide the necessary link for the prosecution to build its case, where
none otherwise exists. It is the link that would inevitably form the chain of testimony necessary to convict the client of a crime.

An argument is advanced that the invocation by petitioners of the privilege of attorney-client confidentiality at this stage of the
proceedings is premature and that they should wait until they are called to testify and examine as witnesses as to matters learned
in confidence before they can raise their objections. But petitioners are not mere witnesses. They are co-principals in the case for
recovery of alleged ill-gotten wealth. They have made their position clear from the very beginning that they are not willing to
testify and they cannot be compelled to testify in view of their constitutional right against self-incrimination and of their
fundamental legal right to maintain inviolate the privilege of attorney-client confidentiality.

PEOPLE VS SANDIGANBAYAN
DOCTRINE: for the application of the attorney-client privilege, however, the period to be considered is the date when the
privileged communication was made by the client to the attorney in relation to either a crime committed in the past or with
respect to a crime intended to be committed in the future. In other words, if the client seeks his lawyer's advice with respect to a
crime that the former has theretofore committed, he is given the protection of a virtual confessional seal which the attorney-client
privilege declares cannot be broken by the attorney without the client's consent. The same privileged confidentiality, however,
does not attach with regard to a crime which a client intends to commit thereafter or in the future and for purposes of which he
seeks the lawyer's advice.

Statements and communications regarding the commission of a crime already committed, made by a party who committed it, to
an attorney, consulted as such, are privileged communications. Contrarily, the unbroken stream of judicial dicta is to the effect
that communications between attorney and client having to do with the client's contemplated criminal acts, or in aid or
furtherance thereof, are not covered by the cloak of privileges ordinarily existing in reference to communications between
attorney and client.

FACTS: The case involves a prominent politician in Mindanao, respondent Ceferino Paredes, Jr., who was formerly the
Provincial Attorney of Agusan del Sur, then Governor, and Congressman. During his stint, Paredes applied for and was granted a
free patent over a vast tract of land. However, it was cancelled because apparently, it has already been designated and reserved as
a school site.

The court found that Paredes had obtained title thereto through fraudulent misrepresentations in his application, and somebody
came forward and filed a case of perjury against him. However, the same was dismissed on the ground of prescription. Then
again, another case was filed against him for violation of RA 3019 (Anti-Graft and Corrupt Practices Act) for using his former
position as Provincial Attorney to influence and induce the Bureau of Lands officials to favorably act on his application for
patent. In all these cases, Paredes was represented by respondent Atty. Sansaet, a practicing attorney.

Paredes, as defense, contends that he has already been charged under the same set of facts and the same evidence where such
complaint (perjury case where he was already arraigned) has already been dismissed. Hence, double jeopardy has already
attached. In support hereof, Paredes presented court records and transcripts as proof of his arraignment in the perjury case.

However, the documents were found to be falsified, in conspiracy with Paredes’ counsel and the clerk of court where the perjury
case was filed. One Teofilo Gelacio claims that no notice of arraignment was ever received by the Office of the Provincial Fiscal.
Hence, another case was filed for falsification of judicial records.

It was then that respondent Sansaet offered to testify as a state witness against his client Paredes, claiming that the latter contrived
and induced him to have the graft case dismissed on the ground of double jeopardy by having him and co-respondent prepare and
falsify the subject documents.

But the Sandiganbayan denied the motion on the ground of attorney-client privilege since the lawyer could not testify against his
own client. In view of such relationship, confidential matters must have been disclosed by Paredes, as client, to accused Sansaet,
as his lawyer, in his professional capacity, and therefore privileged.

----

A case in the Sandiganbayan involved three parties, Paredes – Governor of Agusan del Sur (congressman na sya girl, former
provincial atty.), Honrada – a Clerk of Court and Acting Stenographer, and Sansaet – lawyer of Paredes.

All three are charged with conspiracy in the crime of falsification as several court documents were made by Honorada and then
submitted by Sansaet as defense for a criminal case of Paredes (for perjury and graft and corruption), making it appear as if there
was double jeopardy. The people sought to have Sansaet made a state witness to ensure prosecution of Paredes and Honrada, the
Sandiganbayan however denied the petition stating the privileged communication between a lawyer and his client as barring any
testimony that may be made by Sansaet to be used against Paredes (unless the latter gives his consent).
ISSUE: whether or not the projected testimony of respondent Sansaet, as proposed state witness, is barred by the attorney-client
privilege

RULING: NO. There is no privileged communication rule to talk about. The privilege applies only if the information was
relayed by the client to the lawyer respecting a past crime. The reckoning point is when the communication was given, not when
the lawyer was made to testify.

The attorney-client privilege cannot apply in these cases as the facts thereof and the actuations of both respondents therein
constitute an exception to the rule.

It may be correctly assumed that there was a confidential communication made by Paredes to Sansaet in connection with the
criminal cases since the latter served as his counsel therein. The privilege is not confined to verbal or written communications
made by the client to his attorney but extends as well to information communicated by other means. IOW, including physical
acts. The acts and words of the parties, therefore, during the period when the documents were being falsified were necessarily
confidential since Paredes would not have invited Sansaet to his house and allowed him to witness the same except under
conditions of secrecy and confidence.

However, the announced intention of a client to commit a crime is not included within the confidences which his attorney is
bound to respect. It is true that by now, insofar as the falsifications are concerned, those crimes were necessarily committed in the
past. But for the privilege to apply, the period to be considered is the date when the privileged communication was made by the
client to the attorney in relation to either a crime committed in the past or with respect to a crime intended to be committed in the
future. IOW, if the client seeks his lawyer’s advice with respect to a crime which he has already committed, he is given the
protection of a virtual confessional seal which the privilege declares cannot be broken by the attorney without the client’s
consent. The same privileged confidentiality, however, does not attach with regard to a crime a client intends to commit
thereafter or in the future and for purposes of which he seeks the lawyer’s advice.

Here, the testimony sought to be elicited from Sansaet as state witness are the communications made to him by physical acts
and/or accompanying words of Paredes at the time he and Honrada were about to falsify the documents. Clearly, therefore, the
confidential communications thus made by Paredes to Sansaet were for purposes of and in reference to the crime of falsification
which had not yet been committed in the past by Paredes but which he, in confederacy with his present co-respondents, later
committed. Having been made for purposes of a future offense, those communications are outside the pale of the attorney-client
privilege.

It is well settled that communication between a lawyer and his client, to be privileged, must be for a lawful purpose or in
furtherance of a lawful end. The existence of an unlawful purpose prevents the privilege from attaching. In fact, the prosecution
of the honorable relation of attorney and client will not be permitted under the guise of privilege, and every communication made
to an attorney by a client for a criminal purpose is a conspiracy or attempt at a conspiracy which is not only lawful to divulge, but
which the attorney under certain circumstances may be bound to disclose at once in the interest of justice.

To prevent a conniving counsel from revealing the genesis of a crime which was later committed pursuant to a conspiracy,
because of the objection thereto of his conspiring client, would be one of the worst travesties in the rules of evidence and practice
in the noble profession of law.

CASTILLO vs SANDIGANBAYAN

FACTS: The Republic of the Philippines filed with the Sandiganbayan a complaint for reconveyance, reversion, accounting,
restitution and damages against several persons one of which is petitioner.  This is because the peitioner in the case acted as a
dummy, nominee and/or agent of Defendants Ferdinand E. Marcos, Imelda R. Marcos, Modesto Enriquez, Trinidad Diaz
Enriquez, Rebecco Panlilio,Erlinda Enriquez Panlilio and Leandro Enriquez in establishing Hotel properties Inc. in order to
acquire beneficial interest and control, and conceal ownership, of Silahis International Hotel. The petitioner died. Petitioner,
represented by his heirs, field a Motion to Dismiss on the ground that the Complaint against him is  violative of the lawyer-client
confidentiality privilege and must be dismissed pursuant to the Supreme Courts decision in  Regala vs. Sandiganbayan,
promulgated on September 20, 1996.

SANDIGANBAYAN: denying the motion to dismiss on the ground that petitioner is being sued as principal defendant for being
in conspiracy with other defendants in the commission of the acts complained of.
ISSUE: Whether or not the case may be dismissed on the ground of violaton of the lawyer-client confidentiality privilege.

RULING: YES

It is true that unlike in Regala, petitioner in the present case is not being required to name his clients. However, the case
of Regala is still applicable to the present case because the two cases are the same in more important aspects.

The fact of the lawyer-client relationship between petitioner and defendants Enriquezes and Panlilios was immediately raised by
petitioner as one of his affirmative defenses. In the same vein, in  Regala the professional relationship was raised merely as a
defense by defendant lawyers and was not yet proved during the trial. This notwithstanding, this Court struck out the complaint
against the lawyers.

The respondent Republic argued in its Comment that:

"Moreover, the rule of confidentiality under the lawyer-client relationship is not a valid ground to dismiss a complaint against a
party. It is merely a ground for disqualification of a witness (Section 24, Rule 130, Rules of Court) and may only be invoked at
the appropriate time, such as, when a lawyer is under compulsion to answer as witness, as when, having taken the witness stand,
he is questioned on such confidential communication or advice, or is being otherwise judicially coerced to produce, through
subpoena duces tecum to otherwise, letters or other documents containing the same privileged matter. But defendant is not being
required to testify about or otherwise reveal any confidential communication made by the client to him or his advice given
thereon. What is clear from the complaint is that defendant is being sued as principal defendant for being in conspiracy with the
other defendants in the commission of the acts complained of.

"Besides, the attorney-client privileged communication does not apply if the confidence received by an attorney is for the purpose
of advancing a criminal or fraudulent purpose."5 

This was the same argument raised by the Republic in the case of Regala. In overruling the Republic’s position, this Court ruled:

"An argument is advanced that the invocation by petitioners of the privilege of attorney-client confidentiality at this stage of the
proceedings is premature and that they should wait until they are called to testify and examine as witnesses as to matters learned
in confidence before they can raise their objection. But petitioners are not mere witnesses.1âwphi1 They are co-principals in the
case for recovery of alleged ill-gotten wealth. They have made their position clear from the very beginning that they are not
willing to testify and they cannot be compelled to testify in view of their constitutional right against self-incrimination and of
their fundamental legal right to maintain inviolate the privilege of attorney-client confidentiality." 6 

The doctrine of adherence to judicial precedents or stare decisis is provided in Art. 8 of the Civil Code. The doctrine is
enunciated thus:

"The doctrine of stare decisis enjoins adherence to judicial precedents. It requires courts in a country to follow the rule
established in a decision of the Supreme Court thereof. That decision becomes a judicial precedent to be followed in subsequent
cases by all courts in the land. The doctrine of stare decisis is based on the principle that once a question of law has been
examined and decided, it should be deemed settled and closed to further argument." 7 

DALISAY vs MAURICIO

FACTS: On October 13, 2001, Valeriana U. Dalisay, complainant, engaged respondent’s services
as counsel in a civil case. Notwithstanding his receipt of documents and attorney’s fees in the total
amount of P56,000.00 from complainant, respondent never rendered legal services for her. As a
result, she terminated the attorney-client relationship and demanded the return of her money and
documents, but respondent refused. 

A complaint before the IBP was filed by Dalisay, wherein the IBP recommended that respondent be
ordered to return the money and, the dismissal of the complaint.
Incidentally, upon learning of our Decision, respondent went to the MTC to verify the status of the
said Civil Case No. 00-044. There, he learned of the trial court’s Decision dated December 6, 2001
holding that "the tax declarations and title" submitted by complainant "are not official records of the
Municipal Assessor and the Registry of Deed." Thereupon, respondent filed a Sworn Affidavit
Complaint1 against complainant charging her with violations of Article 171 2 and 172,3 and/or Article
1824 of the Revised Penal Code. He alleged that complainant offered tampered evidence. 

In this motion for reconsideration, respondent raises the following arguments: 

First, complainant did not engage his services as counsel in Civil Case No. 00-044. She hired him
for the purpose of filing two new petitions, a petition for declaration of nullity of title and a petition for
review of a decree. 

Second, Civil Case No. 00-044 was "considered submitted for decision" as early as August 6, 2001,
or more than two months prior to October 13, 2001, the date he was engaged as counsel, hence,
"he could not have done anything anymore" about it.

Third, complainant refused to provide him with documents related to the case, preventing him from
doing his job.

And fourth, complainant offered tampered evidence in Civil Case No. 00-004, prompting him
to file falsification cases against her.

In her opposition to the motion, complainant contends that: (1) respondent violated the principle of
confidentiality between a lawyer and his client when he filed falsification charges against
her; (2) respondent should have returned her money; (3) respondent should have verified the
authenticity of her documents earlier if he really believed that they are falsified; and (4) his refusal to
return her money despite this Court’s directive constitutes contempt. 

HE VIOLATED LC PRIVILEGE

It is axiomatic that no lawyer is obliged to act either as adviser or advocate for every person who
may wish to become his client. He has the right to decline employment. But once he accepts money
from a client, an attorney-client relationship is established, giving rise to the duty of fidelity to the
client’s cause.5 From then on, he is expected to be mindful of the trust and confidence reposed in
him. He must serve the client with competence and diligence, and champion the latter’s cause with
wholehearted devotion.6

Respondent assumed such obligations when he received the amount of P56,000.00 from
complainant and agreed to handle Civil Case No. 00-044. Unfortunately, he had been remiss in the
performance of his duties. As we have ruled earlier, "there is nothing in the records to show that
he (respondent) entered his appearance as counsel of record for complainant in Civil Case
No. 00-044." Neither is there any evidence nor pleading submitted to show that he initiated new
petitions.

LEE VS SIMANDO

FACTS: Atty. Simando was the retained counsel of complainant Dr. Lee from November 2004 until January 8, 2008, with a
monthly retainer fee of Php 3,000.00

Atty. Simando went to see Dr. Lee and asked if the latter could help a certain Felicito M. Mejorado for his needed funds, in
which he also offered to be the co-maker. Due to Atty. Simando's persistence, his daily calls and frequent visits to convince Dr.
Lee, the latter gave in to her lawyer's demands, and finally agreed. Respondent acted as co-maker with Mejorado in 5 different
cash loans amounting to Php 1,400,000.

When the said obligation became due, Mejorado failed and refused to comply with his obligation. Since Atty. Simando was still
her lawyer then, Dr. Lee instructed him to initiate legal action against Mejorado. Atty. Simando said he would get in touch with
Mejorado and ask him to pay his obligation without having to resort to legal action. However, even after several months,
Mejorado still failed to pay Dr. Lee, so she again asked Atty. Simando why no payment has been made yet. Dr. Lee then
reminded Atty. Simando that he was supposed to be the co-maker of the obligation of Mejorado, to which he replied: "Di
kasuhan din ninyo ako!"

Despite complainant's repeated requests, respondent ignored her and failed to bring legal actions against Mejorado. Thus,
complainant was forced to terminate her contract with Atty. Simando.

Respondent claimed that complainant is a money-lender exacting high interest rates from borrowers. He narrated several
instances and civil cases where complainant was engaged in money-lending where he divulged that even after defendants had
already paid their loan, complainant still persists in collecting from them. Respondent asserted that he knew of these transactions,
because he was among the four lawyers who handled complainant's case

COMPLAINANT: lamented that respondent, in his comments, even divulged confidential information he had acquired while he
was still her lawyer and even used it against her in the present case, thus, committing another unethical conduct. She, therefore,
maintained that respondent is guilty of violating the lawyer-client confidentiality rule.

---------

. He claimed that Mejorado was then awaiting the release of his claim for informer's reward from the Bureau of Customs.
Because Dr. Lee did not know Mejorado personally and she claimed to be not in the business of lending money, the former
initially refused to lend money. But Atty. Simando allegedly persisted and assured her that Mejorado will pay his obligation and
will issue postdated checks and sign promissory notes. He allegedly even offered to be the co-maker of Mejorado and assured her
that Mejorado's obligation will be paid when due. Atty. Simando was quoted saying: "Ipapahamak ba kita, kliyente kita";
"Sigurado ito, kung gusto mo, gagarantiyahan ko pa ito, at pipirma din ako"; "Isang buwan lang, at hindi hihigit sa dalawang
buwan ito, bayad ka na."3

ISSUE: W/N there is violation of LCP

YES. Finally, we likewise find respondent guilty of violating Rule 21.01 of the Code of Professional Responsibility. In his
last-ditch effort to impeach the credibility of complainant, he divulged informations which he acquired in confidence
during the existence of their lawyer-client relationship.

ZALAMEA VS DE GUZMAN

ART 1491:

The law expressly prohibits a lawyer from purchasing, even at a public or judicial auction, either in person or through the
mediation of another, any property or interest involved in any litigation in which he may take part by virtue of his profession. 62
The canons of the legal profession provide a similar restriction. 63

The prohibition which rests on considerations of public policy and interest 64 is intended to curtail any undue influence of the
lawyer upon his client on account of his fiduciary and confidential relation with him. 66 The law makes the incapacity of the
attorney to acquire his client’s property in litigation absolute and permanent.®

FACTS: the Zalamea brothers put up EMZEE FOODS INC., (EMZEE) a corporation engaged in lechon business, with Atty. De
Guzman providing the capital and operational funds.

Sometime in 2002, Manuel Enrique informed De Guzman about the property located at Speaker Perez St. (Speaker Perez
property) which was then under the name of Elarfoods, Inc. (Elarfoods), a corporation owned and run by the Zalamea brothers'
aunts and uncles. Since said property had been mortgaged to Banco de Oro (BDO), the bank foreclosed it when Elarfoods failed
to pay the loan. Elarfoods likewise failed to redeem the property, resulting in the consolidation of the ownership over the property
in BDO's name.

The Zalamea then convinced Atty. De Guzman to reacquire the property. The BDO, through Atty. De Guzman, agreed to
sell the property for P20 Million, and with a 10% downpayment. Due to lack of funds of the Zalameas, Atty. De Guzman’s wife,
Angel, agreed to shoulder the P2 Million downpayment. Subsequently, Angel was forced to pay the monthly installments and all
in all, paid a total of P13 Million.

Not long after, the relationship, between the Zalamea brothers and the Spouses De Guzman turned sour. The Spouses De Guzman
wanted reimbursement of the amounts which they had advanced, while the Zalamea brothers claimed sole ownership over the
property.

Hence, the brothers filed a disbarment case against De Guzman for allegedly buying a client's property which was subject of
litigation under Article 1491 of the Civil Code.

Issue:

Whether the prohibition under Art. 1491 for lawyers apply in the case.

Ruling:

No. The SC held that the prohibition does not apply in the case.

The Court dismissed the Petition for Disbarment against Atty. Rodolfo P. de Guzman, Jr. for utter lack of merit.

According to the SC, the prohibition which the Zalameas invoke does not apply where the property purchased was not involved
in litigation. De Guzman clearly never acquired any of his client's properties or interests involved in litigation in which he
may take part by virtue of his profession. There exists not even an iota of proof indicating that said property has ever
been involved in any litigation in which De Guzman took part by virtue of his profession. True, they had previously sought
legal advice from De Guzman but only on how to handle their mother's estate, which likewise did not involve the contested
property. Neither was it shown that De Guzman's law firm had taken part in any litigation involving the Speaker Perez property.

The prohibition [in Article 1491] which rests on considerations of public policy and interests is intended to curtail any undue
influence of the lawyer upon his client on account of his fiduciary and confidential relationship with him.

De Guzman could not have possibly exerted such undue influence, as a lawyer, upon the Zalameas, as his clients.

Indeed, the purchase by a lawyer of his client's property or interest in litigation is a breach of professional ethics and constitutes
malpractice. The persons mentioned in Article 1491 are prohibited from purchasing said property because of an existing trust
relationship. A lawyer is disqualified from acquiring by purchase the property and rights in litigation because of his fiduciary
relationship with such property and rights, as well as with the client.

Clearly, the relationship between the Spouses De Guzman and the Zalamea brothers is actually one of business partners rather
than that of a lawyer and client. Atty. De Guzman's acquisition of the Speaker Perez property was a valid consequence of a
business deal, not by reason of a lawyer-client relationship, for Which he could not be penalized by the Court. De Guzman and
his wife are very well allowed by law to enter into such a transaction and their conduct in this regard was not borne out to have
been attended by any undue influence, deceit, or misrepresentation.

BERBANO vs BARCELONA

SUMMARY:

Berbano, one of the heirs of Rufino Esteban Hilapo, appointed as attorney-in-fact Porfrio Daen to settle
their land dispute with Filinvest Dev. Corp. Pending the land dispute, Daen was incarcerated. She
sought the assistance of Barcelona in releasing Daen. Berbano and Daen's nephew gave Barcelona a total
of PhP64,000 for the cause as Barcelona purported that he knew a Justice of the Supreme Court who can
help with Daen's release but that he would need money for it. However, Daen was not released from jail
as promised and Berbano, in her several attempts to recover the money, was evaded by Atty. Barcelona.

The Court held that Berbano has violated several canons of the Code of Professional Responsibility,
including Canon 16 and Rule 16.01, which demands that lawyers must account for all the money
received from the client. Furthermore, Barcelona had a previous administrative complaint against him of
similar nature and had, as in that case, ignored all hearings and notices from the Investigating
Commissioner. Barcelona was thus declared disbarred from the practice of law and was ordered to return
PhP64,000 to Berbano.

DOCTRINE:
The Code exacts from lawyers not only a firm respect for law, legal processes and the courts but also
mandates the utmost degree of fidelity and good faith in dealing with clients and the moneys
entrusted to them pursuant to their fiduciary relationship.

-------

FACTS:
 11 Mar 1999 – Felicitas Berbano filed a sworn affidavit before the IBP and alleged the following:
o Berbano was one of the heirs of Rufino Esteban Hilapo and had appointed Porfirio Daen as their
attorney-in-fact in the settlement of a land dispute against Filinvest Dev. Corp. with the Commission on
the Settlement of Land Problems (COSLAP) involving 244 hectare land in Alabang, Muntinlupa

o 26 Jan 1999 – Daen was arrested by a Muntinlupa police who presented an expired warrant dated Feb
1990 and was detained at Muntinlupa City Jail, Tunasan

o Naty Sibuya, a friend, recommended Wenceslao Barcelona, her cousin-in-law, to assist in the release of
Daen

o 26 Jan 1999 - Barcelona purported that he could have Daen released the following day if he would be
given PhP50,000. Berbano gave him only PhP15,700 as it was already around 10:30PM and could only
gather the money from their relatives

o 27 Jan 1999 – At a Max's Restaurant, 12NN, Berbano handed Barcelona a pay-to-cash cheque amounting
to PhP24,000 dated 29 Jan 1999. Barcelona claimed that the Justices of the Supreme Court do not accept
cheques but took the cheque presented nonetheless.

o 28 Jan 1999 – Berbano gave an additional PhP10,000 in cash to Barcelona through the latter's wife. As
the cheque was allegedly not encashed according to Barcelona, PhP15,000 was given to him by Gil Daen,
Porfrio's nephew. Berbano also gave PhP1,000 for Barcelona's gasoline expenses.

o 3 Feb 1999 – Barcelona told Berbano that Daen will be released the following day.

o 4 Feb 1999 – Daen was not released and Barcelona, according to his wife, was in Mindanao attending a
peace talk with the Muslims
o After more than a week – Barcelona promised that he would return the PhP64,000 but was never heard
from or seen again by Berbano

   15 Apr 1999 – Investigating Commissioner J. Virgilio A. Bautista of CBD IBP required
Barcelona to submit an answer to the complaint. Barcelona never submitted despite due notice
received by him.
   13 Aug 1999 – Respondent failed to appear in the hearing and was then considered in default.
Complainant testified and manifested that she would bring the PhP24,0000 cheque.
   Complainant and respondent failed to appear in the following hearings: 1 Oct and 19 Nov in
1999, 12 Oct and 14 Dec in 2001 and 28 Jun 2002.
   23 Dec 2002 – Commissioner Bautista recommended that respondent was

guilty of malpractice and serious breach of the Code of Professional Responsibility and
recommended that he be disbarred and ordered to return the PhP24,0000.

   IBP Board of Governors affirmed the recommendation but modified the penalty to suspension
for 6 years

ISSUE:

1. WON Barcelona should be disbarred? YES.

a. Respondent callously demeaned the legal profession by taking money from a client under the pretext
of having connections with a Justice of the Supreme Court

2. Respondent had the audacity to say that Justices of the Supreme Court do not accept cheques
3. Respondent had been charged and found guilty of conduct unbecoming of a lawyer in Gil T.
Aquino v. Atty Wenceslao C. Barcelona where he asked and received an amount of PhP60,000
as he misrepresented that he knew a legal assistant named Gonzalo Mericullo in PNB who
could restructure the loan of the then complainant. No such person was employed by PNB and
as a result, Aquino's property was foreclosed. The Court suspended respondent for six years.
4. Respondent has a penchant for misrepresenting to clients that he has the proper connections to
secure the relief they seek and ask for money allegedly to be given to said connections
5. Act of respondent of not filing his answer and not attending the hearings displays his contempt
for legal proceedings

RULING: Court ordered the disbarment of Barcelona as he was found guilty of gross misconduct and
in violating Canons 1, 7, 11, 16 and Rule 16.01 and ordered that PhP64,000 be returned to the
complainant within 30 days from receipt of the notice.

LICUANAN vs MELO

FACTS: Licuanan filed a complaint with the Office of the Court Administrator against Atty. Melo, for breach of professional
ethics, alleging that Melo, her counsel in an ejectment case, failed to remit to her the rentals collected by him (from Pineda) over
a 12-month period and he did not report to her the receipt of said amounts. It was only after a year from actual receipt that Melo
turned over his collections to Licuanan after the latter’s new counsel, acquired knowledge of the payment and had demanded the
same.

Atty. Melo admitted having received the payment of rentals from Licuanan's tenant, Pinedabut he explained that he kept this
matter to surprise Licuanan with his success in collecting the rentals.SC forwarded the case to the OSG.

FINDINGS AND RECOMMENDATION OF THE SOLGEN:

A lawyer, under his oath, pledges himself not to delay any man for money or malice and is bound to conduct himself with all
good fidelity to his clients. Under paragraph 11 of the Canons of Legal Ethics, he is obligated to report promptly the money of
client that has come to his possession and should not commingle it with his private property or use it for his personal purpose
without his client's consent.

And paragraph 32 further requires a lawyer to maintain a reputation for honesty and fidelity to private trust:

... But above all, a lawyer will find his highest honor in a deserved reputation for fidelity to private trust and to public duty, as an
honest man and as a patriotic and loyal citizen.

It is undisputed that the relation of attorney and client existed between Licuanan and Melo at the time the incident took place. The
records disclose that Atty. Melo obtained judgment in Licuanan's favor against Pineda. The latter was directed to pay but when
she failed to, Melo sent her a letter demanding payment otherwise he will be constrained to take the necessary legal action against
her. Pineda then paid him on different dates and she was issued receipts.

During the period that Melo had been receiving rental payments, he did not inform Licuanan despite the fact that Licuanan used
to call him and inquire regarding the case. He allowed the money to accumulate for a year and kept Licuanan in the dark as to the
progress of the case.

It was only when Licuanan’s new counsel wrote Melo a letter advising him to surrender the money to Licuanan. But this was
rather late because Licuanan, not knowing that Melo had been receiving the rental payments, instituted a case against Pineda
accusing her of "moral turpitude" arising from her alleged failure to pay the rent of her apartment claiming that she has ignored
and refused to pay her just obligation.

This led Pineda to bring an action against Licuanan for damages for she suffered mental anguish, besmirched reputation,
wounded feelings and social humiliation arising from the case Licuanan filed against her, since she had been paying her
obligation religiously to Melo.

Common sense dictates that by unnecessarily withholding the money of Licuanan for such length of time, Melodeprived her of
the use of the same. He must know that the "highly fiduciary" and "confidential relation" of attorney and client requires that the
attorney should promptly account for all funds and property received or held by him for the client's benefit, and failure to do so
constitutes professional misconduct.

A lawyer may be disbarred for any deceit, malpractice or other gross misconduct in his office as attorney or for any violation of
the lawyer's oath.

The relation bet. an atty. and his client is highly fiduciary in nature and of a very delicate, exacting and confidential in character,
requiring a high degree of fidelity and GF. The fact that a lawyer has a lien for fees on money in his hands collected for his
clients does not relieve him from the duty of promptly accounting for the funds received.

Melo is guilty of breach of trust reposed in him by his client. Not only has he degraded himself but as an unfaithful lawyer he has
besmirched the fair name of an honorable profession. By his deceitful conduct, he placed his client in jeopardy by becoming a
defendant in a damage suit; thus, instead of being a help to his client, he became the cause of her misery. He, therefore, deserves
a severe punishment for it.
-SUSPENSION for not less than 1 year

SUPREME COURT:
Adopted the findings of the SolGen but modified the penalty from suspension to disbarment. The actuations of Melo in retaining
for his personal benefit over a one-year period, the amount received by him on behalf of his client depriving her of its use, and
withholding information on the same despite inquiries made by her, is glaringly a breach of the Lawyer's Oath to which he swore
observance, and an evident transgression of the Canons of Professional Ethics particularly:

The lawyer should refrain from any action whereby for his personal benefit or gain he abuses or takes advantage of the
confidence reposed in him by his client.

Indeed, by his professional misconduct, Melo has breached the trust reposed in him by his client. He has shown himself unfit
for the confidence and trust which should characterize an attorney-client relationship and the practice of law.

-DISBAR respondent, Atty. Manuel L. Melo from the practice of law. His name is hereby ordered stricken from the Roll of
Attorneys.

HERNANDEZ VS GO
FACTS: The complainant Nazaria Hernandez was currently facing suits for money against her because of the
unpaid loans that her husband had left when he had abandoned his family.

Hernandez availed of the services of respondent Luciano Go. The latter advised the former to sell all her lots to him
without any monetary consideration for each of the lots. The respondent promised to sell the lands to third parties
and the funds collected from the sales would be used to pay Hernandez’s creditors.

In 1974, it turned out that the respondent did not in fact sell the lots in question. What he did was to pay off the
loans using his own money. Up to the point of this complaint, the respondent still owns the lots in question.

The respondent denies all the allegations and claims that he did not breach the trust between him and his client.

ISSUE:
WHETHER OR NOT the respondent should be disciplined for his actions

RULE:
YES. Respondent Atty. Jose Go is found to be unfit to practice the law profession and is duly DISBARRED from the
brotherhood of lawyers.

RATIO:
The respondent clearly abused his client’s trust in him in having convinced her to sell the lots in question in his
favor without so much as a cent going to Hernandez. He not only deceived Hernandez but he had taken advantage
of the latter during a financial plight.

The IBP Commissioner for Bar Discipline found the respondent to be guilty of violating Canons 16 and 17 and
improperly rendered a resolution to penalize him with 6 months of suspension. The IBP Board of Governors found
this penalty to be too light and sentenced him to 3 years of suspension.

The Supreme Court, however, relied on Section 27 of Rule 138 of the Revised Rules of Court which states that a
lawyer may be disbarred from the practice if he is found to have done a gross misconduct in his office. The court
found that the respondent truly did perform misconduct and the punishment that is due him should be
disbarment.

CANONS:
Canon 16. "A lawyer shall hold in trust all moneys and properties of his client that may come into his possession."

BUSINOS vs RICAFORT

FACTS: Complainant Lourdes R. Businos is one of the heirs of Pedro Rodrigo who are the defendants in a Civil Case.
Respondent was the counsel of record for the defendants in the said case.

Complainant, representing her co-heirs, executed a special power of attorney, appointing and constituting respondent and/or
Pedro Rodrigo, Jr. to be her true and lawful attorney-in-fact with the following powers:

Among others;

2. To demand, collect and receipt for any and all sums of money that may now be deposited in said court by the defendant Oas
Standard High School or hereafter be deposited by said defendant, due and owing to me or said Heirs of Pedro Rodrigo, Sr.,
representing the rentals of said defendant for the lease of the property involved in said case;

the Clerk of Court released all deposits of rentals made in connection with the said case (Civil Case No. 1584) to the defendants
Heirs of Pedro Rodrigo through Lourdes Rodrigo Businos who were receiving the rentals from Oas Standard High School prior
to the institution of this case.
It later informed herein complainant that respondent Atty Ricafort had already received the rental deposit of P25,000.00.
Respondent also received from Oas Standard High School the sum of P5,000.00 as payment for rental of school site. The said
sum was entrusted to respondent with an obligation on his part to deposit the same in the account of complainant's husband at
PNB, Ligao Branch. Instead, however, of depositing the money, respondent converted the money to his own personal use, and
despite several demands, he failed to return the same to complainant. She was thus constrained to file a criminal case for estafa
and an administrative case for disbarment against him. Thus, on November 21, 1994, complainant filed the instant administrative
case against respondent.

Complainant further accuses respondent for demanding and receiving P2,000.00 from her which he said will be used for the bond
in Civil Case No. 1584, but said amount was never used as intended since no bond was required in the said case. Thus,
respondent merely pocketed the said amount.

RULING: respondent breached Section 25 of Rule 138 of the Rules of Court, Rule 1.01 of Canon 1 and Rules 16.01, 16.02 and
16.03 of Canon 16 of the Code of Professional Responsibility. Respondent's transgressions manifested dishonesty and amounted
to grave misconduct and grossly unethical behavior which caused dishonor, not merely to respondent, but to the noble profession
to which he belongs, for it cannot be denied that the respect of litigants for the profession is inexorably diminished whenever a
member of the Bar betrays their trust and confidence.

DISBARRED

QUILBAN vs ROBINOL

This involves the donation of land of Colegio de san jose to the squatters, which was represented by the samahang pagkakaisa ng
barrio bathala president, Bernabe Martin. During the negotiation, Martin, instead of working for the benefit of the Samahan, he
connived with the realtor, Rivera, to obtain the sale to the exclusion of the members.

This prompted the members to file a civil case against Rivera, the realtor. When the case was dismissed, the members appealed
the case with Atty Robinal as their counsel. They raised funds for the payment of the lot for the execution of deed of conveyance
in their favor. However, almost a year later, becausee of lack of action, the samahan members were prompted to change their
counsel, and filed an admin case against Robinol for his failure to return the 75k given to him.

In his defense, Atty Robinol maintains that he only received roughly 50k and that he had the right to hold the money in his
possession as guarantee for his atty’s fees.

RULING:
ATTY ROBINOL had no right to unilaterally appropriate his client’s money not only bc he is bound by a written
agreement, but because under the circumstances, it was highly unjust for him to have done so because his clients were
mere squatters. they had painstakingly raised their respective quotas of 2,500 per family with which to pay for the land
only to be deprived the same by the one who heartlessly took advantage of them.

Further, his atty.’s fee as agreed upon were purely on contingent basis. He shall be given a part of the subject land, equal to the
portion that would pertain to each of them.

RAYOS vs HERNANDEZ

FACTS: Atty Hernandez was the counsel of Rayos in a Civil Case for damages against NAPOCOR. RTC dismissed the complaint.
Upon appeal, CA reversed the RTC decision and awarded damages in favor of Rayos. SC affirmed the CA Decision which became
final and executory.

NAPOCOR issued a Check in the amount of ₱1,060,800.00 payable to Rayos which was turned over to Atty. Hernandez as
counsel. When Rayos demanded the turn over of the check, Atty. Hernandez refused and justified his retention as a means to
ensure payment of his attorney’s fees.

Rayos initiated this complaint for disbarment for Atty. Hernandez’ failure to return the rest of the award in the amount of
₱557,961.21.

In his answer Atty. Hernandez alleged that they had a contract for attorney’s fees on a contingent basis on 40%-60% sharing of
the court award. Atty. Hernandez was entitled to receive 60% of the award – 40% as attorney’s fees and 20% as litigation
expenses. He asseverated that he deposited Rayos’ share of the 40% award in a bank under Rayos’ name.
ISSUE #1: Whether Atty. Hernandez is justified in retaining the amount awarded to Rayos to assure payment of his attorney’s
fees.

HELD: NO.

Moneys collected by an attorney on a judgment rendered in favor of his client constitute trust funds and must be immediately
paid over to the client. Canon 16 of the Code of Professional Responsibility provides that:

CANON 16 - A lawyer shall hold in trust all moneys and properties of his client that may come into his possession.
Rule 16.01 – A lawyer shall account for all money or property collected or received for or from the client.
When Atty. Hernandez withheld and refused to deliver the check, he breached the trust reposed on him. The claim that Rayos
failed to pay his attorney’s fees is not an excuse for Atty. Hernandez’ failure to deliver the amount. A lawyer is not entitled to
unilaterally appropriate his client’s money for himself by the mere fact alone that the client owes him attorney’s fees. The
failure of an attorney to return the client’s money upon demand gives rise to the presumption that he has misappropriated it
for his own use to the prejudice and violation of the general morality, as well as of professional ethics; it also impairs public
confidence in the legal profession and deserves punishment.

It is true that under Canon 16.03 of the Code of Professional Responsibility, an attorney has the following rights:

Rule 16.03- A lawyer shall deliver the funds and property of his client when due or upon demand. However, he shall have a lien
over the funds and may apply so much thereof as may be necessary to satisfy his lawful fees and disbursements, giving notice
promptly thereafter to his client. He shall also have a lien to the same extent on all judgments and executions he has secured
for his client as provided for in the Rules of Court.

But the fact alone that a lawyer has a lien for fees on moneys in his hands collected for his client, does not relieve him of his
duty to promptly account for the moneys received; his failure to do so constitutes professional misconduct. Thus, what
respondent should have properly done was to provide the petitioner with an accounting before deducting his attorney’s fees
and then to turn over the remaining balance of the award collected.

The relationship of attorney and client has always been rightly regarded as one of special trust and confidence. An attorney
must exercise the utmost good faith and fairness in all his relationship vis-à-vis his client. Respondent fell far short of this
standard when he failed to render an accounting for the amount actually received by him on behalf of his client and when he
refused to turn over any portion of said amount to his client upon the pretext that his attorney’s fees had not at all been paid.
Respondent had, in fact, placed his private and personal interest above that of his client.

Lawyering is not a moneymaking venture and lawyers are not merchants. Law advocacy, it has been stressed, is not capital that
yields profits. The returns it births are simple rewards for a job done or service rendered. It is a calling that, unlike mercantile
pursuits which enjoy a greater deal of freedom from governmental interference, is impressed with a public interest, for which it
is subject to State regulation.

A lawyer’s compensation for professional services rendered is subject to the supervision of the court, not just to guarantee that
the fees he charges and receives remain reasonable and commensurate with the services rendered, but also to maintain the
dignity and integrity of the legal profession to which he belongs. Upon taking his attorney’s oath as an officer of the court, a
lawyer submits himself to the authority of the courts to regulate his right to charge professional fees.

BARNACHEA VS QUIOCHO

FACTS: Barnachea filed a complaint for breach of lawyerclient relations against respondent Atty . Edwin T . Quiocho.
Complainant engaged the legal services of respondent for the latter to cause the transfer under her name of the title
over a property previously owned by her sister , Lutgarda Amor D. Barnachea. However , despite the lapse of almost
two months, respondent failed to secure title over the property in favor of complainant. The latter demanded that respondent
refund to her the amount of P41,280.00 and return the documents which she earlier entrusted to him. Complainant
received a letter from respondent informing her that he had failed to cause the transfer of the property under her name
and that he was returning the documents and title she had entrusted to him and refunding to her the amount of
P41,280.00. Respondent told complainant that he needed more time to fund the check. However, respondent failed to
fund the check despite the demands of complainant.
RESPONDENT: respondent denied that complainant contracted his legal services. Although respondent admitted having
received the two checks from complainant, he claimed that said checks were intended to cover actual and incidental expenses for
transportation, communication, representation, necessary services, taxes and fees for the cancellation and transfer of TCT No.
334411 under the name of complainant and not for legal services.

Respondent further alleged that he was a licensed real estate and insurance broker and had been a freelance business management
consultant. At the same time he engaged in real estate brokering, pre-need products marketing for Prudential Life, and life
insurance underwriting for Insular Life. In 1999, he gave up the practice of his profession as a lawyer and subsequently managed
to put up a business center with fellow insurance underwriters for their common insurance underwriting practice. He further
claimed that sometime in August, 2001, an insurance client introduced complainant as an insurance prospect to him. In the course
of their dealing, complainant intimated to respondent her willingness to consider respondents insurance proposal provided the
latter would help her facilitate the cancellation and eventual transfer to her name the property covered by TCT No. 334411 in the
name of complainants sister, Lutgarda Amor D. Barnachea.

RULING: GUILTY OF MALPRACTICE

Respondents claim that complainant did not retain his legal services flies in the face of his letter to complainant. Even if it were
true that no attorney-client relationship existed between them, case law has it that an attorney may be removed or otherwise
disciplined not only for malpractice and dishonesty in the profession but also for gross misconduct not connected with his
professional duties, making him unfit for the office and unworthy of the privileges which his license and the law confer
upon him.

In this case, respondent failed to comply with his undertaking for almost two months. Worse, despite demands of complainant, he
failed to refund the amount of P41,280.00 and to return to complainant the deed of absolute sale and title over the property.
Respondents claim that complainant could not contact him because he did not have any landline at his residence and that his
mobile phone was stolen in October 2001, is hard to believe. He failed to adduce a morsel of evidence to prove that his telephone
at the business center was cut or that his mobile phone had been stolen. Even then, respondent could have easily contacted the
complainant at her residence or could have written her a letter informing her that the original copy of TCT No. 324411 in the
custody of the Register of Deeds was burned when the Quezon City Hall was gutted by fire and that there was a need for the
reconstitution of said title. Neither did respondent adduce evidence that he was a life insurance underwriter for Insular Life or
that he had been sick with diabetes and had lost his sight in his right eye. Respondent simply refused to adduce evidence to prove
his allegations in his Answer to the complaint.

A lawyer is obliged to hold in trust money or property of his client that may come to his possession. He is a trustee to said funds
and property.5 He is to keep the funds of his client separate and apart from his own and those of others kept by him. Money
entrusted to a lawyer for a specific purpose such as for the registration of a deed with the Register of Deeds and for expenses and
fees for the transfer of title over real property under the name of his client if not utilized, must be returned immediately to his
client upon demand therefor.

The Court is led to believe that respondents failure to cause the transfer of the title of the property under the name of
complainant was due to a financial problem that beset him shortly after he received the checks from complainant. It can
easily be inferred from respondents letter that he used complainants money to alleviate if not solve his financial woes.
What compounded respondents unethical conduct was his drawing of a personal check and delivering the same to
complainant without sufficient funds in his bank account to cover the check. Even as he promised to fund his account
with the drawee bank, respondent failed to do so when the check became due.

The lawyers failure to return the money of his client upon demand gave rise to a presumption that he has
misappropriated said money in violation of the trust reposed on him.6 The conversion by a lawyer funds entrusted to him by
his client is a gross violation of professional ethics and a betrayal of public confidence in the legal profession.7

In this case, respondent intransigently refused to return to the complainant the amount of P41,280.00 which he received for the
expenses for the transfer to her of the title of the property and for his professional fees. His dishonest conduct was compounded
by his interjection of flimsy excuses for his obstinate refusal to refund the amount to complainant.

The relation of attorney and client is highly fiduciary in nature and is of a very delicate, exacting and confidential character.8 A
lawyer is duty-bound to observe candor, fairness and loyalty in all his dealings and transactions with his clients.9 The profession,
therefore, demands of an attorney an absolute abdication of every personal advantage conflicting in any way, directly or
indirectly, with the interest of his client. In this case, respondent miserably failed to measure up to the exacting standard expected
of him.
He is SUSPENDED from the practice of law for One (1) Year with a stern warning that a repetition of the same or similar acts
shall be dealt with more severely.

NAVARRO VS SOLIDUM

FACTS: Hilda S. Presbitero and Natividad P. Navarro filed a disbarment case against Atty. Ivan M. Solidum, Jr.
Presbitero and her other daughter, Ma. Theresa P. Yulo, engaged in the services of Solidum for each of their own cases
concerning land. Yulo, pursuant to her land registration case, convinced Navarro to finance the expenses. Navarro paid
Php200,000 for the registration expenses, but later learned that the property was already registered in the name of one Teodoro
Yulo.

Meanwhile, Solidum obtained two loans of Php1,000,000.00 from Navarro and one loan of Php1,000,000.00 to finance his sugar
trading business, securing them with postdated checks and drafting a MOA in each.

Solidum was able to pay complainants a total of Php900,000.00. Thereafter, he failed to pay either the principal amount or the
interest thereon. The checks issued by Solidum to the complainants could no longer be negotiated because the accounts against
which they were drawn were already closed. When complainants called Solidum’s attention, he promised to pay the agreed
interest for September and October 2006 but asked for a reduction of the interest for the succeeding months.

Complainants alleged that Solidum induced them to grant him loans by offering very high interest rates. He also prepared and
signed the checks which turned out to be drawn against his son’s accounts. Complainants further alleged that respondent
deceived them regarding the identity and value of the property he mortgaged because he showed them a different property from
that which he owned. Presbitero further alleged that respondent mortgaged his 263-square-meter property to her for
Php1,000,000.00 but he later sold it for only Php150,000.00.

The IBP-CBD found that respondent was guilty of violating Rule 1.01 of the Code of Professional Responsibility for committing
the following acts:
(1) signing drawn checks against the account of his son as if they were from his own account;
(2) misrepresenting to Navarro the identity of the lot he mortgaged to her;
(3) misrepresenting to Presbitero the true value of the 263-square-meter lot he mortgaged to her;
(4) conspiring with Yulo to obtain the loans from complainants;
(5) agreeing or promising to pay 10% interest on his loans although he knew that it was exorbitant; and
(6) failing to pay his loans because the checks he issued were dishonored as the accounts were already closed.

RULING: VIOLATE RULE 16.04

Here, respondent does not deny that he borrowed ₱1,000,000 from his client Presbitero. At the time he secured the loan,
respondent was already the retained counsel of Presbitero.

While respondent’s loan from Presbitero was secured by a MOA, postdated checks and real estate mortgage, it turned out that
respondent misrepresented the value of the property he mortgaged and that the checks he issued were not drawn from his account
but from that of his son. Respondent eventually questioned the terms of the MOA that he himself prepared on the ground that the
interest rate imposed on his loan was unconscionable. Finally, the checks issued by respondent to Presbitero were dishonored
because the accounts were already closed. The interest of his client, Presbitero, as lender in this case, was not fully protected.
Respondent violated Rule 16.04 of the Code of Professional Responsibility, which presumes that the client is
disadvantaged by the lawyer’s ability to use all the legal maneuverings to renege on his obligation.6 In his dealings with
his client Presbitero, respondent took advantage of his knowledge of the law as well as the trust and confidence reposed in
him by his client.

QUIRANTE vs IAC

In the case of Dr. Casasola’s claim against its erring building contractor, the trial court ruled in favor of the
former who eventually died. Here, petitioner Atty. Quirante filed a motion in the trial court for the
confirmation of his attorney’s fees. According to him, there was an oral agreement between him and the
late Dr. Casasola with regard to his attorney’s fees, as confirmed in writing by the latter’s surviving spouse
and two daughters to be computed as follows:
1. In case of recovery of the P120,000.00 surety bond, the attorney’s fees of the undersigned
counsel (Atty. Quirante) shall be P30,000.00;
2. In case the Honorable Court awards damages in excess of the P120,000.00 bond, it shall be
divided equally between the Heirs of Dr. Casasola, Atty. John C. Quirante and Atty. Dante Cruz.

The trial court granted the motion for confirmation despite an opposition thereto. In the petition for review
on certiorari, the respondent court (IAC) ruled that the confirmation of attorney’s fees is premature.

RULING: CONFIRMATION OF ATTY’S FEES IS PREMATURE.

: A lawyer may enforce his right to fees by filing the necessary petition as an incident of the main action in which his services
were rendered only when something is due the client in the action from which the fee is to be paid, or in a separate action.

If the first alternative is chosen, the Court may pass upon said claim, even if its amount were less
than the minimum prescribed by law for the jurisdiction of said court, upon the theory that the right to
recover attorney's fees is but an incident of the case in which the services of counsel have been
rendered ."   It also rests on the assumption that the court trying the case is to a certain degree
12

already familiar with the nature and extent of the lawyer's services. The rule against multiplicity of
suits will in effect be subserved.  13

What is being claimed here as attorney's fees by petitioners is, however, different from attorney's
fees as an item of damages provided for under Article 2208 of the Civil Code, wherein the award is
made in favor of the litigant, not of his counsel, and the litigant, not his counsel, is the judgment
creditor who may enforce the judgment for attorney's fees by execution.  Here, the petitioner's 14

claims are based on an alleged contract for professional services, with them as the creditors and the
private respondents as the debtors. 

In filing the motion for confirmation of attorney's fees, petitioners chose to assert their claims in the
same action. This is also a proper remedy under our jurisprudence. Nevertheless, we agree with the
respondent court that the confirmation of attorney's fees is premature. As it correctly pointed out, the
petition for review on certiorari filed by PHILAMGEN in this Court (G.R. No. 64834) "may or may not
ultimately result in the granting to the Casasola (sic) family of the total amount of damages" awarded
by the trial court. This especially true in the light of subsequent developments in G.R. No. 64334. In
a decision promulgated on May 21, 1987, the Court rendered judgment setting aside the decision of
May 4, 1983 of the Intermediate Appellate Court in AC-G.R. No. 00202 and ordering the respondent
Regional Trial Court of Manila to certify the appeal of PHILAMGEN from said trial court's decision in
Civil Case No. 122920 to the Court of Appeal. Said decision of the Court became final and executory
on June 25, 1987. 

Since the main case from which the petitioner's claims for their fees may arise has not yet become
final, the determination of the propriety of said fees and the amount thereof should be held in
abeyance. This procedure gains added validity in the light of the rule that the remedy for recovering
attorney's fees as an incident of the main action may be availed of only when something is due to
the client. Thus, it was ruled that: 

... an attorney's fee cannot be determined until after the main litigation has been
decided and the subject of recovery is at the disposition of the court. The issue over
attorney's fee only arises when something has been recovered from which the fee is
to be paid.  15

Quirante v. IAC

Facts: Atty. John Quirante represented Dr. Casasola in a certain case against Guerrero who failed to fulfill his
obligations as building contractor and PHILAMGEN (Philippine American General Insurance Co., Inc.) who acted as
bondsman of Guerrero. During the course of the case, trial court favored Casasola and ordered Guerrero to pay
certain damages and ordering PHILAMGEN to pay P 120,000.00 as surety bond. PHILAMGEN filed several motions
and was denied, which elevated this case in the Supreme Court. When Dr. Casasola died, Quirante subsequently
filed a motion in the trial court for the confirmation of his fees pending adverse party’s filing of a petition for review on
certiorari. Quirante claim that he and the late doctor had an oral agreement that in case of the recovery of surety
bond, he will be given P 30,000 for his attorney’s fee and in case the court award damages in excess of P120,000
bond, it shall be divided equally between the heirs of Casasola, Quirante and Cruz, and this is confirmed in writing by
Casasolas’ widow.

Issue: Whether or not Quirante’s claim for attorney’s fee is premature.

Held: Quirante’s claim for attorney’s fee is premature because the adverse party’s petition for review on certiorari was
still pending in court, and attorney’s fee cannot be determined until after the main litigation has been decided and
subject for recovery is at the court’s disposition. The rule on the remedy for recovering attorney’s fee as incident of
the main action may be availed of only when something is due to the client. Also, what is being claimed by Quirante
as attorney’s fee is not as an item of damages but an award in favor of Casasola, not to his counsel and it is up to his
heirs to enforce the judgment for attorney’s fee by execution, which is stipulated under Attorney’s fee as contract and
as items of damages. Thus, the decision of the Intermediate Appellate Court is affirmed.

Tanhueco v. De Dumo

Facts: Hilaria Tanhueco filed a petition for disbarment against Atty. Justiniano de Dumo for his refusal to remit her
money collected from debtors and refusal to return documents entrusted to him as a counsel in certain collection
cases. Tanhueco allegedly offered De Dumo 15% of what he may be able to collect from debtors but De Dumo
responded that in their agreement he gets 50% of what he may be able to collect as contingent fee. De Dumo also
admitted he did not turn over the P 12, 000.00 he collected and applying it instead as part of his attorney’s fee.

Issue: Whether or not De Dumo’s contingent fee is grossly excessive.

Held: De Dumo’s contingent fee is grossly excessive because 50% is more than half of the total amount due from
Tanhueco’s debtors. His action is believed to be fraudulent because he took advantage of his client who is an old and
sickly woman.

Canon 20 of the CPR states that: A lawyer shall charge only fair and reasonable fees. Attorney’s fee which is found
out to be unconscionable or unreasonable is subject to court’s modification.

A lawyer as an officer of the court has the duty to assist in the impartial administration of justice between parties, and
hence, the fees should be subject to judicial control. Thus, De Dumo is suspended from the practice of law for six
months and the attorney’s fee is reduced to 15% of the total amount collected by him. He is also ordered to return the
P 10, 200.00 net amount of the P 12, 000.00 he collected and entitled of 15% attorney’s fee in case he made any
other collection from Tanhueco’s debtors

There is another aspect to this case which the Court cannot gloss over. Respondent claimed that he
charged complainant, his client, a contingent fee of fifty percent (50%) of the amount collected by
him, plus interest and whatever attorney's fees may be awarded by the trial court chargeable to the
other party. In this jurisdiction, contingent fees are not per se prohibited by law. 8 But when it is
shown that a contract for a contingent fee are obtained by undue influence exercised by the attorney
upon his client or by any fraud or imposition, or that the compensation is clearly excessive, the Court
must and will protect the aggrieved party

Based on their agreement, respondent was actually collecting as attorney's fees sixty percent (60%)
or more than half of the total amount due from defendant debtors; indeed, he was appropriating for
himself more than what he was, according to him, to turn over to his client. 

We believe and so hold that the contingent fee here claimed was, under the facts obtaining in this
case, grossly excessive and unconscionable. 11 Such a fee structure, when considered in conjunction with the
circumstances of this case, also shows that an unfair advantage was taken of the client and legal fraud and imposition perpetrated upon her. 
The complainant was an old and sickly woman and, in respondent's own words, "penniless." She
was at the time she filed her complaint in 1976, already seventy-six (76) years old. In her
circumstances, and given her understandable desire to realize upon debts owed to her before death
overtook her, she would easily succumb to the demands of respondent attorney regarding his
attorney's fees. It must be stressed that the mere fact that an agreement had been reached between
attorney and client fixing the amount of the attorney's fees, does not insulate such agreement from
review and modification by the Court where the fees clearly appear to be excessive or
unreasonable. In Ma

ALBANO VS COLOMA

FACTS:

This proceeding for disbarment was filed by complainant Angel Albano against respondent
Perpetua Coloma, a member of the Philippine Bar. In a letter dated June 20, 1962 addressed
to this Court, complainant alleged that during the Japanese occupation his mother, Delfina
Aquino, and he retained the services of respondent as counsel for them as plaintiffs in Civil
Case No. 4147 of the Court of First Instance of Ilocos Norte.

After which came the accusation that after liberation and long after the courts had been
reorganized, respondent failed to expedite the hearing and termination of the case, as a
result of which they had themselves represented by another lawyer.

This notwithstanding, it was claimed that respondent intervened in the case to collect her
attorney's fees. It was then alleged that during the hearing they were surprised when
respondent presented in exhibit a document showing that they as well as their co-plaintiffs
in the case promised to pay her a contingent fee of 33-1/3% of whatever could be recovered
whether in land or damages.

Issue: May a lawyer be removed for her failure to comply with her obligations as counsel as
she served faithfully, efficiently, continuously and to the best of her knowledge and
capacity?

Held: no, a lawyer cannot be removed without just cause.

The Solicitor General could thus rightfully assert that if there was anyone guilty of bad faith
in this case "it is complainant and his co-plaintiffs in Civil Case No. 4147 who, after
benefiting from the valuable services of respondent in said case, tried to renege on their
agreement for the payment of the latter's contingent attorney's fees by dismissing her as
their counsel after she had already won for them said case in the trial court and the Court of
Appeals, and later, by attempting to impugn the authenticity and genuineness of their
written agreement for the payment of attorney's fees, . . . ."

Counsel, any counsel, who is worthy of his hire, is entitled to be fully recompensed for his
services. With his capital consisting solely of his brains and with his skill, acquired at
tremendous cost not only in money but in the expenditure of time and energy, he is entitled
to the protection of any judicial tribunal against any attempt on the part of a client to escape
payment of his fees. It is indeed ironic if after putting forth the best that is in him to secure
justice for the party he represents, he himself would not get his due. Such an eventuality
this Court is determined to avoid. It views with disapproval any and every effort of those
benefited by counsel's services to deprive him of his hard-earned honorarium. Such an
attitude deserves condemnation.

There is this additional point to consider. As Cardozo aptly observed: "Reputation [in the
legal profession] is a plant of tender growth, and its bloom, once lost, is not easily

restored."14 This Court, certainly is not averse to having such a risk minimized. Where, as in
this case, the good name of counsel was traduced by an accusation made in reckless
disregard of the truth, an action prompted by base ingratitude, the severest censure is
called for.

Metropolitan Bank v. CA

Facts: Atty. Arturo Alfafriz and Associates was the counsel of Metropolitan Bank and Trust Company who handled
civil cases for the declaration of nullity of certain deed of sale with damages. During the pendency of these suits,
without the knowledge of Alfafriz the lands were sold by Metrobank to its sister company for P 600,000 and on the
same day were sold to Herby Commercial for P 2.5 million, and later on mortgaged to Banco de Oro for P 9.2 million.

Alfafriz then filed a motion to enter the charging lien in the records of the civil cases pursuant to Sec. 27 of Rule 138,
equivalent to 25% of the actual and current market values of the litigated properties, as attorney’s fees and filed
motion to fix its attorney’s fee based on quantum meruit.

Metrobank claimed that they had fully paid Alfafriz, however the latter countered that the P 50,000 given could not be
considered as full payment but merely a cash advance, including the P 14,000 that was given to him.

It also appears that Alfafriz attempted to arrange a compromise with Metrobank in order to avoid suit, offering a
compromise amount to P 600,000 but negotiations were unsuccessful. RTC issued order granting Alfafriz a payment
of P 936,000 for attorney’s fees and this order is affirmed by the Court of Appeals. Thus, this petition for review on
certiorari was filed by Metrobank impugning the decision of the Court of Appeals.

Issue: Whether or not Alfafriz is entitled to a charging lien for payment of his attorney’s fee.

Held: NO. Alfafriz is not entitled to a charging lien for payment of his attorney’s fee, because the case does not
involve a money judgment. Rule 138, Sec. 27 provides that: A charging lien is limited only to money judgment and not
to any other kind of judgment. In this case, the dismissal order neither provided for any money judgment nor made
any monetary award to any litigant, much less in favor of Metrobank, hence Alfafriz’s claim is without legal basis. The
petition for review is granted; decision of Court of Appeal is reversed and set aside.

Indeed, an attorney may acquire a lien for his compensation upon money due his client from the
adverse party in any action or proceeding in which the attorney is employed, but such lien does not
extend to land which is the subject matter of the litigation.

ROXAS vs DE ZUZUARREGUI

FACTS: the National Housing Authority (NHA) filed expropriation proceedings against the Zuzuarreguis for parcels of land
belonging to them situated in Antipolo, Rizal with a total land area of 1, 790, 570.36

- The Zuzuarreguis engaged the legal services of Attys. Romeo G. Roxas and Santiago N. Pastor

- They executed a Letter-Agreement which fixed the just compensation due the Zuzuarreguis at P17 per sqm, and anything
in excess of that shall be the contingent fees of Attys. Roxas and Pastor for their legal services

- Resolution issued by the NHA, stated that the property would be acquired at a cost of P19.50 per square meter and that it will be
paid in NHA Bonds which the yield would be based on the Central Bank rate at the time of the payment

- As a result of the NHA Resolution, a Compromise Agreement was executed and it was approved by the Court.
Computed at P19.50 per square meter, the 1,790,570.36 square meters property of the Zuzuarreguis was expropriated at a total
price of P34,916,122.00. The total amount released by the NHA was P54,500,000.00. The difference of P19,583,878.00 is,
undoubtedly, the yield on the bonds.

- The amount turned over to the Zuzuarreguis by Atty. Roxas amounted to P30, 520, 000 in NHA bonds

- On August 25, 1987, a letter was sent by the Zuzuarreguis’ new counsel to Attys. Roxas and Pastor demanding that the latter
deliver to the Zuzuarreguis the yield corresponding to bonds paid by the NHA within a period of 10 days from receipt, under pain
of administrative, civil and/or criminal action

- The Zuzuarreguis then filed a civil action for Sum of Money and Damages, they demanded that the yield on the NHA
bonds be turned over to them

Attys. Roxas and Pastor contend in the main that the Zuzuarreguis are only entitled to the amount
of P17.00 per square meter for the 1,790,570.36 square meters expropriated by the government.
This was, according to them, embodied in the Letter-Agreement

13. Contingent Fees. –

A contract for contingent fee, where sanctioned by law, should be reasonable under all the
circumstances of the case including the risk and uncertainty of the compensation, but should always
be subject to the supervision of a court, as to its reasonableness.

and Canon 20, Rule 20.01 of the Code of Professional Responsibility, 46 viz:

CANON 20 – A LAWYER SHALL CHARGE ONLY FAIR AND REASONABLE FEES.

Rule 20.01. – A lawyer shall be guided by the following factors in determining his fees:

(a) The time spent and the extent of the services rendered or required;

(b) The novelty and difficulty of the question involved;

(c) The importance of the subject matter;

(d) The skill demanded;

(e) The probability of losing other employment as a result of acceptance of the proffered
case;

(f) The customary charges for similar services and the schedule of fees of the IBP chapter to
which he belongs;

(g) The amount involved in the controversy and the benefits resulting to the client from the
service;

(h) The contingency or certainty of compensation;

(i) The character of the employment, whether occasional or established; and

 (j) The professional standing of the lawyer.

However, in cases where contingent fees are sanctioned by law, the same should be reasonable
under all the circumstances of the case, and should always be subject to the supervision of a court,
as to its reasonableness,47such that under Canon 20 of the Code of Professional Responsibility, a
lawyer is tasked to charge only fair and reasonable fees. 

Indubitably entwined with the lawyer’s duty to charge only reasonable fees is the power of this Court
to reduce the amount of attorney’s fees if the same is excessive and unconscionable. 48 Thus,
Section 24, Rule 138 of the Rules of Court partly states: 

SEC. 24. Compensation of attorneys; agreement as to fees. – An attorney shall be entitled to have
and recover from his client no more than a reasonable compensation for his services, with a view to
the importance of the subject matter of the controversy, the extent of the services rendered, and the
professional standing of the attorney. x x x. A written contract for services shall control the amount to
be paid therefore unless found by the court to be unconscionable or unreasonable.

Attorney’s fees are unconscionable if they affront one’s sense of justice, decency or
reasonableness.49 It becomes axiomatic therefore, that power to determine the reasonableness or
the, unconscionable character of attorney's fees stipulated by the parties is a matter falling within the
regulatory prerogative of the courts.50

In the instant case, Attys. Roxas and Pastor received an amount which was equal to forty-four
percent (44%) of the just compensation paid (including the yield on the bonds) by the NHA to the
Zuzuarreguis, or an amount equivalent to P23,980,000.00 of the P54,500,000.00. Considering that
there was no full blown hearing in the expropriation case, ending as it did in a Compromise
Agreement, the 44% is, undeniably, unconscionable and excessive under the circumstances. Its
reduction is, therefore, in order. This is in accordance with our ruling in the earlier case of Tanhueco
v. De Dumo51, where we reduced the amount of attorney’s fees from sixty percent (60%) to fifteen
percent (15%), for being excessive and unreasonable.

It is imperative that the contingent fees received by Attys. Roxas and Pastor must be equitably
reduced. In the opinion of this Court, the yield that corresponds to the percentage share of the
Zuzuarreguis in the P19.50 per square meter just compensation paid by the NHA must be returned
by Attys. Roxas and Pastor. 1avvph!l.ne+

The yield on the NHA bonds amounted to P19,583,878.00. This amount must therefore be divided
between the Zuzuarreguis, on the one hand, and Attys. Roxas and Pastor, on the other. The division
must be pro rata. The amount of P17.00 that should go to the Zuzuarreguis represents 87.18% of
the P19.50 per square meter just compensation, The P2.50 per square meter that was to go to Attys.
Roxas and Pastor, on the other hand, represents 12.82%.

The Zuzuarreguis are entitled to the yield equal to 87.18% of the P19,583,878.00, while Attys. Roxas
and Pastor are entitled to 12.82% of said amount. The amount corresponding to 87.17% of
P19,583,878.00 is P17,073,224.84. This is the yield that the Zuzuarreguis are entitled to. Attys.
Roxas and Pastor, on the other hand, are entitled to P2,510,653.16.

Attys. Roxas and Pastor, in the opinion of this Court, were not shortchanged for their efforts for they
would still be earning or actually earned attorney’s fees in the amount of P6,987,078.75
(P4,476,425.59 + P2,510,653.16).
The amount of P17,073,224.84 must therefore be returned by Attys. Roxas and Pastor to the
Zuzuarreguis. They can take this out from the yield in the amount of P19,583,878.00 which they
have appropriated for themselves.

MASMUD vs NLRC

FACTS:
In 2003, Evangeline Masmud filed a complaint on behalf of her late husband
Alexander against First Victory Shipping Services for non payment of permanent
disability benefits, medical expenses, sickness allowances, moral and exemplary
damages, and attorney’s fees of his late husband Alexander and then Alexander
hire Atty. Go as his counsel. In consideration of Atty. Go’s legal services,
Alexander agreed to pay attorneys fees on a contingent basis, as follows: 20 % of
total monetary claims as settled or paid and an additional 10 % in case of appeal. It
was likewise agreed that any award of attorney’s fees shall pertain to respondent’s
law firm as compensation.

The Labour Arbiter rendered a decision granting the monetary claims of

Alexander. However Alexander’s employer filed an appeal with the NLRC. During
the pendency of the proceedings before the NLRC, Alexander died thereafter Atty.
Go substitute Evangelina as complainant. The NLRC denied the motion of the
Alexander’s employer. On appeal before the CA, the decision of the Labour
Arbiter was affirmed with modification. Eventually, the decision of the NLRC
became final and executor and Atty. Go moved for the execution of the NLRC
decision, which was granted by the Labour Arbiter. The surety bond of the
employer was garnished and Atty. Go moved for the release of the said amount to
Evangelina. The Labour Arbiter directed the NLRC Cashier to release the amount
of P 3, 454, 079. 20 to Evangelina and P 680,000.00 will go to Atty. Go.
Dissatisfied, Atty. Go filed a motion to record an enforce attorneys lien alleging
that Evangelina reneged on their contigent fee agreement. Evangelina paid only
the amount of P680,000.00, equivalent to 20% of the award as attorneys fees, thus,
leaving a balance of 10% pertaining to the counsel as attorneys fees.

Evangelina manifested that Atty. Go’s claim for attorneys fees of 40% of the total
monetary award was null and void based on Article 111 of the Labour Code is the
law that should govern Atty. Go’s compensation as her counsel. (

)
Issue:
Whether or not Atty. Go’s compensation is under the concept of attorneys fees
governed by Section 24, Rule 138 of the Rules of Court or under the extraordinary
concept governed by Article 111 of the Labour Code.

Ruling:
Atty. Go’s compensation should be governed by Section 24, Rule 138 of the Rules
of Court and not Article 111 of the Labour Code. The retainer contract between
Atty. Go and Evangelina provides for a contingent fee. The contract shall control
in the determination of the amount to be paid, unless found by the court to be
unconscionable or unreasonable. Attorney's fees are unconscionable if they affront
one's sense of justice, decency or reasonableness. The decree of
unconscionability or unreasonableness of a stipulated amount in a contingent
fee contract will not preclude recovery. It merely justifies the fixing by the
court of a reasonable compensation for the lawyer's services.
 
The criteria found in the Code of Professional Responsibility are also to be
considered in assessing the proper amount of compensation that a lawyer should
receive. Canon 20, Rule 20.01 of the said Code provides:
 
CANON 20 A LAWYER SHALL CHARGE ONLY FAIR AND
REASONABLE FEES.
 
Rule 20.01. A lawyer shall be guided by the following factors in
determining his fees:
 
(a) The time spent and the extent of the services rendered or required;
 
(b) The novelty and difficulty of the question involved;
 
(c) The importance of the subject matter;
 
(d) The skill demanded;
 
(e) The probability of losing other employment as a result of
acceptance of the proffered case;
  
(f) The customary charges for similar services and the schedule of
fees of the IBP Chapter to which he belongs;
 
(g) The amount involved in the controversy and the benefits resulting
to the client from the service;
 
(h) The contingency or certainty of compensation;
 
(i) The character of the employment, whether occasional or
established; and
 
(j) The professional standing of the lawyer.
 
 
Contingent fee contracts are subject to the supervision and close scrutiny of the
court in order that clients may be protected from unjust charges. The amount of
contingent fees agreed upon by the parties is subject to the stipulation that counsel
will be paid for his legal services only if the suit or litigation prospers. A much
higher compensation is allowed as contingent fees because of the risk that the
lawyer may get nothing if the suit fails. The Court finds nothing illegal in the
contingent fee contract between Atty. Go and Evangelina’s husband. The CA
committed no error of law when it awarded the attorneys fees of Atty. Go and
allowed him to receive an equivalent of 39% of the monetary award.
 

There are two concepts of attorney's fees. In the ordinary sense, attorney's
fees represent the reasonable compensation paid to a lawyer by his client for
the legal services rendered to the latter. On the other hand, in its
extraordinary concept, attorney's fees may be awarded by the court as
indemnity for damages to be paid by the losing party to the prevailing
party,15 such that, in any of the cases provided by law where such award can
be made, e.g., those authorized in Article 2208 of the Civil Code, the amount
is payable not to the lawyer but to the client, unless they have agreed that
the award shall pertain to the lawyer as additional compensation or as part
thereof.16

Here, we apply the ordinary concept of attorney's fees, or the compensation

that Atty. Go is entitled to receive for representing Evangelina, in
substitution of her husband, before the labor tribunals and before the court. 
Evangelina maintains that Article 111 of the Labor Code is the law that
should govern Atty. Go's compensation as her counsel and assiduously
opposes their agreed retainer contract. 

Article 111 of the said Code provides: 

ART. 111. Attorney's fees. - (a) In cases of unlawful withholding of wages

the culpable party may be assessed attorney's fees equivalent to ten percent
of the amount of the wages recovered. ςηαñrοblεš νιr†υαl  lαω lιbrαrÿ

Contrary to Evangelina's proposition, Article 111 of the Labor Code deals

with the extraordinary concept of attorney's fees. It regulates the amount
recoverable as attorney's fees in the nature of damages sustained by and
awarded to the prevailing party. It may not be used as the standard in fixing
the amount payable to the lawyer by his client for the legal services he
rendered.17

In this regard, Section 24, Rule 138 of the Rules of Court should be
observed in determining Atty. Go's compensation. The said Rule provides:

SEC. 24. Compensation of attorney's; agreement as to fees. - An attorney

shall be entitled to have and recover from his client no more than a
reasonable compensation for his services, with a view to the importance of
the subject matter of the controversy, the extent of the services rendered,
and the professional standing of the attorney. No court shall be bound by the
opinion of attorneys as expert witnesses as to the proper compensation, but
may disregard such testimony and base its conclusion on its own
professional knowledge. A written contract for services shall control the
amount to be paid therefor unless found by the court to be unconscionable
or unreasonable.18

The retainer contract between Atty. Go and Evangelina provides for a

contingent fee. The contract shall control in the determination of the amount
to be paid, unless found by the court to be unconscionable or
unreasonable.19 Attorney's fees are unconscionable if they affront one's
sense of justice, decency or reasonableness.20 The decree of
unconscionability or unreasonableness of a stipulated amount in a contingent
fee contract will not preclude recovery. It merely justifies the fixing by the
court of a reasonable compensation for the lawyer's services.

URBAN BANK VS PEÑA

FACTS:
In 1994, Isabel Sugar Company, Inc. (ISCI) sold a parcel of land to Urban Bank, Inc. (UBI).
The land was sold for P240 million. As the land was occupied by unauthorized sub-tenants,
ISCI’s lawyer, Atty. Magdaleno Peña had to negotiate with them for them to relocate. But
the said occupants, knowing that the land was already transferred to UBI, refused to
recognize Peña. ISCI then communicated with UBI so that the latter may authorize Peña to
negotiate with the tenants. Peña had to barricade himself inside the property to keep the
tenants out who were forcing their way in especially so that the local cops are now
sympathetic to them. Peña then had a phone conversation with Teodoro Borlongan,
president of UBI, where Peña explained to him the situation. In said conversation, Peña
asked authorization from Borlongan to negotiate with the tenants. Peña also asked that he
be paid 10% of the purchase price or (P24 million) for his efforts. Borlongan agreed over
the phone on the condition that Peña should be able to settle with the tenants otherwise he
forfeits said 10% fee. Peña also asked that said authorization be put into writing.
The authorization was put into writing but no mention was made as regards the 10% fee, (in
short, that part was not written in the written authorization released by UBI). Peña was able
to settle and relocate the tenants. After everything was settled and the property is now
formally under the possession of UBI, Peña began sending demands to UBI for the latter to
pay him the P24 million fee agreed upon, plus his expenses for the relocation of the tenants
and the hiring of security guards or an additional P3 million. But UBI refused to make
payment hence Peña filed a complaint for recovery against UBI.
The trial court ruled in favor of Peña as it found there indeed was a contract of agency
created between  and UBI and that Peña is entitled to the 10% fee plus the expenses he
incurred including litigation expenses. In sum, the trial court awarded him P28 million.
The Court of Appeals however reversed the order of the trial court. It ruled that no agency
was formed but for his legal services, Peña is entitled to payment but applying the principle
of unjust enrichment and quantum meruit, Peña should only be paid P3 million.
ISSUE: Whether or not Atty. Magdaleno Peña is entitled to receive the P28 million.
HELD: No. The Supreme Court ruled that said amount is unconscionable. Peña is entitled
to payment for compensation for services rendered as agent of Urban Bank, but on the
basis of the principles of unjust enrichment and quantum meruit. In the first place, other
than the self-serving testimony of Peña, there was no other evidence presented to support
his claim that Borlongan agreed to pay him that 10% over the phone. The written
authorization later issued merely confirms the power granted him to negotiate with the
tenants. The written authorization proved the existence of agency but not the existence of
any agreement as to how much Peña should be paid.
Absent any such agreement, the principle of quantum meruit should be applied. In this
case, Peña is entitled to receive what he merit for his services, or as much as he has
earned. In dealing with the tenants, Peña didn’t have to perform any extraordinary acts or
legal maneuvering. Hence, he is entitled to receive P1.5 million for his legal services. He is
also entitled to reimbursement for his expenses in securing the property, to wit, P1.5 million
for the security guards he had to hire and another P1.5 million for settling and relocating the
23 tenants. Total of P4.5 million.
The Supreme Court emphasized that lawyering is not a business; it is a profession in which
duty to public service, not money, is the primary consideration.
 CORPUS VS CA

Having been close friends, aside from being membres Civil Liberties Union, petitioner Corpus
intimately calls respondent David by his nickname "Juaning" and the latter addresses the former
simply as "Marino".

(first handled by Atty Alvarez.)

Facts: Juan David sought to recover attorney’s fees for professional services rendered to Mariano Corpus. David was
asked to handle the administrative case against Corpus filed by several employees of the Central Bank Export
Department. In the course of the case, the court rendered decision in favor of Corpus, ordering his reinstatement and
payment of his back salaries and allowances. David, then filed a formal demand for collection of 50% of the amount
recovered for his attorney’s fee but Corpus denied the demand and appealed to the Court of Appeals that David’s
services were offered and rendered gratuitously and at most he is entitled to attorney’s fee of P 2,500.00. David, also
appealed to the Court of Appeals alleging that the lower court erred in ordering Corpus to pay the sum of P 30,000.00
as attorney’s fee due to him.

Petitioner Marino Corpus contends that respondent David is not entitled to attorney's fees because there was no
contract to that effect. On the other hand, respondent David contends that the absence of a formal contract for the
payment of the attorney's fees will not negate the payment thereof because the contract may be express or implied,
and there was an implied understanding between the petitioner and private respondent that the former will pay the
latter attorney's fees when a final decision shall have been rendered in favor of the petitioner reinstating him to -his
former position in the Central Bank and paying his back salaries.

Issue: Whether or not David is entitled to attorney’s fee.

Held: David is entitled to attorney’s fee because there was an implied agreement made by Corpus that he will pay
attorney’s fee when a final decision shall have been rendered in his favor and upon issuing a check worth P2,000.00.
The absence of contract for attorney’s fee in this case is no argument against the payment of such fee considering
the close friendship between them.

Canon 20, Rule 20.4 states that: A lawyer shall avoid controversies with clients concerning compensation and shall
resort to judicial action only to prevent imposition, injustice or fraud. The Lawyer may enforce his attorney’s fees by
filing an appropriate motion or petition as an incident in the main action where he rendered legal services. David’s
action to protect his right to fees in the services rendered is only appropriate. Thus, Corpus is directed to pay David
the sum of P 20,000.00 for attorney’s fee. Against But David was held in contempt and reprimanded for the
improvident act made.

MALVAR VS KRAFT FOODS

FACTS:Although the practice of law is not a business, an attorney is entitled to be properly

compensated for the professional services rendered for the client, who is bound by her express
agreement to duly compensate the attorney. The client may not deny her attorney such just
compensation.

Malvar filed a complaint for illegal suspension and illegal dismissal against KFPI and
Bautista in the National Labor Relations Commission (NLRC). The Labor Arbiter found and
declared her suspension and dismissal illegal, and ordered her reinstatement, and the payment of
her full backwages, inclusive of allowances and other benefits, plus attorney’s fees. NLRC and
CA affirmed the decision of the Labor Arbiter. After the judgment in her favor became final and
executory Malvar moved for the issuance of a writ of execution but the execution failed due to
questionable computation of the award. Malvar requested for the 2nd issuance of the writ of
execution and was partially complied with but with protest on the part of Kraft by filing a TRO
for further execution since the computation is incorrect. CA ruled in favor of Kraft. Thus, Malvar
appealed.

While her appeal was pending in this Court, Malvar and Kraft entered into a compromise
agreement. Thereafter, Malvar filed an undated Motion to Dismiss/Withdraw Case, praying that
the appeal be immediately dismissed/withdrawn in view of the compromise agreement, and that
the case be considered closed and terminated. Before the Court could act on Malvar’s Motion to
Dismiss/Withdraw Case, the Court received a so-called Motion for Intervention to Protect
Attorney’s Rights from Malvar’s counsel, The Law Firm of Dasal, Llasos and Associates.

Malvar unceremoniously and without any justifiable reason terminated its legal service
and required it to withdraw from the case. The counsel indicated that Malvar’s precipitate action
had baffled, shocked and even embarrassed the Intervenor/counsel, because it had done
everything legally possible to serve and protect Malvar’s interest.

ISSUE:
Can the Motion for Intervention to protect attorney’s rights prosper?

RULING:
Yes. A client has an undoubted right to settle her litigation without the intervention of the
attorney, for the former is generally conceded to have exclusive control over the subject matter
of the litigation and may at any time, if acting in good faith, settle and adjust the cause of action
out of court before judgment, even without the attorney’s intervention. It is important for the
client to show, however, that the compromise agreement does not adversely affect third persons
who are not parties to the agreement. By such, a client has the absolute right to terminate the
attorney-client relationship at any time with or without cause. But this right of the client is not
unlimited because good faith is required in terminating the relationship. It is basic that an
attorney is entitled to have and to receive a just and reasonable compensation for services
performed at the special instance and request of his client. The attorney who has acted in good
faith and honesty in representing and serving the interests of the client should be reasonably
compensated for his service.

In the absence of the lawyer’s fault, consent or waiver, a client cannot deprive the lawyer of his just
fees already earned in the guise of a justifiable reason. Here, Malvar not only downplayed the worth
of the Intervenor’s legal service to her but also attempted to camouflage her intent to defraud her
lawyer by offering excuses that were not only inconsistent with her actions but, most importantly, fell
short of being justifiable.

The letter Malvar addressed to Retired Justice Bellosillo, who represented the Intervenor, debunked
her allegations of unsatisfactory legal service because she thereby lavishly lauded the Intervenor for
its dedication and devotion to the prosecution of her case and to the protection of her interests. Also
significant was that the attorney-client relationship between her and the Intervenor was not severed
upon Atty. Dasal’s appointment to public office and Atty. Llasos’ resignation from the law firm. In
other words, the Intervenor remained as her counsel of record, for, as we held in Rilloraza, Africa,
De Ocampo and Africa v. Eastern Telecommunication Philippines, Inc.,50 a client who employs a law
firm engages the entire law firm; hence, the resignation, retirement or separation from the law firm of
the handling lawyer does not terminate the relationship, because the law firm is bound to provide a
replacement.

The stipulations of the written agreement between Malvar and the Intervenors, not being contrary to
law, morals, public policy, public order or good customs, were valid and binding on her. They
expressly gave rise to the right of the Intervenor to demand compensation. In a word, she could not
simply walk away from her contractual obligations towards the Intervenor, for Article 1159 of the Civil
Code provides that obligations arising from contracts have the force of law between the parties and
should be complied with in good faith.

BALINGIT v. CERVANTES

(A.C. No. 11059, November 9, 2016)

Complainant has two sons Jose Antonio Balingit, Jr. and Carlo Balingit. His
sons were riding their motorcycles which collided with a car driven by
David A. Alizadeh. Jose Antonio, Jr. was dead on arrival at the hospital
while his passenger Kristopher Rocky Kabigting, Jr. suffered physical
injuries and Carlo suffered serious physical injuries. A criminal negligence
was filed against David. Complainant together with Carlo, Kristopher and
the heirs of Jose Antonio, Jr. hired the respondent in filing a separate civil
suit for damages and an administrative case with the Professional
Regulation Commission (PRC) against David, who passed the physician
board exam. A demand letter was sent to David for payment of P2, 000,
000.00 plus 25% as attorney’s fees.

Atty. Cervantes signed and prepared an Agreement about the terms of

respondents’ engagement addressed to Kristopher, Carlo, and the heirs of
Jose Antonio, Jr. which they did not sign.

Complainant paid the sum of P45,000.00 as partial acceptance fee for the filing of the civil suit
for damages as evidenced by a handwritten receipt issued by Atty. Delarmente. In addition, Atty.
Cervantes allegedly received P10,000.00 from Imelda Balingit (Imelda), complainant's daughter-
in-law, without issuing any receipt.12 However, despite respondents' receipt of the P45,000.00
and complainant's submission to respondents of the necessary documents,13 as of December 19,
2011, when the present complaint was filed, and until today, respondents have failed to institute
the separate civil suit for damages agreed upon.14chanrobleslaw
A Compromise Agreement was signed. Upon hearing the Compromise
Agreement, Atty. Cervantes demanded 10% of the amount of the
compromise as the attorney’s fee and P5, 000.00 as appearance fee which
the complainant refused to pay. As complainant still refused to pay, Atty.
Cervantes filed a criminal complaint22 for estafa against complainant, his
wife, and his sons, as well as a complaint for deportation with the Bureau
of Immigration, on the ground that complainant and his family are
undesirable British aliens, While the complainant filed the present
disbarment case against respondents before the Integrated Bar of the
Philippines-Commission on Bar Discipline (IBP-CBD). Respondents filled
separate motions for extension of time to submit their answers. Atty.
Delarmente failed to file his answer whereas Atty. Cervantes filed a motion

to admit his verified answer. Atty. Cervantes denied receiving money and
did not receive the acceptance and docket fees to the case.

ISSUE:

Whether or not the respondent violated Canon 20, and Rule 20.04 of the
Code of Professional Responsibility
RULING: YES.

Worse, Atty. Cervantes demanded payment of P5,000.00 appearance fee and 10% of the
settlement as success fee even though the hearing was for the criminal case and the Compromise
Agreement was entered in the course of the criminal proceedings; thus, outside the scope of
respondents' engagement. Indeed, it is highly improper for a lawyer to impose additional
professional fees upon his client which were never mentioned nor agreed upon at the time of the
engagement of his services.40 chanrobleslaw

Assuming respondents are entitled to additional payment of professional fees, their manner of
enforcing it still warrants disciplinary sanction. Rule 20.4 of the CPR advises lawyers to avoid
controversies with clients concerning their compensation and to resort to judicial action only to
prevent imposition, injustice or fraud. This is because matters of fees present an irreconcilable
conflict of interests between a client and his lawyer. 41Suits to collect fees should be avoided and
should be filed only when circumstances force lawyers to resort to it, 42 such as "when [a] conflict
has reached such point that it only becomes the lawyer's duty to withdraw from the action but to
assert his right to compensation because of the intolerable attitude assumed by his client, x x
x."43
chanrobleslaw

In these exceptional circumstances, a lawyer may enforce his right to his fees by filing the
necessary petition as an incident of the main action in which his services were rendered. 44 Thus,
in Malvar v. Kraft Food Philippines, Inc.,45 We approved the filing of a motion for intervention
as a measure to protect a counsel's right to the fees agreed upon with his client. Alternatively, an
aggrieved lawyer may also file an independent civilaction against his client for the payment of
his fees. The former is preferable to avoid multiplicity of suits. 46 chanrobleslaw

In the present case, when complainant refused to pay, Atty. Cervantes proceeded to file a
criminal case for estafa and deportation proceedings against complainant and his family, This we
cannot countenance. In Retuya v. Gorduiz,47 We suspended a lawyer for six (6) months for filing
a groundless case for estafa against his own client when the latter refused to pay his attorney's
fees due to disagreements as to the amount. Relatedly, in Alcantara v. De Vera,48 We held that
there is nothing ethically remiss in a lawyer who files numerous cases in different fora, as long as
he does so in good faith, in accordance with the Rules, and without any ill-motive or purpose
other than to achieve justice and fairness.49 Here, We find that the estafa and deportation
proceedings filed against complainant and his family were meant to harass and compel the latter
to accede to respondents' demand for additional professional fees. 

DOMINGO vs AQUINO

FACTS: the Court of First Instance of Pangasinan rendered judgment approving the money claim of respondent Pedro A.
Aquino against the petitioner estate by ordering the then special administratrix, Asuncion Domingo Sta. Maria, "to pay from the
available funds of the estate the sum of P20,000.00 with 12% interest per annum from June 10, 1954 to Pedro A. Aquino."

CONTENTION OF THE COMPLAINANT:

Complainant contends, that Atty. Jose A Unson who was the estate’s counsel of
record in the appellate court, did not received the copy of the notice and judgement of the
appellate court sent to him by registered mail. The estate’s attorney in the intestate
proceedings pending in the lower court. Attys. Primicias, Del Castillo and Macaraeg were
verbally informed by Unson of the judgement rendered on appeal by the appellate court.

that the former special administratrix, Asuncion Domingo Sta. Maria had long
resigned as such with the permission of the intestate court, that the other co-special
administrator, Atty. Luis Domingo, Jr. (who had caused the prosecution of the appeal) was
removed from his trust by the intestate court's order dated May 21, 1963

RULING OF THE SUPREME COURT

 
While it may be true that Atty. Unson ceased as counsel for the estate and for the
former administrator sometime on November 8, 1966, when the intestate court granted his
motion dated November 2, 1966, to withdraw as counsel by virtue of his appointment to
and assumption on February 8, 1966 of the public office of Assistant Administrator of the
Sugar Quota Administration, this was true only insofar as the case in the intestate court
was concerned. He continued on record in the appellate court as counsel for the estate as
appellant therein and did not file therein any withdrawal as counsel and neither did the
petitioner inform said court of any change of counsel or of party-administrator, as required
by Rule 138, section 26 of the Rules of Court. More so, no appearance of any new counsel
for the estate was ever filed with the appellate court.
Notice and copy of the appellate court's decision of January 20, 1967, were
therefore duly served by registered mail on the estate's counsel of record at his address of
record at 307 Trinity Building, San Luis, Ermita Manila in accordance with Rule 13,
section 8 of the Rules of Court. In accordance with said Rule, service by registered mail of
the appellate court's decision upon the petitioner's counsel of record was deemed
completed and effected upon the addressee's failure to claim his mail on the fifth day after
the first notice of the postmaster. Atty. Unson continued to represent the estate as counsel
in the appellate court. He continued to be authorized to represent the estate as its counsel,
until the new administrator should terminate his services, which she never did.
Petitioner's counsel are reminded of this Court's admonition in Pajares vs. Abad
Santos, and other cases cited therein, to wit, that "the cooperation of litigants and their
attorneys is needed so that needless clogging of the court dockets with unmeritorious
cases may be avoided. There must be more faithful adherence to Rule 7, section 5 of the
Rules of Court which provides that 'the signature of an attorney constitutes a certificate by
him that he has read the pleading and that to the best of his knowledge, information and
belief, there is good ground to support it; and that it is not interposed for delay' and
expressly admonishes that 'for a willful violation of this rule, an attorney may be subjected
to disciplinary action

Remedial law; Change of counsel; Court should be informed.—Atty. Unson continued on record in the
appellate court as counsel for the estate as appellant therein and did not file therein any withdrawal
as counsel and neither did the petitioner inform said court of any change of counsel or of party-
administrator, as required by Rule 138, section 26 of the Rules of Court. More so, no appearance of any
new counsel for the estate was ever filed with the appellate court.

Same; Completeness of service by registered mail.—Service by registered mail of the appellate court’s
decision upon the petitioner’s counsel of record was deemed completed and effected upon the
addressee’s failure to claim his mail on the fifth day after the first notice of the postmaster. This has
ever since been the prevailing rule in the interests of public policy and sound administration of justice,
as most recently affirmed in Fojas vs. Navarro, L-26365, April 30, 1970, citing a long line of applicable
precedents.

Same; Counsel of estate, not of administrator.—The party in the subject case was the intestate estate
of the deceased Luis C. Domingo, Sr. and that Atty. Unson represented the estate as counsel in the said
case. The fact that his services were engaged by Luis Domingo, Jr., in his (Luis’) official capacity as
administrator, did not make him the personal counsel of Luis. Thus, notwithstanding Luis’ removal as
administrator, Atty. Unson continued to represent the estate as counsel in the appellate court. He
continued to be authorized to represent the estate as its counsel, until the new administrator should
terminate his services which she never did.

Same; Court’s admonition to counsel; Cooperation of litigants and their attorneys needed.—The
cooperation of litigants and their attorneys is needed so that needless clogging of the court dockets
with unmeritorious cases may be avoided. There must be more faithful adherence to Rule 7, section 5
of the Rules of Court which provided that “the signature of an attorney constitutes a certificate by him
that he has read the pleading and that to the best of his knowledge, information and belief, there is
good ground to support it; and that it is not interposed for delay” and expressly admonishes that “for a
willful violation of this rule, an attorney may be subjected to disciplinary action.” [Intestate Estate of
the Deceased Luis C. Domingo, Sr. vs. Aquino, 38 SCRA 472(1971)]

MONTANO vs IBP

FACTS: Atty. Dealca, counsel for Felicisimo Montano withdrew his services for his client upon
the latter's failure to comply with their retainer agreement. Complainant Felicisimo claimed that
such conduct by respondent counsel exceeded the ethical standards of the law profession and
prays that the latter be sternly dealt with administratively. Complainant later on filed motions
praying for the imposition of the maximum penalty of disbarment.

LETTER

Pepe and Del Montano,

For breaking your promise, since you do not want to fulfill your end of the
bargain, heres your reward:

Henceforth, you lawyer for yourselves. Here are your papers.

ISSUE: Whether or not Atty. Dealca's conduct just and proper?

HELD: We find Atty Dealca’s conduct unbecoming of a member of the legal profession. Under
Canon 22 of the Code of Professional Responsibility, a lawyer shall withdraw his services only
for good cause and upon notice appropriate in the circumstances. Although he may withdraw his
services when client deliberately fails to pay the fees for the services, under the circumstances of
the present case, Atty. Dealca’s withdrawal was unjustified as complainant did not deliberately
fail to pay him the atty’s fees. Rule 20.4 of Canon 290, mandates that a lawyer shall avoid
controversies with clients concerning his compensation and shall resort to judicial action only to
prevent imposition, injustice or fraud. Sadly, for not so large a sum owed to him by complainant
(P 3,500.00), respondent lawyer failed to act in accordance with the demands of the Code.
But,only in a clear case of misconduct that seriously affects the standing and character of the
lawyers an officer of the court and member of the bar will disbarment be imposed a s penalty

OBANDO VS FIGUERAS

FACTS:

Obando was appointed as respondent Eduardo’s co-administrator of the joint

estate of Jose and Dona Alegria Figueras. Obando and several other members of the
Obando clan was allegedly bequeathed a will of the properties left by the Figueras
couple including two parcels of land in Gilmore Avenue, New Manila, Quezon City.
Upon insistence of the respondent that the alleged will was a forgery, the will was
submitted to the National Bureau of Investigation (NBI) for examination and found that
the signatures were not made by the same person which led to the indictment and
conviction of Obando for estafa through falsification of a public document.
Eduardo sold the lots to Amigo Realty Corporation on the strength of an Order issued
by the probate court on May 15, 1991.

Petitioner Obando, in his capacity as co-administrator and universal heir of Doña

Alegria, filed a Complaint against Eduardo and Amigo Realty for the nullification of the
sale to the Regional Trial Court of Quezon City, Branch 79.

In Special Proceeding Nos. 61567 and 123948, the probate court in its order dated
December 17, 1997 removed Obando from his office as co-administrator of the estate.
Consequently, on January 27, 1998 the respondents filed a Joint Motion to Dismiss on
the civil case to which the trial court granted the motion. Obando then filed a Motion for
Reconsideration to no avail. Then his Petition for Certiorari and Mandamus was
dismissed and the dismissal order of the RTC was affirmed. Petitioner then argues
before the Supreme Court that the motion to dismiss was invalid since at the time of the
filing, Atty. Yuseco no longer represented the respondents, as shown by Eduardo’s
Manifestation and Motion dated January 8, 1998, dispensing with said counsel’s
services in the proceedings in view of a Compromise Agreement with Petitioner
Obando.

ISSUE:

Whether or not Atty. Yuseco ceased to be the defendant’s Counsel.

HELD:

No. Representation continues until the court dispenses with the services of
counsel in accordance with Section 26, Rule 138 of the Rules of Court. Counsel may be
validly substituted only if the following requisites are complied with: (1) new counsel files
a written application for substitution; (2) the client’s written consent is obtained; and (3)
the written consent of the lawyer to be substituted is secured, if it can still be; if the
written consent can no longer be obtained, then the application for substitution must
carry proof that notice of the motion has been served on the attorney to be substituted
in the manner required by the Rules. In this case, Eduardo did not dismiss Attorney
Yuseco. In fact, the former manifested that he had been tricked by Petitioner Obando
into signing the aforesaid Manifestation and Motion and Compromise Agreement.
Besides, the filing of the Motion to Dismiss was not prejudicial but beneficial to the said
respondent; hence, he had no reason to complain. At the discretion of the court, an
attorney who has already been dismissed by the client is allowed to intervene in a case
in order to protect the clients rights. In the present case, had there been any irregularity,
it should have been raised by the respondents, not the petitioners.
 CAOILE VS MACARAEG

DOCTRINE: A motion for extension to file an appellant’s brief carries with it the
presumption that the applicant-lawyer will file the pleading within the requested
extended period. Failure to do so without any reasonable excuse violates the Code of
Professional Responsibility. 

FACTS: 
This is a Disbarment case filed by Caoile against Atty. Macaraeg for neglect and
dereliction of duty. 
Caoile alleged that: 

Along with four others, they engaged the services of Atty. Macaraeg in an action for
recovery of ownership filed before the CFI of Lingayen, Pangasinan; 
CFI rendered a judgment AGAINST them, so, Caoile et al decided to appeal before the
CA; 
Atty. Macaraeg filed a Notice of Appeal; he moved for extension of time to file the
Caoile’s brief; in the last motion for extension, Atty. Macaraeg alleged that he was
already in the process of doing the finishing touches on the brief and just needed to
have it printed. Yet, the extended period expired without Atty. Macaraeg filing any
brief. The CA, dismissed the appeal and such became final and executory. 

Caoile et al were not aware of the dismissal until they were served with the CFI’s writ of
Execution and a Notice of Sale at public auction of their property. 
When Caoile confronted Atty. Macaraeg about the dismissal of the case, Atty. Macaraeg
told them that it was because he was not paid in full for his services in filing the appeal. 

Atty. Macaraeg denied Francisco’s accusation that he neglected their case. He pointed
out that: to push through with the appeal he even advanced some of the appeal
expenses. 
While he admitted that he failed to submit an appellants’ brief, he averred that the same
was 
actually the fault of his clients who failed to provide the necessary funds to file said
brief. 
He constantly reminded Francisco to give him the amount necessary to cover the costs
of the transcript and printing of the appeal brief. 
He even filed three motions for extension of time to file brief to give Francisco more
time to come up with the said payment. Still, Francisco was unable to pay. 

ISSUE: Whether or not Atty. Macaraeg violated Rule 12.03 of the Code of Professional
Responsibility? 

HELD: Yes, if Atty. Macaraeg truly believed that the necessary funds from his clients were
not forthcoming, 
he could have excused himself from the case. The Code of Professional Responsibility
allows a counsel to withdraw his services for a good cause, including the client’s failure
to comply with the retainer agreement. 
● A motion for extension to file an appellant’s brief carries with it the presumption that
the applicant-lawyer will file the pleading within the requested extended period. Failure
to do so without any reasonable excuse violates the Code of Professional Responsibility. 
● The court, however, dismissed the petitioner’s complaint for disbarment because the
complainant had already lost interest in pursuing this disbarment case against Atty.
Macaraeg and that there is truth in the handwritten notation in the return of the
subpoena that Atty. Macaraeg had already passed away.