PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC |
” -Earl Warren
PROBLEM AREAS IN LEGAL ETHICS
SPECIFIC AREAS
REPRESENTATION OF CONFLCIITNG INTERESTS
Ocampo-Ingcoco v. Yrreverre, Jr.
A.C. No. 5480
September 29, 2003
Doctrine: One of the recognized exceptions to the rule against a
lawyer's representation of clients with conflicting interests is where the
clients knowingly consent to the dual representation after the
prospective counsel makes full disclosure of the facts to the parties.
FACTS:
 Leilani Ocampo-Ingcoco and Baltazar D. Ocampo filed an
administrative complaint before the Court charging
respondent Atty. Alejandro G. Yrreverre, Jr. for "unethical
and unprofessional conduct in violation of his duty as a
lawyer.
 Complainants alleged that respondent notarized a falsified
Deed of Absolute Sale involving a parcel of land then
registered under the name of their parents, Pacita and
Hermilindo Ocampo. The alleged vendee, Rosita S. Billones,
falsified their father's signature and caused the notarization
of the deed before the respondent.
 Respondent's illegal act of notarizing the said deed without
the parties thereto appearing before him was compounded by
the fact that he even placed a Community Tax Certificate
(CTC) Number, which was not issued to Pacita, but to a
certain Edelia M. Balingan. As a consequence of the
respondent's acts, Rosita Billones and her husband were able
to transfer the subject property in their names despite the
non-payment of the purchase price. Old TCT was thus
cancelled, and a new TCT was issued in the name of the
Billones Spouses.
 Complainants later learned that the respondent apparently
had a personal interest in the subject property, as it was later
mortgaged to JCY Loans and Mortgage, Inc., a company
owned by the respondent, and for whom the latter also acted
as legal counsel. Rosita Billones secured a loan from JCY Loan
and Mortgage, Inc. and used the subject property as
collateral.
 Pacita, filed a civil case for nullification of the deed of sale and
reconveyance of title to real property. Respondent then
entered his appearance as counsel for the Billones
Spouses.The complainants also filed a criminal case for estafa
through falsification against the Billones.
 Complainants further alleged that the respondent,
although acting as counsel for the Billones Spouses in
the said civil case, also acted as counsel for JCY Loans
and Mortgage, Inc., which had earlier filed a civil case
against the same spouses. The respondent also entered
his appearance as counsel for JCY Loans and
Mortgage, Inc., which moved to intervene in the civil
case. According to the complainants, such act of the
respondent was unprofessional and unethical, as he
counseled for parties with conflicting interests.
ISSUES:
1. Whether or not respondent is representing clients with
conflicting interests. (NO)
2. Whether or not respondent’s act of notarizing a deed without
requiring the parties to be present to attest to the truth of the
matters constitutes a breach of notarial law. (YES)
RULING:
1. No conflict of interest.
Respondent cannot be held liable for representing conflicting interests
in acting as defense counsel for the Billiones Spouses in the civil case
while acting as counsel for defendant-intervenor JCY Loans and
Mortgage, Inc. in the same case. The evidence presented by the
respondent shows that when the Billones Spouses secured his services
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“In civilized life, law floats in a sea of ethics.
as counsel, they were made fully aware of the pertinent facts and
circumstances.
Consent and written conformity was obtained after full disclosure of the
facts of the case. They even submitted a verified written manifestation
of conformity to show proof that the respondent was hired with their
approval.
One of the recognized exceptions to the rule against a lawyer's
representation of clients with conflicting interests is where the
clients knowingly consent to the dual representation after the
prospective counsel makes full disclosure of the facts to the
parties.
2. Yes, respondent is guilty for violation of notarial law.
Section 1 of Public Act No. 2103 provides:
(a) The acknowledgment shall be made before a notary public or
an officer duly authorized by law of the country to take
acknowledgments of instruments or documents in the place
where the act is done. The notary public or the officer taking
the instrument or document is known to him and that he is
the same person who executed it, and acknowledged that the
same is his free act and deed. The certificate shall be made
under his official seal, if he is by law required to keep a seal,
and if not, his certificate shall so state.
Notary public should not notarize a document unless the persons who
signed the same are the very same persons who executed and
personally appeared before the said notary public to attest to the
contents and truth of what are stated therein. The defense of the
respondent that he acted in good faith, and had no knowledge that Mr.
Ocampo, the other party to the document, was already deceased, is of
no merit.
When the respondent notarized the Deed of Absolute Sale without
ascertaining that the vendors-signatories thereto were the very same
persons who executed it and personally appeared before him to attest
to the truth of what were stated therein, he undermined the confidence
of the public on notarial documents and thereby breached Canon I of
the Code of Professional Responsibility which requires lawyers
to uphold the Constitution, obey the laws of the land and
promote respect for the law and legal processes, and Rule 1.01
thereof which proscribes lawyers from engaging in unlawful,
dishonest, immoral or deceitful conduct. In acknowledging that
the parties personally came and appeared before him, the respondent
also made an untruthful statement, thus violating Rule 10.01
of the Code of Professional Responsibility and his oath as a
lawyer that he shall do no falsehood.Moreover, he opens himself
to prosecution for falsification of a public document.
Penalty: Notary Public Revoked; Supended from the practice of law for
6 months
San Jose Homeowners Association, Inc. V. Romanillos
A.C. No. 5580
June 15, 2005
FACTS:
In 1985, respondent Romanillos (“RESPONDENT”) represented San
Jose Homeowners Association, Inc. (“SJHAI”) before the Human
Settlements Regulation Commission (HSRC) in a case against Durano
and Corp., Inc. (DCI) for violation of the Subdivision and Condominium
Buyer's Protection Act (P.D. No. 957). SJHAI alleged that Lot No. 224
was designated as a school site in the subdivision plan that DCI
submitted to the Bureau of Lands in 1961 but was sold by DCI to
spouses Durano without disclosing it as a school site.
FIRST DISBARMENT CASE
While still the counsel for SJHAI, respondent represented
Myrna and Antonio Montealegre in requesting for SJHAI's
conformity to construct a school building on Lot No. 224 to be
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC |
purchased from Durano. When the request was denied, respondent
applied for clearance before the Housing and Land Use
Regulatory Board (HLURB) in behalf of Montealegre. SHJAI’s
Board of Directors then terminated respondent's services as counsel
and engaged another lawyer to represent the association.
Moreover, respondent also acted as counsel for Lydia
Durano-Rodriguez who substituted for DCI in Civil Case No.
18014 entitled "San Jose Homeowners, Inc. v. Durano and Corp., Inc."
filed before the RTC of Makati City. With this, SJHAI filed a disbarment
case against respondent for representing conflicting interests,
docketed as Administrative Case No. 4783.
COMMISSION ON BAR DISCIPLINE OF THE IBP
The Investigating Commissioner found the following:
1. Respondent failed to observe candor and fairness in dealing with his
clients, knowing fully well that the Montealegre case was adverse
to SJHAI wherein he had previously been Corporate Secretary having
access to all its confidential documents or otherwise and its counsel in
handling the implementation of the Writ of Execution against its
developer and owner, DCI.
2. Respondent acted as counsel for the substituted defendant Lydia
Durano-Rodriguez; the conflict of interest between the latter and SJHAI
became so revealing yet, respondent proceeded to represent the
former.
3.
The Investigating Commissioner recommended dismissal of the
complaint with the admonition that respondent should observe
extra care and diligence in the practice of his profession to uphold its
dignity and integrity beyond reproach.
IBP BOARD OF GOVERNORS
It adopted and approved the report and recommendation of the
Investigating Commissioner through a Resolution dated March 8, 1999.
SECOND DISBARMENT CASE
However, despite the admonition, respondent continued
representing Lydia Durano-Rodriguez before the Court of Appeals
and this Court and even moved for the execution of the decision. With
this, a second disbarment case was filed against respondent for
violation of the March 8, 1999 Resolution in A.C. No. 4783 and
for his alleged deceitful conduct in using the title "Judge"
although he was found guilty of grave and serious misconduct.
RESPONDENT’S COMMENT AND EXPLANATION:
1. The respondent claimed that he continued to represent Lydia
Durano-Rodriguez against petitioner despite the March 8, 1999
Resolution because it was still pending when the second
disbarment case was filed. He maintained that the instant
petition is a rehash of the first disbarment case from which he
was exonerated.
2. As to the use of title “Judge,” respondent stated, that since the filing
of the instant petition he had ceased to attach the title to his
name.
IBP’S INVESTIGATION, REPORT AND RECOMMENDATION.
1. The Investigating Commissioner reported that respondent did not
violate the admonition because it referred to future cases only
and not to cases subject of A.C. No. 4783. Besides, petitioner never
questioned the propriety of respondent's continued representation of
Lydia Durano-Rodriguez on appeal until the case was terminated.
2. The Investigating Commissioner believed that respondent was
deceitful when he used the title "Judge", which created a false
impression that he was an incumbent.
3. The Investigating Commissioner recommended the minimum
penalty of reprimand to a maximum penalty of four (4) months
suspension. Also, a stern warning shall be given to respondent in that,
should he violate his undertaking/promise not to handle any case in the
future where the SJHAI would be the adverse party and/or should he
again use the title of "Judge" which would create an impression that he
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“In civilized life, law floats in a sea of ethics.” -Earl Warren
is still connected to the judiciary, a more severe penalty shall be
imposed on him by the Commission.
IBP BOARD OF GOVERNORS
It approved with modification from 4 months to six (6) months of
suspension. It considered that the respondent is in violation of Rule
1.01 and Rule 3.01 of the Code of Professional Responsibility (CPR). It
goes with a WARNING that should he violate his undertaking/promise a
more severe penalty shall be imposed against him.
ISSUES:
1. Whether or not, the respondent is guilty of representing
conflicting interests.
2. Whether or not the respondent should be liable for the
continuous use of the title “judge”.
RULING:
First Issue: YES.
The respondent undoubtedly represented the inconsistent
interests of SJHAI, DCI as substituted by Lydia Durano-Rodriguez and
the Montealegres. The former was admonished yet he continued to
represent Durano-Rodriguez against SJHAI. Also, it is inconsequential
that petitioner never questioned the propriety of respondent's
continued representation of Lydia Durano-Rodriguez. The lack of
opposition does not mean tacit consent. As long as the lawyer
represents inconsistent interests of two (2) or more opposing
clients, he is guilty of violating his oath and the CPR.
Specifically, the respondent violated Rule 15.03 of the CPR which
mandates that “a lawyer shall not represent conflicting interests
except by written consent of all concerned given after a full
disclosure.” It is also misleading for respondent to insist that he was
exonerated in A.C. No. 4783.
Second Issue: YES.
The Supreme Court (SC) agreed with the IBP that respondent's
continued use of the title "Judge" violated Rules 1.01 and 3.01
of the CPR prohibiting a lawyer from engaging in deceitful conduct and
from using any misleading statement or claim regarding qualifications
or legal services.
The quasi-judicial notice he posted in the billboards referring to himself
as a judge is deceiving. It was a clear attempt to mislead the public into
believing that the order was issued in his capacity as a judge when he
was dishonorably stripped of the privilege. Respondent did not
honorably retire from the judiciary. During the pendency of
Zarate vs. Judge Romanillos case, he resigned from being a judge,
where he was eventually found guilty of grave and serious
misconduct and would have been dismissed from the service had
he not resigned. In that case, respondent was found guilty of illegal
solicitation and receipt of P10,000.00 from a party litigant. He was given
the supreme penalty of dismissal.
A judge who resigned from office prior to the effectivity of his dismissal
shall be FORFEITED of all leave and retirement benefits and
privileges to which herein respondent Judge may be entitled WITH
PREJUDICE to reinstatement and/or reemployment in any branch or
instrumentality of government, including government-owned or
controlled agencies or corporations. Undoubtedly, the use of the title
'Judge' is one of such privileges, which should be reserved only to
judges, incumbent and retired, and not to those who were dishonorably
discharged from the service. As correctly pointed out by the
Investigating Commissioner, the right to retain and use said title applies
only to the aforementioned members of the bench and no other, and
certainly not to those who were removed or dismissed from the
judiciary, such as respondent.
Considerably, this is not respondent's first infraction as an officer of the
Court and a member of the legal profession:
1. He was stripped of his retirement benefits and other privileges in
Zarate v. Judge Romanillos.
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC | “In civilized life, law floats in a sea of ethics.” -Earl Warren
2. In A.C. No. 4783, he got off lightly with just an admonition.
With respondent’s previous infractions, his disbarment is consequently
warranted and his name is ordered stricken from the Roll of
Attorneys.
Northwestern Univ., Inc. V. Arquillo
A.C. No. 6632
August 02, 2005
DOCTRINE: Representing conflicting interests is prohibited by
the Code of Professional Responsibility. Unless all the affected clients'
written consent is given after a full disclosure of all relevant facts,
attorneys guilty of representing conflicting interests shall as a rule be
sanctioned with suspension from the practice of law.
FACTS:
Northwestern University, Inc. and Mr. Ben A. Nicolas (COMPLAINANTS)
accused Atty. Macario D. Arquillo (RESPONDENT) of engaging
in conflicting interest in a case before the National Labor Relations
Commission.
Complainant alleges that in a consolidated case, herein respondent
appeared and acted as counsels for both complainants (eight out of the
eighteen complainants therein) and respondent (one out of the ten
respondents therein).
Respondent failed to file his Answer to the Complaint despite a June 24
1998 Order of the IBP-CBD directing him to do so. Even after receiving
five notices, he failed to appear in any of the scheduled hearings.
Consequently, he was deemed to have waived his right to participate in
the proceedings.
Thereafter, the complainants were ordered to submit their verified
position paper with supporting documents, after which the case was to
be deemed submitted for decision. In their Manifestation dated August
30, 2004, they said that they would no longer file a position paper. They
agreed to submit the case for decision on the basis of their
Letter-Affidavit together with all the accompanying documents.
In his Report, Commissioner Dennis B. Funa found respondent guilty of
violating the conflict-of-interests rule under the Code of Professional
Responsibility. Thus, the former recommended the latter's suspension
from the practice of law for a period of six (6) months.
The Board of Governors of the IBP adopted the Report and
Recommendation of Commissioner Funa, with the modification that the
period of suspension was increased to two (2) years.
On January 20, 2005, respondent filed a Motion for Reconsideration to
set aside the resolution. The IBP denied the Motion.
ISSUE:
Whether or not Atty. Arquillo is guilty of misconduct for representing
conflicting interest.
RULING: YES.
An attorney cannot represent adverse interests. It is a hornbook
doctrine grounded on public policy that a lawyer's representation of
both sides of an issue is highly improper. The proscription applies when
the conflicting interests arise with respect to the same general matter,
however slight such conflict may be. It applies even when the attorney
acts from honest intentions or in good faith.
In the present case, Atty. Macario D. Arquillo, as counsel for
Respondent Jose C. Castro in NLRC Cases, filed a Motion to Dismiss
those cases. Shortly thereafter, a position paper was filed by Atty.
Arquillo as counsel for several complainants in consolidated NLRC Cases.
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All the cases in the second set were included in the first one, for which
he had filed the subject Motion to Dismiss. Furthermore, in his position
paper for the complainants, Atty. Arquillo protected his other client,
Respondent Jose C. Castro, in these words:
“More than lack of valid cause for the
dismissal of complainants, respondents, except
Atty. Jose C. Castro and Atty. Ernesto B.
Asuncion, should be made accountable for not
according complainants their right to due
process."
In his two-page Motion for Reconsideration, Atty. Arquillo claims that
there was no conflict of interest in his representation of both the
respondent and the complainants in the same consolidated cases,
because all of them were allegedly on the same side. Attaching to the
Motion the Decision of Labor Arbiter Norma C. Olegario on the
consolidated NLRC cases, Atty. Arquillo theorizes that her judgment
absolved Castro of personal liability for the illegal dismissal of the
complainants; this fact allegedly showed that there was no conflict in
the interests of all the parties concerned.
This Court does not agree. Atty. Arquillo's acts cannot be justified by the
fact that, in the end, Castro was proven to be not personally liable for
the claims of the dismissed employees. Having agreed to represent one
of the opposing parties first, the lawyer should have known that there
was an obvious conflict of interests, regardless of his alleged belief that
they were all on the same side. It cannot be denied that the dismissed
employees were the complainants in the same cases in which Castro
was one of the respondents. Indeed, Commissioner Funa correctly
enounced:
"As counsel for complainants,
[r]espondent had the duty to
oppose the Motion to Dismiss filed by Jose G.
Castro. But under the circumstance, it would be
impossible since [r]espondent is also the counsel
of Jose G. Castro. And it appears that it was
[r]espondent who prepared the Motion to
Dismiss, which he should be opposing [a]s
counsel of Jose G. Castro, Respondent had the
duty to prove the Complaint wrong. But
Respondent cannot do this because he is the
counsel for the complainants. Here lies the
inconsistency. The inconsistency of
interests is very clear.
The IBP Board of Governors recommended that respondent be
suspended from the practice of law for two years. Considering, however,
prior rulings in cases also involving attorneys representing conflicting
interests, we reduce the suspension to one (1) year.
WHEREFORE, Atty. Macario D. Arquillo is found GUILTY of
misconduct and is hereby SUSPENDED from the practice of law for a
period of one (1) year.
ADDITIONAL NOTES:
When a lawyer represents two or more opposing parties, there is a
conflict of interests, the existence of which is determined by three
separate tests:
(1) when, in representation of one client, a lawyer is required to fight
for an issue or claim, but is also duty-bound to oppose it for another
client;
(2) when the acceptance of the new retainer will require an attorney to
perform an act that may injuriously affect the first client or, when called
upon in a new relation, to use against the first one any knowledge
acquired through their professional connection; or
(3) when the acceptance of a new relation would prevent the full
discharge of an attorney's duty to give undivided fidelity and loyalty to
the client or would invite suspicion of unfaithfulness or double dealing in
the performance of that duty.
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC |
Quiambao v. Bamba
A.C. No. 6708
August 25, 2005
FACTS:
Felicitas S. Quiambao (QUIAMBAO) charges Atty. Nestor A. Bamba
(ATTY. BAMBA) for violating the CPR for representing conflicting
interests when the latter filed a case against her while he was at that
time representing her in another case (ejectment), and for committing
other acts of disloyalty and double-dealing.
Quiambao was the President and managing director of Allied
Investigation Bureau Inc. (AIB) a family owned corporation engaged in
providing security and investigation services.
FELICIATAS QUIAMBAO’S SIDE:
She avers that she procured the legal services of Atty. Bamba not only
for the corporate affairs of AIB but also for her personal case, in an
ejectment case filed by Quiambao against Sps. Torroba and she paid
him for Attorney’s fees.
6 months after she resigned as AIB president, Atty. Bamba filed on
behalf of AIB a complaint for replevin and damages against her
for the purpose of recovering from her the car of AIB assigned to her as
a service vehicle. This he did without withdrawing as counsel of
record in the ejectment case, which was then still pending.
For acts of disloyalty and double dealing. She avers that Atty. Bamba
proposed to her that she organize her own security agency and that he
would assist her in its organization, causing her to resign as president of
AIB. That Atty. Bamba assisted her in another security agency (QRMSI),
registered under Quiambao’s name and Atty. Bamba as silent partner
(this was denied by Atty. Bamba). The latter was paid attorney's fees for
his legal services in organizing and incorporating QRMSI.
While serving as legal counsel for AIB and a "silent partner" of QRMSI,
he convinced Quiambao’s brother to organize another security
agency, San Esteban Security Services, Inc. (SESSI) where he
(the Atty. Bamba) served as its incorporator, director, and
president. (this was denied by Atty. Bamba saying it was the brother
and his wife who has effective control over SESSI)
The brother and Atty. Bamba then illegally diverted the funds of AIB to
fund the incorporation of SESSI, and likewise planned to eventually
close down the operations of AIB and transfer the business to SESSI.
ATTY. BAMBA’S SIDE:
He admits that he represented the Quiambao in the ejectment case and
later represented AIB in the replevin case against her.
However, he denies that he was the "personal lawyer" of the
Quiambao, and that he was made to believe that it was part of his
function as counsel for AIB to handle even the "personal cases" of its
officers.
That the ejectment case and the replevin case are unrelated cases
involving different issues and parties and, therefore, the privilege
information gathered from one case would have no use in the other.
That it was Quiambao who insisted that he stay as her counsel despite
the perceived differences among her, her brother, and AIB over the
motor vehicle subject of the replevin case.
He serves AIB and SESSI in different capacities: as legal counsel of the
former and as president of the latter purchasing 800 shares.
Investigating Commissioner:
Found Atty. Bamba guilty of respresenting conflicting interests. He was
her counsel in an ejectment case and as legal cpunsel of AIB in replevin
case filed against her (Quiambao). That He was still the legal counsel of
IAB when he advised Quiambao on the incorporation of another security
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“In civilized life, law floats in a sea of ethics.” -Earl Warren
agency QRMSI and when he conferred with the brother of Quiambao to
organize SESSI. Suspended for 1 year. This was adopted by the IBP
Board of Governors but reduced it to a mere stern reprimand.
ISSUE:
Whether or not Atty. Bamba is guilty of misconduct for representing
conflicting interests in contravention of the basic tenets of the legal
profession.
RULING:
YES.
Rule 15.03, Canon 5 of the CPR provides:
"A lawyer shall not represent conflicting interests except by
written consent of all concerned given after a full disclosure
of the facts."
This prohibition is founded on principles of public policy and good taste.
The lawyer learn all facts connected to the client’s case, weak and
strong points. The relationship is, one of trust and confidence of the
highest degree. This is not only to inviolate client’s confidence but also
to avoid the appearance of treachery and double dealing.
Tests if there is conflict of interests;
1. whether a lawyer is duty-bound to fight for an issue or claim
in behalf of one client and, at the same time, to oppose that
claim for the other client.
So, if a lawyer's argument for one client has to be opposed by
that same lawyer in arguing for the other client, there is a
violation of the rule. or
2. whether the acceptance of new relation would prevent the
full discharge of the lawyer's duty of undivided fidelity and
loyalty to the client or invite suspicion of unfaithfulness or
double-dealing in the performance of that duty, or
3. whether the lawyer would be called upon in the new relation
to use against a former client any confidential information
acquired through their connection or previous employment.
The proscription against representation of conflicting interests applies
to a situation where the opposing parties are present clients in the
same action or in an unrelated action.
ITC, Atty. Bamba filed the replevin case on behalf of AIB he
was still the counsel of record of the complainant in the
pending ejectment case.
His representation of opposing clients in both cases, though unrelated,
obviously constitutes conflict of interest or, at the least, invites suspicion
of double-dealing.
While Atty. Bamba may assert that the complainant expressly
consented to his continued representation in the ejectment
case, the respondent failed to show that he fully disclosed the
facts to both his clients and he failed to present any written
consent of the complainant and AIB as required under Rule
15.03, Canon 15 of the CPR.
Neither can we accept respondent's plea that he was duty-bound to
handle all the cases referred to him by AIB, including the personal cases
of its officers which had no connection to its corporate affairs.
They have the right to decline such employment, subject, however, to
Canon 14 of the CPR. Although there are instances where lawyers
cannot decline representation, they cannot be made to labor under
conflict of interest between a present client and a prospective one.
Atty. Bamba alleges that, he was invited to join QRMSI but he
"vehemently refused to join them due to his perception of conflicting
interest as he was then (and still is at present) the Legal Counsel" of AIB,
which is also a security agency. However, later allowed himself to
become an incorporator, stockholder, and president of SESSI, which is
also a security agency.
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC |
He justified his acts claiming that he is serving with different capacities.
As an in-house legal counsel of AIB, protecting the legal rights and
interest of the corporation; hearing on violations of company rules and
regulations of their office employees and security guards; and
representing the corporation in any litigation for or against it. And as a
president of Sessi, serving in the operational aspects of
business. That Quiambao not being a stockholder of AIB and SESSI
has no right to question the conflict of interest in serving 2 security
agencies.
The proscription against representation of conflicting interests finds
application where the conflicting interests arise with respect to the
same general matter however slight the adverse interest may be. It
applies even if the conflict pertains to the lawyer's private
activity or in the performance of a function in a
non-professional capacity.
An important criterion is probability, not certainty, of conflict to
determine if there is conflict of interest.
Since the respondent has financial or pecuniary interest in SESSI, which
is engaged in a business competing with his client's, and, more
importantly, he occupies the highest position in SESSI, one cannot help
entertaining a doubt on his loyalty to his client AIB. (PASSES THE 2ND
TEST).
The close relationship of the majority stockholders of both companies
does not negate the conflict of interest. Neither does his protestation
that his shareholding in SESSI is "a mere pebble among the sands."
It must be noted that Republic Act No. 5487, otherwise known as
the Private Security Agency Law, prohibits a person from
organizing or having an interest in more than one security
agency.
Thus, in organizing SESSI, Atty. Bamba violated Rule 1.02, Canon 1 of
the CPR, which mandates lawyers to promote respect for the law and
refrain from counseling or abetting activities aimed at defiance of the
law. The Supreme Court suspended Atty. Bamba for 1 year from the
practice of law.
Lim, Jr. V. Villarosa
A.C. No. 5303
June 15, 2006
FACTS:
Atty. Villarosa (respondent) was the lawyer of Lumot A. Jalandoni,
Chairman or President of Penta Resorts Corporation (PRC). Mrs.
Jalandoni has two sons-in-law, Dennis G. Jalbuena married to her
daughter, Carmen J. Jalbuena, and complainant Humberto C. Lim Jr.,
married to her daughter, Cristina J. Lim.
Mrs. Jalandoni organized a corporation namely the Penta Resorts
Corporation (PRC) where she owned almost ninety seven percent
(97%). In reality, Penta Resorts Corporation is a single proprietorship
belonging to Mrs. Jalandoni. The only property of the corporation is the
Alhambra Hotel, constructed solely through the effort of the spouses
Jalbuena on that parcel of land.
Respondent represented Mrs. Jalandoni in a civil case. Utmost trust and
confidence were reposed on him, hence delicate and confidential
matters involving all the personal circumstances of his client were
entrusted to the him. Respondent was provided with all the necessary
information relative to the property in question and on legal matters
affecting PRC particularly involving problems which affect Hotel
Alhambra. Respondent was privy to all transactions and affairs of the
corporation/hotel.
Respondent handled the entire case and also presented Mrs. Jalandoni
as a witness, eventually respondent filed a motion to withdraw as
counsel for Mrs. Jalandoni without any approval or knowledge form the
said client, which resulted to irreparable injury to Mrs. Jalandoni
because it suffered unexpected defeat.
EH 401 | A.Y. 2019-2020 | Borata | Dadol |Jailani | Javier | Kinazo | Manit | Ricalde | Zosa
“In civilized life, law floats in a sea of ethics.” -Earl Warren
Thereafter, Sps. Jalbuena was sued by PRC for estafa, and the
respondent represented the Sps. Jalbuena before the city Prosecutor of
Bacolod. In his contention the respondent said there is a retainership
agreement between them and Mr. Jalbuena and that he cannot refuse.
A case was filed against the respondent, due to conflict of interest to his
clients and for not releasing the significant documents which belongs to
Mrs. Jalandoni or PRC and which was allegedly used for the benefit or
advantage of Sps. Jalbuena in the case filed against them by PRC.
ISSUE:
Whether or not there is conflict of interest in the cases represented and
handled by Atty. Villarosa.
RULING:
Yes.
Rule 15.03 provides that a lawyer shall not represent conflicting
interests except by written consent of all concerned given after a full
disclosure of the facts.
It is only upon strict compliance with the condition of full disclosure of
facts that a lawyer may appear against his client; OW, his
representation of conflicting interests is reprehensible. Conflict of
interest may be determined in this manner:
 if the acceptance of the new retainer will require the attorney
to do anything which will injuriously affect his client in any
matter in which he represents him and also whether he will
be called upon in his new relation, to use against his first
client any knowledge acquired through their connection.
 whether the acceptance of a new relation will prevent an
attorney from the full discharge of his duty of undivided
fidelity and loyalty to his client or invite suspicion of
unfaithfulness or double-dealing in the performance thereof
(cases in which the opposing parties are present
clients either in the same action or in a totally
unrelated case)
 whether he will be called upon in his new relation to use
against his first client any knowledge acquire in the previous
employment. (cases where the adverse party against
whom the attorney appears is his former client in a
matter which is related, directly or indirectly, to the
present controversy)
This rule on conflict of interests covers not only cases in which
confidential communications have been confided but also those in
which no confidence has been bestowed or will be used.
The rule prohibits a lawyer from representing new clients whose
interests oppose those of a former client in any manner, whether or not
they are parties in the same action or in totally unrelated cases.
ITC, the cases directly or indirectly involved the parties’ connection to
PRC, even if neither PRC nor Lumot A. Jalandoni was specifically named
as party-litigant in some of the cases mentioned.
An attorney owes to his client undivided allegiance. After being retained
and receiving the confidences of the client, he cannot, without the free
and intelligent consent of his client, act both for his client and for one
whose interest is adverse to, or conflicting with that of his client in the
same general matter. The prohibition stands even if the adverse
interest is very slight; neither is it material that the intention
and motive of the attorney may have been honest.
Even respondents alleged effort to settle the existing controversy
among the family members was improper because the written consent
of all concerned was still required. A lawyer who acts as such in settling
a dispute cannot represent any of the parties to it.
As to Atty. Villarosa’s withdrawal, a lawyer shall withdraw his
services only for good cause and upon notice appropriate in the
circumstances.
A lawyer who desires to retire from an action without the written
consent of his client must file a petition for withdrawal in court. He must
serve a copy of his petition upon his client and the adverse party at least
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC | “In civilized life, law floats in a sea of ethics.” -Earl Warren
three days before the date set for hearing, otherwise the court may
treat the application as a "mere scrap of paper."
ITC, respondent made no such move. He admitted that he withdrew as
counsel on April 26, 1999, which withdrawal was supposedly approved
by the court on April 28, 1999. The conformity of Mrs. Jalandoni was
only presumed by Atty. Villarosa because of the appearance of Atty.
Alminaza in court, supposedly in his place.
The appearance of Atty. Alminaza in fact was not even to substitute for
respondent but to act as additional counsel.
Respondent should not have presumed that his motion to withdraw as
counsel would be granted by the court. Yet, he stopped appearing as
Mrs. Jalandoni's counsel beginning April 28, 1999, the first hearing date.
No order from the court was shown to have actually granted his motion
for withdrawal.
The fact That Mrs. Jalandoni continued with Atty. Alminaza's
professional engagement on her behalf despite respondent's withdrawal
did not absolve the latter of the consequences of his unprofessional
conduct, specially in view of the conflicting interests already discussed.
Wherefore, Atty. Villarosa is found GUILTY of violating Canon 15 and
Canon 22 of the Code of Professional Responsibility and is SUSPENDED
from the practice of law for one (1) year.
Paz v. Sanchez
A.C. No. 6125
September 19, 2006
FACTS:
This is a disbarment complaint filed by Simon D. Paz (Paz) against Atty.
Pepito A. Sanchez (Pepito) for representing conflicting interests and
violation of the lawyer's oath.
Simon Paz and his partners engaged the services of Atty. Sanchez to
assist them in the purchase and documentation of such purchase of
several parcels of land from tenant farmers in Pampanga as well as
defend Paz’s claim on the properties against the claim of George Lizares.
On May 2000 after the termination of their lawyer-client relationship,
Sanchez filed a complaint before the Department of Agrarian Reform
Board (DARAB) on behalf of Isidro Dizon (Dizon) for annulment of TCT
No. 420127-R in the name of Paz and his partners.
Paz then explained that the subject property was among the properties
purchased by them with Sanchez’s assistance. Later on June 23, 2003,
Sanchez filed a civil case against Paz and Sycamore Venture Corp.
before the RTC, San Fernando, Pampanga for annulment of TCT No.
483629-R while the DARAB case was pending.
With that, Paz filed the administrative complaint alleging conflict of
interests and use of malicious machination in the filing of the DARAB
case.
IBP’s findings and recommendation:
Commissioner San Juan found Sanchez guilty of violating the prohibition
against representing conflicting interests. The IBP Board of Governors
adopted the findings of Commissioner San Juan and recommended
imposition of ONE YEAR SUSPENSION from the practice of law as a
penalty.
ISSUE:
Whether or not Sanchez represented conflicting interests when he later
represented Isidro Dizon in the DARAB Case .
RULING:
Yes.
Rule 15.03 of the Code of Professional Responsibility provides that "a
lawyer shall not represent conflicting interests except by written
consent of all concerned given after full disclosure of the facts."
EH 401 | A.Y. 2019-2020 | Borata | Dadol |Jailani | Javier | Kinazo | Manit | Ricalde | Zosa
Lawyers are deemed to represent conflicting interests when, on behalf
of one client, it is their duty to contend for that which duty to another
client requires them to oppose. The proscription against representation
of conflicting interest applies to a situation where the opposing parties
are present clients in the same action or in an unrelated action.
The Court noted that by Sanchez’s own admission, Paz and Dizon were
both his clients at the time when he filed the DARAB case on behalf of
Dizon. Likewise, Sanchez did not specifically deny that he represented
conflicting interests, that he merely offered to justify his actuations by
stating that he felt it was his “duty and responsibility” to file the case.
Good faith and honest intentions do not excuse the violation of this
prohibition. In representing both complainant and Dizon, respondent's
duty of undivided fidelity and loyalty to his clients was placed under a
cloud of doubt. In the eyes of the Court, Sanchez should have inhibited
himself from representing Dizon against Paz in the DARAB and RTC
cases to avoid conflict of interest.
WHEREFORE, the Court finds respondent Atty. Pepito A. Sanchez
GUILTY of violating Rule 15.03 of the Code of Professional
Responsibility. The Court SUSPENDS respondent from the practice of
law for ONE YEAR and WARNS respondent that the commission of a
similar act in the future will merit a more severe penalty.
Capinpin, Jr. V. Cesa, Jr.
A.C. No. 6933
July 05, 2017
FACTS:
Complainant (Capinpin Jr.) executed a real estate mortgage on 2 of his
two lots in favor of Family Lending Corporation (FLC) as security for a
loan amounting to PhP5 Million with interest at two percent (2%) per
month. FLC through its President, Dr. Malaya initiated foreclosure
proceedings due to default in payment. Complainant availed of several
legal remedies, but the auction sale still proceeded. For these cases,
FLC engaged respondent Cesa’s legal services.
Complaint:
- Alleged that during the proceedings, Cesa approached
complainant to negotiate the deferment of the auction sale
and the possible settlement of the loan obligation.
- Cesa allegedly represented himself as being capable of
influencing the sheriff to defer the auction sale, as well as his
client FLC through Dr. Malaya to accept the amount of PhP7
Million to fully settle the loan obligation.
Respondent’s Contention:
- Cesa denied the allegations and alleged that it was
complainant who asked for his help to be given more time to
raise funds to pay the loan obligation and that Cesa
communicated said request to FLC.
- That the payments alleged in the complaint are advance
payments of his Attorney’s Fees, as evidenced by a Letter
signed by complainant and addressed to FLC thru Dr. Malaya
in which complainant expressly stated that he will negotiate
for the payment of respondent’s fees as FLC’s counsel.
IBP Findings
- Suspended Cesa for 1 year for violation of Canon 15.03, for
representing conflicting interests, and Canon 16.01, for not
accounting the money received from Capinpin in favor of FLC.
ISSUE:
Should Atty. Cesa, Jr. be administratively disciplined based on the
allegations in the complaint and evidence on record?
RULING:
YES.
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PROBLEM AREAS IN LEGAL ETHICS | ATTY. GCC | “In civilized life, law floats in a sea of ethics.” -Earl Warren
Respondent violated Canon 15, Rule 15.03 and Canon 16, Rule 16.01 of
the CPR:

Rule 15.03 — A lawyer shall not represent conflicting

interests except by written consent of all concerned given after a
full disclosure of the facts.

Rule 16.01 — A lawyer shall account for all money or

property collected or received for or from the client.

Violation of Rule 15.03:

FLC engaged respondent's legal services to represent it in opposing

complainant's actions to forestall the foreclosure proceedings. As can be
gleaned from respondent's position paper, however, it is admitted that
respondent extended help to the complainant in negotiating with FLC
for the reduction of the loan payment and cessation of the foreclosure
proceedings.

There is conflict of interest when a lawyer represents inconsistent

interests of two or more opposing parties. The test is whether or not in
behalf of one client, it is the lawyer's duty to fight for an issue or claim,
but it is his duty to oppose it for the other client.

The relationship between a lawyer and his client is imbued with the
highest level of trust and confidence. The reason for the prohibition on
conflict of interest is to avoid the appearance of treachery and
double-dealing for only then can litigants be encouraged to entrust their
secrets to their lawyers.

Evidently, Cesa was working on conflicting interests — that of his client,

which was to be able to foreclose and obtain the best amount they
could get to cover the loan obligation, and that of the complainant's,
which was to forestall the foreclosure and settle the loan obligation for a
lesser amount.

As to the allegation the FLC had knowledge of Cesa’s dealings, the court
found no record of any consent from any parties allowing Cesa to
negotiate. As to respondent’s admission that he received payments of
professional fees from complainant, this only made matters worse for
him since it was highly improper. Respondent’s professional fees must
come from his client, even if eventually such fees will be reimbursed by
the adverse party depending on their agreement.

Furthermore, the Letter presented does not, in any way, prove that
there was an agreement between Capinpin and FLC. It is also suspicious
that respondent was already receiving several amounts even before the
date of the said Letter, supposedly stating an agreement between
Capinpin and FLC as regards the settlement of the lona obligation and
the payment of Cesa’s professional fees.

Violation of Rule 16.01:

At any rate, even assuming that there was indeed an arrangement

between FLC and complainant that Cesa's professional fees shall be
paid by the complainant, which will be later on deducted from whatever
the latter will pay FLC for the settlement of his loan obligation,
respondent's act of accepting such payments from the complainant and
appropriating the same for his professional fees is still reprehensible.
The said payments from the complainant are still considered FLC's
money; as such respondent should have accounted the same for his
client.

IBP Resolution Affirmed.

EH 401 | A.Y. 2019-2020 | Borata | Dadol |Jailani | Javier | Kinazo | Manit | Ricalde | Zosa Page 7 of 7