Nakpil vs Valdez

Facts: Due to lack of

funds, Jose Nakpil
asked for respondent
Atty. Valdez who is his
friend, to purchase the
Moran summer house.
Atty. Valdez in a
agreement, would keep
the property in trust for
the Nakpils until the
latter could buy it back.
Respondent also
obtained loan banks for
the purchase and
renovation of the
property. A title was
also issued in
respondent’s name.
When Jose Nakpil died,
respondent acted as the
legal counsel and
accountant of the
decease’s widow Imelda
Nakpil and placed the
latter as the
administratrix of the
estate. During the
intestate proceeding it
was found out that the
Moran summer house
was excluded from the
inventory of Nakpil’s
estate and that the title
of which was
transferred to the
company of respondent.
Imelda Nakpil, the
widow of Jose and
complainant, filed with
the CFI an action for
reconveyance and an
administrative case
against respondent.
Respondent denied the
allegations in his
answer that there was
no conflict of interest as
the Moran summer
house was not paid
back to him by the
Nakpil thus he is the
absolute owner of the
summer house.
Issue:
1.W/n respondent is
guilty of violating Canon
17 of the CPR
2.W/n there was conflict
of interest on the part of
the respondent.
Held:
1. Yes. Canon 17
provides that a
lawyer owes fidelity
to the cause of his
client and he shall be
mindful of the trust
and confidence
reposed in him. The
respondent’s act of
excluding the Moran
property from the
estate which his law
firm was representing
reveals a lack of
fidelity to the cause
of his client. If he
truly believed that
the property
belonged to him he
should have informed
complainant of his
adverse claim and if
there was no
agreement on the
ownership,
respondent should
have formally
presented the claim
in the intestate
proceeding instead of
transferring the
property to his own
corporation and
hiding it from the
complainant and the
judge in the
proceeding. To
matters worse, he
charged the two
loans as liability of
the estate which was
obtained by
respondent for the
purchase and
renovation of the
property which he
claimed for himself.
His misuse of his
legal expertise to
deprive his client of
 the Moran property is
clearly unethical.
2. Yes. The Court held
that respondent is
guilty of representing
conflicting interests.
In the case at bar, he
allowed his
accounting firm to
represent two
creditors of the
estate and at the
same time allowing
his law frim to
represent the estate
in the proceedings
where these claims
were presented
which makes the act
a breach of
professional ethics
and placed
respondent and his
law firm’s loyalty
under a cloud of
doubt. Respondent
exhibited less than
full fidelity to his duty
to observe candor,
fairness and loyalty
in his dealings and
transactions with his
clients.

Guilty of misconduct.
Suspended- one year