EN BANC

and to recommend the proper administrative sanctions against her as the evidence may warrant.[11] In accordance with the mandate of the Order, the Committee conducted an investigation of the case and issued a Resolution[12] dated 18 October 2004 where it concluded that a prima facie case of Dishonesty and Serious Misconduct against respondent existed. The Committee thus recommended respondents preventive suspension for ninety (90) days pending formal investigation of the charges against her.[13] On 28 January 2005, the Committee submitted a Report[14] to the new CA Presiding Justice Romeo A. Brawner with its recommendation that respondent be dismissed from service. Based on the hearings conducted and the evidence received by the Committee, the antecedent facts are as follows: Complainants case referred to above had been pending with the CA for more than two years.[15] Complainant filed an illegal dismissal case against PAGCOR before the Civil Service Commission (CSC). The CSC ordered complainants reinstatement but a writ of preliminary injunction and a temporary restraining order was issued by the CA in favor of PAGCOR, thus complainant was not reinstated to his former job pending adjudication of the case.[16] Desiring an expeditious decision of his case, complainant sought the assistance of respondent sometime in July 2004 after learning of the latters employment with the CA from her sister, Magdalena David. During their first telephone conversation[17] and thereafter through a series of messages they exchanged via SMS,[18] complainant informed respondent of the particulars of his pending case. Allegedly, complainant thought that respondent would be able to advise him on how to achieve an early resolution of his case. However, a week after their first telephone conversation, respondent allegedly told complainant that a favorable and speedy decision of his case was attainable but the person who was to draft the decision was in return asking for One Million Pesos (P1,000,000.00).[19] Complainant expostulated that he did not have that kind of money since he had been jobless for a long time, to which respondent replied, Eh, ganoon talaga ang lakaran dito, eh. Kung wala kang pera, pasensiya na.[20] Complainant then tried to ask for a reduction of the amount but respondent held firm asserting that the price had been set, not by her but by the person who was going to make the decision.[21] Respondent even admonished complainant with the words Wala tayo sa palengke iho![22] when the latter bargained for a lower amount.[23] Complainant then asked for time to determine whether or not to pay the money in exchange for the decision. Instead, in August of 2004, he sought the assistance of Imbestigador.[24] The crew of the TV program accompanied him to PAOCCF-SPG where he lodged a complaint against respondent for extortion.[25] Thereafter, he communicated with respondent again to verify if the latter was still asking for the money [26] and to set up a meeting with her.[27] Upon learning that respondents offer of a favorable decision in

[A.M. No. CA-05-18-P. April 12, 2005]

ZALDY NUEZ, complainant, vs. ELVIRA CRUZ-APAO, respondent. DECISION PER CURIAM: What brings our judicial system into disrepute are often the actuations of a few erring court personnel peddling influence to party-litigants, creating the impression that decisions can be bought and sold, ultimately resulting in the disillusionment of the public. This Court has never wavered in its vigilance in eradicating the so-called bad eggs in the judiciary. And whenever warranted by the gravity of the offense, the supreme penalty of dismissal in an administrative case is meted to erring personnel.[1] The above pronouncement of this Court in the case of Mendoza vs. Tiongson[2] is applicable to the case at bar. This is an administrative case for Dishonesty and Grave Misconduct[3] against Elvira Cruz-Apao (Respondent), Executive Assistant II of the Acting Division Clerk of Court of the Fifteenth (15th) Division, Court of Appeals (CA). The complaint arose out of respondents solicitation of One Million Pesos (P1,000,000.00) from Zaldy Nuez (Complainant) in exchange for a speedy and favorable decision of the latters pending case in the CA,[4] more particularly, CA-G.R. SP No. 73460 entitled PAGCOR vs. Zaldy Nuez.[5] Complainant initially lodged a complaint with the Action Center of the Television program Imbestigador of GMA Network,[6] the crew of which had accompanied him to the Presidential Anti-Organized Crime CommissionSpecial Projects Group (PAOCC-SPG) in Malacaang where he filed a complaint for extortion[7] against respondent. This led to the conduct of an entrapment operation by elements of the Presidential Anti-Organized Crime Task Force (PAOCTF) on 28 September 2004 at the Jollibee Restaurant, 2 nd Floor, Times Plaza Bldg., corner Taft and United Nations Avenue, Manila,[8] the place where the supposed hand-over of the money was going to take place. Respondents apprehension by agents of the PAOCTF in the course of the entrapment operation prompted then CA Presiding Justice (PJ) Cancio C. Garcia (now Supreme Court Justice) to issue Office Order No. 297-04-CG[9] (Order) which created an ad-hoc investigating committee (Committee).[10] The Committee was specifically tasked among others to conduct a thorough and exhaustive investigation of respondents case

exchange for One Million Pesos (P1,000,000.00) was still standing, the plan for the entrapment operation was formulated by Imbestigador in cooperation with the PAOCC. On 24 September 2004, complainant and respondent met for the first time in person at the 2nd Floor of Jollibee, Times Plaza Bldg.,[28] the place where the entrapment operation was later conducted. Patricia Siringan (Siringan), a researcher of Imbestigador, accompanied complainant and posed as his sister-in-law.[29] During the meeting, complainant clarified from respondent that if he gave the amount of One Million Pesos (P1,000,000.00), he would get a favorable decision. This was confirmed by the latter together with the assurance that it would take about a month for the decision to come out.[30] Respondent also explained that the amount of One Million Pesos (P1,000,000.00) guaranteed a favorable decision only in the CA but did not extend to the Supreme Court should the case be appealed later.[31] When respondent was asked where the money will go, she claimed that it will go to a male researcher whose name she refused to divulge. The researcher was allegedly a lawyer in the CA Fifth (5th) Division where complainant case was pending.[32] She also claimed that she will not get any part of the money unless the researcher decides to give her some.[33] Complainant tried once again to bargain for a lower amount during the meeting but respondent asserted that the amount was fixed. She even explained that this was their second transaction and the reason why the amount was closed at One Million Pesos (P1,000,000.00) was because on a previous occasion, only Eight Hundred Thousand Pesos (P800,000.00) was paid by the client despite the fact that the amount had been pegged at One Million Three Hundred Thousand Pesos (P1,300,000.00).[34] Complainant then proposed that he pay a down payment of Seven Hundred Thousand Pesos (P700,000.00) while the balance of Three Hundred Thousand Pesos (P300,000.00) will be paid once the decision had been released.[35] However, respondent refused to entertain the offer, she and the researcher having learned their lesson from their previous experience for as then, the client no longer paid the balance of Five Hundred Thousand Pesos (P500,000.00) after the decision had come out.[36] Complainant brought along copies of the documents pertinent to his case during the first meeting. After reading through them, respondent allegedly uttered, Ah, panalo ka.[37] The parties set the next meeting date at lunchtime on 28 September 2004 and it was understood that the money would be handed over by complainant to respondent then.[38] On the pre-arranged meeting date, five (5) PAOCTF agents, namely: Capt. Reynaldo Maclang (Maclang) as team leader, SPO1 Renato Banay (Banay), PO1 Bernard Villena (Villena), PO1 Danny Feliciano, and PO2 Edgar delos Reyes[39] arrived at around 11:30 in the morning at Jollibee.[40]Nuez and Siringan arrived at past noon and seated themselves at the table beside the one occupied by the two (2) agents, Banay and Villena. Complainant had with him an unsealed long brown envelope containing ten (10) bundles of marked money and paper money which was to be given to respondent.[41] The envelope did not actually contain the One Million Pesos (P1,000,000.00) demanded by respondent, but instead contained paper money in denominations of One Hundred Pesos (P100.00), Five

Hundred Pesos (P500.00) and One Thousand Pesos (P1,000.00), as well as newspaper cutouts.[42] There were also ten (10) authentic One Hundred Peso (P100.00) bills which had been previously dusted with ultra-violet powder by the PAOCTF.[43] The three other PAOCTF agents were seated a few tables away[44] and there were also three (3) crew members fromImbestigador at another table operating a mini DV camera that was secretly recording the whole transaction.[45] Respondent arrived at around 1:00 p.m.[46] She appeared very nervous and suspicious during the meeting.[47] Ironically, she repeatedly said that complainant might entrap her, precisely like those that were shown on Imbestigador.[48] She thus refused to receive the money then and there. What she proposed was for complainant and Siringan to travel with her in a taxi and drop her off at the CA where she would receive the money.[49] More irony ensued. Respondent actually said that she felt there were policemen around and she was afraid that once she took hold of the envelope complainant proffered, she would suddenly be arrested and handcuffed.[50] At one point, she even said, Ayan o, tapos na silang kumain, bakit hindi pa sila umaalis?,[51] referring to Banay and Villena at the next table. To allay respondents suspicion, the two agents stood up after a few minutes and went near the staircase where they could still see what was going on.[52] Complainant, respondent and Siringan negotiated for almost one hour. [53] Complainant and Siringan bargained for a lower price but respondent refused to accede. When respondent finally touched the unsealed envelope to look at the money inside, the PAOCTF agents converged on her and invited her to the Western Police District (WPD) Headquarters at United Nations Avenue for questioning.[54] Respondent became hysterical as a commotion ensued inside the restaurant.[55] On the way to the WPD on board the PAOCTF vehicle, Banay asked respondent why she went to the restaurant. The latter replied that she went there to get the One Million Pesos (P1,000,000.00).[56] Respondent was brought to the PNP Crime Laboratory at the WPD where she was tested and found positive for ultra-violet powder that was previously dusted on the money.[57] She was later detained at the WPD Headquarters. At seven oclock in the evening of 28 September 2004, respondent called Atty. Lilia Mercedes Encarnacion Gepty (Atty. Gepty), her immediate superior in the CA at the latters house.[58] She tearfully confessed to Atty. Gepty that she asked for money for a case and was entrapped by police officers and the media.[59] Enraged at the news, Atty. Gepty asked why she had done such a thing to which respondent replied, Wala lang maam, sinubukan ko lang baka makalusot.[60] Respondent claimed that she was ashamed of what she did and repented the same. She also asked for Atty. Geptys forgiveness and help. The latter instead reminded respondent of the instances when she and her coemployees at the CA were exhorted during office meetings never to commit such offenses.[61] Atty. Gepty rendered a verbal report[62] of her conversation with their divisions chairman, Justice Martin S. Villarama. She reduced the report into writing and submitted

the same to then PJ Cancio Garcia on 29 September 2004.[63] She also later testified as to the contents of her report to the Committee. During the hearing of this case, respondent maintained that what happened was a case of instigation and not an entrapment. She asserted that the offer of money in exchange for a favorable decision came not from her but from complainant. To support her contention, she presented witnesses who testified that it was complainant who allegedly offered money to anyone who could help him with his pending case. She likewise claimed that she never touched the money on 28 September 2004, rather it was Capt. Maclang who forcibly held her hands and pressed it to the envelope containing the money. She thus asked that the administrative case against her be dismissed. This Court is not persuaded by respondents version. Based on the evidence on record, what happened was a clear case of entrapment, and not instigation as respondent would like to claim. In entrapment, ways and means are resorted to for the purpose of ensnaring and capturing the law-breakers in the execution of their criminal plan. On the other hand, in instigation, the instigator practically induces the would-be defendant into the commission of the offense, and he himself becomes a co-principal.[64] In this case, complainant and the law enforcers resorted to entrapment precisely because respondent demanded the amount of One Million Pesos (P1,000,000.00) from complainant in exchange for a favorable decision of the latters pending case. Complainants narration of the incidents which led to the entrapment operation are more in accord with the circumstances that actually transpired and are more credible than respondents version. Complainant was able to prove by his testimony in conjunction with the text messages from respondent duly presented before the Committee that the latter asked for One Million Pesos (P1,000,000.00) in exchange for a favorable decision of the formers pending case with the CA. The text messages were properly admitted by the Committee since the same are now covered by Section 1(k), Rule 2 of the Rules on Electronic Evidence[65] which provides: Ephemeral electronic communication refers to telephone conversations, text messages . . . and other electronic forms of communication the evidence of which is not recorded or retained. Under Section 2, Rule 11 of the Rules on Electronic Evidence, Ephemeral electronic communications shall be proven by the testimony of a person who was a party to the same or who has personal knowledge thereof . . . . In this case, complainant who was the recipient of said messages and therefore had personal knowledge thereof testified on their contents and import. Respondent herself admitted that the cellphone number reflected in complainants cellphone from which the messages originated was hers.[66] Moreover, any doubt respondent may have had as to the admissibility of the text messages had been laid to rest when she and her counsel signed and attested to the

veracity of the text messages between her and complainant.[67] It is also well to remember that in administrative cases, technical rules of procedure and evidence are not strictly applied.[68] We have no doubt as to the probative value of the text messages as evidence in determining the guilt or lack thereof of respondent in this case. Complainants testimony as to the discussion between him and respondent on the latters demand for One Million Pesos (P1,000,000.00) was corroborated by the testimony of a disinterested witness, Siringan, the reporter of Imbestigador who was present when the parties met in person. Siringan was privy to the parties actual conversation since she accompanied complainant on both meetings held on 24 and 28 of September 2004 at Jollibee. Respondents evidence was comprised by the testimony of her daughter and sister as well as an acquaintance who merely testified on how respondent and complainant first met. Respondents own testimony consisted of bare denials and self-serving claims that she did not remember either the statements she herself made or the contents of the messages she sent. Respondent had a very selective memory made apparent when clarificatory questions were propounded by the Committee. When she was asked if she had sent the text messages contained in complainants cellphone and which reflected her cellphone number, respondent admitted those that were not incriminating but claimed she did not remember those that clearly showed she was transacting with complainant. Thus, during the 17 November 2004 hearing, where respondent was questioned by Justice Salazar-Fernando, the following transpired: Q: After reading those text messages, do you remember having made those text messages?

(Respondent) A: Only some of these, your honors.

Justice Salazar-Fernando: Which one? A: Sabi ko po magpunta na lang sila sa office. Yung nasa bandang unahan po, your Honors.

Q:

What else? A: Tapos yung sabi ko pong pagpunta niya magdala siya ng I.D. or isama niya sa kanya si Len David. Okay, You remember having texted Zaldy Nuez on September 23, 2004 at 1309 which was around 1:09 in the afternoon and you said di me

Q:

pwede punta na lang kayo dito sa office Thursday 4:45 p.m. Room 107 Centennial Building. A: Yes, your Honors. Q: And on September 23, 2004 at 1731 which was around 5:31 in the afternoon you again texted Zaldy Nuez and you said Sige bukas nang tanghali sa Times Plaza, Taft Avenue, corner U.N. Avenue. Magdala ka ng I.D. para makilala kita o isama mo si Len David.

This she did not do. She answered those calls and messages though she later claimed she did not remember having sent the same messages to complainant. She could also have reported the matter to the CA Presiding Justice, an action which respondent admitted during the hearing was the proper thing to do under the circumstances.[70] But this course of action she did not resort to either, allegedly because she never expected things to end this way.[71] While claiming that she was not interested in complainants offer of a million pesos, she met with him not only once but twice, ostensibly, to tell the latter to stop pestering her. If respondent felt that telling complainant to stop pestering her would be more effective if she did it in person, the same would have been accomplished with a single meeting. There was no reason for her to meet with complainant again on 28 September 2004 unless there was really an understanding between them that the One Million Pesos (P1,000,000.00) will be handed over to her then. Respondent even claimed that she became afraid of complainant when she learned that the latter had been dismissed by PAGCOR for using illegal drugs.[72]This notwithstanding, she still met with him on 28 September 2004. Anent complainants narration of respondents refusal to reduce the amount of One Million Pesos (P1,000.000.00) based on the lesson learned from a previous transaction, while admitting that she actually said the same, respondent wants this Court to believe that she said it merely to have something to talk about.[73] If indeed, respondent had no intention of committing any wrongdoing, it escapes the Court why she had to make up stories merely to test if complainant could make good on his alleged boast that he could come up with a million pesos. It is not in accord with ordinary human experience for an honest government employee to make up stories that would make party-litigants believe that court decisions may be bought and sold. Time and again this Court has declared, thus: Everyone in the judiciary bears a heavy burden of responsibility for the proper discharge of his duty and it behooves everyone to steer clear of any situations in which the slightest suspicion might be cast on his conduct. Any misbehavior on his part, whether true or only perceived, is likely to reflect adversely on the administration of justice.[74] Respondent having worked for the government for twenty four (24) years, nineteen (19) of which have been in the CA,[75] should have known very well that court employees are held to the strictest standards of honesty and integrity. Their conduct should at all times be above suspicion. As held by this Court in a number of cases, The conduct or behavior of all officials of an agency involved in the administration of justice, from the Presiding Judge to the most junior clerk, should be circumscribed with the heavy burden of responsibility.[76] Their conduct must, at all times be characterized by among others, strict propriety and decorum in order to earn and maintain the respect of the public for the judiciary.[77] Respondents actuations from the time she started communicating with complainant in July 2004 until the entrapment operation on 28 September 2004 show a lack of the moral fiber demanded from court employees. Respondents avowals of

A:

Opo, your Honors. Q: How about on September 23 at 5:05 in the afternoon when you said Di pwede kelan mo gusto fixed price na iyon.

A:

I dont remember that, your Honors. Q: Again on September 23 at 5:14 p.m. you said Alam mo di ko iyon price and nagbigay noon yung gagawa. Wala ako doon. You dont also remember this?

A:

Yes, your Honors. Q: September 27 at 1:42 p.m. Oo naman ayusin nyo yung hindi halatang pera. You also dont remember that?

A:

Yes Your Honors. Q: September 27 at 1:30 in the afternoon, Di na pwede sabi sa akin. Pinakaiusapan ko na nga ulit iyon. You dont remember that?

A:

No, your Honors.[69]

Respondent would like this Court to believe that she never had any intention of committing a crime, that the offer of a million pesos for a favorable decision came from complainant and that it was complainant and the law enforcers who instigated the whole incident. Respondent thus stated that she met with complainant only to tell the latter to stop calling and texting her, not to get the One Million Pesos (P1,000,000.00) as pre-arranged. This claim of respondent is preposterous to say the least. Had the offer of a million pesos really come from complainant and had she really intended to stop the latter from corrupting her, she could have simply refused to answer the latters messages and calls.

innocence notwithstanding, the evidence clearly show that she solicited the amount of One Million Pesos (P1,000,000.00) from complainant in exchange for a favorable decision. The testimony of Atty. Gepty, the recipient of respondents confession immediately after the entrapment operation, unmistakably supports the finding that respondent did voluntarily engage herself in the activity she is being accused of. Respondents solicitation of money from complainant in exchange for a favorable decision violates Canon I of the Code of Conduct for Court Personnel which took effect on 1 June 2004 pursuant to A.M. No. 03-06-13-SC. Sections 1 and 2, Canon I of the Code of Conduct for Court Personnel expressly provide: SECTION 1. Court personnel shall not use their official position to secure unwarranted benefits, privileges or exemption for themselves or for others. SECTION 2. Court personnel shall not solicit or accept any gift, favor or benefit based on any explicit or implicit understanding that such gift, favor or benefit shall influence their official actions. (Underscoring supplied) It is noteworthy that the penultimate paragraph of the Code of Conduct for Court Personnel specifically provides: INCORPORATION OF OTHER RULES SECTION 1. All provisions of the law, Civil Service rules, and issuances of the Supreme Court governing the conduct of public officers and employees applicable to the judiciary are deemed incorporated into this Code. By soliciting the amount of One Million Pesos (P1,000,000.00) from complainant, respondent committed an act of impropriety which immeasurably affects the honor and dignity of the judiciary and the peoples confidence in it. In the recent case of Aspiras vs. Abalos,[78] complainant charged respondent, an employee of the Records Section, Office of the Court Administrator (OCA), Supreme Court for allegedly deceiving him into giving her money in the total amount of Fifty Two Thousand Pesos (P52,000.00) in exchange for his acquittal in a murder case on appeal before the Supreme Court. It turned out that respondents representation was false because complainant was subsequently convicted of murder and sentenced to suffer the penalty of reclusion perpetua by the Supreme Court.[79] The Supreme Court en banc found Esmeralda Abalos guilty of serious misconduct and ordered her dismissal from the service. This Court aptly held thus: In Mirano vs. Saavedra,[80] this Court emphatically declared that a public servant must exhibit at all times the highest sense of honesty and integrity. The administration of justice is a sacred task, and by the very nature of their duties and responsibilities, all those

involved in it must faithfully adhere to, hold inviolate, and invigorate the principle that public office is a public trust, solemnly enshrined in the Constitution.[81] Likewise, in the grave misconduct case against Datu Alykhan T. Amilbangsa of the Sharia Circuit Court, Bengo, Tawi-Tawi,[82] this Court stated: No position demands greater moral righteousness and uprightness from the occupant than the judicial office. Those connected with the dispensation of justice bear a heavy burden of responsibility. Court employees in particular, must be individuals of competence, honesty and probity charged as they are with safeguarding the integrity of the court . . . . The High Court has consistently held that persons involved in the administration of justice ought to live up to the strictest standards of honesty and integrity in the public service. He should refrain from financial dealings which would interfere with the efficient performance of his duties.[83] The conduct required of court personnel must always be beyond reproach.[84] The following pronouncement of this Court in the case of Yrastorza, Sr. vs. Latiza, Court Aide, RTC Branch 14 Cebu City[85] is also worth remembering: Court employees bear the burden of observing exacting standards of ethics and morality. This is the price one pays for the honor of working in the judiciary. Those who are part of the machinery dispensing justice from the lowliest clerk to the presiding judge must conduct themselves with utmost decorum and propriety to maintain the publics faith and respect for the judiciary. Improper behavior exhibits not only a paucity of professionalism at the workplace but also a great disrespect to the court itself. Such demeanor is a failure of circumspection demanded of every public official and employee.[86] In view of the facts narrated above and taking into account the applicable laws and jurisprudence, the Committee in their Report[87]recommended that respondent be dismissed from government service for GRAVE MISCONDUCT and violation of Sections 1 and 2, Canon 1 of the Code of Conduct for Court Personnel.[88] Finding the Committees recommendation to be supported by more than substantial evidence and in accord with the applicable laws and jurisprudence, the recommendation is well taken. WHEREFORE, premises considered, respondent Elvira Cruz-Apao is found GUILTY of GRAVE MISCONDUCT and violation of SECTIONS 1 and 2 of the CODE OF CONDUCT FOR COURT PERSONNEL and is accordingly DISMISSED from government service, with prejudice to re-employment in any branch, instrumentality or agency of the government, including government-owned and controlled corporations. Her retirement and all benefits except accrued leave credits are hereby FORFEITED. SO ORDERED.

Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr., Azcuna, Tinga and ChicoNazario, JJ., concur.

Dear Angel, This refers to our previous discussion regarding your habitual absences and tardiness the last of which was on June 26, 1991. Your records will attest to the fact that on several occasions, your attention has been called to your habitual tardiness and non-observance of standing office procedures regarding attendance. Despite several opportunities given to you, you cannot seem to reform your ways and attitude on the matter of attendance. Considering that we are a service-oriented company, you can appreciate that we cannot allow such a situation to continue lest we put the best interest of the Company in jeopardy. Much to our regret, therefore, pleased (sic) be advised that the Company is terminating your employment effective July 31, 1991. You are requested to report to Personnel Department at your earliest convenience for the settlement of any money or benefits due you. Very truly yours, (Sgd) V.V. REYES Business Manager cc: L.L. Abano Alleging that his dismissal was without just cause and due process, private respondent filed a complaint with the Arbitration Branch of the Department of Labor and Employment (DOLE) on July 18, 1991. In his position paper filed on September 6, 1991, he claimed that he was not given the opportunity to be heard and that he was summarily dismissed from employment based on charges which had not been duly proven.[5] Petitioners denied private respondents claims. It was alleged that several conferences were held by the management with private respondent because of the latters unsatisfactory performance in the company and he was given sufficient warning and opportunity to reform and improve his attitude toward attendance, [6] but to their regret, he never did. It was alleged that private respondent was constantly told of his poor attendance record and inefficiency through the companys internal electronic mail (e-mail) system. According to petitioners, this system allows paperless or telematic[7] communication among IBM personnel in the company offices here and abroad. An employee is assigned a User ID and the corresponding password is provided by the employee himself and, theoretically, known only to him. Employees are then expected to turn on their computers everyday, log in to the system by k eying in their respective IDs and passwords in order to access and read the messages sent to and

SECOND DIVISION

[G.R. No. 117221. April 13, 1999]

IBM PHILIPPINES, INC., VIRGILIO L. PEA, and VICTOR V. REYES, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and ANGEL D. ISRAEL, respondents. DECISION MENDOZA, J.: This is a petition for certiorari to set aside the decision,[1] dated April 15, 1994, of the National Labor Relations Commission (NLRC) finding private respondent to have been illegally dismissed and ordering his reinstatement and the payment of his wages from August 1991 until he is reinstated. Petitioner IBM Philippines, Inc. (IBM) is a domestic corporation engaged in the business of selling computers and computer services. Petitioners Virgilio L. Pea and Victor V. Reyes were ranking officers of IBM during the period pertinent to this case. On April 1, 1975, private respondent Angel D. Israel commenced employment with IBM as Office Products Customer Engineer. For the next sixteen (16) years, he occupied two other positions in the company,[2] received numerous awards,[3] and represented the company in various seminars and conferences in and out of the country.[4] On February 1, 1990, private respondent was assigned to the team supervised by petitioner Reyes. On June 27, 1991, petitioner Reyes handed a letter to private respondent informing the latter that his employment in the company was to be terminated effective July 31, 1991 on the ground of habitual tardiness and absenteeism. The letter states, thus: June 27, 1991 Mr. Angel D. Israel Present

stored in the computer system. To reply, an employee types in or encodes his messageresponse and sends the same to the intended recipient, also via the computer system. The system automatically records the time and date each message was sent and received, including the identification of the sender and receiver thereof. All messages are recorded and stored in computer disks.[8] Attached to petitioners position paper were copies of print -outs of alleged computer entries/messages sent by petitioner Reyes to private respondent through IBMs internal computer system. The following is a summary of the contents of the print-outs which mostly came from petitioner Reyes computer: (a) Private respondent was admonished when he would miss out on meetings with clients and failed to attend to important accounts, such as that of Hella Philippines;[9] (b) Petitioner Reyes conducted consultations with private respondent concerning the latters work habits;[10] (c) A new policy of requiring employees to be at the office at 8:30 a.m. every morning was adopted and employees were no longer allowed to sign out of the office by phone;[11] (d) Petitioner Reyes would type into his computer the records of the security guard which reflect private respondents daily tardiness and frequent absences;[12] (e) Private respondent was admonished when he failed to respond to instructions from his superiors;[13] (f) IBM Australia, contacted by Hella Australia, once asked about the reported lack of attention given to Hella Philippines.[14] Private respondent directly answered IBM Australia, through telematic memo, and reported that Hella Philippines was deferring its computer plan and decided to use micros in the meantime;[15] (g) The said response was denied by Hella Australia which later made it clear that it would be buying anything but IBM;[16] and (h) While private respondent showed some improvement after consultations where he allegedly admitted his shortcomings, petitioner Reyes reported that he (private respondent) would eventually slide back to his old ways despite constant counselling and repeated warnings that he would be terminated if he would not improve his work habits.[17] Through these computer print-outs calling private respondents attention to his alleged tardiness and absenteeism, petitioner sought to prove that private respondent was sufficiently notified of the charges against him and was guilty thereof because of his failure to deny the said charges. On March 13, 1992, the labor arbiter rendered a decision finding private respondent to have been terminated for cause and accordingly dismissing the complaint. Considering, however, the ground for termination as well as private respondents long record of

service to the company, the arbiter ordered the award of separation pay at the rate equivalent to one-half (1/2) month salary for every year of service. The dispositive portion of the decision reads WHEREFORE, judgment is hereby rendered in this case declaring respondent IBM Phils., Inc. not guilty of the charge of illegal dismissal. However, respondent company is directed to pay complainant Israel the sum of Two Hundred Forty Eight Thousand (P248,000.00) as separation pay. All other claims are denied for lack of merit. It appears, however, that prior to the release of the labor arbiters decision at 11:21 a.m. on March 26, 1992, private respondent had filed a Manifestation And Motion To Admit Attached New Evidence For The Complainant which was received by the Arbitration Branch at 10:58 a.m. of the same day. The evidence consisted of private respondents Daily Time Records (DTRs) for the period June 1, 1990 to August 31, 1990 and pay slips for the period January 1990 to June 1991 showing that private respondent did not incur any unexcused absences, that he was not late on any day within the period and that no deduction was made from his salary on account of tardiness or absences. Private respondent appealed to the NLRC which, on April 15, 1994, reversed the labor arbiters decision and found private respondents dismissal illegal. The NLRC ruled: (1) that the computer print-outs which petitioners presented in evidence to prove that private respondents office attendance was poor were insufficient to show that the latter was guilty of habitual absences and tardiness; and (2) that private respondent was not heard in his defense before the issuance of the final notice of dismissal. [18] The dispositive portion of the NLRCs decision reads: WHEREFORE, the Decision dated March 13, 1992 is hereby SET ASIDE and a new one entered declaring the dismissal of the complainant as illegal. Respondent (sic) are hereby ordered to reinstate complainant to his former position without loss of his seniority rights and to pay backwages starting August 1991 until reinstated at the rate of P40,516.65 a month including all its benefits and bonuses. Presiding Commissioner Edna Bonto-Perez dissented on the ground she found that petitioners have presented strong and convincing documentary evidence that private respondent was guilty of habitual tardiness and absences. She was also of the opinion that private respondent was sufficiently warned before he was actually dismissed.[19] Petitioners moved for a reconsideration, but their motion was denied in a resolution, dated July 20, 1994. Hence, this petition for certiorari. Petitioners contend that 1. THE NATIONAL LABOR RELATIONS COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OF JURISDICTION IN HOLDING THAT NO JUST CAUSE EXISTS NOR WAS THERE DUE PROCESS OBSERVED IN THE DISMISSAL OF THE PRIVATE RESPONDENT BECAUSE

THE COMPUTER PRINTOUTS WHICH PROVE JUST CAUSE AND DUE PROCESS ARE NOT ADMISSIBLE IN EVIDENCE. 2. THE NATIONAL LABOR RELATIONS COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF ITS JURISDICTION IN HOLDING THAT EVEN IF THE COMPUTER PRINTOUTS WERE ADMISSIBLE, PETITIONER FAILED TO SATISFY DUE PROCESS. We find petitioners contention to be without merit. First. Petitioners argue that the computer print-outs submitted by them need not be identified or authenticated according to the rules of procedure in regular courts in order for the same to be admissible in evidence. They contend that technical rules of evidence do not apply to administrative/labor cases[20] and because of a relaxation of the rules of evidence, private respondent was in fact allowed by the labor arbiter to adduce additional evidence even after a decision had been rendered.[21] It is indeed true that administrative agencies, such as the NLRC, are not bound by the technical rules of procedure and evidence in the adjudication of cases.[22] This was the reason private respondent was allowed to submit additional evidence even after the case was deemed submitted for resolution by the labor arbiter. The practice of admitting additional evidence on appeal in labor cases has been sanctioned by this Court. [23] However, the liberality of procedure in administrative actions is subject to limitations imposed by basic requirements of due process. As this Court said in Ang Tibay v. CIR,[24] the provision for flexibility in administrative procedure does not go so far as to justify orders without a basis in evidence having rational probative value. More specifically, as held in Uichico v. NLRC:[25] It is true that administrative and quasi-judicial bodies like the NLRC are not bound by the technical rules of procedure in the adjudication of cases. However, this procedural rule should not be construed as a license to disregard certain fundamental evidentiary rules. While the rules of evidence prevailing in the courts of law or equity are not controlling in proceedings before the NLRC, the evidence presented before it must at least have a modicum of admissibility for it to be given some probative value. The Statement of Profit and Losses submitted by Crispa, Inc. to prove its alleged losses, without the accompanying signature of a certified public accountant or audited by an independent auditor, are nothing but self-serving documents which ought to be treated as a mere scrap of paper devoid of any probative value. The computer print-outs, which constitute the only evidence of petitioners, afford no assurance of their authenticity because they are unsigned. The decisions of this Court, while adhering to a liberal view in the conduct of proceedings before administrative agencies, have nonetheless consistently required some proof of authenticity or reliability as condition for the admission of documents.

In Rizal Workers Union v. Ferrer-Calleja,[26] this Court struck down the decision of the Director of Labor Relations which was based on an unsigned and unidentified manifesto. It was held: From even a perfunctory assessment, it becomes apparent that the evidence upon which said decision is professedly based does not come up to that standard of substantiality. It is of course also a sound and settled rule that administrative agencies performing quasijudicial functions are unfettered by the rigid technicalities of procedure observed in the courts of law, and this so that disputes brought before such bodies may be resolved in the most expeditious and inexpensive manner possible. But what is involved here transcends mere procedural technicality and concerns the more paramount principles and requirements of due process, which may not be sacrificed to speed or expediency...The clear message of [Article 221 of the Labor Code] is that even in the disposition of labor cases, due process must never be subordinated to expediency or dispatch. Upon this principle, the unidentified documents relied upon by respondent Director must be seen and taken for what they are, mere inadmissible hearsay. They cannot, by any stretch of reasoning, be deemed substantial evidence of the election frauds complained of. Likewise, in the case of EMS Manpower & Placement Services v. NLRC,[27] the employer submitted a photocopy of a telex which supposedly shows that the employee was guilty of serious misconduct and which became the basis of her dismissal. This Court ruled that the telex, a single document, totally uncorroborated and easily concocted or fabricated to suit ones personal interest and purpose, [28] was insufficient to uphold the employers defense. In Jarcia Machine Shop and Auto Supply, Inc. v. NLRC, this Court held as incompetent unsigned daily time records presented to prove that the employee was neglectful of his duties: Indeed, the [DTRs] annexed to the present petition would tend to establish private respondents neglectful attitude towards his work duties as shown by repeated and habitual absences and tardiness and propensity for working undertime for the year 1992. But the problem with these DTRs is that they are neither originals nor certified true copies. They are plain photocopies of the originals, if the latter do exist. More importantly, they are not even signed by private respondent nor by any of the employers representatives...[29] In the case at bar, a specimen of the computer print-out submitted by petitioners reads: Date and time 10/12/90 09:23:1

To:

From: REYESVV -- MNLVM1 ISRAEL -- MNLRVM Israel, A.D.

SEC: I IBM INTERNAL USE ONLY Subject: Angel, have been trying to pin you down for a talk the past couple of days. Whatever happened to our good discussion 2 weeks ago? I thought you would make an effort to come in on time from then on? If you have problems which prevent you from coming in on time, let me know because I would really like to help if I can. The sum of all your quotas is less than mine so I really need all of you pitching in. Kindly take a look at your proofs in-tray as there are some to dos which are pending. Acts such as St. Louis U. and NEECO should be worth looking into as theyve been inquiring about upgrading their very old boxes. If you are too tied up for these accounts do let me know so I can reassign. By Monday morning please. Lets give it that final push for the branch! ============================================================= Regards from the APPLICATION SYSTEMS MARKETING group Victor V. Reyes - Marketing Manager MNLVM 1 (REYESVV) T (832)8192-279

which he denied he had ever received. On the other hand, private respondents additional evidence, consisting of DTRs and pay slips, show that he did not incur unexcused absences or tardiness or that he suffered deduction in pay on account of such absences or tardiness. Indeed, petitioners could have easily proven their allegations by presenting private respondents DTRs. Since these were in petitioners possession, their non-production thereof raises the presumption that if presented they would be adverse to petitioners. This is precisely what the best evidence rule guards against. The purpose of the rule requiring the production of the best evidence is the prevention of fraud, because if a party is in possession of such evidence and withholds it, and seeks to substitute inferior evidence in its place, the presumption naturally arises that the better evidence is withheld for fraudulent purposes which its production would expose and defeat.[33] Private respondents DTRs for the period June 1, 1990 -- August 30, 1990[34] show that while his attendance record may not have been perfect, it was at least satisfactory. The days when private respondent did not report to the office were credited either as vacation or as sick leaves. On days when he was away on business trips, his destination was shown. The DTRs were signed by petitioner Victor Reyes. It is said that the DTRs presented were only for the period when private respondents attendance was excellent; he took care not to submit his DTRs for other months during which he was often late in coming to office.[35] As the Solicitor General has pointed out, however, it was precisely during that period of June 1, 1990 --August 30, 1990 when, according to the print-outs submitted by petitioners, private respondent was often late or absent. Nor is there proof to support petitioners allegation that it was private respondents secretary and not him who often signed the attendance sheet. [36] Indeed, petitioners did not present private respondents secretary or, at the very least, attach an affidavit sworn to by her to prove their allegations and thus dispute the DTRs presented by private respondent. This, notwithstanding ample opportunity to do so. On the other hand, as already stated, the DTRs, showing private respondents good attendance, were signed by petitioner Victor Reyes himself, and no good reason has been shown why they cannot be relied upon in determining private respondents attendance. Third. Even assuming the charges of habitual tardiness and absenteeism were true, such offenses do not warrant private respondents dismissal. He has not been shown to have ever committed any infraction of company rules during his sixteen-year stint in the company. Although it is alleged that he failed to attend important client meetings and gave false representations to a valued client to cover his tracks, there is no record finding him guilty of such offenses. Dismissal has always been regarded as the ultimate penalty.[37] The fact that lapses in private respondents attendance record may have occurred only during his final year in the company, after a long period of exemplary performance, makes petitioners contention dubious. While it is true that long years of

============================================================= Not one of the 18 print-out copies submitted by petitioners was ever signed, either by the sender or the receiver. There is thus no guarantee that the message sent was the same message received. As the Solicitor General pointed out, the messages were transmitted to and received not by private respondent himself but his computer.[30] Neither were the print-outs certified or authenticated by any company official who could properly attest that these came from IBMs computer system or that the data stored in the system were not and/or could not have been tampered with before the same were printed out. It is noteworthy that the computer unit and system in which the contents of the print-outs were stored were in the exclusive possession and control of petitioners since after private respondent was served his termination letter, he had no more access to his computer.[31] Second. Even if the computer print-outs were admissible, they would not suffice to show that private respondents dismissal was justified. Petitioners contention is that private respondent was repeatedly warned through computer messages for coming in late or not reporting at all to the office during the period May 1990 -- June 1991 but he never denied the allegations. Therefore, he must be deemed to have admitted these allegations.[32] But the burden of proving that the dismissal was for just cause is on petitioners. They cannot simply rely on any admission by private respondent implied from his failure to deny the alleged computer messages to him

service is no guarantee against dismissal for wrongdoing, [38] at least the employees record does provide an index to his work. In case doubt exists between the evidence presented by the employer and that presented by the employee, the scales of justice must be tilted in favor of the latter.[39] Fourth. The print-outs likewise failed to show that private respondent was allowed due process before his dismissal. The law requires an employer to furnish the employee two written notices before termination of his employment may be ordered. The first notice must inform him of the particular acts or omissions for which his dismissal is sought, th e second of the employers decision to dismiss the employee after he has been given the opportunity to be heard and defend himself.[40] These requirements were not observed in this case. As noted earlier, there is no evidence that there was an exchange of communication between petitioners and private respondent regarding the latters supposed substandard performance. Private respondent has consistently denied, however, that he was ever advised of the charges hurled against him. The so-called one-on-one consultations or personal counsellings mentioned in the print-outs between petitioner Reyes and private respondent concerning the latters work habits do not satisfy the requirements of due process, as we had occasion to say in Pono v. NLRC.[41] Consultations or conferences may not be a substitute for the actual holding of a hearing. Every opportunity and assistance must be accorded to the employee by the management to enable him to prepare adequately for his defense, including legal representation.[42] In Ruffy v. NLRC,[43] this Court held that what would qualify as sufficient or ample opportunity, as required by law, would be every kind of assistance that management must accord to the employee to enable him to prepare adequately for his defense. No such opportunity was given to private respondent in this case. He was simply served his termination notice without being heard in his defense. Fifth. Petitioners allege that the NLRC, after concluding that the evidence submitted by them were not properly identified or authenticated, should have remanded the case to the arbiter for clarificatory hearing. A formal hearing was not de rigueur. The 1994 Rules of Procedure of the NLRC, 4 provides: Immediately after the submission by the parties of their position papers/memorandum, the Labor Arbiter shall, motu proprio, determine whether there is a need for a formal trial or hearing. At this stage, he may, at his discretion and for the purpose of making such determination, ask clarificatory questions to further elicit facts or information, including but not limited to the subpoena of relevant documentary evidence, if any, from any party or witness.

As held by the NLRC: Aside from these computer print-outs, respondents have not presented any other evidence to prove that complainant was ever called for investigation nor his side heard prior to receipt of the termination letter dated June 27, 1991. In fact, even if we consider these computer print-outs, respondents still failed to satisfy the requirements of procedural due process. . . . In this particular case, we observe that there is failure on the part of respondents to prove the existence of a legal cause. The evidence presented before the Labor Arbiter did not sufficiently and clearly support the allegation of respondents that complainant committed habitual absences and tardiness resulting into inefficiency.[44] In spite of this finding, petitioners failed to adduce additional evidence when they moved for a reconsideration of the NLRC decision or when they filed the instant petition. Despite the opportunities afforded them, petitioners failed to substantiate their allegations. Neither have they shown sufficient reasons to convince this Court that, if the case were to be remanded to the arbiter for a formal hearing, they would be able to present evidence which they could not have presented during the initial stages of this case. As we held in Megascope General Services v. NLRC:[45] As regards petitioners contention that a hearing has to be conducted to fully ventilate the issues in the case, . . . [s]uffice it to state that nonverbal devices such as written explanations, affidavits, position papers or other pleadings can establish just as clearly and concisely an aggrieved partys defenses. Petitioner was amply provided with the opportunity to present evidence that private respondents were not its employees. Indeed, it was petitioners failure to present substantial evidence to buttress its claims that worked to its disadvantage and not the absence of a fullblown hearing before the public respondent. WHEREFORE, the petition is DISMISSED and the decision of the NLRC, dated April 15, 1994, is hereby AFFIRMED. SO ORDERED. Bellosillo, (Chairman), Puno, Quisumbing, and Buena, JJ., concur. FIRST DIVISION

[G. R. No. 129329. July 31, 2001]

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ESTER M. ASUNCION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, Second Division, MABINI MEDICAL CLINIC and DR. WILFRIDO JUCO, respondents. DECISION KAPUNAN, J.: In her petition filed before this Court, Ester Asuncion prays that the Decision, dated November 29, 1996, and the Resolution, dated February 20,1997, of the public respondent National Labor Relations Commission, Second Division, in NLRC CA. 011188 which reversed the Decision of the Labor Arbiter, dated May 15, 1996 be set aside. The antecedents of this case are as follows: On August 16, 1993, petitioner Ester M. Asuncion was employed as an accountant/bookkeeper by the respondent Mabini Medical Clinic. Sometime in May 1994, certain officials of the NCR-Industrial Relations Division of the Department of Labor and Employment conducted a routine inspection of the premises of the respondent company and discovered upon the disclosure of the petitioner of (documents) violations of the labor standards law such as the non-coverage from the SSS of the employees. Consequently, respondent Company was made to correct these violations. On August 9, 1994, the private respondent, Medical Director Wilfrido Juco, issued a memorandum to petitioner charging her with the following offenses: 1. Chronic Absentism (sic) You have incurred since Aug. 1993 up to the present 35 absences and 23 half-days. 2. Habitual tardiness You have late (sic) for 108 times. As shown on the record book. 3. Loitering and wasting of company time on several occasions and witnessed by several employees. 4. Getting salary of an absent employee without acknowledging or signing for it. 5. Disobedience and insubordination - continued refusal to sign memos given to you.[1] Petitioner was required to explain within two (2) days why she should not be terminated based on the above charges. Three days later, in the morning of August 12, 1994, petitioner submitted her response to the memorandum. On the same day, respondent Dr. Juco, through a letter dated August 12, 1994, dismissed the petitioner on the ground of disobedience of lawful orders and for her failure to submit her reply within the two-day period. This prompted petitioner to file a case for illegal termination before the NLRC.

In a Decision, dated May 15, 1996, Labor Arbiter Manuel Caday rendered judgment declaring that the petitioner was illegally dismissed. The Labor Arbiter found that the private respondents were unable to prove the allegation of chronic absenteeism as it failed to present in evidence the time cards, logbooks or record book which complainant signed recording her time in reporting for work. These documents, according to the Labor Arbiter, were in the possession of the private respondents. In fact, the record book was mentioned in the notice of termination. Hence, the non-presentation of these documents gives rise to the presumption that these documents were intentionally suppressed since they would be adverse to private respondents claim. Moreover, the Labor Arbiter ruled that the petitioners absences were with the conformity of the private respondents as both parties had agreed beforehand that petitioner would not report to work on Saturdays. The handwritten listing of the days when complainant was absent from work or late in reporting for work and even the computerized print-out, do not suffice to prove that petitioners absences were unauthorized as they could easily be manufactured.[2] Accordingly, the dispositive portion of the decision states, to wit: WHEREFORE, Premises Considered, judgment is hereby rendered declaring the dismissal of the complainant as illegal and ordering the respondent company to immediately reinstate her to her former position without loss of seniority rights and to pay the complainants backwages and other benefits, as follows: 1) P73,500.00 representing backwages as of the date of this decision until she is actually reinstated in the service; 2) P20,000.00 by way of moral damages and another P20,000.00 representing exemplary damages; and 3) 10% of the recoverable award in this case representing attorneys fees. SO ORDERED.[3] On appeal, public respondent NLRC rendered the assailed decision which set aside the Labor Arbiters ruling. Insofar as finding the private respondents as having failed to present evidence relative to petitioners absences and tardiness, the NLRC agrees with the Labor Arbiter. However, the NLRC ruled that petitioner had admitted the tardiness and absences though offering justifications for the infractions. The decretal portion of the assailed decision reads: WHEREFORE, premises considered, the appealed decision is hereby VACATED and SET ASIDE and a NEW ONE entered dismissing the complaint for illegal dismissal for lack of merit. However, respondents Mabini Medical Clinic and Dr. Wilfrido Juco are jointly and solidarily ordered to pay complainant Ester Asuncion the equivalent of her three (3) months salary

11

for and as a penalty for respondents non-observance of complainants right to due process. SO ORDERED.[4] Petitioner filed a motion for reconsideration which the public respondent denied in its Resolution, dated February 19, 1997. Hence, petitioner through a petition forcertiorari under Rule 65 of the Rules of Court seeks recourse to this Court and raises the following issue: THE PUBLIC RESPONDENT ERRED IN FINDING THAT THE PETITIONER WAS DISMISSED BY THE PRIVATE RESPONDENT FOR A JUST OR AUTHORIZED CAUSE. The petition is impressed with merit. Although, it is a legal tenet that factual findings of administrative bodies are entitled to great weight and respect, we are constrained to take a second look at the facts before us because of the diversity in the opinions of the Labor Arbiter and the NLRC. [5] A disharmony between the factual findings of the Labor Arbiter and those of the NLRC opens the door to a review thereof by this Court.[6] It bears stressing that a workers employment is property in the constitutional sense. He cannot be deprived of his work without due process. In order for the dismissal to be valid, not only must it be based on just cause supported by clear and convincing evidence,[7] the employee must also be given an opportunity to be heard and defend himself. [8] It is the employer who has the burden of proving that the dismissal was with just or authorized cause.[9] The failure of the employer to discharge this burden means that the dismissal is not justified and that the employee is entitled to reinstatement and backwages.[10] In the case at bar, there is a paucity of evidence to establish the charges of absenteeism and tardiness. We note that the employer company submitted mere handwritten listing and computer print-outs. The handwritten listing was not signed by the one who made the same. As regards the print-outs, while the listing was computer generated, the entries of time and other annotations were again handwritten and unsigned.[11] We find that the handwritten listing and unsigned computer print-outs were unauthenticated and, hence, unreliable. Mere self-serving evidence of which the listing and print-outs are of that nature should be rejected as evidence without any rational probative value even in administrative proceedings. For this reason, we find the findings of the Labor Arbiter to be correct. On this point, the Labor Arbiter ruled, to wit: x x x In the instant case, while the Notice of Termination served on the complainant clearly mentions the record book upon which her tardiness (and absences) was based, the respondent (company) failed to establish (through) any of these documents and the

handwritten listing, notwithstanding, of (sic) the days when complainant was absent from work or late in reporting for work and even the computerized print-outs, do not suffice to prove the complainants absences were unauthorized as they could easily be manufactured. x x x[12] In IBM Philippines, Inc. v. NLRC,[13] this Court clarified that the liberality of procedure in administrative actions is not absolute and does not justify the total disregard of certain fundamental rules of evidence. Such that evidence without any rational probative value may not be made the basis of order or decision of administrative bodies. The Courts ratiocination in that case is relevant to the propriety of rejecting the unsigned handwritten listings and computer print-outs submitted by private respondents which we quote, to wit: However, the liberality of procedure in administrative actions is subject to limitations imposed by basic requirements of due process. As this Court said in Ang Tibay v. CIR, the provision for flexibility in administrative procedure does not go so far as to justify orders without a basis in evidence having rational probative value. More specifically, as held in Uichico v. NLRC: It is true that administrative and quasi-judicial bodies like the NLRC are not bound by the technical rules of procedure in the adjudication of cases. However, this procedural rule should not be construed as a license to disregard certain fundamental evidentiary rules. While the rules of evidence prevailing in the courts of law or equity are not controlling in proceedings before the NLRC, the evidence presented before it must at least have a modicum of admissibility for it to be given some probative value. The Statement of Profit and Losses submitted by Crispa, Inc. to prove its alleged losses, without the accompanying signature of a certified public accountant or audited by an independent auditor, are nothing but self-serving documents which ought to be treated as a mere scrap of paper devoid of any probative value. The computer print-outs, which constitute the only evidence of petitioners, afford no assurance of their authenticity because they are unsigned. The decisions of this Court, while adhering to a liberal view in the conduct of proceedings before administrative agencies, have nonetheless consistently required some proof of authenticity or reliability as condition for the admission of documents. In Jarcia Machine Shop and Auto Supply, Inc. v. NLRC,[14] this Court held as incompetent unsigned daily time records presented to prove that the employee was neglectful of his duties: Indeed, the DTRs annexed to the present petition would tend to establish private respondents neglectful attitude towards his work duties as shown by repeated and habitual absences and tardiness and propensity for working undertime for the year 1992. But the problem with these DTRs is that they are neither originals nor certified true copies. They are plain photocopies of the originals, if the latter do exist. More

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importantly, they are not even signed by private respondent nor by any of the employers representatives. x x x. In the case at bar, both the handwritten listing and computer print-outs being unsigned, the authenticity thereof is highly suspect and devoid of any rational probative value especially in the light of the existence of the official record book of the petitioners alleged absences and tardiness in the possession of the employer company. Ironically, in the memorandum charging petitioner and notice of termination, private respondents referred to the record book as its basis for petitioners alleged absenteeism and tardiness. Interestingly, however, the record book was never presented in evidence. Private respondents had possession thereof and the opportunity to present the same. Being the basis of the charges against the petitioner, it is without doubt the best evidence available to substantiate the allegations. The purpose of the rule requiring the production of the best evidence is the prevention of fraud, because if a party is in possession of such evidence and withholds it, and seeks to substitute inferior evidence in its place, the presumption naturally arises that the better evidence is withheld for fraudulent purposes which its production would expose and defeat.[15] Thus, private respondents unexplained and unjustified non-presentation of the record book, which is the best evidence in its possession and control of the charges against the petitioner, casts serious doubts on the factual basis of the charges of absenteeism and tardiness. We find that private respondents failed to present a single piece of credible evidence to serve as the basis for their charges against petitioner and consequently, failed to fulfill their burden of proving the facts which constitute the just cause for the dismissal of the petitioner. However, the NLRC ruled that despite such absence of evidence, there was an admission on the part of petitioner in her Letter dated August 11, 1994 wherein she wrote: I am quite surprised why I have incurred 35 absences since August 1993 up to the present. I can only surmise that Saturdays were not included in my work week at your clinic. If you will please recall, per agreement with you, my work days at your clinic is from Monday to Friday without Saturday work. As to my other supposed absences, I believe that said absences were authorized and therefore cannot be considered as absences which need not be explained (sic). It is also extremely difficult to understand why it is only now that I am charged to explain alleged absences incurred way back August 1993. [16] In reversing the decision of the Labor Arbiter, public respondent NLRC relied upon the supposed admission of the petitioner of her habitual absenteeism and chronic tardiness. We do not subscribe to the findings of the NLRC that the above quoted letter of petitioner amounted to an admission of her alleged absences. As explained by petitioner, her alleged absences were incurred on Saturdays. According to petitioner, these should not be considered as absences as there was an arrangement between her and the private respondents that she would not be required to work on Saturdays. Private respondents have failed to deny the existence of this arrangement. Hence, the decision

of the NLRC that private respondent had sufficient grounds to terminate petitioner as she admitted the charges of habitual absences has no leg to stand on. Neither have the private respondents shown by competent evidence that the petitioner was given any warning or reprimanded for her alleged absences and tardiness. Private respondents claimed that they sent several notices to the petitioner warning her of her absences, however, petitioner refused to receive the same. On this point, the Labor Arbiter succinctly observed: The record is bereft of any showing that complainant was ever warned of her absences prior to her dismissal on August 9, 1994. The alleged notices of her absences from August 17, until September 30, 1993, from October until November 27, 1993, from December 1, 1993 up to February 26, 1994 and the notice dated 31 May 1994 reminding complainant of her five (5) days absences, four (4) half-days and tardiness for 582 minutes (Annex "1" to "1-D" attached to respondent' Rejoinder), fail to show that the notices were received by the complainant. The allegation of the respondents that the complainant refused to received (sic) the same is self-serving and merits scant consideration. xxx[17] The Court, likewise, takes note of the fact that the two-day period given to petitioner to explain and answer the charges against her was most unreasonable, considering that she was charged with several offenses and infractions (35 absences, 23 half-days and 108 tardiness), some of which were allegedly committed almost a year before, not to mention the fact that the charges leveled against her lacked particularity. Apart from chronic absenteeism and habitual tardiness, petitioner was also made to answer for loitering and wasting of company time, getting salary of an absent employee without acknowledging or signing for it and disobedience and insubordination. [18] Thus, the Labor Arbiter found that actually petitioner tried to submit her explanation on August 11, 1994 or within the two-day period given her, but private respondents prevented her from doing so by instructing their staff not to accept complainants explanation, which was the reason why her explanation was submitted a day later.[19] The law mandates that every opportunity and assistance must be accorded to the employee by the management to enable him to prepare adequately for his defense.[20] In Ruffy v. NLRC,[21] the Court held that what would qualify as sufficient or ample opportunity, as required by law, would be every kind of assistance that management must accord to the employee to enable him to prepare adequately for his defense. In the case at bar, private respondents cannot be gainsaid to have given petitioner the ample opportunity to answer the charges leveled against her. From the foregoing, there are serious doubts in the evidence on record as to the factual basis of the charges against petitioner. These doubts shall be resolved in her favor in line with the policy under the Labor Code to afford protection to labor and construe doubts in favor of labor.[22] The consistent rule is that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. The employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause.[23] Not having satisfied its burden of proof,

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we conclude that the employer dismissed the petitioner without any just cause. Hence, the termination is illegal. Having found that the petitioner has been illegally terminated, she is necessarily entitled to reinstatement to her former previous position without loss of seniority and the payment of backwages.[24] WHEREFORE, the Decision of the National Labor Relations Commission, dated November 29, 1996 and the Resolution, dated February 20, 1997 are hereby REVERSED and SET ASIDE, and the Decision of the Labor Arbiter, dated May 15, 1996 REINSTATED. SO ORDERED. Puno, Pardo, and Ynares-Santiago, JJ., concur. Davide, Jr., C.J., (Chairman), on official leave.

This petition for review on certiorari impugns the decision of the Court of Appeals in CAG.R. Nos. 08265-08268 1affirming the order of Branch 168, Regional Trial Court, National Capital Judicial Region, in Civil Cases Nos. 19123-28, 19136 and 19144, fixing attorney's fees and directing herein petitioner Metropolitan Bank and Trust Company (Metrobank, for brevity), as defendant in said civil cases, to pay its attorneys, herein private respondent Arturo Alafriz and Associates, movant therein, the amount of P936,000.00 as attorney's fees on a quantum meruit basis. The records show that from March, 1974 to September, 1983, private respondent handled the above-mentioned civil cases before the then Court of First Instance of Pasig (Branches I, II, VI, X, XIII, XIX, XX AND XXIV) in behalf of petitioner. 2 The civil cases were all for the declaration of nullity of certain deeds of sale, with damages. The antecedental facts 3 which spawned the filing of said actions are undisputed and are hereinunder set forth as found by the trial court and adopted substantially in the decision of respondent court. A certain Celedonio Javier bought seven (7) parcels of land owned by Eustaquio Alejandro, et al., with a total area of about ten (10) hectares. These properties were thereafter mortgaged by Javier with the petitioner to secure a loan obligation of one Felix Angelo Bautista and/or International Hotel Corporation. The obligors having defaulted, petitioner foreclosed the mortgages after which certificates of sale were issued by the provincial sheriff in its favor as purchaser thereof Subsequently, Alejandro, alleging deceit, fraud and misrepresentation committed against him by Javier in the sale of the parcels of land, brought suits against Javier et al., and included petitioner as defendant therein. It was during the pendency of these suits that these parcels of land were sold by petitioner to its sister corporation, Service Leasing Corporation on March 23, 1983 for the purported price of P600,000.00. On the same day, the properties were resold by the latter to Herby Commercial and Construction Corporation for the purported price of P2,500,000.00. Three months later, or on June 7, 1983, Herby mortgaged the same properties with Banco de Oro for P9,200,000.00. The lower court found that private respondent, did not have knowledge of these transfers and transactions. As a consequence of the transfer of said parcels of land to Service Leasing Corporation, petitioner filed an urgent motion for substitution of party on July 28, 1983. Private respondent, on its part, filed on August 16, 1983 a verified motion to enter in the records of the aforesaid civil cases its charging lien, pursuant to Section 37, Rule 138 of the Rules of Court, equivalent to twenty-five percent (25%) of the actual and current market values of the litigated properties as its attorney's fees. Despite due notice, petitioner failed to appear and oppose said motion, as a result of which the lower court granted the same and ordered the, Register of Deeds of Rizal to annotate the attorney's liens on the certificates of title of the parcels of land. Meanwhile, the plaintiffs Alejandro, et al. in the aforesaid civil cases, which had been consolidated and were pending before the Regional Trial Court of Pasig, filed a motion to

[1]

Letter from Medical Director Wilfrido S. Juco to herein petitioner, dated August 9, 1994; Rollo, p. 104 Republic of the Philippines SUPREME COURT Manila SECOND DIVISION

G.R. No. 86100-03 January 23, 1990 METROPOLITAN BANK AND TRUST COMPANY, petitioner, vs. THE HONORABLE COURT OF APPEALS and ARTURO ALAFRIZ and ASSOCIATES, respondents. Bautista, Picazo, Buyco, Tan & Fider for petitioner. Arturo A. Alafriz & Associates for and in their own behalf.

REGALADO, J.:

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dismiss their complaints therein, which motion the lower court granted with prejudice in its order dated September 5, 1983. On December 29, 1983, the same court ordered the Register of Deeds to annotate the attorney's liens of private respondent on the derivative titles which cancelled Transfer Certificates of Title Nos. 453093 to 453099 of the original seven (7) parcels of land hereinbefore adverted to. On May 28,1984, private respondent filed a motion to fix its attorney's fees, based on quantum meruit, which motion precipitated an exchange of arguments between the parties. On May 30, 1984, petitioner manifested that it had fully paid private respondent; the latter, in turn, countered that the amount of P50,000.00 given by petitioner could not be considered as full payment but merely a cash advance, including the amount of P14,000.00 paid to it on December 15, 1980. It further appears that private respondent attempted to arrange a compromise with petitioner in order to avoid suit, offering a compromise amount of P600,000.00 but the negotiations were unsuccessful. Finally, on October 15,1984, the court a quo issued the order assailed on appeal before respondent court, granting payment of attorney's fees to private respondent, under the following dispositive portion: PREMISES CONSIDERED, the motion is hereby granted and the Metropolitan Bank and Trust Company (METROBANK) and Herby Commercial and Construction Corporation 4 are hereby ordered to pay the movant Arturo Alafriz and Associates the amount of P936,000.00 as its proper, just and reasonable attorney's fees in these cases. 5 On appeal, respondent court affirmed the order of the trial court in its decision promulgated on February 11, 1988. A motion for reconsideration, dated March 3, 1988, was filed by petitioner but the same was denied in a resolution promulgated on November 19, 1988, hence the present recourse. The issues raised and submitted for determination in the present petition may be formulated thus: (1) whether or not private respondent is entitled to the enforcement of its charging lien for payment of its attorney's fees; (2) whether or not a separate civil suit is necessary for the enforcement of such lien and (3) whether or not private respondent is entitled to twenty-five (25%) of the actual and current market values of the litigated properties on aquantum meruit basis. On the first issue, petitioner avers that private respondent has no enforceable attorney's charging lien in the civil cases before the court below because the dismissal of the complaints therein were not, in the words of Section 37, Rule 138, judgments for the payment of money or executions issued in pursuance of such judgments. 6 We agree with petitioner.

On the matter of attorney's liens Section 37, Rule 138 provides: . . . He shall also have a lien to the same extent upon all judgments for the payment of money, and executions issued in pursuance of such judgments, which he has secured in a litigation of his client, from and after the time when he shall have caused a statement of his claim of such lien to be entered upon the records of the court rendering such judgment, or issuing such execution, and shall have caused written notice thereof to be delivered to his client and to the adverse party; and he shall have the same right and power over such judgments and executions as his client would have to enforce his lien and secure the payment of his just fees and disbursements. Consequent to such provision, a charging lien, to be enforceable as security for the payment of attorney's fees, requires as a condition sine qua non a judgment for money and execution in pursuance of such judgment secured in the main action by the attorney in favor of his client. A lawyer may enforce his right to fees by filing the necessary petition as an incident in the main action in which his services were rendered when something is due his client in the action from which the fee is to be paid. 7 In the case at bar, the civil cases below were dismissed upon the initiative of the plaintiffs "in view of the frill satisfaction of their claims." 8 The dismissal order neither provided for any money judgment nor made any monetary award to any litigant, much less in favor of petitioner who was a defendant therein. This being so, private respondent's supposed charging lien is, under our rule, without any legal basis. It is flawed by the fact that there is nothing to generate it and to which it can attach in the same manner as an ordinary lien arises and attaches to real or personal property. In point is Morente vs. Firmalino, 9 cited by petitioner in support of its position. In that case, movant-appellant attorney sought the payment of his fees from his client who was the defendant in a complaint for injunction which was dismissed by the trial court after the approval of an agreement entered into by the litigants. This Court held: . . . The defendant having suffered no actual damage by virtue of the issuance of a preliminary injunction, it follows that no sum can be awarded the defendant for damages. It becomes apparent, too, that no amount having been awarded the defendant, herein appellant's lien could not be enforced. The appellant, could, by appropriate action, collect his fees as attorney. Private respondent would nevertheless insist that the lien attaches to the "proceeds of a judgment of whatever nature," 10 relying on the case of Bacolod-Murcia Milling Co. Inc. vs. Henares 11 and some American cases holding that the lien attaches to the judgment recovered by an attorney and the proceeds in whatever form they may be. 12

15

The contention is without merit just as its reliance is misplaced. It is true that there are some American cases holding that the lien attaches even to properties in litigation. However, the statutory rules on which they are based and the factual situations involved therein are neither explained nor may it be said that they are of continuing validity as to be applicable in this jurisdiction. It cannot be gainsaid that legal concepts of foreign origin undergo a number of variegations or nuances upon adoption by other jurisdictions, especially those with variant legal systems. In fact, the same source from which private respondent culled the American cases it cited expressly declares that "in the absence of a statute or of a special agreement providing otherwise, the general rule is that an attorney has no lien on the land of his client, notwithstanding such attorney has, with respect to the land in question, successfully prosecuted a suit to establish the title of his client thereto, recovered title or possession in a suit prosecuted by such client, or defended successfully such client's right and title against an unjust claim or an unwarranted attack," 13 as is the situation in the case at bar. This is an inescapable recognition that a contrary rule obtains in other jurisdictions thereby resulting in doctrinal rulings of converse or modulated import. To repeat, since in our jurisdiction the applicable rule provides that a charging lien attaches only to judgments for money and executions in pursuance of such judgment, then it must be taken in haec verba. The language of the law is clear and unequivocal and, therefore, it must be taken to mean exactly what it says, barring any necessity for elaborate interpretation. 14 Notably, the interpretation, literal as it may appear to be, is not without support in Philippine case law despite the dearth of cases on all fours with the present case. In Caina et al. vs. Victoriano, et al., 15 the Court had the occasion to rule that "the lien of respondent is not of a nature which attaches to the property in litigation but is at most a personal claim enforceable by a writ of execution." In Ampil vs. Juliano-Agrava, et al., 16 the Court once again declared that a charging lien "presupposes that the attorney has secured a favorable money judgment for his client . . ." Further, in Director of Lands vs. Ababa, et al., 17 we held that "(a) charging lien under Section 37, Rule 138 of the Revised Rules of Court is limited only to money judgments and not to judgments for the annulment of a contract or for delivery of real property as in the instant case." Even in the Bacolod-Murcia Milling case, which we previously noted as cited by private respondent, there was an express declaration that "in this jurisdiction, the lien does not attach to the property in litigation." 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. 18 More specifically, an attorney merely defeating recovery against his client as a defendant is not entitled to a lien on the property involved in litigation for fees and the court has no power

to fix the fee of an attorney defending the client's title to property already in the client's possession. 19 While a client cannot defeat an attorney's right to his charging lien by dismissing the case, terminating the services of his counsel, waiving his cause or interest in favor of the adverse party or compromising his action, 20 this rule cannot find application here as the termination of the cases below was not at the instance of private respondent's client but of the opposing party. The resolution of the second issue is accordingly subsumed in the preceding discussion which amply demonstrates that private respondent is not entitled to the enforcement of its charging lien. Nonetheless, it bears mention at this juncture that an enforceable charging lien, duly recorded, is within the jurisdiction of the court trying the main case and this jurisdiction subsists until the lien is settled. 21 There is certainly no valid reason why the trial court cannot pass upon a petition to determine attorney's fees if the rule against multiplicity of suits is to be activated. 22 These decisional rules, however, apply only where the charging lien is valid and enforceable under the rules. On the last issue, the Court refrains from resolving the same so as not to preempt or interfere with the authority and adjudicative facility of the proper court to hear and decide the controversy in a proper proceeding which may be brought by private respondent. A petition for recovery of attorney's fees, either as a separate civil suit or as an incident in the main action, has to be prosecuted and the allegations therein established as any other money claim. The persons who are entitled to or who must pay attorney's fees have the right to be heard upon the question of their propriety or amount. 23Hence, the obvious necessity of a hearing is beyond cavil. Besides, in fixing a reasonable compensation for the services rendered by a lawyer on the basis of quantum meruit, the elements to be considered are generally (1) the importance of the subject matter in controversy, (2) the extent of the services rendered, and (3) the professional standing of the lawyer. 24 These are aside from the several other considerations laid down by this Court in a number of decisions as pointed out by respondent court. 25 A determination of all these factors would indispensably require nothing less than a full-blown trial where private respondent can adduce evidence to establish its right to lawful attorney's fees and for petitioner to oppose or refute the same. Nothing in this decision should, however, be misconstrued as imposing an unnecessary burden on private respondent in collecting the fees to which it may rightfully be entitled. But, as in the exercise of any other right conferred by law, the proper legal remedy should

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be availed of and the procedural rules duly observed to forestall and obviate the possibility of abuse or prejudice, or what may be misunderstood to be such, often to the undeserved discredit of the legal profession. 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 government interference, is impressed with public interest, for which it is subject to State regulation. 26 ACCORDINGLY, the instant petition for review is hereby GRANTED and the decision of respondent Court of Appeals of February 11, 1988 affirming the order of the trial court is hereby REVERSED and SET ASIDE, without prejudice to such appropriate proceedings as may be brought by private respondent to establish its right to attorney's fees and the amount thereof. SO ORDERED. Republic of the Philippines SUPREME COURT Manila EN BANC

purpose of misleading this Court in order to obtain a favorable judgment, and thus failing to live up to the standards expected of a member of the Bar. In his EXPLANATION of 1 September 1992, Atty. Benjamin M. Dacanay "humbly prostrates himself before the Honorable Court and throws himself at its mercy," and explains that . . . whenever he prepares petitioners either for the Court of Appeals or the Supreme Court, he dictates to his secretary and if portions of the decision or order to be appealed from have to be quoted, he simply instructs his said secretary to copy the particular pages of the said decision or order. In the case at bar, he did instruct his secretary to copy the corresponding pages in the decision of the Court of Appeals. Somehow, however, some words were intercalated on a particular paragraph noted by the Honorable Court he regrettably is at a loss to explain. He remembers, however, that at the time he was preparing the petition at bar there were other pleadings necessitating equal if not preferential attention from him which could perhaps be the reason why his secretary committed a very grievous mistake, Such mistake though he does not condone and he feel upset at the turn of events. 2 Attached to his EXPLANATION as Annex "A" is an Affidavit 3 of Alicia A. Castro, purportedly his Secretary, stating among others that 3. . . . in the preparation of the petition for review on certiorari filed with the Supreme Court, it was Atty. Benjamin M. Dacanay who dictated to me the contents of said petition; 4. . . . in the preparation of the petition, he told me, as he is wont to do whenever he prepares a petition, to copy the particular pages in the decision of the Court of Appeals, in CA-G.R. SP No. 23773 entitled "Adez Realty, Inc., petitioner versus The Hon. Judge of the Regional Trial Court of Morong, Rizal, Branch 79 (not 89 as stated is the Affidavit), et al., respondents"; 5. . . . when I copied the particular pages of the decision of the Court of Appeals as instructed by Atty. Benjamin M. Dacanay, I did as instructed, but it was only after our office received the copy of the decision of the Supreme Court in G.R. No. 100643 . . . that Atty. Dacanay confronted me and asked me where I got that portion which was added to the particular paragraph noted by the Supreme Court; that it was only then that I realized the mistake I committed;

G.R. No. 100643 October 30, 1992 ADEZ REALTY, INCORPORATED, petitioner, vs. HONORABLE COURT OF APPEALS, PRESIDING JUDGE, RTC, BR. 79, Morong, Rizal, PROVINCIAL SHERIFF OF RIZAL, Morong, Rizal, REGISTER OF DEEDS, Quezon City, and AGUENDO EUGENIO, respondents. RESOLUTION

PER CURIAM : In Our Resolution of 14 August 1992, We directed ATTY. BENJAMIN M. DACANAY, counsel for petitioner Adez Realty, Inc., to "SHOW CAUSE within five (5) days from notice why he should not be disciplinary dealt with for intercalating a material fact in the judgment of the court a quo 1 thereby altering and modifying its factual findings with the apparent

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xxx xxx xxx 7. . . . I surmise that the error could have been due to the fact that ADEZ REALTY, Inc. has so many cases being handled by the law office that I presume I could have copied or my intention was distracted by other pleadings atop my table at the time. Upon receipt of the EXPLANATION of counsel, the First Division referred his case en consulta to the Court En Banc which accepted and took cognizance of it in view of the possible sanction that may be imposed on a member of the Bar. After due deliberation, the Court En Banc brushed off as simply unsatisfactory and incredible counsel's explanation that it was his secretary who committed the mistake. This "passing-the-buck" stance of counsel was already aptly treated in Adaza v. Barinaga, 4 where the Court observed thus Making the law office secretary, clerk or messenger the scapegoat or patsy for the delay in filing of pleading, motion and other paper and for the lawyer's dereliction of duty is a common alibi of practicing lawyer. Like the alibi of the accused in criminal cases, counsel's shifting of the blame to his office employee is usually a concoction utilized to cover up his own negligence, incompetence, indolence and ineptitude. The case of petitioner is no better; it can be worse. For, how could the secretary have divined the phrase "without notice to the actual occupants of the property, Adez Realty," without counsel dictating it word for word? Could it have been a providential mistake of the secretary as it was very material, and on which could have hinged the fate of a litigant's cause? Whatever be the truth in this regard, counsel cannot elude administrative responsibility which borders on falsification of a judicial record to which, by his inveigling, he unfortunately drags his secretary. Indeed, by no means can he evade responsibility for the vicious intercalation as he admittedly dictated and signed the petition. It is the bounden duty of lawyers to check, review and recheck the allegation in their pleadings, more particularly the quoted portions, and ensure that the statements therein are accurate and the reproductions faithful, down to the last word and even punctuation mark. The legal profession demands that lawyers thoroughly go over pleadings, motions and other documents dictated or prepared by them, type or transcribed by their secretaries or clerks, before filing them with the court. If a client is bound by the acts of his counsel, with more reason should counsel be bound the acts of his secretary who merely follow his orders. 5 The instant case originate from a petition for reconstitution of title over a parcel of land. Section 13 of R.A. 26, in relation to Sec. 12 of the same statute, on which petitioner bases one of his causes of action, provides among others that notice should be given to the

occupants or persons in possession of the property. Compliance therewith is a material requirement for granting a petition for reconstitution of title. The inserted phase "without notice to the actual occupants of the property, Adez Realty," was just the right phrase intercalated at the right place, making it highly improbable to be unintentionally, much less innocently, committed; and by the secretary a that. All circumstances herein simply but strongly sustain Our belief. Certainly, making it appear that respondent Court of Appeals found that no notice was given to the occupants of subject property when in fact it did not make such a finding is a clear indication not merely of carelessness in lifting a portion of the assailed decision but a malicious attempt to gain undue advantage in the sporting arena of fairplay and, more importantly, to deceive and misguide this Court, which is the final arbiter of litigations. Well-entrenched in our jurisprudence is the rule that, save in certain instances, factual findings of the Court of Appeals are binding upon this Court. 6 The distortion of facts committed by counsel, with the willing assistance of his secretary, is a grave offense and should not be treated lightly, not only because it may set a dangerous precedent by, rather, because it is a clear and serious violation of one's oath as member of the Bar. Rule 10.02, Canon 10, Chapter III, of the Code of Professional Responsibility directs that "[a] lawyer shall not knowingly misquote or misrepresent the contents of a paper, the language or the argument of opposing counsel, or the text of a decision or authority, or knowingly cite as a law a provision already rendered inoperative by repeal or amendment, or assert as a fact that which has not been proved" (Emphasis supplied). Misquoting or intercalating phrases in the text of a court decision constitutes willful disregard of the lawyer's solemn duty to act at all times in manner consistent with the truth. A lawyer should never venture to mislead the court by false statements or quotations of facts or laws. Thus, in Bautista v. Gonzales, 7 We suspended respondent for six (6) months for, among other submitting to the lower court falsified documents, representing them to the true copies. In Chavez v. Viola, 8 We suspend respondent counsel for five (5) months after he filed an Amended Application for Original Registration of Title which contained false statements. The case at bar, although akin to the aforementioned cases, has more serious and farreaching repercussions. Those who attempt to misguide this Court, the last forum for appeal, should be dealt with more severely lest We be made unwilling instruments of inequity and injustice. Indeed, counsel has demonstrated his wanton disregard for truth and fairplay even before the Highest Court of the land. Worse, he compounded his unprofessional mischief by laying the blame on his hapless secretary whose duty is was simply to obey him. It is well to repeat, perhaps to the point of satiety, what We have already said . . . that the practice of law is not a right but a privilege bestowed by the State on those who show that they possess, and continue to possess, the qualifications required by law for the conferment of such

18

privilege. On of those requirement is the observance of honesty and candor. It cannot be gainsaid that candidness, especially towards the courts, is essential for the expeditious administration of justice . . . A lawyer, on the other hand, has the fundamental duty to satisfy that expectation. Otherwise, the administration of justice would gravely suffer . . . It is essential that lawyers bear in mind at all times that their duty is not to their clients but rather to the courts, that they are above all . . . sworn to assist the courts in rendering justice to all and sundry, and only secondarily are they advocates of the exclusive interest of their clients. For this reason, he is required to swear to do no falsehood, nor consent to the doing of any in court. 9 WHEREFORE, We find ATTY. BENJAMIN M. DACANAY, counsel for petitioner, guilty of intercalating a material fact in a judicial Decision elevated to Us on certiorari, thereby altering its factual findings with the apparent purpose, and no other, of misleading the Court in order to obtain a favorable judgment, and thus miserably failing to live up to the standards expected of him as a members of the Philippines Bar. Consequently, ATTY. BENJAMIN M. DACANAY is hereby DISBARRED effective immediately from the practice of law. Let copies of this Resolution be served personally on Atty. Benjamin M. Dacanay at his given address at Mezzanine Floor, WIL-VIC Building, 125 Kamias Road, Quezon City, entered upon his personal records, and furnished the Integrated Bar of the Philippines and all the courts throughout the country. SO ORDERED. Gutierrez, Jr. Cruz, Feliciano, Padilla, Bidin, Grio-Aquino, Medialdea, Regalado, Davide, Jr., Romero, Nocon, Bellosillo, Melo and Campos, JJ. concur. Narvasa, C.J. is on leave. Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. 100113 September 3, 1991 RENATO CAYETANO, petitioner, vs. CHRISTIAN MONSOD, HON. JOVITO R. SALONGA, COMMISSION ON APPOINTMENT, and

HON. GUILLERMO CARAGUE, in his capacity as Secretary of Budget and Management, respondents. Renato L. Cayetano for and in his own behalf. Sabina E. Acut, Jr. and Mylene Garcia-Albano co-counsel for petitioner.

PARAS, J.:p We are faced here with a controversy of far-reaching proportions. While ostensibly only legal issues are involved, the Court's decision in this case would indubitably have a profound effect on the political aspect of our national existence. The 1987 Constitution provides in Section 1 (1), Article IX-C: There shall be a Commission on Elections composed of a Chairman and six Commissioners who shall be natural-born citizens of the Philippines and, at the time of their appointment, at least thirty-five years of age, holders of a college degree, and must not have been candidates for any elective position in the immediately preceding -elections. However, a majority thereof, including the Chairman, shall be members of the Philippine Bar who have been engaged in the practice of law for at least ten years. (Emphasis supplied) The aforequoted provision is patterned after Section l(l), Article XII-C of the 1973 Constitution which similarly provides: There shall be an independent Commission on Elections composed of a Chairman and eight Commissioners who shall be natural-born citizens of the Philippines and, at the time of their appointment, at least thirty-five years of age and holders of a college degree. However, a majority thereof, including the Chairman, shall be members of the Philippine Bar who have been engaged in the practice of law for at least ten years.' (Emphasis supplied) Regrettably, however, there seems to be no jurisprudence as to what constitutes practice of law as a legal qualification to an appointive office. Black defines "practice of law" as: The rendition of services requiring the knowledge and the application of legal principles and technique to serve the interest of another with

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his consent. It is not limited to appearing in court, or advising and assisting in the conduct of litigation, but embraces the preparation of pleadings, and other papers incident to actions and special proceedings, conveyancing, the preparation of legal instruments of all kinds, and the giving of all legal advice to clients. It embraces all advice to clients and all actions taken for them in matters connected with the law. An attorney engages in the practice of law by maintaining an office where he is held out to be-an attorney, using a letterhead describing himself as an attorney, counseling clients in legal matters, negotiating with opposing counsel about pending litigation, and fixing and collecting fees for services rendered by his associate. (Black's Law Dictionary, 3rd ed.) The practice of law is not limited to the conduct of cases in court. (Land Title Abstract and Trust Co. v. Dworken,129 Ohio St. 23, 193 N.E. 650) A person is also considered to be in the practice of law when he: ... for valuable consideration engages in the business of advising person, firms, associations or corporations as to their rights under the law, or appears in a representative capacity as an advocate in proceedings pending or prospective, before any court, commissioner, referee, board, body, committee, or commission constituted by law or authorized to settle controversies and there, in such representative capacity performs any act or acts for the purpose of obtaining or defending the rights of their clients under the law. Otherwise stated, one who, in a representative capacity, engages in the business of advising clients as to their rights under the law, or while so engaged performs any act or acts either in court or outside of court for that purpose, is engaged in the practice of law. (State ex. rel. Mckittrick v..C.S. Dudley and Co., 102 S.W. 2d 895, 340 Mo. 852) This Court in the case of Philippine Lawyers Association v.Agrava, (105 Phil. 173,176-177) stated: The practice of law is not limited to the conduct of cases or litigation in court; it embraces the preparation of pleadings and other papers incident to actions and special proceedings, the management of such actions and proceedings on behalf of clients before judges and courts, and in addition, conveying. In general, all advice to clients, and all action taken for them in mattersconnected with the law incorporation services, assessment and condemnation services contemplating an appearance before a judicial body, the foreclosure of a mortgage, enforcement of a creditor's claim in bankruptcy and insolvency proceedings, and conducting proceedings in attachment, and in matters of estate and guardianship have been held to constitute law

practice, as do the preparation and drafting of legal instruments, where the work done involves the determination by the trained legal mind of the legal effect of facts and conditions. (5 Am. Jr. p. 262, 263). (Emphasis supplied) Practice of law under modem conditions consists in no small part of work performed outside of any court and having no immediate relation to proceedings in court. It embraces conveyancing, the giving of legal advice on a large variety of subjects, and the preparation and execution of legal instruments covering an extensive field of business and trust relations and other affairs. Although these transactions may have no direct connection with court proceedings, they are always subject to become involved in litigation. They require in many aspects a high degree of legal skill, a wide experience with men and affairs, and great capacity for adaptation to difficult and complex situations. These customary functions of an attorney or counselor at law bear an intimate relation to the administration of justice by the courts. No valid distinction, so far as concerns the question set forth in the order, can be drawn between that part of the work of the lawyer which involves appearance in court and that part which involves advice and drafting of instruments in his office. It is of importance to the welfare of the public that these manifold customary functions be performed by persons possessed of adequate learning and skill, of sound moral character, and acting at all times under the heavy trust obligations to clients which rests upon all attorneys. (Moran, Comments on the Rules of Court, Vol. 3 [1953 ed.] , p. 665-666, citing In re Opinion of the Justices [Mass.], 194 N.E. 313, quoted in Rhode Is. Bar Assoc. v. Automobile Service Assoc. [R.I.] 179 A. 139,144). (Emphasis ours) The University of the Philippines Law Center in conducting orientation briefing for new lawyers (1974-1975) listed the dimensions of the practice of law in even broader terms as advocacy, counselling and public service. One may be a practicing attorney in following any line of employment in the profession. If what he does exacts knowledge of the law and is of a kind usual for attorneys engaging in the active practice of their profession, and he follows some one or more lines of employment such as this he is a practicing attorney at law within the meaning of the statute. (Barr v. Cardell, 155 NW 312) Practice of law means any activity, in or out of court, which requires the application of law, legal procedure, knowledge, training and experience. "To engage in the practice of law is to perform those acts which are characteristics of the profession. Generally, to practice law is to give notice or render any kind of service, which device or service requires the use in any degree of legal knowledge or skill." (111 ALR 23)

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The following records of the 1986 Constitutional Commission show that it has adopted a liberal interpretation of the term "practice of law." MR. FOZ. Before we suspend the session, may I make a manifestation which I forgot to do during our review of the provisions on the Commission on Audit. May I be allowed to make a very brief statement? THE PRESIDING OFFICER (Mr. Jamir). The Commissioner will please proceed. MR. FOZ. This has to do with the qualifications of the members of the Commission on Audit. Among others, the qualifications provided for by Section I is that "They must be Members of the Philippine Bar" I am quoting from the provision "who have been engaged in the practice of law for at least ten years". To avoid any misunderstanding which would result in excluding members of the Bar who are now employed in the COA or Commission on Audit, we would like to make the clarification that this provision on qualifications regarding members of the Bar does not necessarily refer or involve actual practice of law outside the COA We have to interpret this to mean that as long as the lawyers who are employed in the COA are using their legal knowledge or legal talent in their respective work within COA, then they are qualified to be considered for appointment as members or commissioners, even chairman, of the Commission on Audit. This has been discussed by the Committee on Constitutional Commissions and Agencies and we deem it important to take it up on the floor so that this interpretation may be made available whenever this provision on the qualifications as regards members of the Philippine Bar engaging in the practice of law for at least ten years is taken up. MR. OPLE. Will Commissioner Foz yield to just one question. MR. FOZ. Yes, Mr. Presiding Officer. MR. OPLE. Is he, in effect, saying that service in the COA by a lawyer is equivalent to the requirement of a

law practice that is set forth in the Article on the Commission on Audit? MR. FOZ. We must consider the fact that the work of COA, although it is auditing, will necessarily involve legal work; it will involve legal work. And, therefore, lawyers who are employed in COA now would have the necessary qualifications in accordance with the Provision on qualifications under our provisions on the Commission on Audit. And, therefore, the answer is yes. MR. OPLE. Yes. So that the construction given to this is that this is equivalent to the practice of law. MR. FOZ. Yes, Mr. Presiding Officer. MR. OPLE. Thank you. ... ( Emphasis supplied) Section 1(1), Article IX-D of the 1987 Constitution, provides, among others, that the Chairman and two Commissioners of the Commission on Audit (COA) should either be certified public accountants with not less than ten years of auditing practice, or members of the Philippine Bar who have been engaged in the practice of law for at least ten years. (emphasis supplied) Corollary to this is the term "private practitioner" and which is in many ways synonymous with the word "lawyer." Today, although many lawyers do not engage in private practice, it is still a fact that the majority of lawyers are private practitioners. (Gary Munneke, Opportunities in Law Careers [VGM Career Horizons: Illinois], [1986], p. 15). At this point, it might be helpful to define private practice. The term, as commonly understood, means "an individual or organization engaged in the business of delivering legal services." (Ibid.). Lawyers who practice alone are often called "sole practitioners." Groups of lawyers are called "firms." The firm is usually a partnership and members of the firm are the partners. Some firms may be organized as professional corporations and the members called shareholders. In either case, the members of the firm are the experienced attorneys. In most firms, there are younger or more inexperienced salaried attorneyscalled "associates." (Ibid.). The test that defines law practice by looking to traditional areas of law practice is essentially tautologous, unhelpful defining the practice of law as that which lawyers do. (Charles W. Wolfram, Modern Legal Ethics [West Publishing Co.: Minnesota, 1986], p. 593).

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The practice of law is defined as the performance of any acts . . . in or out of court, commonly understood to be the practice of law. (State Bar Ass'n v. Connecticut Bank & Trust Co., 145 Conn. 222, 140 A.2d 863, 870 [1958] [quoting Grievance Comm. v. Payne, 128 Conn. 325, 22 A.2d 623, 626 [1941]). Because lawyers perform almost every function known in the commercial and governmental realm, such a definition would obviously be too global to be workable.(Wolfram, op. cit.). The appearance of a lawyer in litigation in behalf of a client is at once the most publicly familiar role for lawyers as well as an uncommon role for the average lawyer. Most lawyers spend little time in courtrooms, and a large percentage spend their entire practice without litigating a case. (Ibid., p. 593). Nonetheless, many lawyers do continue to litigate and the litigating lawyer's role colors much of both the public image and the self perception of the legal profession. (Ibid.). In this regard thus, the dominance of litigation in the public mind reflects history, not reality. (Ibid.). Why is this so? Recall that the late Alexander SyCip, a corporate lawyer, once articulated on the importance of a lawyer as a business counselor in this wise: "Even today, there are still uninformed laymen whose concept of an attorney is one who principally tries cases before the courts. The members of the bench and bar and the informed laymen such as businessmen, know that in most developed societies today, substantially more legal work is transacted in law offices than in the courtrooms. General practitioners of law who do both litigation and non-litigation work also know that in most cases they find themselves spending more time doing what [is] loosely desccribe[d] as business counseling than in trying cases. The business lawyer has been described as the planner, the diagnostician and the trial lawyer, the surgeon. I[t] need not [be] stress[ed] that in law, as in medicine, surgery should be avoided where internal medicine can be effective." (Business Star, "Corporate Finance Law," Jan. 11, 1989, p. 4). In the course of a working day the average general practitioner wig engage in a number of legal tasks, each involving different legal doctrines, legal skills, legal processes, legal institutions, clients, and other interested parties. Even the increasing numbers of lawyers in specialized practice wig usually perform at least some legal services outside their specialty. And even within a narrow specialty such as tax practice, a lawyer will shift from one legal task or role such as advice-giving to an importantly different one such as representing a client before an administrative agency. (Wolfram, supra, p. 687). By no means will most of this work involve litigation, unless the lawyer is one of the relatively rare types a litigator who specializes in this work to the exclusion of much else. Instead, the work will require the lawyer to have mastered the full range of traditional lawyer skills of client counselling, advice-giving, document drafting, and negotiation. And increasingly lawyers find that the new skills of evaluation and mediation are both effective for many clients and a source of employment. (Ibid.). Most lawyers will engage in non-litigation legal work or in litigation work that is constrained in very important ways, at least theoretically, so as to remove from it some of

the salient features of adversarial litigation. Of these special roles, the most prominent is that of prosecutor. In some lawyers' work the constraints are imposed both by the nature of the client and by the way in which the lawyer is organized into a social unit to perform that work. The most common of these roles are those of corporate practice and government legal service. (Ibid.). In several issues of the Business Star, a business daily, herein below quoted are emerging trends in corporate law practice, a departure from the traditional concept of practice of law. We are experiencing today what truly may be called a revolutionary transformation in corporate law practice. Lawyers and other professional groups, in particular those members participating in various legal-policy decisional contexts, are finding that understanding the major emerging trends in corporation law is indispensable to intelligent decision-making. Constructive adjustment to major corporate problems of today requires an accurate understanding of the nature and implications of the corporate law research function accompanied by an accelerating rate of information accumulation. The recognition of the need for such improved corporate legal policy formulation, particularly "modelmaking" and "contingency planning," has impressed upon us the inadequacy of traditional procedures in many decisional contexts. In a complex legal problem the mass of information to be processed, the sorting and weighing of significant conditional factors, the appraisal of major trends, the necessity of estimating the consequences of given courses of action, and the need for fast decision and response in situations of acute danger have prompted the use of sophisticated concepts of information flow theory, operational analysis, automatic data processing, and electronic computing equipment. Understandably, an improved decisional structure must stress the predictive component of the policy-making process, wherein a "model", of the decisional context or a segment thereof is developed to test projected alternative courses of action in terms of futuristic effects flowing therefrom. Although members of the legal profession are regularly engaged in predicting and projecting the trends of the law, the subject of corporate finance law has received relatively little organized and formalized attention in the philosophy of advancing corporate legal education. Nonetheless, a cross-disciplinary approach to legal research has become a vital necessity.

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Certainly, the general orientation for productive contributions by those trained primarily in the law can be improved through an early introduction to multi-variable decisional context and the various approaches for handling such problems. Lawyers, particularly with either a master's or doctorate degree in business administration or management, functioning at the legal policy level of decision-making now have some appreciation for the concepts and analytical techniques of other professions which are currently engaged in similar types of complex decision-making. Truth to tell, many situations involving corporate finance problems would require the services of an astute attorney because of the complex legal implications that arise from each and every necessary step in securing and maintaining the business issue raised. (Business Star, "Corporate Finance Law," Jan. 11, 1989, p. 4). In our litigation-prone country, a corporate lawyer is assiduously referred to as the "abogado de campanilla." He is the "big-time" lawyer, earning big money and with a clientele composed of the tycoons and magnates of business and industry. Despite the growing number of corporate lawyers, many people could not explain what it is that a corporate lawyer does. For one, the number of attorneys employed by a single corporation will vary with the size and type of the corporation. Many smaller and some large corporations farm out all their legal problems to private law firms. Many others have in-house counsel only for certain matters. Other corporation have a staff large enough to handle most legal problems in-house. A corporate lawyer, for all intents and purposes, is a lawyer who handles the legal affairs of a corporation. His areas of concern or jurisdiction may include, inter alia: corporate legal research, tax laws research, acting out as corporate secretary (in board meetings), appearances in both courts and other adjudicatory agencies (including the Securities and Exchange Commission), and in other capacities which require an ability to deal with the law. At any rate, a corporate lawyer may assume responsibilities other than the legal affairs of the business of the corporation he is representing. These include such matters as determining policy and becoming involved in management. ( Emphasis supplied.) In a big company, for example, one may have a feeling of being isolated from the action, or not understanding how one's work actually

fits into the work of the orgarnization. This can be frustrating to someone who needs to see the results of his work first hand. In short, a corporate lawyer is sometimes offered this fortune to be more closely involved in the running of the business. Moreover, a corporate lawyer's services may sometimes be engaged by a multinational corporation (MNC). Some large MNCs provide one of the few opportunities available to corporate lawyers to enter the international law field. After all, international law is practiced in a relatively small number of companies and law firms. Because working in a foreign country is perceived by many as glamorous, tills is an area coveted by corporate lawyers. In most cases, however, the overseas jobs go to experienced attorneys while the younger attorneys do their "international practice" in law libraries. (Business Star, "Corporate Law Practice," May 25,1990, p. 4). This brings us to the inevitable, i.e., the role of the lawyer in the realm of finance. To borrow the lines of Harvard-educated lawyer Bruce Wassertein, to wit: "A bad lawyer is one who fails to spot problems, a good lawyer is one who perceives the difficulties, and the excellent lawyer is one who surmounts them." (Business Star, "Corporate Finance Law," Jan. 11, 1989, p. 4). Today, the study of corporate law practice direly needs a "shot in the arm," so to speak. No longer are we talking of the traditional law teaching method of confining the subject study to the Corporation Code and the Securities Code but an incursion as well into the intertwining modern management issues. Such corporate legal management issues deal primarily with three (3) types of learning: (1) acquisition of insights into current advances which are of particular significance to the corporate counsel; (2) an introduction to usable disciplinary skins applicable to a corporate counsel's management responsibilities; and (3) a devotion to the organization and management of the legal function itself. These three subject areas may be thought of as intersecting circles, with a shared area linking them. Otherwise known as "intersecting managerial jurisprudence," it forms a unifying theme for the corporate counsel's total learning. Some current advances in behavior and policy sciences affect the counsel's role. For that matter, the corporate lawyer reviews the globalization process, including the resulting strategic repositioning that the firms he provides counsel for are required to make, and the

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need to think about a corporation's; strategy at multiple levels. The salience of the nation-state is being reduced as firms deal both with global multinational entities and simultaneously with sub-national governmental units. Firms increasingly collaborate not only with public entities but with each other often with those who are competitors in other arenas. Also, the nature of the lawyer's participation in decision-making within the corporation is rapidly changing. The modem corporate lawyer has gained a new role as a stakeholder in some cases participating in the organization and operations of governance through participation on boards and other decision-making roles. Often these new patterns develop alongside existing legal institutions and laws are perceived as barriers. These trends are complicated as corporations organize for global operations. ( Emphasis supplied) The practising lawyer of today is familiar as well with governmental policies toward the promotion and management of technology. New collaborative arrangements for promoting specific technologies or competitiveness more generally require approaches from industry that differ from older, more adversarial relationships and traditional forms of seeking to influence governmental policies. And there are lessons to be learned from other countries. In Europe, Esprit, Eureka and Race are examples of collaborative efforts between governmental and business Japan's MITI is world famous. (Emphasis supplied) Following the concept of boundary spanning, the office of the Corporate Counsel comprises a distinct group within the managerial structure of all kinds of organizations. Effectiveness of both long-term and temporary groups within organizations has been found to be related to indentifiable factors in the group-context interaction such as the groups actively revising their knowledge of the environment coordinating work with outsiders, promoting team achievements within the organization. In general, such external activities are better predictors of team performance than internal group processes. In a crisis situation, the legal managerial capabilities of the corporate lawyer vis-a-vis the managerial mettle of corporations are challenged. Current research is seeking ways both to anticipate effective managerial procedures and to understand relationships of financial liability and insurance considerations. (Emphasis supplied) Regarding the skills to apply by the corporate counsel, three factors are apropos:

First System Dynamics. The field of systems dynamics has been found an effective tool for new managerial thinking regarding both planning and pressing immediate problems. An understanding of the role of feedback loops, inventory levels, and rates of flow, enable users to simulate all sorts of systematic problems physical, economic, managerial, social, and psychological. New programming techniques now make the system dynamics principles more accessible to managers including corporate counsels. (Emphasis supplied) Second Decision Analysis. This enables users to make better decisions involving complexity and uncertainty. In the context of a law department, it can be used to appraise the settlement value of litigation, aid in negotiation settlement, and minimize the cost and risk involved in managing a portfolio of cases. (Emphasis supplied) Third Modeling for Negotiation Management. Computer-based models can be used directly by parties and mediators in all lands of negotiations. All integrated set of such tools provide coherent and effective negotiation support, including hands-on on instruction in these techniques. A simulation case of an international joint venture may be used to illustrate the point. [Be this as it may,] the organization and management of the legal function, concern three pointed areas of consideration, thus: Preventive Lawyering. Planning by lawyers requires special skills that comprise a major part of the general counsel's responsibilities. They differ from those of remedial law. Preventive lawyering is concerned with minimizing the risks of legal trouble and maximizing legal rights for such legal entities at that time when transactional or similar facts are being considered and made. Managerial Jurisprudence. This is the framework within which are undertaken those activities of the firm to which legal consequences attach. It needs to be directly supportive of this nation's evolving economic and organizational fabric as firms change to stay competitive in a global, interdependent environment. The practice and theory of "law" is not adequate today to facilitate the relationships needed in trying to make a global economy work. Organization and Functioning of the Corporate Counsel's Office. The general counsel has emerged in the last decade as one of the most vibrant subsets of the legal profession. The corporate counsel hear responsibility for key aspects of the firm's strategic issues, including structuring its global operations, managing improved relationships

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with an increasingly diversified body of employees, managing expanded liability exposure, creating new and varied interactions with public decision-makers, coping internally with more complex make or by decisions. This whole exercise drives home the thesis that knowing corporate law is not enough to make one a good general corporate counsel nor to give him a full sense of how the legal system shapes corporate activities. And even if the corporate lawyer's aim is not the understand all of the law's effects on corporate activities, he must, at the very least, also gain a working knowledge of the management issues if only to be able to grasp not only the basic legal "constitution' or makeup of the modem corporation. "Business Star", "The Corporate Counsel," April 10, 1991, p. 4). The challenge for lawyers (both of the bar and the bench) is to have more than a passing knowledge of financial law affecting each aspect of their work. Yet, many would admit to ignorance of vast tracts of the financial law territory. What transpires next is a dilemma of professional security: Will the lawyer admit ignorance and risk opprobrium?; or will he feign understanding and risk exposure? (Business Star, "Corporate Finance law," Jan. 11, 1989, p. 4). Respondent Christian Monsod was nominated by President Corazon C. Aquino to the position of Chairman of the COMELEC in a letter received by the Secretariat of the Commission on Appointments on April 25, 1991. Petitioner opposed the nomination because allegedly Monsod does not possess the required qualification of having been engaged in the practice of law for at least ten years. On June 5, 1991, the Commission on Appointments confirmed the nomination of Monsod as Chairman of the COMELEC. On June 18, 1991, he took his oath of office. On the same day, he assumed office as Chairman of the COMELEC. Challenging the validity of the confirmation by the Commission on Appointments of Monsod's nomination, petitioner as a citizen and taxpayer, filed the instant petition for certiorari and Prohibition praying that said confirmation and the consequent appointment of Monsod as Chairman of the Commission on Elections be declared null and void. Atty. Christian Monsod is a member of the Philippine Bar, having passed the bar examinations of 1960 with a grade of 86-55%. He has been a dues paying member of the Integrated Bar of the Philippines since its inception in 1972-73. He has also been paying his professional license fees as lawyer for more than ten years. (p. 124, Rollo)

After graduating from the College of Law (U.P.) and having hurdled the bar, Atty. Monsod worked in the law office of his father. During his stint in the World Bank Group (19631970), Monsod worked as an operations officer for about two years in Costa Rica and Panama, which involved getting acquainted with the laws of member-countries negotiating loans and coordinating legal, economic, and project work of the Bank. Upon returning to the Philippines in 1970, he worked with the Meralco Group, served as chief executive officer of an investment bank and subsequently of a business conglomerate, and since 1986, has rendered services to various companies as a legal and economic consultant or chief executive officer. As former Secretary-General (1986) and National Chairman (1987) of NAMFREL. Monsod's work involved being knowledgeable in election law. He appeared for NAMFREL in its accreditation hearings before the Comelec. In the field of advocacy, Monsod, in his personal capacity and as former Co-Chairman of the Bishops Businessmen's Conference for Human Development, has worked with the under privileged sectors, such as the farmer and urban poor groups, in initiating, lobbying for and engaging in affirmative action for the agrarian reform law and lately the urban land reform bill. Monsod also made use of his legal knowledge as a member of the Davide Commission, a quast judicial body, which conducted numerous hearings (1990) and as a member of the Constitutional Commission (1986-1987), and Chairman of its Committee on Accountability of Public Officers, for which he was cited by the President of the Commission, Justice Cecilia Muoz-Palma for "innumerable amendments to reconcile government functions with individual freedoms and public accountability and the party-list system for the House of Representative. (pp. 128-129 Rollo) ( Emphasis supplied) Just a word about the work of a negotiating team of which Atty. Monsod used to be a member. In a loan agreement, for instance, a negotiating panel acts as a team, and which is adequately constituted to meet the various contingencies that arise during a negotiation. Besides top officials of the Borrower concerned, there are the legal officer (such as the legal counsel), the finance manager, and an operations officer (such as an official involved in negotiating the contracts) who comprise the members of the team. (Guillermo V. Soliven, "Loan Negotiating Strategies for Developing Country Borrowers," Staff Paper No. 2, Central Bank of the Philippines, Manila, 1982, p. 11). (Emphasis supplied) After a fashion, the loan agreement is like a country's Constitution; it lays down the law as far as the loan transaction is concerned. Thus, the meat of any Loan Agreement can be compartmentalized into five (5) fundamental parts: (1) business terms; (2) borrower's representation; (3) conditions of closing; (4) covenants; and (5) events of default. (Ibid., p. 13). In the same vein, lawyers play an important role in any debt restructuring program. For aside from performing the tasks of legislative drafting and legal advising, they score national development

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policies as key factors in maintaining their countries' sovereignty. (Condensed from the work paper, entitled "Wanted: Development Lawyers for Developing Nations," submitted by L. Michael Hager, regional legal adviser of the United States Agency for International Development, during the Session on Law for the Development of Nations at the Abidjan World Conference in Ivory Coast, sponsored by the World Peace Through Law Center on August 26-31, 1973). ( Emphasis supplied) Loan concessions and compromises, perhaps even more so than purely renegotiation policies, demand expertise in the law of contracts, in legislation and agreement drafting and in renegotiation. Necessarily, a sovereign lawyer may work with an international business specialist or an economist in the formulation of a model loan agreement. Debt restructuring contract agreements contain such a mixture of technical language that they should be carefully drafted and signed only with the advise of competent counsel in conjunction with the guidance of adequate technical support personnel. (See International Law Aspects of the Philippine External Debts, an unpublished dissertation, U.S.T. Graduate School of Law, 1987, p. 321). ( Emphasis supplied) A critical aspect of sovereign debt restructuring/contract construction is the set of terms and conditions which determines the contractual remedies for a failure to perform one or more elements of the contract. A good agreement must not only define the responsibilities of both parties, but must also state the recourse open to either party when the other fails to discharge an obligation. For a compleat debt restructuring represents a devotion to that principle which in the ultimate analysis is sine qua non for foreign loan agreements-an adherence to the rule of law in domestic and international affairs of whose kind U.S. Supreme Court Justice Oliver Wendell Holmes, Jr. once said: "They carry no banners, they beat no drums; but where they are, men learn that bustle and bush are not the equal of quiet genius and serene mastery." (See Ricardo J. Romulo, "The Role of Lawyers in Foreign Investments," Integrated Bar of the Philippine Journal, Vol. 15, Nos. 3 and 4, Third and Fourth Quarters, 1977, p. 265). Interpreted in the light of the various definitions of the term Practice of law". particularly the modern concept of law practice, and taking into consideration the liberal construction intended by the framers of the Constitution, Atty. Monsod's past work experiences as a lawyer-economist, a lawyer-manager, a lawyer-entrepreneur of industry, a lawyer-negotiator of contracts, and a lawyer-legislator of both the rich and the poor verily more than satisfy the constitutional requirement that he has been engaged in the practice of law for at least ten years.

Besides in the leading case of Luego v. Civil Service Commission, 143 SCRA 327, the Court said: Appointment is an essentially discretionary power and must be performed by the officer in which it is vested according to his best lights, the only condition being that the appointee should possess the qualifications required by law. If he does, then the appointment cannot be faulted on the ground that there are others better qualified who should have been preferred. This is a political question involving considerations of wisdom which only the appointing authority can decide. (emphasis supplied) No less emphatic was the Court in the case of (Central Bank v. Civil Service Commission, 171 SCRA 744) where it stated: It is well-settled that when the appointee is qualified, as in this case, and all the other legal requirements are satisfied, the Commission has no alternative but to attest to the appointment in accordance with the Civil Service Law. The Commission has no authority to revoke an appointment on the ground that another person is more qualified for a particular position. It also has no authority to direct the appointment of a substitute of its choice. To do so would be an encroachment on the discretion vested upon the appointing authority. An appointment is essentially within the discretionary power of whomsoever it is vested, subject to the only condition that the appointee should possess the qualifications required by law. ( Emphasis supplied) The appointing process in a regular appointment as in the case at bar, consists of four (4) stages: (1) nomination; (2) confirmation by the Commission on Appointments; (3) issuance of a commission (in the Philippines, upon submission by the Commission on Appointments of its certificate of confirmation, the President issues the permanent appointment; and (4) acceptance e.g., oath-taking, posting of bond, etc. . . . (Lacson v. Romero, No. L-3081, October 14, 1949; Gonzales, Law on Public Officers, p. 200) The power of the Commission on Appointments to give its consent to the nomination of Monsod as Chairman of the Commission on Elections is mandated by Section 1(2) SubArticle C, Article IX of the Constitution which provides: The Chairman and the Commisioners shall be appointed by the President with the consent of the Commission on Appointments for a term of seven years without reappointment. Of those first appointed, three Members shall hold office for seven years, two Members for five years, and the last Members for three years, without reappointment. Appointment to any vacancy shall be only for the unexpired term of

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the predecessor. In no case shall any Member be appointed or designated in a temporary or acting capacity. Anent Justice Teodoro Padilla's separate opinion, suffice it to say that his definition of the practice of law is the traditional or stereotyped notion of law practice, as distinguished from the modern concept of the practice of law, which modern connotation is exactly what was intended by the eminent framers of the 1987 Constitution. Moreover, Justice Padilla's definition would require generally a habitual law practice, perhaps practised two or three times a week and would outlaw say, law practice once or twice a year for ten consecutive years. Clearly, this is far from the constitutional intent. Upon the other hand, the separate opinion of Justice Isagani Cruz states that in my written opinion, I made use of a definition of law practice which really means nothing because the definition says that law practice " . . . is what people ordinarily mean by the practice of law." True I cited the definition but only by way of sarcasm as evident from my statement that the definition of law practice by "traditional areas of law practice is essentially tautologous" or defining a phrase by means of the phrase itself that is being defined. Justice Cruz goes on to say in substance that since the law covers almost all situations, most individuals, in making use of the law, or in advising others on what the law means, are actually practicing law. In that sense, perhaps, but we should not lose sight of the fact that Mr. Monsod is a lawyer, a member of the Philippine Bar, who has been practising law for over ten years. This is different from the acts of persons practising law, without first becoming lawyers. Justice Cruz also says that the Supreme Court can even disqualify an elected President of the Philippines, say, on the ground that he lacks one or more qualifications. This matter, I greatly doubt. For one thing, how can an action or petition be brought against the President? And even assuming that he is indeed disqualified, how can the action be entertained since he is the incumbent President? We now proceed: The Commission on the basis of evidence submitted doling the public hearings on Monsod's confirmation, implicitly determined that he possessed the necessary qualifications as required by law. The judgment rendered by the Commission in the exercise of such an acknowledged power is beyond judicial interference except only upon a clear showing of a grave abuse of discretion amounting to lack or excess of jurisdiction. (Art. VIII, Sec. 1 Constitution). Thus, only where such grave abuse of discretion is clearly shown shall the Court interfere with the Commission's judgment. In the instant case, there is no occasion for the exercise of the Court's corrective power, since no abuse,

much less a grave abuse of discretion, that would amount to lack or excess of jurisdiction and would warrant the issuance of the writs prayed, for has been clearly shown. Additionally, consider the following: (1) If the Commission on Appointments rejects a nominee by the President, may the Supreme Court reverse the Commission, and thus in effect confirm the appointment? Clearly, the answer is in the negative. (2) In the same vein, may the Court reject the nominee, whom the Commission has confirmed? The answer is likewise clear. (3) If the United States Senate (which is the confirming body in the U.S. Congress) decides to confirma Presidential nominee, it would be incredible that the U.S. Supreme Court would still reverse the U.S. Senate. Finally, one significant legal maxim is: We must interpret not by the letter that killeth, but by the spirit that giveth life. Take this hypothetical case of Samson and Delilah. Once, the procurator of Judea asked Delilah (who was Samson's beloved) for help in capturing Samson. Delilah agreed on condition that No blade shall touch his skin; No blood shall flow from his veins. When Samson (his long hair cut by Delilah) was captured, the procurator placed an iron rod burning white-hot two or three inches away from in front of Samson's eyes. This blinded the man. Upon hearing of what had happened to her beloved, Delilah was beside herself with anger, and fuming with righteous fury, accused the procurator of reneging on his word. The procurator calmly replied: "Did any blade touch his skin? Did any blood flow from his veins?" The procurator was clearly relying on the letter, not the spirit of the agreement. In view of the foregoing, this petition is hereby DISMISSED. SO ORDERED.

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