Canon 16 and Canon 17 (Without Other Rules) - Cases

Compiled by: | TINA SIUAGAN
1
LEGAL ETHICS ASSIGNED CASE READINGS
CANON 16
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
A.C. No. 2591 September 8, 2006
LETICIA ADRIMISIN, complainant,
vs.
ATTY. ROLANDO S. JAVIER, respondent.

D E C I S I O N
CARPIO, J.:
The Case
On 12 September 1983, Leticia Adrimisin ("complainant") filed a
complaint-affidavit
1
with the Ministry of Justiceseeking the
disbarment of Atty. Rolando S. Javier ("respondent") for deceit
and misrepresentation.
The Facts
Complainant alleges that on 12 July 1983, she was introduced by
her cousin, Pablo Adrimisin, to respondent. She needed the help
of a lawyer in having her son-in-law, Alfredo Monterde
("Monterde"), who was charged with the crime of qualified theft,
released from the Caloocan City Jail. Complainant claims that
respondent advised her to file a bail bond. Complainant informed
respondent that her only money was P500. Complainant contends
that respondent received the money, issued a receipt
2
and
promised that Monterde would be released from jail the following
day.
Complainant also alleges that respondent failed to keep his
promise in having Monterde released. Complainant went to
respondent's office several times but it seemed that respondent
was avoiding her. Monterde was later released upon settlement of
the case with his employer. Complainant claims that she
demanded for the return of the P500 but respondent failed to
return this amount.
Respondent did not file any comment or answer. He only
appeared in the investigative hearings conducted by the Office of
the Solicitor General ("OSG"). Respondent, in his testimony,
claims he was not hired by complainant aslegal counsel.
Respondent alleges complainant only asked his help to secure a
bail bond.
3
Respondent admits he received P500 for the bail bond
and called up Carlos Alberto ("Alberto"), an insurance
agent.
4
Respondent claims he gave the P500 to Alberto. However,
the amount was not sufficient to pay for the bond.
5
Respondent
denies that he promised to have Monterde released
immediately.
6
Respondent claims he advised complainant to get
back her money directly from Alberto.
7

Alberto, the insurance agent, was presented during the hearing.
He testified that on 20 July 1983, respondent came to him to


2
secure a bail bond for qualified theft.
8
Alberto showed a copy of
the personal bail bond dated 20 July 1983, issued
by Philippine Phoenix Surety & Insurance, Inc. ("Philippine
Phoenix Surety") with a premium ofP940 and costs of
documentary stamps, notarial fees and clearances at P279 for
a total of P1,219.
9
Alberto claimed he issued a genuine bond but it
was not filed in court because complainant failed to pay the
balance.
10
He also testified that Pablo Adrimisin asked for the
refund of the P500 but the amount could not be refunded due
to expenses already incurred and forfeiture of the remainder in
favor of Alberto's office.
11

The bail bond which was marked as Exhibit "1" contained a
stamped "Limitation of Liability" clause. The clause states
"Authorized limit of the bond shall not exceed P20,000 and it is
not valid for theft and robbery cases."
12
The portion "Not valid for
theft and robbery cases" was deleted with a marking pen but this
cancellation was not signed or initialed. Alberto was asked why
the cancellation was unsigned. Alberto replied that he had no
knowledge on who made the stamp or the cancellation.
13
When
asked if it is the policy of Philippine Phoenix Surety not to post
personal bail bond with respect to theft and robbery cases,
Alberto answered in the affirmative.
14

Alberto also clarified that he is not connected with Philippine
Phoenix Surety but he is an employee of the House of Bonds,
which is the general agent of the former.
15

Mr. Alfredo Brigoli ("Brigoli"), General Manager of the House of
Bonds, was also presented as one of respondent's witnesses.
Brigoli explained that he gives Alberto 5 sets of pre-signed bail
bond forms.
16
However, in theft, robbery and drug cases, Alberto
is required to seek his approval before the bond is issued.
Brigoli testified that it was Alberto's daughter who called him up
for approval to issue a bond for qualified theft.
17
He informed
Alberto's daughter to bring the original bond and its duplicate
copies to his office in Intramuros for his signature, but the same
was not done.
18
Due to the lack of his signature, Brigoli claimed
that the bond has not been approved.
19
Brigoli also testified that
since the bond was not forwarded to his office, the same was not
recorded and the payment was not remitted.
The OSG's Report and Recommendation
The OSG's Investigating Solicitor Antonio G. Castro heard the case
and submitted a Report and Recommendation ("Report"). The
OSG recommended that respondent be suspended from the
practice of law for not less than one year. The Report reads:
The charge of deceit and misrepresentation against respondent
has been sufficiently established. Respondent himself admits that
he received from complainant the sum of P500.00 for the bail
bond of complainant's son-in-law Alfredo Monterde; that he failed
to secure Monterde's release from jail; and that he did not return
the sum of P500.00 to complainant (pp. 9-20, tsn, March 14,
1985).
x x x x


3
Respondent's defense that he actually secured a bail bond for
Monterde is a mere afterthought. Firstly, complainant confided to
him that she had no more money except P500.00. He would not,
therefore, secure a bail bond with higher premium than P500.00.
Secondly, while he declared that the records of Monterde's case in
the Regional Trial Court in Caloocan City, Branch XXV, sala of
Judge Oscar Herrera showed that the recommended bail
was P8,000.00 (pp. 8-9, tsn, March 14, 1985), the personal bail
bond, marked as Exhibit "1", which was allegedly prepared, was
forP9,400.00 (Exh. "1", p. 7, Folder of Exhs.).
Thirdly, respondent's witness, Alfredo Brigoli, the general manager
of the AAF House of Bonds, admitted that Exhibit "1" was not
finally approved. On cross-examination, he declared:
"Q Have you signed that as finally approved?
A No, sir. When they called up asking for my signature on the
deleted portion of the bond, Mr. Alberto never came to my office.
Q In other words that bond has not been finally approved.
A Not finally approved because there is no signature yet."
(p. 20, tsn, Sept. 30, 1985).
As held by this Honorable Court in Royong v. Oblena, 7 SCRA 859,
868-869 (1963), "The respondent's misconduct, although
unrelated to his office, may constitute sufficient grounds for
disbarment." And in Quingwa v. Puno, 19 SCRA 439, 445 (1967),
it also held that, "Indeed, it is important that members of this
ancient and learned profession of law must conform themselves in
accordance with the highest standards of morality."
Specifically, for deceit and misrepresentation, respondent may be
suspended or disbarred (In re Paraiso, 41 Phil. 24, 25 [1920]).
20

The Court's Ruling
The Court finds respondent liable for violation of Canon 16 and
Rule 18.03 of the Code of Professional Responsibility ("Code").
The Code mandates every lawyer to hold in trust all moneys and
properties of his client that may come into his
possession.
21
Consequently, a lawyer should account for the
money received from a client.
22
The Code also enjoins a lawyer
not to neglect a legal matter entrusted to him,
23
and his
negligence in connection therewith shall render him liable.
Respondent himself admitted the receipt of P500 from
complainant as payment for the bail bond as shown in
histestimony and in Exhibit "A". By his receipt of the amount,
respondent agreed to take up complainant's cause and owed
fidelity to complainant and her cause, even if complainant never
paid any fee. Lawyering is not a business. It is a profession in
which duty to public service, not money, is the primary
consideration.
24

Respondent claims that on 12 July 1983, he called up Alberto for
the issuance of the bail bond but it took 8 days before the bail
bond was prepared. In failing to immediately secure the bail bond,
respondent clearly neglected to exercise ordinary diligence or that
reasonable degree of care and skill required by the circumstances.


4
There were also irregularities in the personal bail bond. Firstly, it
was issued on 20 July 1983 but notarized sometime in 1984 as
seen in the Notarial Certificate. The Court therefore agrees with
OSG's finding that respondent's defense that he secured a bail
bond was a mere afterthought. Furthermore, complainant filed her
complaint on 12 September 1983, which means that the bond was
notarized only after the complaint was filed. Secondly, the bail
bond was not valid for theft and robbery cases. Although there
was a cancellation of such phrase through marking pen, the same
was not countersigned, and hence the cancellation was void.
Thirdly, the payment for the bond was not recorded and neither
was it remitted to the issuer of the bond. This means that the
bond was a mere piece of paper without any value for it failed to
serve its purpose.
Complainant demanded for the return of the P500 but respondent
kept on insisting that complainant seek refund from Alberto.
Respondent has the duty to account for the money entrusted to
him by complainant. In Parias v. Paguinto,
25
we held that "a
lawyer shall account for all money or property collected from the
client. Money entrusted to a lawyer for a specific purpose, such as
for filing fee, but not used for failure to file the case must
immediately be returned to the client on demand." In the present
case, money for the payment of the bond's premium was not used
for the purpose intended. Hence, respondent must return the
amount to complainant upon demand.
A lawyer's failure to return upon demand the funds held by him
on behalf of his client gives rise to the presumption that he has
appropriated the same for his own use in violation of the trust
reposed in him by his client. Such act is a gross violation of
general morality as well as of professional ethics. It impairs public
confidence in the legal profession and deserves punishment.
26

This is not the first time respondent is found to have unlawfully
withheld and misappropriated money. In Igual v. Javier,
27
the
Court held that respondent had unjustifiably refused to return
Igual's money upon demand and his absence of integrity was
highlighted by his "half-baked excuses, hoary pretenses and
blatant lies in his testimony before the IBP Committee on Bar
Discipline." The Court suspended Javier from the practice of law
for a period of one month and ordered him to restitute the
amount of P7,000 to Igual. In that case, we reminded respondent
that he was "expected to always live up to the standards
embodied in the Code of Professional Responsibility for the
relationship between an attorney and his client is highly fiduciary
in nature and demands utmost fidelity and good faith."
28

We reiterate this reminder. Lawyers who convert the funds
entrusted to them are in gross violation of professional ethics and
are guilty of betrayal of public confidence in the legal
profession.
29
Those who are guilty of such infraction may be
disbarred or suspended from the practice of law.
30

WHEREFORE, we SUSPEND Atty. Rolando S. Javier from the
practice of law for SIX MONTHS effective upon finality of this
Decision. We ORDER respondent to restitute complainant Leticia
Adrimisin the Five Hundred Pesos (P500) with legal interest
computed from 12 September 1983 until full payment.


5
Respondent shall submit to the Court proof of restitution within
ten (10) days from payment.
Let copies of this resolution be furnished the Office of the Bar
Confidant to be appended to respondent's personal record, and
the Integrated Bar of the Philippines. The Court Administrator
shall furnish copies to all courts of the land for their information
and guidance.
SO ORDERED.
Panganiban, C.J., Puno, Quisumbing, Ynares-Santiago, Sandoval-
Gutierrez, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr.,
Azcuna, Tinga, Chico-Nazario, Garcia, Velasco, Jr., J.J., concur.

SUPREME COURT
Manila
EN BANC
A.C. No. 7057 July 25, 2006
DAVID L. ALMENDAREZ, JR., complainant,
vs.
ATTY. MINERVO T. LANGIT, respondent.
D E C I S I O N
CARPIO, J.:
The Case
On 5 May 2004, David L. Almendarez, Jr. ("complainant") filed this
complaint-affidavit
1
before the Integrated Bar of the Philippines
(IBP), seeking the disbarment of Atty. Minervo T. Langit
("respondent") for acts unbecoming alawyer.
The facts are undisputed:
Complainant, as attorney-in-fact of his mother Pura Lioanag Vda.
de Almendarez, was the plaintiff in an ejectment case before the
Municipal Trial Court of Dagupan City, Branch 2 ("trial court").
Respondent served as complainant's counsel. While the case was
pending, defendant Roger Bumanlag ("Bumanlag")
deposited monthly rentals for the property in dispute to the
Branch Clerk of Court.


6
On 3 February 1994, the trial court rendered a decision in the
ejectment case based on a compromise agreementexecuted by
complainant and Bumanlag. On 18 December 1995, the trial court
issued an alias writ of execution for the satisfaction of the
decision. A court order
2
dated 2 March 2000 granted the Omnibus
Motion for Execution andWithdrawal of Deposited Rentals filed by
respondent as complainant's counsel. Respondent filed a second
motion for withdrawal of deposited rentals, which the trial court
also granted on 16 March 2000.
Sometime in May 2003, complainant learned that respondent was
able to withdraw the rentals deposited by Bumanlag. Felicidad
Daroy ("Daroy"), Officer-in-Charge Clerk of Court, confirmed this
to complainant who received from Daroy copies of the two
withdrawal slips drawn from the trial court's savings account. One
slip dated 10 March 2000 was for P28,000,
3
and another slip
dated 19 April 2000 was for P227,000.
4
Thus, respondent received
a total of P255,000, as evidenced by two receipts
5
signed by him.
The withdrawals were made through Daroy's authorized
representative Antonia Macaraeg, but Daroy personally delivered
the money to respondent. Respondent did not inform complainant
of these transactions.
Complainant, through his new counsel Atty. Miguel D. Larida, sent
respondent on 30 June 2003 a final demand letter for the
accounting and return of the P255,000.
6
Respondent failed to
reply.
Hence, complainant filed this case for disbarment against
respondent for failing to account for complainant's funds.
Complainant further accuses respondent of neglecting to pursue
the implementation of the writ of execution issued in the
ejectment case.
On 12 May 2004, IBP Director for Bar Discipline Rogelio A. Vinluan
("IBP Director Vinluan") ordered respondent to submit his Answer
to the complaint. Respondent did not file an answer despite
receipt of the notice.
7

On 4 October 2004, IBP Investigating Commissioner Caesar R.
Dulay ("IBP Commissioner Dulay") notified the parties to appear
before him for a mandatory conference on 15 November 2004,
later reset to 17 January 2005. Only complainant appeared at the
conference, prompting IBP Commissioner Dulay to order the
conference terminated and to declare that respondent had waived
his right to participate in the proceedings. IBP Commissioner
Dulay directed the parties to file their respective position papers.
Complainant submitted his position paper on 22 March 2005.
Again, respondent took no action.
Findings and Recommendation of the IBP
On 8 June 2005, IBP Commissioner Dulay submitted
his Report and Recommendation ("Report")
8
with the finding that
respondent failed to account for money he held in trust for
complainant. The Report considered complainant's evidence "clear
and convincing" enough to justify disciplinary action against
respondent for violation of Rule 16.01 of the Code of Professional
Responsibility. IBP Commissioner Dulay recommended that
respondent be declared guilty of gross misconduct and suspended


7
for one year, aside from being ordered to render an accounting of
the money he had received.
In a Resolution
9
dated 17 December 2005, the IBP Board of
Governors approved the Report, with the modification that the
penalty of suspension be increased to two years.
The Court's Ruling
We sustain the findings of the IBP.
Respondent committed a flagrant violation of his oath when he
received the sum of money representing the monthly rentals
intended for his client, without accounting for and returning such
sum to its rightful owner. Respondent received the money in his
capacity as counsel for complainant. Therefore, respondent held
the money in trust for complainant. The Code of Professional
Responsibility ("Code") states:
CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS
AND PROPERTIES OF HIS CLIENT THAT MAY COME INTO HIS
POSSESSION.
Rule 16.01A lawyer shall account for all money or property
collected or received for or from the client.
Rule 16.03A lawyer shall deliver the funds and property to his
client when due or upon demand. However, he shall have a lien
over the funds and may apply so much thereof as may be
necessary to satisfy his lawful fees and disbursements, giving
notice promptly thereafter to his client. He shall also have a lien to
the same extent on all judgments and executions he has secured
for his client as provided for in the Rules of Court.
Respondent should have immediately notified complainant of the
trial court's approval of the motion to withdraw
the deposited rentals. Upon release of the funds to him,
respondent could have collected any lien which he had over them
in connection with his legal services, provided he gave prompt
notice to complainant. A lawyer is not entitled to unilaterally
appropriate his client's money for himself by the mere fact that
the client owes him attorney's fees.
10
In this case, respondent did
not even seek to prove the existence of any lien, or any other
right that he had to retain the money.
Respondent's failure to turn over the money to complainant
despite the latter's demands gives rise to the presumption that he
had converted the money for his personal use and benefit. This is
a gross violation of general morality as well as of professional
ethics, impairing public confidence in the legal profession.
11
More
specifically, it renders respondent liable not only for violating the
Code but also for contempt, as stated in Section 25, Rule 138 of
the Rules of Court:
SEC. 25. Unlawful retention of client's funds; contempt When
an attorney unjustly retains in his hands money of his client after
it has been demanded he may be punished for contempt as
an officer of the Court who has misbehaved in his official
transactions; but proceedings under this section shall not be a bar
to a criminal prosecution.


8
Additionally, respondent failed to observe Canon 17
12
of the Code,
which obligates the lawyer to take up the cause of his client with
entire zeal and devotion. It seems that after respondent received
the withdrawn deposits, he never contacted complainant again.
He did not pursue the implementation of the writ of execution
issued in the ejectment case, to the prejudice of complainant. By
his inaction, respondent violated the trust and confidence reposed
in him. For in agreeing to be complainant's counsel, respondent
undertook to take all steps necessary to safeguard complainant's
interest in the case.
The misconduct of respondent is aggravated by his unjustified
refusal to heed the orders of the IBP requiring him to file an
answer to the complaint-affidavit and, afterwards, to appear at
the mandatory conference. Although respondent did not appear at
the conference, the IBP gave him another chance to defend
himself through aposition paper. Still, respondent ignored this
directive, exhibiting a blatant disrespect for authority. Indeed, he
is justly charged with conduct unbecoming a lawyer, for a lawyer
is expected to uphold the law and promote respect for legal
processes.
13
Further, a lawyer must observe and maintain respect
not only to the courts, but also to judicial officers and other duly
constituted authorities,
14
including the IBP. Under Rule 139-B of
the Rules of Court, the Court has empowered the IBP to
conduct proceedings for the disbarment, suspension, or discipline
of attorneys.
The relation of attorney and client is highly fiduciary, requiring
utmost good faith, loyalty, and fidelity on the part of the attorney.
Respondent miserably failed in this regard. Instead, he
demonstrated a lack of integrity, care, and devotion required by
the legal profession from its members. Whenever a lawyer is no
longer worthy of the trust and confidence of the public, this Court
has the right and duty to withdraw his privilege as officer of the
Court and member of the Bar.
15

WHEREFORE, we find Atty. Minervo T. Langit GUILTY of
violating Canons 1, 11, 16, and 17 of the Code of Professional
Responsibility. We SUSPEND respondent from the practice of law
for two years effective upon finality of this Decision.
We ORDER respondent to RESTITUTE, within 30 days from
finality of this Decision, complainant'sP255,000, with interest at
12% per annum from 30 June 2003 until fully paid.
We DIRECT respondent to submit to the Court proof of payment
within 15 days from payment of the full amount.
Let copies of this Decision be furnished all courts, the Office of the
Bar Confidant, as well as the Integrated Bar of the Philippines, for
their notice and guidance.
SO ORDERED.
Panganiban, C.J., Puno, Quisumbing, Ynares-Santiago, Sandoval-
Gutierrez, Austria-Martinez, Corona, Carpio-Morales, Callejo, Sr.,
Azcuna, Tinga, Chico-Nazario, Garcia, Velasco, Jr., J.J., concur.


9
EN BANC
[A.C. NO. 4562 : June 15, 2005]
DANIEL MORTERA, TERESITA MORTERA, FERDINAND
MORTERA and LEO MORTERAComplainants, v. ATTY.
RENATO B. PAGATPATAN, Respondent.
R E S O L U T I O N
CORONA, J.:
How far may a lawyer go to ensure that he gets paid?cralawlibrary
The answer to this question is stated clearly in Canon 16 of the
Code of Professional Responsibility for Lawyers
1
and
in decisions
2
applying the same, but it is apparently not plain
enough to the respondent in this case. It therefore behooves us to
make an example of him for the improvement of the legal
profession.
This disbarment case originated from the execution of a judgment
in a civil action for "rescission of contracts with a prayer for
prohibitory mandatory injunction."
3

In brief, the complainants, then the plaintiffs, sued their mother,
one Renato C. Aguilar and one PhilipArnold Palmer Bradfield for
the rescission of a contract of sale. They secured judgment under
which Aguilar was to pay them P155,000 for the property, which
this Court affirmed.
4

On April 15, 1994, respondent did the unthinkable. Under
a secret agreement with Aguilar, he accepted P150,000 from the
latter as partial payment of the judgment sum, issuing a receipt
for the amount.
5
He then deposited the money in his
personal bank account without the knowledge of
complainants.
6
Until now, respondent adamantly refuses
to surrender the money to complainants, despite the successive
Orders of the RTC and the Court of Appeals.
7

For his part, respondent, in his comment
8
admits his secret
agreement with and receipt of the money from Aguilar,
interposing as his defense the fact that the complainants and their
mother owed him the money he appropriated for services
previously rendered. They would not have paid him his fees had
he not done what he did.
9
In support of his argument, the
respondent narrated his years of service as counsel for the
complainants and their mother. He alleged the amounts they
owed him although he presented no evidence of any agreement
between him and the complainants for the exact amount of
his compensation.
Respondent's responsibility to the complainants is unequivocally
stated in Canons 15 and 16 of the Code of Professional
Responsibility. The four rules governing this situation were: he
owed candor to his clients;
10
he was bound to account for
whatever money he received for and from them;
11
as a lawyer, he
was obligated to keep his own money separate from that of his
clients;
12
and, although he was entitled to a lien over the funds in
order to satisfy his lawful fees,
13
he was also bound to give


10
prompt notice to his clients of such liens and to deliver the funds
to them upon demand or when due.
Respondent violated each and every one of these rules.
Respondent cited the need to protect the money from other
persons claiming to be heirs of Eusebio Montera
14
and from the
volatile temperament of the complainants
15
but did not present
any evidence at all to prove either claim. Thus, these claims
should be ignored.
Because the respondent admitted concealing his clients' money,
the only question in our minds is how severe his punishment
should be.
The Board of Governors of the Integrated Bar of the Philippines
resolved
16
to suspend the respondent for one year.
We do not agree.
In Aldovino v. Pujalte,
17
respondent Atty. Pedro C. Pujalte similarly
faced disbarment charges for having withheld his clients' money in
violation of Canon 16. Pujalte alleged a lien for his fees over the
contested amount but adduced no evidence of this supposed lien.
In disposing of that case, we said:
Respondent has no right to retain or appropriate unilaterally, as
lawyer's lien, the sum of P250,000, as attorney's fees. In fact, he
did not adduce any proof of such agreement. His mere allegation
or claim is not proof. Obviously, his failure to return the money to
complainants upon demand gave rise to the presumption that he
misappropriated it in violation of the trust reposed on him. His act
of holding on to their money without their acquiescence is conduct
indicative of lack of integrity and propriety. He was clinging to
something not his and to which he had no right.
As a penalty for his infraction, Atty. Pujalte was suspended for a
year.
However, in the more recent case of de Guzman Buado and Lising
v. Layag
18
which involved a violation of Canons 15, 16 and 17, the
Court En Banc imposed the much heavier penalty of indefinite
suspension.
In that case, Atty. Eufracio Layag, the lawyer of the complainants
Lising and de Guzman, successfully prosecuted a case against
Inland Trailways, Inc. (Inland). Pursuant to the judgment, Inland
issued three checks, one payable to Layag, one payable to Lising
and one payable to de Guzman who had already passed away by
then. Layag received all three checks from the deputy sheriff but
did not inform the complainants. He then gave them to one Marie
Paz Gonzales for encashment on the strength of a special power
of attorney (SPA) purportedly executed by the late de Guzman
appointing her as his attorney-in-fact. This SPA authorized
Gonzales to encash any check or bill of exchange received in
settlement of the case. Even after complainants learned of the
issuance of the checks two years later and demanded delivery of
the proceeds, Layag refused to do so.
In imposing upon Layag the penalty of indefinite suspension, the
Court En Banc considered his years of experience as a lawyer, his


11
ignorance of the law, specifically the Civil Code, and his violation
of not one but three Canons.
Even though, on its face, this case has more in common
with Pujalte than with Layag, a one-year suspension seems too
lenient for a number of reasons.
First, the respondent in this case has been a practicing lawyer
since 1974
19
and even runs his own small law firm. For all his vast
experience, however, he claims that he has done nothing wrong
by concealing and withholding his clients' money from
them.
20
Coming from a seasoned practitioner of the law, this
attitude is inexcusable.
Second, the respondent had other means of recovering his fees,
having filed a case for that purpose which was, however,
dismissed for his failure to properly implead an indispensable
party.
21
In short, having botched his own effort to recover his
fees, he sought to simply subvert both law and proper procedure
by holding on to the money.
Clearly, the respondent's actuations were thoroughly tainted with
bad faith, deceit and utter contempt of his sworn duty as a
lawyer. Thus, a heavier penalty than a mere one-year suspension
is definitely called for.
WHEREFORE, the IBP Board of Governors Resolution No. XV-
2002-223 in Administrative Case No. 4562, finding respondent
liable for violation of Canon 16 of the Code of Professional
Responsibility is hereby AFFIRMED with
the MODIFICATION that instead of a one-year suspension, Atty.
Renato B. Pagatpatan is hereby SUSPENDED from the practice
of law for two years.
Respondent is further directed to turn over to the complainants,
within five (5) days from receipt of this resolution, the P150,000
he received in their behalf.
Respondent is also ORDERED to report to the Office of the Bar
Confidant his compliance herewith within 15 days from such
compliance.
Let a copy of this Resolution be attached to the personal record of
Atty. Renato B. Pagatpatan and copies furnished the Integrated
Bar of the Philippines and the Office of the Court Administrator for
dissemination to all courts.
This Resolution is immediately executory.
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-
Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez,
Carpio-Morales, Callejo, Sr., Azcuna, Tinga, Chico-Nazario,
and Garcia, JJ., concur.


12
EN BANC
A.C. No. 5829 October 28, 2003
DANIEL LEMOINE, complainant,
vs.
ATTY. AMADEO E. BALON, JR., respondent.

D E C I S I O N
PER CURIAM:
On December 17, 1999, complainant Daniel Lemoine, a French
national, filed a verified complaint
1
against respondent Atty.
Amadeo E. Balon, Jr., for estafa and misconduct before the
Integrated Bar of the Philippines. The case, docketed as CBD Case
No. 99-679, was referred by the Commission on Bar Discipline to
an Investigator for investigation, report and recommendation.
The facts that spawned the filing of the complaint are as follows:
In early 1998, complainant filed a car insurance claim with the
Metropolitan Insurance Company (Metropolitan Insurance), the
insurer of his vehicle which was lost. As complainant encountered
problems in pursuing his claim which was initially rejected,
2
his
friend, a certain Jesus "Jess" Garcia (Garcia), arranged for the
engagement of respondents services.
By letter
3
of October 21, 1998 addressed to Elde
Management, Inc., "ATTN: Mr. Daniel Lemoine," under whose
care complainant could be reached, respondent advised
complainant, whom he had not before met, that for hislegal
services he was charging "25% of the actual amount being
recovered. . . payable upon successful recovery;" an advance
payment of P50,000.00 "to be charged [to complainant] to be
deducted from whatever amount [would] be successfully
collected;" P1,000.00 "as appearance and conference fee for each
and every court hearings, conferences outside our law office and
meetings before the Office of the Insurance Commission which
will be also charged to our 25% recovery fee;" and legal expenses
"such as but not limited to filing fee, messengerial and postage
expenses . . . and other miscellaneous but related expenses," to
be charged to complainants account which would be reimbursed
upon presentation of statement of account.
The letter-proposal of respondent regarding attorneys fees does
not bear complainants conformity, he not having agreed
therewith.
It appears that Metropolitan Insurance finally offered to settle
complainants claim, for by letter
4
of December 9,1998 addressed
to it, respondent confirmed his acceptance of its offer to settle the
claim of complainant "in an ex-gratia basis of 75% of his policy
coverage which is therefore FIVE HUNDRED TWENTY FIVE
THOUSAND (P525,000.00) PESOS."
A day or a few days before December 23, 1998 when complainant
left for France,
5
he, on the advice of respondent, signed an
already prepared undated Special Power of Attorney
6
authorizing
respondent and/or Garcia to bring any action against Metropolitan


13
Insurance for the satisfaction of complainants claim as well as to
"negotiate, sign, compromise[,] encash and receive payment"
from it. The Special Power of Attorney was later dated December
23, 1998 on which same date Metropolitan Insurance issued a
Chinabank Check No. 841172 payable to complainant in the
amount of P525,000.00 as full settlement of the claim.
7
The check
was received by respondent.
In the meantime, complainant returned to the Philippines in early
January 1999 but left again on the 24th of the same month.
8
On
inquiry about the status of his claim, Garcia echoed to
complainant what respondent had written him (Garcia) in
respondents letter
9
of March 26, 1999 that the claim was still
pending with Metropolitan Insurance and that it was still subject
of negotiations in which Metropolitan Insurance offered to settle it
for P350,000.00representing fifty percent thereof. In the same
letter to Garcia, respondent suggested the acceptance of the offer
of settlement to avoid a protracted litigation.
On December 6, 1999, on complainants personal visit to
the office of Metropolitan Insurance, he was informed that his
claim had long been settled via a December 23, 1998 check given
to respondent the year before.
10
Complainant lost no time in going
to the law office of respondent who was not around, however, but
whom he was able to talk by telephone during which he
demanded that he turn over the proceeds of his claim.
11

Respondent thereupon faxed to complainant a December 7, 1999
letter
12
wherein he acknowledged having in his possession the
proceeds of the encashed check which he retained, however, as
attorneys lien pending complainants payment of his attorneys
fee, equivalent to fifty percent (50%) of entire amount collected.
In the same letter, respondent protested what he branded as the
"uncivilized and unprofessional behavior" complainant "reportedly
demonstrated" at respondents office. Respondent winded up his
letter as follows, quoted verbatim:
We would like to make it clear that we cannot give you the
aforesaid amount until and unless our attorneys fees will be
forthwith agreed and settled. In the same manner, should you be
barbaric and uncivilized with your approached, we will not hesitate
to make a proper representation with the Bureau of Immigration
and Deportation for the authenticity of your visa, Department of
Labor and Employment for your working status, Bureau of
Internal Revenue for your taxation compliance and the National
Bureau of Investigation [with] which we have a good network...
While it [is your] prerogative to file a legal action against us, it is
also our prerogative to file a case against you. We will rather
suggest if you could request your lawyer to just confer with us for
the peaceful settlement of this matter. (Underscoring and
emphasis supplied)
As despite written demands,
13
respondent refused to turn over the
proceeds of the insurance claim and to acknowledge the
unreasonableness of the attorneys fees he was demanding,
complainant instituted the administrative action at bar on
December 17, 1999.
In his Complaint-Affidavit, complainant alleged that "[i]t appears
that there was irregularity with the check," it having been


14
issued payable to him, but "and/or AMADEO BALON" was therein
intercalated after his (complainants) name.
14
1awphi1.nt
Maintaining that respondent was entitled to only P50,000.00 in
attorneys fees,
15
complainant decried respondents continued
possession of the proceeds of his claim
16
and his
misrepresentations that the recoverythereof was fraught with
difficulties.
17

In his Counter-Affidavit
18
of February 18, 2000, respondent
asserted that his continued retention of the proceeds of
complainants claim is in lawful exercise of his lien for unpaid
attorneys fees. He expressed readiness, however, to account for
and turn them over once he got paid fifty percent (50%) thereof,
he citing the so called contingent fee billing method of "no cure,
no pay" adopted by practicing lawyers in the insurance industry as
the basis of the amount of his attorneys fees,
19
which to him was
justified in the absence of an attorney-client contract between him
and complainant, the latter having rejected respondents letter-
proposal of October 21, 1998.
20

Respondent also highlighted the value of the time and efforts he
extended in pursuing complainants claim and theexpenses he
incurred in connection therewith. He went on to assert that his
inability to contact complainant whose whereabouts he did not
know prompted him to encash the check and keep the proceeds
thereof in conformity with the Special Power of Attorney executed
in his favor.
21

During the hearings conducted by the IBP Investigator,
complainant echoed his allegations in his Complaint-Affidavit and
stressed that he turned down as unreasonable respondents
proposal in his October 21, 1998 letter that he be paid 25% of the
actual amount collected for his legal services.
22
And he presented
documentary evidence, including the March 26, 1999 letter of
respondent informing his co-attorney-in-fact Garcia of the
supposedly still unrecovered claim and suggesting acceptance of
the purported offer of Metropolitan Insurance to settle
complainants claim at P350,000.00.
Explaining how his above-mentioned March 26, 1999 letter to
Garcia came about, respondent declared that it was made upon
Garcias request, intended for a certain Joel Ramiscal (Ramiscal)
who was said to be Garcias business partner.
23

Respondent later submitted a June 13, 2001 Supplement
24
to his
Counter-Affidavit reiterating his explanation that it was on Garcias
express request that he wrote the March 26, 1999 letter, which
was directed to the fax number of Ramiscal.1vvphi1.nt
Additionally, respondent declared that in the first week of May
1999, on the representation of Garcia that he had talked to
complainant about respondents retention of fifty percent (50%)
of the insurance proceeds for professional fees less expenses,
25
he
gave Garcia, on a staggered basis, the total amount of
P233,000.00 which, so respondent averred, is the amount of
insurance claim complainant is entitled to receive less attorneys
fees and expenses.
26
Thus, respondent claimed that he gave
Garcia the amount of P30,000.00 on May 31, 1999 at Dulcinea
Restaurant in Greenbelt, Makati; the amounts of P50,000.00,
P20,000.00 and P30,000.00 on different occasions at his


15
(respondents) former address through his executive secretary
Sally I. Leonardo; the amount of P20,000.00 at the office of his
(respondents) former employer Commonwealth
Insurance Company through his subordinate Glen V. Roxas; and
several other payments at Dulcinea, and at Manila
Intercontinental Hotels coffee shop sometime in October
1999.
27
Respondent submitted the separate sworn statements of
Leonardo and Roxas.
28

Explaining why no written memorandum of the turn over of
various payments to Garcia was made, respondent alleged that
there was no need therefor since he very well knew Garcia who is
a co-Rotarian and co-attorney-in-fact and whom he really dealt
with regarding complainants claim.
29

Respondent furthermore declared that he rejected complainants
offer to pay him P50,000.00 for his services, insisting that since
there had been no clear-cut agreement on his professional fees
and it was through him that Metropolitan Insurance favorably
reconsidered its initial rejection of complainants claim, he is
entitled to a contingent fee of 50% of the net proceeds thereof.
30

Finally, respondent declared that he, in connection with his follow-
up of the insurance claim, incurred representation expenses of
P35,000.00, entertainment and other representation expenses on
various occasions of P10,000.00, and transportation and gasoline
expenses and parking fees of P5,000.00;
31
and that his retention
of complainants money was justified in light of his apprehension
that complainant, being an alien without a valid working permit in
the Philippines, might leave the country anytime without settling
his professional fees.
32

The Investigating Commissioner, by Report and
Recommendation
33
of October 26, 2001, found respondent guilty
of misconduct and recommended that he be disbarred and
directed to immediately turn over to complainant the sum of
P475,000.00 representing the amount of the P525,000.00
insurance claim less respondents professional fees of P50,000.00,
as proposed by complainant.
The Board of Govenors of the Integrated Bar of the Philippines,
acting on the Investigators Report, issued Resolution No. XV-
2002-401
34
on August 3,2002, reading:
RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and
APPROVED, the Report and Recommendation of the Investigating
Commissioner of the above-entitled case, herein made part of this
Resolution/Decision as Annex "A"; and, finding the
recommendation fully supported by the evidence on record and
the applicable laws and rules, with modification, and considering
respondents dishonesty which amounted to grave misconduct and
grossly unethical behavior which caused dishonor, not merely to
respondent but the noble profession to which he belongs,
Respondent is hereby SUSPENDED from the practice of law for six
(6) months with the directive to turn over the amount of Five
Hundred Twenty Five Thousand (P525,000.00) Pesos to the
complainant without prejudice to respondents right to claim
attorneys fees which he may collect in the proper forum.
(Underscoring supplied)


16
The records of the case are before this Court for final action.
Respondent, by a Motion for Reconsideration
35
filed with this
Court, assails the Investigating Commissioners Report and
Recommendation as not supported by clear, convincing and
satisfactory proof. He prays for the reopening of the case and its
remand to the Investigator so that Garcia can personally appear
for his (respondents) confrontation.
There is no need for a reopening of the case. The facts material to
its resolution are either admitted or documented.
This Court is in full accord with the findings of the IBP
Investigator that respondent violated the following provisions of
the Code of Professional Responsibility, to wit:
RULE 1.01 - A lawyer shall not engage in unlawful, dishonest,
immoral or deceitful conduct.
xxx
CANON 15 - A lawyer shall observe candor, fairness and loyalty in
all his dealings and transactions with his clients.
RULE 15.06 - A lawyer shall not state or imply that he is able to
influence any public official, tribunal or legislative body.
xxx
CANON 16 - A lawyer shall hold in trust all moneys and properties
of his client that may come into his possession.
RULE 16.01 - A lawyer shall account for all money or property
collected or received for or from the client.
RULE 16.02 - A lawyer shall keep the funds of each client separate
and apart from his own and those of others kept by him.
RULE 16.03 - A lawyer shall deliver the funds and property of his
client when due or upon demand. However, he shall have a lien
over the funds and may apply so much thereof as may be
necessary to satisfy his lawful fees and disbursements, giving
notice promptly thereafter to his client. He shall also have a lien to
the same extent on all judgments and executions he has secured
for his client as provided for in the Rules of Court.
xxx
CANON 17 - A lawyer owes fidelity to the cause of his client and
he shall be mindful of the trust and confidence in him.
xxx
RULE 18.04 - A lawyer shall keep the client informed of the status
of his case and shall respond within a reasonable time to the
clients request for information.
xxx
RULE 21.02 - A lawyer shall not, to the disadvantage of his client,
use information acquired in the course of employment, nor shall
he use the same to his advantage or that of a third person, unless
the client with full knowledge of the circumstances consents
thereto.


17
Specifically with respect to above-quoted provision of Canon 16 of
the Code of Professional Responsibility, the Filipino lawyers
principal source of ethical rules, which Canon 16 bears on the
principal complaint of complainant, a lawyer must hold in trust all
moneys and properties of his client that he may come to possess.
This commandment entails certain specific acts to be done by a
lawyer such as rendering an accounting of all money or property
received for or from the client
36
as well as delivery of the funds or
property to the client when due or upon demand.
37
Respondent
breached this Canon when after he received the proceeds of
complainants insurance claim, he did not report it to complainant,
who had a given address in Makati, or to his co-attorney-in-fact
Garcia who was his contact with respect to complainant.
In fact, long after respondent received the December 23,
1998 check for P525,000.00 he, by his letter of March 26, 1999 to
Garcia, had even the temerity to state that the claim was still
pending and recommend "acceptance of the 50% offer . . . which
is P350,000.00 pesos." His explanation that he prepared and sent
this letter on Garcias express request is nauseating. A lawyer, like
respondent, would not and should not commit prevarication,
documented at that, on the mere request of a friend.
By respondents failure to promptly account for the funds he
received and held for the benefit of his client, he committed
professional misconduct.
38
Such misconduct is reprehensible at a
greater degree, for it was obviously done on purpose through the
employment of deceit to the prejudice of complainant who was
kept in the dark about the release of the check, until he himself
discovered the same, and has to date been deprived of the use of
the proceeds thereof.
A lawyer who practices or utilizes deceit in his dealings with his
client not only violates his duty of fidelity, loyalty and devotion to
the clients cause but also degrades himself and besmirches the
fair name of an honorable profession.
39

That respondent had a lien on complainants funds for his
attorneys fees did not relieve him of his duty to account for
it.
40
The lawyers continuing exercise of his retaining lien
presupposes that the client agrees with the amount of attorneys
fees to be charged. In case of disagreement or when the client
contests that amount for being unconscionable, however, the
lawyer must not arbitrarily apply the funds in his possession to the
payment of his fees.
41
He can file, if he still deems it desirable, the
necessary action or proper motion with the proper court to fix the
amount of such fees.
42

In respondents case, he never had the slightest attempt to bring
the matter of his compensation for judicial determination so that
his and complainants sharp disagreement thereon could have
been put to an end. Instead, respondent stubbornly and in bad
faith held on to complainants funds with the obvious aim of
forcing complainant to agree to the amount of attorneys fees
sought. This is an appalling abuse by respondent of the exercise
of an attorneys retaining lien which by no means is an absolute
right and cannot at all justify inordinate delay in the delivery of
money and property to his client when due or upon demand.


18
Respondent was, before receiving the check, proposing a 25%
attorneys fees. After he received the check and after complainant
had discovered its release to him, he was already asking for 50%,
objection to which complainant communicated to him. Why
respondent had to doubly increase his fees after the lapse of
about one year when all the while he has been in custody of the
proceeds of the check defies comprehension. At any rate, it
smacks of opportunism, to say the least.
As for respondents claim in his June 2001 Supplement to his
Counter-Affidavit that he had on several occasions from May
1999 to October 1999 already delivered a total of P233,000.00 out
of the insurance proceeds to Garcia in trust for complainant, this
does not persuade, for it is bereft of any written memorandum
thereof. It is difficult to believe that a lawyer like respondent could
have entrusted such total amount of money to Garcia without
documenting it, especially at a time when, as respondent alleged,
he and Garcia were not in good terms.
43
Not only that. As stated
earlier, respondents Counter-Affidavit of February 18, 2000 and
his December 7, 1999 letter to complainant unequivocally
contained his express admission that the total amount of
P525,000.00 was in his custody. Such illogical, futile attempt to
exculpate himself only aggravates his misconduct. Respondents
claim discredited, the affidavits of Leonardo and Roxas who,
acting allegedly for him, purportedly gave Garcia some amounts
forming part of the P233,000.00 are thus highly suspect and merit
no consideration.
The proven ancillary charges against respondent reinforce the
gravity of his professional misconduct.
The intercalation of respondents name to the Chinabank check
that was issued payable solely in favor ofcomplainant as twice
certified by Metropolitan Insurance
44
is clearly a brazen act of
falsification of a commercial document which respondent resorted
to in order to encash the check.
Respondents threat in his December 7, 1999 letter to expose
complainant to possible sanctions from certain government
agencies with which he bragged to have a "good network" reflects
lack of character, self-respect, and justness.
It bears noting that for close to five long years respondent has
been in possession of complainants funds in the amount of over
half a million pesos. The deceptions and lies that he peddled to
conceal, until its discovery by complainant after about a year, his
receipt of the funds and his tenacious custody thereof in a grossly
oppressive manner point to his lack of good moral character.
Worse, by respondents turnaround in his Supplement to his
Counter-Affidavit that he already delivered to complainants friend
Garcia the amount of P233,000.00 which, so respondent claims, is
all that complainant is entitled to, he in effect has declared that he
has nothing more to turn over to complainant. Such incredible
position is tantamount to a refusal to remit complainants funds,
and gives rise to the conclusion that he has misappropriated
them.
45

In fine, by respondents questioned acts, he has shown that he is
no longer fit to remain a member of the noble profession that is
the law.


19
WHEREFORE, respondent Atty. Amadeo E. Balon, Jr., is found
GUILTY of malpractice, deceit and gross misconduct in the
practice of his profession as a lawyer and he is hereby
DISBARRED. The Office of the Clerk of Court is directed to strike
out his name from the Roll of Attorneys and to inform all courts
and the Integrated Bar of the Philippines of this Decision.
Respondent is ordered to turn over to complainant, Daniel
Lemoine, the amount of P525,000.00 within thirty (30) days from
notice, without prejudice to whatever judicial action he may take
to recover his attorneys fees and purported expenses incurred in
securing the release thereof from Metropolitan Insurance.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Puno, Vitug, Panganiban, Quisumbing,
Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-
Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.
Ynares-Santiago, J., on leave.

SUPREME COURT
Manila
EN BANC
A.C. No. 8380 November 20, 2009
ARELLANO UNIVERSITY, INC. Complainant,
vs.
ATTY. LEOVIGILDO H. MIJARES III, Respondent.

D E C I S I O N
PER CURIAM:
This disbarment case is about the need for a lawyer to account for
funds entrusted to him by his client.
The Facts and the Case
The facts are taken from the record of the case and
the report and recommendation of the Commission on Bar
Discipline of the Integrated Bar of the Philippines (IBP).
Sometime in January 2004, complainant Arellano University, Inc.
(the University) engaged the services of respondent Leovigildo H.
Mijares III, a member of the Bar, for securing a certificate of title
covering a dried up portion of the Estero de San Miguel that the
University had been occupying. The property was the subject of a


20
Deed of Exchange dated October 1, 1958 between the City of
Manila and the University.
In its complaint for disbarment against Mijares, the University
alleged that it gave him all the documents he needed to
accomplish his work. Later, Mijares asked the University for and
was given P500,000.00 on top of his attorneys fees, supposedly
to cover the expenses for "facilitation and processing." He in turn
promised to give the money back in case he was unable to get
the work done.
On July 5, 2004 Mijares informed the University that he already
completed Phase I of the titling of the property, meaning that he
succeeded in getting the Metro Manila Development
Authority (MMDA) to approve it and that the documents had
already been sent to the Department of Environment and Natural
Resources (DENR). The University requested Mijares for copies of
the MMDA approval but he unjustifiably failed to comply despite
his clients repeated demands. Then he made himself scarce,
prompting the University to withdraw all the cases it had
entrusted to him and demand the return of the P500,000.00 it
gave him.
On November 23, 2005 the University wrote Mijares by registered
letter, formally terminating his services in the titling matter and
demanding the return of the P500,000.00. But the letter could not
be served because he changed office address without telling the
University. Eventually, the University found his new address and
served him its letter on January 2, 2006. Mijares personally
received it yet he did not return the money asked of him.
In his answer to the complaint, Mijares alleged that he and the
University agreed on a number of courses of action relating to the
project assigned to him: first, get the Universitys application for a
survey plan which the DENR-NCR approved for a "facilitation cost"
of P500,000.00; second, get a favorable MMDA endorsement for a
"facilitation cost" of another P500,000.00; and, third, the titling of
the property by the Land Registration Authority for a "facilitation
cost" of still another P500,000.00.
Mijares also alleged that the DENR-NCR Assistant Regional
Director told him that he needed to get a favorable endorsement
from MMDA and that the person to talk to about it was
Undersecretary Cesar Lacuna. Mijares later met the latter through
a common friend. At their meeting, Mijares and Lacuna allegedly
agreed on what the latter would get for recommending approval
of the application. Later, Mijares said, he gave the P500,000.00
to Lacunathrough their common friend on Lacunas instruction.
Mijares next alleged that, after he received the money, Lacuna
told him that the University filed an identical application earlier on
March 15, 2002. Mijares claimed that the University deliberately
withheld this fact from him. Lacuna said that, because of the
denial of that prior application, he would have difficulty
recommending approval of the present application. It appeared
that Lacuna endorsed the previous application to the Mayor of
Manila on July 23, 2003 but the latter did not act on it.
Mijares finally alleged that he and Lacuna wanted to bypass the
Mayor of Manila in the paper work but they were unable to arrive
at a concrete plan. Mijares claimed that the University gave him


21
only P45,000.00 as his fees and that it was with the Universitys
conformity that he gave the P500,000.00 to Lacuna.
The IBP designated Atty. Dennis B. Funa as Commissioner to
conduct a formal investigation of the complaint.Despite numerous
settings, however, Mijares failed to appear before the
Commissioner and adduce evidence in his defense.
On October 17, 2008 Commissioner Funa submitted his Report
and Recommendation
1
in the case to theIntegrated Bar of the
Phillippines Board of Governors. The Report said that the
University did not authorize Mijares to give P500,000.00 to the
then MMDA Deputy Chairman Cesar Lacuna; that Mijares had
been unable to account for and return that money despite
repeated demands; and that he admitted under oath having
bribed a government official.
Commissioner Funa recommended a) that Mijares be held guilty of
violating Rules 1.01 and 1.02, Canon 15, Rule 15.05, Canon 16,
Rules 16.01 and 16.03, and Canon 18, Rule 18.04 of the Code of
Professional Responsibility and meted out the penalty of
disbarment; b) that he be ordered to return the P500,000.00 and
all the pertinent documents to the University; and c) that Mijares
sworn statement that formed part of his Answer be endorsed to
the Office of the Ombudsman for investigation and, if warranted,
for prosecution with respect to his shady dealing with Deputy
Chairman Lacuna.
On December 11, 2008 the IBP Board of Governors passed
Resolution XVIII-2008-631, adopting and approving the
Investigating Commissioners recommendation but modifying the
penalty from disbarment to indefinite suspension from the practice
of law and ordering Mijares to return the P500,000.00 and all
pertinent documents to the University within six months from
receipt of the Courts decision.
2

The Question Presented
The only question presented in this case is whether or not
respondent Mijares is guilty of misappropriating theP500,000.00
that his client, the University, entrusted to him for use in
facilitating and processing the titling of a property that it claimed.
The Courts Ruling
Section 27, Rule 138 of the Revised Rules of Court provides for
the disbarment or suspension of a lawyer for the following: (1)
deceit; (2) malpractice; (3) gross misconduct in office; (4) grossly
immoral conduct; (5) conviction of a crime involving moral
turpitude; (6) violation of the lawyers oath; (7) willful
disobedience of any lawful order of a superior court; and (8)
willfully appearing as an attorney for a party without authority to
do so.
3

Every lawyer has the responsibility to protect and advance the
interests of his client such that he must promptly account for
whatever money or property his client may have entrusted to him.
As a mere trustee of said money or property, he must hold them
separate from that of his own and make sure that they are used
for their intended purpose. If not used, he must return the money
or property immediately to his client upon demand, otherwise the
lawyer shall be presumed to have misappropriated the same in


22
violation of the trust reposed on him.
4
A lawyers conversion of
funds entrusted to him is a gross violation of professional ethics.
5

Here, respondent Mijares chose not to be heard on his evidence.
Technically, the only evidence on record that the Court can
consider is the Universitys evidence that he got P500,000.00 from
complainant for expenses in facilitating and processing its title
application; that he undertook to return the money if he did not
succeed in his purpose; that he falsely claimed having obtained
the MMDA approval of the application; and that he nonetheless
refused to return the money despite repeated demands.
Unopposed, this evidence supports the finding of guilt of the
Investigating Commissioner and the IBP Board of Governors.
Besides, even if the Court were to consider the defense that
Mijares laid out in his answer, the same does not rouse sympathy.
He claims that he gave the P500,000.00 to Undersecretary
Lacuna, with the Universitys conformity, for a favorable MMDA
endorsement to the Mayor of Manila. He also claims that, in a
complete turnaround, Lacuna later said that he could not provide
the endorsement because, as it turned out, the MMDA had
previously given such endorsement of the Universitys earlier
application and the Mayor of Manila did not act on that
endorsement.
But, if this were so, there was no reason for Mijares not to face
the University and make it see that it had no cause for complaint,
having given him clearance to pass on the P500,000.00 to Lacuna.
Instead, Mijares kept silent. He did not deny that the University
went all over town looking for him after he could not return the
money. Nor did he take any action to compel Lacuna to hand back
the money that the University gave him. More, his not showing up
to testify on his behalf at the investigation of the case is a dead
giveaway of the lack of merit of his defense. No evidence exists to
temper the doom that he faces.
Even more unfortunate for Mijares, he admitted under oath
having bribed a government official to act favorably on his clients
application to acquire title to a dried-up creek. That is quite
dishonest. The Court is not, therefore, inclined to let him off with
the penalty of indefinite suspension which is another way of
saying he can resume his practice after a time if he returns the
money and makes a promise to shape up.1avvphi1
The Court is also not inclined to go along with the IBPs
recommendation that the Court include in its decision an order
directing Mijares to return the P500,000.00 that the University
entrusted to him. The University knowingly gave him that money
to spend for "facilitation" and processing. It is not nave. There is
no legitimate expense called "facilitation" fee. This term is a
deodorized word for bribe money. The Court will not permit the
conversion of a disbarment proceeding into a remedy for
recovering bribe money lost in a bad deal.
WHEREFORE, the Court finds respondent Leovigildo H. Mijares
III, a member of the Bar, GUILTY of violation of Rules 1.01 and
1.02, Canon 15, Rule 15.05, Canon 16, Rules 16.01 and 16.03,
and Canon 18, Rule 18.04 of the Code of Professional
Responsibility and imposes on him the penalty of DISBARMENT.
He is, in addition, directed to return to complainant Arellano


23
University, Inc. all the documents in his possession covering the
titling matter that it referred to him.
Let the sworn statement of respondent Mijares, forming his
Answer, be forwarded to the Office of the Ombudsman for
whatever action it deems proper under the circumstances.
SO ORDERED.

RULE 16.03
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 161390 April 16, 2008
RAUL H. SESBREO, petitioner,
vs.
HON. COURT OF APPEALS, PROVINCE OF CEBU, GOV.
EDUARDO R. GULLAS, THE PROVINCIAL TREASURER, THE
PROVINCIAL AUDITOR, THE PROVINCIAL ENGINEER
PATROCINIO BACAY (sued both in their official and
personal capacities), respondents.

D E C I S I O N
NACHURA, J.:
For review is the Decision
1
of the Court of Appeals (CA) dated July
23, 2003 and its Resolution
2
dated January 12, 2004 in CA-G.R.
CV No. 43287. The assailed decision reversed the decision
3
of the
Regional Trial Court(RTC), Branch 6, Cebu City in Civil Case R-
19022 insofar as the RTC held the Province of Cebu liable for
damages to petitioner Raul H. Sesbreo. The assailed resolution
denied petitioners motion for reconsideration.


24
On January 26, 1970, Mrs. Rosario Sen and
other camineros
4
hired the petitioner to prosecute Civil Cases Nos.
R-10933
5
and R-11214,
6
evidenced by an Agreement,
7
the terms
of which read as follows:
AGREEMENT
WE, the undersigned, hereby agree to pay Atty. Raul H. Sesbreo,
thirty (30%) percent of whatever back salaries, damages, etc.
that we may recover in the mandamus and other cases that we
are filing or have filed against the Province of Cebu, the Provincial
Governor, etc., whether or not the said cases will be amicably
settled or decided by the courts by final judgment. We shall take
care of all expenses in connection with the said cases.
8

During the pendency of the aforesaid cases or on April 17, 1979,
petitioner registered his charging/retaining lien based on the
Agreement.
9

The camineros obtained favorable judgment when the Court of
First Instance (now RTC) of Cebu ordered that they be reinstated
to their original positions with back salaries, together with
all privileges and salary adjustments or increases.
10
Aggrieved, the
Commissioner of Public Highways and the
District Engineer filed certiorari cases before this Court where the
petitioner willingly rendered further legal assistance and
represented the camineros.
When respondent Eduardo R. Gullas (Gov. Gullas) assumed the
position of governor of Cebu, he proposed the
compromise settlement of all mandamus cases then pending
against the province which included Civil Cases Nos. R-10933 and
R-11214 handled by the petitioner.
On April 21, 1979, the camineros, represented by the petitioner,
and the province of Cebu, through then Gov. Gullas, forged
a Compromise Agreement,
11
with the following terms and
conditions:
1. The respondent Province of Cebu represented in this act by
Gov. Eduardo R. Gullas, duly authorized by proper resolution of
the Sanguniang Panlalawigan, hereby agrees to immediately
appropriate and pay full backwages and salaries as awarded by
the trial court in its decision to all the private respondents-
employees from and after July 1, 1968, the date of their
termination, up to the date of the approval of the herein
Compromise Agreement by the Honorable Supreme Court, except
for those who are qualified for compulsory retirement whose
back salaries and wages shall be limited up to the effective date of
their retirement.
x x x x
9. That the amounts payable to the employees concerned
represented by Atty. Raul H. Sesbreo is subject to said lawyers
charging and retaining liens as registered in the trial court and in
the Honorable Court of Appeals.
x x x x
11. That upon request of the employees concerned, most of
whom are in dire actual financial straits, the Province of Cebu is


25
agreeable to paying an advance of P5,000.00 to each employee
payable through their counsel, Atty. Raul H. Sesbreo, deductible
from the total amount that each will receive from the Province of
Cebu, effective upon confirmation by the Honorable Solicitor
General, the Supreme Court and the Philippine National Bank
where the JJ (now infrastructure funds) are now in deposit under
trust.
12

Apparently, the camineros waived their right to reinstatement
embodied in the CFI decision and the province agreed that it
immediately pay them their back salaries and other claims. This
Court adopted said compromise agreement in our decision
13
dated
December 18, 1979.
14

In view of the finality of the above decision, the camineros,
through their new counsel (who substituted for the petitioner),
moved for its execution. The court then ordered the issuance of a
partial writ of execution directing the payment of only 45% of the
amount due them based on the computation of the provincial
engineering office as audited by the authority concerned.
15
The
court did not release the remaining 55%, thus holding in
abeyance the payment of the lawyers fees pending the
determination of the final amount of such fees.
16
However,
instead of complying with the court order directing partial
payment, the province of Cebu directly paid the camineros the full
amount of their adjudicated claims.
17

Thus, petitioner filed the complaint for Damages (Thru Breach of
Contract) and Attorneys Fees against the Province of Cebu, the
provincial governor, treasurer, auditor, and engineer in their
official and personal capacities, as well as against his former
clients (the camineros).
18

Petitioner anchored his claim on the provision of the Civil Code,
specifically Article 19
19
thereof. He alleged that by directly paying
the camineros the amounts due them, the respondents induced
the camineros to violate their written contract for attorneys
fees.
20
He likewise claimed that they violated the compromise
agreement approved by the Court by computing the camineros
money claims based on the provincial instead of the national wage
rate which, consequently, yielded a lower amount.
21
Petitioner
went on to say that although he was not a party to the above
contracts, by virtue of the registration of his charging lien, he was
a quasi-party and thus, had legal standing to institute the case
below.
22

On August 23, 1982, petitioner moved to dismiss the case against
the camineros after he had entered into an agreement with them
and settled their differences.
23
The case, however, proceeded
against the respondents.
On October 18, 1992, the RTC rendered a decision in favor of the
petitioner and against the respondent province of Cebu, the
pertinent portion of which reads:
Wherefore, for all the foregoing, judgment is rendered, ordering
the defendant Province of Cebu to pay the plaintiff the following
sums:
(a) P669,336.51 in actual damages; with interest of 12% per
annum from date of demand until fully paid;


26
(b) P20,000.00 in moral damages;
(c) P5,000.00 in litigation expenses; and
(d) To pay the costs.
24

While maintaining the validity of the compromise agreement, the
trial court found that the petitioners money claims should have
been computed based on the national and not the provincial rate
of wages paid the camineros. Accordingly, the court declared that
the petitioner was prejudiced to the extent of the difference
between these two rates. The court further upheld the petitioners
status as a quasi-party considering that he had a registered
charging lien. However, it did not give credence to the petitioners
claim that the respondent public officials induced the camineros to
violate their contract, and thus, absolved them from liability.
On appeal, the CA reversed the trial courts decision and
dismissed the complaint.
25
The appellate court concluded that
petitioner failed to sufficiently establish his allegation that the
respondents induced the caminerosto violate the agreement for
attorneys fees and the compromise agreement, and that he
suffered damage due to respondents act of directly paying
the camineros the amounts due them.
26

Hence, the instant petition. In his Memorandum, petitioner raises
the following issues:
1. RESPONDENT COURT OF APPEALS ERRED IN NOT AFFIRMING
THE TRIAL COURT DECISION DUE TO LONG DELAY IN DECIDING
CA-G.R. CV NO. 43287.
2. RESPONDENT COURT OF APPEALS ERRED IN NOT DISMISSING
THE APPEAL IN CA-G.R. CV NO. 43287 FOR FAILURE TO
PROSECUTE AND DUE TO THE FATALLY-DEFECTIVE APPELLANTS
BRIEF.
3. RESPONDENT COURT OF APPEALS ERRED IN REVERSING THE
TRIAL COURT DECISION BY DECLARING THAT THE TRIAL COURT
SHOULD NOT FIX THE ATTORNEYS FEES OF PETITIONER
DESPITE THE FACT THAT THE TRIAL COURT DECISION IS CLEAR
THAT WHAT WAS ADJUDGED WAS THE DECLARATION THAT
THERE WAS BREACH OF THE COMPROMISE CONTRACT AND
DAMAGES ARE TO BE AWARDED THE PETITIONER.
4. RESPONDENT COURT OF APPEALS ERRED IN NOT DECLARING
RESPONDENTS GULLAS, RESENTES, SANCHEZ AND BACAY AS
PERSONALLY LIABLE AND THAT THEIR PERSONAL LIABILITY IS
SOLIDARY WITH THAT OF RESPONDENT PROVINCE OF CEBU.
5. RESPONDENT COURT OF APPEALS ERRED IN NOT DECLARING
THAT PRIVATE RESPONDENTS ARE SOLIDARILY LIABLE TO PAY
TO PETITIONER ACTUAL OR COMPENSATORY, MORAL,
EXEMPLARY, NOMINAL, TEMPERATE DAMAGES, LITIGATION
EXPENSES AND LOSS OF EARNINGS AND INTERESTS.
27

The petition is bereft of merit.
Petitioner insists that the CA should have affirmed the trial courts
decision in view of the delay in resolving the case, and should
have denied the appeal because of the formal defects in the
appellants brief.
28
Petitioner cites the cases of Malacora v. Court
of Appeals
29
and Flora v. Pajarillaga
30
where this Court held that


27
an appealed case which had been pending beyond the time fixed
by the Constitution should be "deemed affirmed."
We cannot apply the cited cases to the one at bench because they
were decided on the basis of Section 11 (2), Article X of the 1973
Constitution, which reads:
SEC. 11. x x x
(2) With respect to the Supreme Court and other collegiate
appellate courts, when the applicable maximum period shall have
lapsed without the rendition of the corresponding decision or
resolution because the necessary vote cannot be had, the
judgment, order, or resolution appealed from shall be deemed
affirmed x x x.
That provision is not found in the present Constitution. The court,
under the 1987 Constitution, is now mandated to decide or
resolve the case or matter submitted to it for determination within
specified periods.
31
Even when there is delay and no decision or
resolution is made within the prescribed period, there is no
automatic affirmance of the appealed decision. The appellate
court, therefore, cannot be faulted in not affirming the RTCs
decision. While we do not tolerate delay in the disposition of
cases, we cannot dismiss appealed cases solely because they had
been pending in court for a long period, especially when the
appeal is highly meritorious as in the present case.
Likewise, we cannot agree with the petitioner that the appealed
case be dismissed on account of the formal defects in
respondents appellants brief filed before the CA. The
requirements laid down by the Rules of Court on the contents of
the brief are intended to aid the appellate court in arriving at a
just and proper conclusion of the case.
32
However, despite its
deficiencies, respondents appellants brief is sufficient in form and
substance as to apprise the appellate court of the essential facts
and nature of the case, as well as the issues raised and the laws
necessary for the disposition of the same.
33
Thus, we sustain the
CAs decision to rule on the merits of the appeal instead of
dismissing it on mere technicality.
Now, on the main issue of whether or not respondents are liable
for damages for breach of contract.
Petitioner clarifies that he instituted the instant case for breach of
the compromise agreement and not for violation of the agreement
for attorneys fees as mistakenly concluded by the appellate court.
He also cites Calalang v. De Borja
34
in support of his right to
collect the amounts due him against the judgment debtor (the
respondents).
35
Lastly, petitioner argues that the respondent public
officials acted beyond the scope of their authority when they
directly paid the camineros their money claims and failed to
withhold the petitioners fees. There is, according to the
petitioner, a showing of bad faith on the part of the province and
the public officials concerned.
After a careful scrutiny of the record of the case, we find no
compelling reason to disturb the appellate courts conclusion. We
would like to stress at this point that the compromise agreement
had been validly entered into by the respondents and
the camineros and the same became the basis of the judgment


28
rendered by this Court. Its validity, therefore, had been laid to
rest as early as 1979 when the Court promulgated its decision
inCommissioner of Public Highways v. Burgos.
36
In fact, the
judgment had already been fully satisfied by the respondents. It
was precisely this full satisfaction of judgment that gave rise to
the instant controversy, based primarily on the petitioners claim
that he was prejudiced because of the following: 1) the wrong
computation in thecamineros money claims by using the
provincial and not the national wage rate; and 2) the mode of
satisfying the judgment through direct payment which impaired
his registered charging lien.
Petitioners claim for attorneys fees was evidenced by
an agreement for attorneys fees voluntarily executed by
the camineros where the latter agreed to pay the former "thirty
(30%) percent of whatever back salaries, damages, etc. that
they might recover in the mandamus and other cases that they
were filing or have filed." Clearly, no fixed amount was specifically
provided for in their contract nor was a specified rate agreed upon
on how the money claims were to be computed. The use of the
word "whatever" shows that the basis for the computation would
be the amount that the court would award in favor of
the camineros. Considering that the parties agreed to a
compromise, the payment would have to be based on the amount
agreed upon by them in the compromise agreement approved by
the court. And since the compromise agreement had assumed
finality, this Court can no longer delve into its substance,
especially at this time when the judgment had already been fully
satisfied. We cannot allow the petitioner to question anew the
compromise agreement on the pretext that he suffered damage.
As long as he was given the agreed percentage of the amount
received by the camineros, then, the agreement is deemed
complied with, and petitioner cannot claim to have suffered
damage.
Petitioner likewise claims that he was prejudiced by respondents
act in directly paying the camineros the amounts due them, as it
rendered inutile the charging lien duly registered for his
protection.
To insure payment of his professional fees and reimbursement of
his lawful disbursements in keeping with his dignity as an officer
of the court, the law creates in favor of a lawyer a lien, not only
upon the funds, documents and papers of his client which have
lawfully come into his possession until what is due him has been
paid, but also a lien upon all judgments for the payment of money
and executions issued pursuant to such judgments rendered in
the case wherein his services have been retained by the
client.
37
Section 37, Rule 138 of the Rules of Court specifically
provides:
Section 37. Attorneys liens. An attorney shall have a lien upon
the funds, documents and papers of his client, which have lawfully
come into his possession and may retain the same until his lawful
fees and disbursements have been paid, and may apply such
funds to the satisfaction thereof. 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


29
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.
A charging lien is an equitable right to have the fees and costs
due to the lawyer for services in a suit secured to him out of the
judgment or recovery in that particular suit. It is based on the
natural equity that the plaintiff should not be allowed to
appropriate the whole of a judgment in his favor without paying
thereout for the services of his attorney in obtaining such
judgment.
38

In this case, the existence of petitioners charging lien is
undisputed since it was properly registered in the records. The
parties even acknowledged its existence in their compromise
agreement. However, a problem arose when the respondents
directly paid in full the camineros money claims and did not
withhold that portion which corresponds to petitioners fees.
When the judgment debt was fully satisfied, petitioner could have
enforced his lien either against his clients (thecamineros herein)
or against the judgment debtor (the respondents herein). The
clients, upon receiving satisfaction of their claims without paying
their lawyer, should have held the proceeds in trust for him to the
extent of the amount of his recorded lien, because after the
charging lien had attached, the attorney is, to the extent of said
lien, regarded as an equitable assignee of the judgment or funds
produced by his efforts.
39
The judgment debtors may likewise be
held responsible for their failure to withhold from
the camineros the amount of attorneys fees due the petitioner.
In the instant case, the petitioner rightly commenced an action
against both his clients and the judgment debtors. However, at
the instance of the petitioner himself, the complaint against his
clients was withdrawn on the ground that he had settled his
differences with them. He maintained the case against
respondents because, according to him, the computation of
the camineros money claims should have been based on the
national and not the provincial wage rate. Thus, petitioner insists
that the respondents should be made liable for the difference.
While the respondents may have impaired the petitioners
charging lien by satisfying the judgment without regard for the
lawyers right to attorneys fees, we cannot apply the doctrine
enunciated in Calalang v. Judge de Borja,
40
because of the peculiar
circumstances obtaining in this case. In Calalang, this Court
stressed that the judgment debtor may be held responsible for his
failure to withhold the amount of attorneys fees in accordance
with the duly registered charging lien.
41
However, there is a
disparity between the two cases, because, in this case, the
petitioner had withdrawn his complaint against the camineros with
whom he had a contract for legal services. The withdrawal was
premised on a settlement, which indicates that his former clients
already paid their obligations. This is bolstered by the certification
of the clerk of court that his former clients had deposited their
passbooks to ensure payment of the agreed fees. Having been


30
paid by his clients in accordance with the agreement, his claim
against the respondents, therefore, has no leg to stand on.
Neither can the petitioner rely on Bacolod Murcia Milling Co., Inc.
v. Henares, etc.
42
where this court declared that satisfaction of the
judgment, in general, does not by itself bar or extinguish the
attorneys liens, as the court may even vacate such satisfaction
and enforce judgment for the amount of the lien.
43
However, the
satisfaction of the judgment extinguishes the lien if there has
been a waiver, as shown either by the attorneys conduct or by his
passive omission.
44
In the instant case, petitioners act in
withdrawing the case against the camineros and agreeing to settle
their dispute may be considered a waiver of his right to the lien.
No rule will allow a lawyer to collect from his client and then
collect anew from the judgment debtor except, perhaps, on a
claim for a bigger amount which, as earlier discussed, is baseless.
Lawyering is not a moneymaking venture and lawyers are not
merchants. Law advocacy is not capital that yields profits. The
returns it births are simple rewards for a job done or service
rendered. It is a calling that, unlike mercantile pursuits which
enjoy a greater deal of freedom from governmental interference,
is impressed with a public interest, for which it is subject to state
regulation.
45

Considering that petitioners claim of higher attorneys fees is
baseless and considering further that he had settled his case as
against his former clients, we cannot sustain his right to damages
for breach of contract against the respondents, even on the basis
of Articles 1191
46
or 1311.
47
Although we sustain his status to
institute the instant case, we cannot render a favorable judgment
because there was no breach of contract. Even if there was such a
breach, he had waived his right to claim against the respondents
by accepting payment and/or absolving from liability those who
were primarily liable to him. Thus, no liability can be imputed to
the province of Cebu or to the respondent public officials, either in
their personal or official capacities.
Lastly, we cannot ascribe bad faith to the respondents who
directly paid the camineros the amounts due them. The records
do not show that when they did so, they induced the camineros to
violate their contract with the petitioner; nor do the records show
that they paid their obligation in order to cause prejudice to the
petitioner. The attendant circumstances, in fact, show that
the camineros acknowledged their liability to the petitioner and
they willingly fulfilled their obligation. It would be contrary to
human nature for the petitioner to have acceded to the
withdrawal of the case against them, without receiving the agreed
attorneys fees.
WHEREFORE, premises considered, the petition is
hereby DENIED. The Decision of the Court of Appeals dated July
23, 2003 and its Resolution dated January 12, 2004 in CA-G.R. CV
No. 43287 are AFFIRMED.
SO ORDERED.


31
RULE 16.04
EN BANC

BOBIE ROSE V. FRIAS, A. C. No. 6656
Complainant, (formerly CBD-98-591)

Present :

DAVIDE, JR. C.J.
PUNO,
PANGANIBAN,
QUISUMBING,
YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
CARPIO,
- v e r s u s - AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
CALLEJO, SR.,
AZCUNA,
TINGA,
CHICO-NAZARIO and
GARCIA, JJ.
ATTY. CARMENCITA
BAUTISTA LOZADA,
Respondent. Promulgated :

December 13, 2005
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - x

R E S O L U T I O N

CORONA, J.:

In this disbarment case, we are faced with conflicting
versions of the incidents surrounding the filing of the verified
complaint
[1]
for deception and malpractice allegedly committed by
Atty. Carmencita Bautista Lozada.

For her part, complainant Bobie Rose Frias alleged that
respondent became her retained counsel and legal adviser in the
early part of 1990. She entrusted to respondent documents and
titles of properties in November of that year. Sometime in
December 1990, respondent persuaded complainant to sell her
house located at 589 Batangas East, Ayala Alabang Village,
Muntinlupa City. Respondent allegedly acted as broker as she
was in need of money.

On December 7, 1990 respondent hastily arranged a
meeting with her and a prospective buyer, Dra. Flora San Diego,
in Valenzuela, Manila. She was allegedly made to sign a
Memorandum of Agreement (MOA)
[2]
without her having read it
because they had to reach the bank before it closed at 3:00
p.m.


32
When they arrived at the Security Bank branch in
Valenzuela, San Diego handed respondent P2M in cash and P1M
in check, instead of P3M in cash as the down payment
[3]
indicated
in the MOA.

Out of the P2M in cash, respondent took P1M as her
commission without complainants consent. When complainant
protested, respondent promised to sign a promissory note later.
The P1M check was later on dishonored by the bank because it
was a stale check.

San Diego eventually backed out from the sale. However, she
converted the aborted sale into a mortgage loan at 36% p.a.
interest, as provided for in the MOA.

Since the transaction between her and San Diego did not
materialize, complainant allegedly tried to recover from
respondent the title
[4]
to the property and other
documents.
[5]
Respondent, however, started avoiding
her. Complainant recovered the documents placed inside an
envelope only on May 6, 1991. On the same day, however, the
envelope was allegedly stolen from her Pajero. She reported the
incident to the police.
[6]
She also informed respondent about the
incident, and the latter prepared an affidavit of
loss.
[7]
Complainant later offered this affidavit as evidence in a
petition for issuance of a duplicate copy of the title she filed in the
RTC of Makati, Branch 142.
[8]

A perjury case
[9]
was then filed by San Diego against complainant
on the ground that the title to the property was never really lost
(as alleged by complainant in the affidavit of loss) but was with
San Diego all along. San Diego maintained that complainant
handed it to her on the day they signed the MOA. Complainant
denied these allegations. She instead claimed that the perjury
case was filed by San Diego, with respondent as counsel, to
coerce her (complainant) to assign the property to San Diego and
to abandon her claim of P1M from respondent.

San Diego also filed a case
[10]
for the return of the P3M she paid
complainant, at 36% p.a. interest. Complainant claimed that her
failure to return the money to San Diego was by reason of
respondents refusal to give back the P1M she took as
commission. Complainant was thus constrained to file a civil case
against respondent. Despite the favorable decision
[11]
of the trial
court, which was affirmed by the Court of Appeals
[12]
, respondent
refused to return the money.

In her answer
[13]
to the disbarment complaint, respondent
claimed that, although complainant was engaged in the buy-build-
and-sell of real property, she represented her only in labor cases
relative to the latters overseas recruitment business. Respondent
denied that she persuaded complainant to sell the property in
Ayala Alabang. Rather, it was complainant who offered to sell or
mortgage the property to respondent. Since respondent did not
have enough money, complainant requested her to sell or
mortgage the property and offered her a loan, commission and
attorneys fees on the basis of the selling price.


33

According to respondent, complainant confided that on October
29, 1990 she offered the Alabang property to a certain Nelia Sta.
Cruz. Complainant received P400,000 as earnest money in this
transaction on the condition that she would return the said
amount to Sta. Cruz in two weeks in case the latter decided not to
proceed with the sale.
[14]
The said amount would in turn be used
to buy another property.

Respondent also claimed that on December 4, 1990, she
introduced complainant to another client, Dra. San Diego, as a
prospective buyer. They visited the Alabang property to check on
the house. It was there that complainant offered the house to San
Diego for either sale or mortgage. They then discussed the terms
and conditions to be contained in the MOA.
[15]
The agreement
was thereafter signed in respondents office in Valenzuela, Metro
Manila on December 7, 1990, duly notarized by Atty. Manuel
Aguinaldo.
[16]
They then proceeded to Prudential Bank (not
Security Bank as alleged in the complaint) to withdraw P2M in
cash. Upon receipt of P2M in cash and P1M check down payment,
complainant gave San Diego the TCT.

Complainant then handed to respondent P900,000 as commission
and loan, duly receipted in a promissory note.
[17]
Complainant
further entrusted P100,000 to respondent to be given to Nelia Sta.
Cruz as partial reimbursement of the P400,000 earnest money.
[18]

Respondent maintained that when San Diego backed out
from the transaction, the latter demanded the return of only P2M,
not P3M, as clearly stated in San Diegos letter
[19]
to the
complainant dated March 20, 1991.
Respondent denied that complainant previously demanded
the return of the P1M until the civil case against her was
instituted. She expressed her willingness to pay theP900,000 plus
the agreed interest, but not the P1M plus interest baselessly
demanded from her by complainant. In an attempt to settle the
controversy, respondent offered to pay the P900,000 to
complainant in the presence of San Diego, so complainant could in
turn pay San Diego the P2M.

Respondent also denied that she prepared the affidavit of loss
which was offered as evidence by complainant in the petition for
issuance of lost title.

Respondent further denied that she represented San Diego in the
criminal cases of perjury and false testimony which the latter filed
against complainant.

In a report and recommendation dated July 25, 2000, the IBP
Investigating Commissioner
[20]
found respondent guilty of
dishonesty and malpractice for concealing the identity of the
person in actual possession of complainants documents and for
preparing an affidavit of loss even if she knew that the documents
were in San Diegos custody. A suspension for six months from
the practice of law was accordingly recommended.

A careful study of the records reveals that the IBP
recommendation relied solely on complainants self-serving and


34
unsupported claims. A re-examination of the differing claims of
the parties, however, discloses that, instead of the grounds relied
on by the IBP, respondent should be held accountable for certain
serious violations of the Code of Professional Responsibility.

Canon 15.03 of the Code of Professional Responsibility provides:

A lawyer shall not represent conflicting interests except by written
consent of all concerned given after a full disclosure of the facts.

A lawyer may not, without being guilty of professional
misconduct, act as counsel for a person whose interest conflicts
with that of his present
[21]
or former client.
[22]
He may not also
undertake to discharge conflicting duties any more than he may
represent antagonistic interests. This stern rule is founded on the
principles of public policy and good taste.
[23]
It springs from the
relation of attorney and client which is one of trust and
confidence.

The test of conflict of interest is whether the acceptance of a new
relation will prevent an attorney from the full discharge of his duty
of undivided fidelity and loyalty to his client or invite suspicion of
unfaithfulness or double-dealing in its performance.
[24]
The
conflict exists if the acceptance of the new retainer will require the
attorney to perform an act which will injuriously affect his first
client in any matter in which he represented him and also whether
he will be called upon in his new relation to use against the first
client any knowledge acquired through their connection.
[25]

In this case, respondent not only admitted that she represented
both complainant and San Diego in unrelated actions but also
counseled both of them in the sale of the Alabang property.

As their lawyer, she was duty-bound to protect both of their
interests. She should have therefore refrained from jumbling their
affairs. Yet she introduced complainant to another client of hers
as a buyer of the property. She even had the temerity to broker
the transaction. At that early stage, she should have realized that
her role as their lawyer had been seriously compromised. Since
buyer and seller had evident antagonistic interests, she could not
give both of them sound legal advice. On top of this,
respondents obvious tendency then was to help complainant get
a high selling price since the amount of her commission was
dependent on it.

After several suits were filed as an offshoot of the transaction
between her two clients, respondent found herself in a very tight
situation. Although she denied that she represented any of them,
her active participation in the transaction was obvious and it
clearly displayed an utter disregard of the rule against discharging
inconsistent duties to her clients. The great likelihood was that
she would be called upon to use against either the complainant or
San Diego information acquired through her professional
connection with them.

Furthermore, her role as their counsel in the other unrelated cases
was also compromised. Both parties had, at this point, become


35
wary of her since she had by then taken for her own
convenience San Diegos side by refusing to return the P900,000
to complainant until San Diego was paid. It was not surprising
therefore that complainant filed this administrative case because
of the suspicion that respondent had double-crossed her.

The records further establish that respondent collected her full
commission even before the transaction between complainant and
San Diego was completed. This unmasked respondents greed
which she now wants us so badly to ignore. Her integrity was
placed in serious doubt the moment her promised commission
started motivating her every move. Her behavior was, sad to say,
simply distasteful.

Likewise, her act of borrowing money from a client was a violation
of Canon 16.04 of the Code of Professional Responsibility:

A lawyer shall not borrow money from his client unless the
clients interests are fully protected by the nature of the case and
by independent advice.

A lawyers act of asking a client for a loan, as what respondent
did, is very unethical. It comes within those acts considered as
abuse of clients confidence. The canon presumes that the client
is disadvantaged by the lawyers ability to use all the legal
maneuverings to renege on her obligation.

Finally, respondent should be reminded that a lawyer should, at
all times, comply with what the court lawfully requires.
[26]
Here,
respondent continues to disregard the final order of the Court of
Appeals finding her liable for the P900,000 she received from
complainant. We see no justification for her continued delay in
complying with an order that has long become final. Respondent
adamantly insists that she and complainant should simultaneously
settle their obligations. As a lawyer, she should have known that
her obligation to complainant was independent of and separate
from complainants obligation to the buyer. Her refusal to comply
with the appellate courts order is, therefore, a willful disobedience
to its lawful orders and must not be left unpunished.

WHEREFORE, respondent Atty. Carmencita Bautista Lozada is
hereby found guilty of violating Rule 15.03 and 16.04 of the Code
of Professional Responsibility and of willfully disobeying a final and
executory decision of the Court of Appeals. She is
hereby SUSPENDED from the practice of law for a period of two
(2) years from notice, with a STERN WARNING that a repetition
of the same or similar acts will be dealt with more severely.

Let copies of this Resolution be furnished all courts of the land,
the Integrated Bar of the Philippines, as well as the Office of the
Bar Confidant for their information and guidance, and let it be
entered in respondents personal records.

SO ORDERED.


36
CANON 17
SUPREME COURT
Manila
EN BANC
A.C. No. 1526 January 31, 2005
NAZARIA S. HERNANDEZ (DECEASED), SUBSTITUTED BY
LUCIANO S. HERNANDEZ, JR., complainant,
vs.
ATTY. JOSE C. GO, respondent.

D E C I S I O N
PER CURIAM:
For our resolution is the verified letter-complaint
1
for disbarment
against Atty. Jose C. Go dated June 23, 1975 filed by Nazaria S.
Hernandez (now deceased). Both parties are from Zamboanga
City.
The allegations in the letter-complaint are:
Sometime in 1961, complainants husband abandoned her and her
son, Luciano S. Hernandez, Jr. Shortly thereafter, her husbands
numerous creditors demanded payments of his loans. Fearful that
the variousmortgage contracts involving her properties will be
foreclosed and aware of impending suits for sums of money
against her, complainant engaged the legal services of Atty. Jose
C. Go, herein respondent.
Respondent instilled in complainant a feeling of helplessness, fear,
embarrassment, and social humiliation. He advised her to give him
her land titles covering Lots 848-A, 849-Q, and 849-P at
Zamboanga City so he could sellthem to enable her to pay her
creditors. He then persuaded her to execute deeds of sale in his
favor without any monetary or valuable consideration.
Complainant agreed on condition that he would sell the lots and
from the proceeds pay her creditors.
Complainant also owned Lots 2118, 2139, and 1141-A, likewise
located in Zamboanga City, which were mortgaged to her
creditors. When the mortgages fell due, respondent redeemed the
lots. Again, he convinced her to execute deeds of sale involving
those lots in his favor. As a result, respondent became
the registered owner of all the lots belonging to complainant.
Sometime in 1974, complainant came to know that respondent did
not sell her lots as agreed upon. Instead, he paid her creditors
with his own funds and had her land titles registered in his name,
depriving her of her real properties worth millions.1a\^/phi1.net
In our Resolution dated September 24, 1975, respondent was
required to file his comment on the complaint.
Instead of filing his comment, respondent submitted a motion to
dismiss on the ground that the complaint is premature since there
is pending before the then Court of First Instance of Zamboanga
City Civil Case No. 1781
2
for recovery of ownership and declaration


37
of nullity of deeds of sale filed by complainant against him
involving the subject lots.
On November 14, 1975, we issued a Resolution denying
respondents motion and requiring him to submit his answer.
In his answer dated December 19, 1975, respondent denied the
allegations in the instant complaint. He averred that he sold,
in good faith, complainants lots to various buyers, including
himself, for valuable consideration. On several occasions, he
extended financial assistance to complainant and even invited her
to live with his family. His children used to call her "Lola" due to
her frequent visits to his residence. He prayed that the complaint
be dismissed for failure to state a cause of action.
On January 17, 1977, we referred the case to the Office of the
Solicitor General (OSG) for investigation, report, and
recommendation.
It was only on March 13, 1990 or after 13 years, 1 month and 26
days that the OSG filed a motion to refer the instant case to the
IBP for the retaking of the testimonies of complainants witnesses
and the submission of itsreport and recommendation.
On April 4, 1990, we issued a Resolution referring the case to the
IBP for investigation, report, and recommendation.
The Report and Recommendation dated June 15, 2004 of Atty.
Lydia A. Navarro, Commissioner of the IBP Commission on Bar
Discipline, is quoted as follows:
"A careful examination and evaluation of the evidence submitted
by the parties showed that all the properties of the complainant
are presently owned by the respondent by virtue of several deeds
of sale executed by the complainant in favor of the respondent
without monetary consideration except Lot 849-D situated in
Tomas Claudio which was returned by the respondent to the
complainant on September 5, 1974.
It is evident from the records that respondent was the one who
notarized the documents involving the said properties redeemed
or repurchased by the complainant from her creditors which
ended up in respondents name like in the deed of sale executed
by Victoriano Dejerano in favor of Nazaria Hernandez over Lots
1141-A-3-A and 1141-A-3-B; deed of sale executed by Antonio
Masrahon on September 3, 1961regarding Lot No. 1141-A; deed
of absolute sale executed by Francisco Esperat over the Curuan
properties on November 9, 1971 and the cancellation of the
mortgage executed by Alfonso Enriquez on July 18, 1964 over the
Tomas Claudio properties.
The foregoing legal activities and operations of the respondent in
addition to his having discussed, advised and gave solutions to
complainants legal problems and liabilities to her creditors and
even requested her creditors for extension of time to pay
complainants accounts constitute practice of law as legal counsel
for consultation aside from representing complainant in other
cases; a mute proof of a lawyer-client relations between them, a
fact also admitted by the respondent.


38
It is incumbent upon the respondent to have rendered a detailed
report to the complainant on how he paid complainants creditors
without selling her properties. Instead of selling to buyers at
higher price, he paid them out of his own funds; then later on
admitted that he was one of the purchasers of complainants
properties in utter disregard of their agreement and no evidence
was submitted by the respondent concerning the value of the said
sale of complainants properties.
As such, respondent did not adhere faithfully and honestly in his
obligation and duty as complainants legal adviser and counsel
when he took advantage of the trust and confidence reposed in
him by the complainant in ultimately putting complainants
properties in his name and possession in violation of Canon 17 of
the Code of Professional Responsibility.
WHEREFORE, in view of the foregoing, the undersigned
respectfully recommends that respondent Atty. Jose C. Go be
suspended from the practice of law for a period of six (6) months
from receipt hereof and the IBP Chapter where he is a registered
member be furnished a copy of the same for implementation
hereof, subject to the approval of the Honorable Members of the
Board of Governors."
On July 30, 2004, the IBP Board of Governors passed Resolution
No. XVI-2004-39 adopting and approving the Report of
Commissioner Navarro with modification in the sense that the
recommended penalty of suspension from the practice of law was
increased from six (6) months to three (3) years.
We sustain the Resolution of the IBP Board of Governors finding
that respondent violated the Code of Professional
Responsibility.l^vvphi1.net However, we have to modify its
recommended penalty.1a\^/phi1.net
Canon 16 of the Code of Professional Responsibility, the principal
source of ethical rules for lawyers in this jurisdiction, provides:
"A lawyer shall hold in trust all moneys and properties of
his client that may come into his possession."
Respondent breached this Canon. His acts of acquiring for himself
complainants lots entrusted to him are, by any standard, acts
constituting gross misconduct, a grievous wrong, a forbidden act,
a dereliction in duty, willful in character, and implies a wrongful
intent and not mere error in judgment.
3
Such conduct on the part
of respondent degrades not only himself but also the name and
honor of the legal profession. He violated this Courts mandate
that lawyers must at all times conduct themselves, especially in
their dealing with their clients and the public at large, with
honesty and integrity in a manner beyond reproach.
4

Canon 17 of the same Code states:
"A lawyer owes fidelity to the cause of his client and he
shall be mindful of the trust and confidence reposed in
him."
The records show that complainant reposed such high degree of
trust and confidence in herein respondent, that when she
engaged his services, she entrusted to him her land titles and


39
allowed him to sell her lots, believing that the proceeds thereof
would be used to pay her creditors. Respondent, however, abused
her trust and confidence when he did not sell her properties to
others but to himself and spent his own money to pay her
obligations. As correctly observed by Investigating IBP
Commissioner Lydia Navarro, respondent is duty-bound to render
a detailed report to the complainant on how much he sold the
latters lots and the amounts paid to her creditors. Obviously, had
he sold the lots to other buyers, complainant could have earned
more. Records show that she did not receive any amount from
respondent. Clearly, respondent did not adhere faithfully and
honestly in his duty as complainants counsel.
Undoubtedly, respondents conduct has made him unfit to remain
in the legal profession. He has definitely fallen below the moral
bar when he engaged in deceitful, dishonest, unlawful and grossly
immoral acts. We have been exacting in our demand for integrity
and good moral character of members of the Bar. They are
expected at all times to uphold the integrity and dignity of the
legal profession
5
and refrain from any act or omission which might
lessen the trust and confidence reposed by the public in the
fidelity, honesty, and integrity of the legal profession.
6
Membership
in the legal profession is a privilege.
7
And whenever it is made to
appear that an attorney is no longer worthy of the trust and
confidence of his clients and the public, it becomes not only the
right but also the duty of this Court, which made him one of its
officers and gave him the privilege of ministering within its Bar, to
withdraw the privilege.
8
Respondent, by his conduct, blemished
not only his integrity as a member of the Bar, but also the legal
profession.
Public interest requires that an attorney should exert his best
efforts and ability to protect the interests of his clients. A lawyer
who performs that duty with diligence and candor not only
protects his clients cause; he also serves the ends of justice and
does honor to the bar and helps maintain the respect of the
community to the legal profession.
It is a time-honored rule that good moral character is not only a
condition precedent to admission to the practice of law. Its
continued possession is also essential for remaining in the legal
profession.
9

Section 27, Rule 138 of the Revised Rules of Court mandates that
a lawyer may be disbarred or suspended by this Court for any of
the following acts: (1) deceit; (2) malpractice; (3) gross
misconduct in office; (4) grossly immoral conduct; (5)
conviction of a crime involving moral turpitude; (6) violation of the
lawyers oath; (7) willful disobedience of any lawful order of a
superior court; and (8) willfully appearing as an attorney for a
party without authority to do so.
10

In Rayos-Ombac vs. Rayos ,
11
we ordered the disbarment of
lawyer when he deceived his 85-year old aunt into entrusting him
with all her money and later refused to return the same despite
demand. In Navarro vs. Meneses III,
12
we disbarred a member of
the Bar for his refusal or failure to account for the P50,000.00 he
received from a client to settle a case. In Docena vs.
Limson ,
13
we expelled from the brotherhood of lawyers, an
attorney who extorted money from his client through deceit and
misrepresentation. In Busios vs. Ricafort ,
14
an attorney was


40
stripped of his license to practice law for misappropriating his
clients money.
Considering the depravity of respondents offense, we find the
penalty recommended by the IBP too light. It bears reiterating
that a lawyer who takes advantage of his clients financial plight to
acquire the latters properties for his own benefit is destructive of
the confidence of the public in the fidelity, honesty, and integrity
of the legal profession. Thus, for violation of Canon 16 and Canon
17 of the Code of Professional Responsibility, which constitutes
gross misconduct, and consistent with the need to maintain the
high standards of the Bar and thus preserve the faith of the public
in the legal profession, respondent deserves the ultimate penalty,
that of expulsion from the esteemed brotherhood of lawyers.
WHEREFORE, respondent JOSE S. GO is found guilty of gross
misconduct and is DISBARRED from the practice of law. His name
is ordered STRICKEN from the Roll of Attorneys EFFECTIVE
IMMEDIATELY.
Let copies of this Decision be furnished the Bar Confidant, the
Integrated Bar of the Philippines and all courts throughout the
country.
SO ORDERED.
Davide, Jr., C.J., Puno, Panganiban, Quisumbing, Ynares-
Santiago, Sandoval-Gutierrez, Carpio, Austria-Martinez, Corona,
Carpio-Morales, Azcuna, Tinga, Chico-Nazario and Garcia, JJ.,
concur. Callejo, Sr., J., on official leave.

EN BANC

MARIA
ANGALAN,

NENA
ANGALAN,

DIONICIO
ANGALAN,

MAGDALENA
ANGALAN,
FRANCISCA
ANGALAN,

INIS
ANGALAN,

ROSALINO
ANGALAN,
AND
JOSEFINA
ANGALAN,

A.C. No. 7181

Present:

PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
VELASCO,
JR., NACH
URA,
LEONARDO-DE
CASTRO,
BRION, and
PERALTA, JJ.


41
ALL OF
WHOM ARE
HEIRS

OF ANGALAN
SAMAL
married
to SANAAN
SAMAL,

Complai
nants,

- versus -

ATTY.
LEONIDO C.
DELANTE,

Responde
nt.
Promulgated:
February 6, 2009

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - -x

D E C I S I O N

PER CURIAM:

This is a complaint filed by Maria, Nena, Dionicio,
Magdalena, Francisca, Inis, Rosalino, and Josefina Angalan
(complainants) against Atty. Leonido C. Delante (respondent) for
gross violation of the Code of Professional Responsibility.

Complainants are the heirs of Angalan Samal (Angalan)
and Sanaan Samal (Sanaan). Complainants allege that they are
illiterate and belong to the Samal Tribe. Angalan, Sanaan, and
complainants owned a 9.102-hectare parcel of land in Barrio San
Jose, Kaputian, Island Garden City of Samal, Davao del
Norte. The property was covered by Original Certificate of Title
(OCT) No. P-11499.
[1]

On 15 April 1971, Angalan and complainants
borrowed P15,000 from Navarro R. Eustaquio and Arabella P.
Eustaquio (Spouses Eustaquio). To secure the loan, Angalan and
complainants mortgaged 8.102 hectares of the 9.102-hectare
property and surrendered OCT No. P-11499 to the Spouses
Eustaquio. The Spouses Eustaquio prepared a document
[2]
and


42
asked Angalan and complainants to sign it. Angalan and
complainants affixed their thumb marks on the document.

When complainants tried to pay the loan and recover OCT
No. P-11499 from the Spouses Eustaquio, the Spouses Eustaquio
refused. Complainants learned that the document which the
Spouses Eustaquio prepared, and which complainants signed, was
a deed of absolute sale and not a real estate mortgage. They also
learned that Navarro R. Eustaquio (Navarro) had transferred the
title over the 8.102-property to his name OCT No. P-11499 was
canceled and Transfer Certificate of Title (TCT) No. T-9926
[3]
in
the name of Navarro was issued.

Complainants engaged the services of respondent for the
purpose of recovering their property. In a receipt
[4]
dated 18
November 1970, respondent acknowledged receipt of P1,200 from
Francisca Angalan and her husband, Macario Capul (Capul),
representing the full payment of his professional fees: Received
from Mr. MACARIO CAPUL and FRANCISCA RAFAEL CAPUL the
sum of ONE THOUSAND TWO HUNDRED PESOS (P1,200.00)
representing full payment of professional services in regard to
recovery of Original Certificate of Title No. P-11499 in the name of
Angalan (Samal).

Respondent filed a complaint
[5]
dated 13 April 1976 with
the then Court of First Instance (CFI), now Regional Trial Court
(RTC), Judicial Region XVI, Tagum, Davao stating that:

2. x x x Angalan Samal and his children x
x x are the original patentees of a certain parcel of land, situated
in Ombay, Samal, Davao, covered under Original Certificate of
Title No. P-11499, of the Registry of Deeds of Davao, having
acquired the same under HP-No. 65310, pursuant to the
provisions of the Homestead Laws of the Public Land Law (C.A.
141);

3. x x x [O]n April 15, 1971, the herein
original patentees x x x sold and conveyed said parcel of land
covered by the aforesaid title to the herein defendants for the
sum of FIFTEEN THOUSAND PESOS (P15,000.00) x x x;

4. x x x [U]nder the provisions of the
Public Land Law, particularly Section 119 thereof and even on the
face of the title of said property now under the name of the
defendants x x x the herein plaintiffs have the right to repurchase
said property within a period of five (5) years from the date of the
conveyance;

x x x x

7. [A]s a matter of right under the law,
the herein plaintiffs are entitled to the produce of the property at
least beginning April 8, 1976;

x x x x


43
9. [B]y reason of unwarranted refusal on
the part of the defendants to reconvey the property to plaintiffs,
the latter have been constrained to engage, and in fact have
engaged, the services of counsel x x x
[6]

Complainants and the Spouses Eustaquio entered into an
amicable settlement. In the amicable settlement
[7]
dated 3
September 1977, the parties stated that:

1. x x x [T]he plaintiffs have offered to
the defendant[s] the sum of P30,000.00 as repurchase price
which the defendant[s accept];

2. x x x [U]pon the signing
hereof, the plaintiffs shall pay the defendant[s] the sum
of P15,000.00 and for this purpose hereby authorize the
defendants to collect the same from the Clerk of Court which
amount had been deposited with this Honorable Court; Likewise,
upon signing hereof the Deed of Reconveyance shall be
immediately executed and delivered by the defendants to
plaintiff[s];

3. x x x [W]hile the balance
of P15,000.00 has not been paid, the defendant[s] shall continue
to possess, and if necessary to gather the produce of the
property, however, upon receipt of the defendant[s] of the
balance of P15,000.00, said defendants together with [their]
agent and/or worker, Alfredo Rabadon shall clear the area and
turnover the same within fifteen (15) days from receipt [of] said
balance.
[8]

In a Decision
[9]
dated 30 September 1977, the CFI approved the
amicable settlement.

Complainants did not have the P30,000 repurchase price
for the property. Respondent advanced the P30,000 and, in
return, complainants allowed respondent to possess the property
and gather its produce until he is paid. In a letter
[10]
dated 10
January 1979 and addressed to the barrio captain of Umbay,
Samal, Davao del Norte, respondent stated that:

This will inform you that the Heirs of Angalan Samal have already
redeemed their property through me from Mr. Navarro Eustaquio
since September, 1978. In my capacity as counsel of the Heirs of
Angalan Samal and owner of the money in redeeming the
property, I have authorized Mr. Macario Capol to take over the
possession of the property together with the harvesting of the
matured coconuts.

When complainants tried to repay the P30,000 repurchase
price and recover the property from respondent, respondent
refused. Complainants learned that respondent transferred the
title of the property to his name TCT No. T-9926 was canceled
and TCT No. T-57932
[11]
in the name of respondent was issued.


44
Complainants filed a complaint
[12]
dated 30 April 2004 with
the RTC, Judicial Region XI, Branch 34, Davao City praying that
(1) the deed of absolute sale prepared by the Spouses Eustaquio
and signed by the complainants be declared void, (2) TCT No. T-
57932 be declared void, and (3) respondent be made to pay
damages. The case was docketed as Civil Case No. 57-2004. In
his answer
[13]
dated 29 December 2004, respondent stated that:

[In] 1971, ANGALAN (SAMAL) [now deceased) [sic] together with
his son-in-law, MACARIO CAPUL, the latter being the town mate
of herein defendant Delante in Danao, Cebu and who is married
to the daughter of the late ANGALAN (SAMAL), came to herein
defendants office and sought for an advice to borrow money;

x x x [T]he late ANGALAN (SAMAL) together with his children in
company with MACARIO CAPUL, were directed by herein
defendant to inform him why it was necessary for them to borrow
money and for whatever [sic] purpose; after their story, herein
defendant disagreed as to their justification in borrowing money
which was for no other purpose except to have money on their
own;

x x x x

It is preposterous for plaintiff[s] to claim that they had [sic]
engaged the professional services of herein defendant to file an
annulment case since plaintiffs never came back apparently
ashamed when they were driven out, but worse they had [sic]
never paid the herein defendant a single centavo for purposes of
filing an annulment case against co-defendant NAVARRO
EUSTAQUIO;

x x x [T]he transfer of said property consisting of 8.102 hectares
under the name of herein defendants was not tainted with any
deceit but effected legally by virtue of a valid deed of
saleexecuted by defendants [sic] spouses EUSTAQUIO in favor of
herein defendants.
x x x x

[T]he absolute deed of sale, [sic] dated 15 April 1971, executed
by herein plaintiffs in favor of defendants EUSTAQUIO, speaks for
itself. It is a sale of real property and NOT a mortgage.

x x x x

Contrary to the malicious and untruthful claim of the plaintiffs, the
legal services of defendant Atty. LEONIDO DELANTE was never
solicited by them. Plaintiffs only asked defendant from where
they could borrow money, and after knowing that they just simply
would [sic] like to borrow money without any concrete
investments in mind to repay [sic] back [sic] any loan, defendant
Atty. LEONIDO DELANTE drove them out of his office and told
them to look for another person to help them;

Defendant Atty. LEONIDO DELANTE later learned from MACARIO
CAPUL, who is a friend and a town mate, and who is the husband
of FRANCISCA ANGALAN CAPUL, that the plaintiffs had negotiated
a sale with a certain NAVARRO EUSTAQUIO x x x;


45

In September 1977, a former Filipino client of herein defendant
DELANTE, who, and his family [sic] are now permanent residents
of New York, was looking for a real property to build his
retirement home, [sic] and he approached herein defendant, in
which he was referred to defendant EUSTAQUIO [sic]; Upon
visiting the property of defendant EUSTAQUIO, he was so
impressed of the location of the property and decided to buy the
same, hence left the money to herein defendant DELANTE and to
buy [sic] said property under defendants name, with the
understanding to turn over said property to him, as soon as he
and his family shall have returned to the country;

x x x [S]ince herein defendant is not interested over the said
property as his own, he waited for his client from New York to
come home and to get his property but after 11 years, his client
decided not to come back anymore to the Philippines, and
directed herein defendant to register the Deed of Sale over the
property to [sic] his name and directed herein defendant to refund
his client.
[14]

Complainants filed a complaint
[15]
dated 28 December 2005
with the Court charging respondent with gross violation of the
Code of Professional Responsibility. In a Resolution
[16]
dated 3
July 2006, the Court required respondent to comment on the
complaint and, in a Resolution
[17]
dated 4 December 2006, the
Court referred the case to the Integrated Bar of the Philippines
(IBP) for investigation, report and recommendation.

In a Notice dated 14 March 2007, Commissioner Salvador
B. Hababag (Commissioner Hababag) directed complainants and
respondent to appear before the IBP for a mandatory
conference. The parties failed to appear at the mandatory
conference. In an Order dated 16 May 2007, Commissioner
Hababag directed the parties to submit their position papers.

In a motion dated 4 April 2007 and filed with the RTC,
respondent and complainants prayed that Civil Case No. 57-2004
be dismissed. Complainants filed with the Court a motion to
withdraw the complaint for disbarment dated 4 April 2007 and an
affidavit of desistance dated April 2007.

In his position paper dated 2 July 2007, respondent stated
that (1) Angalan and Capul went to his office in 1971 to
seek advice about borrowing money; (2) his client from New York
bought the property from the Spouses Eustaquio; and (3)
complainants executed a motion to withdraw the complaint for
disbarment and an affidavit of desistance.

In a Report dated 15 October 2007, Commissioner
Hababag found that respondent violated the Code of Professional
Responsibility:

The issue to resolve is whether or not respondent
committed grave violation of [the] Code of Professional
Responsibility when he bought the property of his client[s]
without their knowledge, consent and against their will?


46

Weighing evidence presented by both parties, respondent
should be punished for his unprofessional and distasteful
acts.

x x x x

His vain attempt to salvage his malicious acts was
too flimsy to gain belief and acceptance. It is
unbelievable that a buyer would entrust his money
intended for payment of a property but allowed that said
property be registered under the name of another,
specifically his lawyer, simply runs counter to ordinary
human nature. (Emphasis supplied)

Commissioner Hababag recommended that respondent be
suspended from the practice of law for six months.

In a Resolution dated 22 November 2007, the IBP Board of
Governors (Board) adopted and approved the Report with
modification. The Board increased respondents suspension from
six months to one year.

Pursuant to Section 12(b), Rule 139-B of the Rules of
Court,
[18]
the Board forwarded the case to the Court for final
action.

The Court sustains the findings of the IBP.

Complainants and respondent presented two different sets
of facts. According to complainants, they engaged the services of
respondent for the purpose of recovering their property from the
Spouses Eustaquio. In violation of the trust and confidence they
reposed in him, respondent transferred the title over the property
to his name. According to respondent, complainants did not
engage his services. His client from New York was the one who
bought the property from the Spouses Eustaquio.

After a careful review of the records, the Court gives
credence to complainants version of the facts.

Respondents credibility is highly questionable. In his
answer dated 29 December 2004 and filed with the CFI and in his
position paper dated 2 July 2007 and filed with the IBP,
respondent alleged that Angalan and Capul went to his office in
1971 to seek advice about borrowing money. According to
respondent, complainants did not engage his services. In his
answer, respondent stated that:

It is preposterous for [complainants] to claim that they
had [sic] engaged the professional services of herein
defendant to file an annulment case since [complainants]
never came back apparently ashamed when they were driven out
x x x;

x x x x


47
Contrary to the malicious and untruthful claim
of [complainants], the legal services of defendant Atty.
LEONIDO DELANTE was never solicited by them. Plaintiffs
only asked defendant from where they could borrow
money, and after knowing that they just simply would like to
borrow money without any concrete investments in mind to repay
back [sic] any loan, defendant Atty. LEONIDO DELANTE drove
them out of his office and told them to look for another person to
help them;

Defendant Atty. LEONIDO DELANTE later learned from
MACARIO CAPUL x x x that the plaintiffs had negotiated a
sale with a certain NAVARRO EUSTAQUIO.
[19]
(Emphasis
supplied)

The Court is not impressed. Angalan and complainants
went to respondents office not to seek advice about borrowing
money but to engage his services for the purpose of recovering
their property. This is obvious. First, after Angalan and
complainants went to respondents office, respondent filed a
complaint with the CFI praying that the Spouses Eustaquio
reconvey the property to Angalan and complainants. Second, in
the complaint, respondent stated that, by reason of unwarranted
refusal on the part of the defendants to reconvey the property to
plaintiffs, the latter have been constrained to engage, and
in fact have engaged, the services of counsel. Third,
respondent issued a receipt to complainants stating that he
RECEIVED from Mr. MACARIO CAPUL and FRANCISCA
RAFAEL CAPUL the sum of ONE THOUSAND TWO
HUNDRED PESOS (P1,200.00) representing full payment
of professional services in regard to the recovery of
Original Certificate of Title No. P-11499 in the name of
Angalan (Samal). Fourth, in respondents letter dated 10
January 1979 and addressed to the barrio captain of Umbay,
Samal, Davao del Norte, he stated that he was the lawyer of
complainants:

This will inform you that the Heirs of Angalan Samal have already
redeemed their property through me from Mr. Navarro Eustaquio
since September, 1978. In my capacity as counsel of the
Heirs of Angalan Samal and owner of the money in redeeming
the property, I have authorized Mr. Macario Capol to take over the
possession of the property together with the harvesting of the
matured coconuts.
[20]

These clearly show that complainants engaged the services of
respondent.

In his answer, respondent alleged that complainants did
not pay him his professional fees (which, according to him, they
did not engage). He stated that, [complainants] had never paid
the herein defendant a single centavo for purposes of filing an
annulment case against x x x NAVARRO EUSTAQUIO.

The Court is not impressed. Complainants fully paid
respondent his professional fees. This is obvious. In a receipt


48
dated 18 November 1970, respondent stated that he RECEIVED
from Mr. MACARIO CAPUL and FRANCISCA RAFAEL CAPUL
the sum of ONE THOUSAND TWO HUNDRED PESOS
(P1,200.00) representing full payment of professional
services in regard to the recovery of Original Certificate of Title
No. P-11499 in the name of Angalan (Samal). This clearly shows
that complainants paid respondent his professional fees.

In his answer and position paper, respondent alleged that
his client from New York bought the property from the Spouses
Eustaquio:

[I]n September 1977, a former Filipino client of herein
respondent, who, and his family [sic] are now permanent
residents of New York, was looking for a real property to build his
retirement home, and he approached herein respondent, in which
[sic] he was referred to Navarro Eustaquio; and upon visiting the
property of Navarro Eustaquio, he was impressed of [sic] the
location of the property and decided to buy the same, hence left
the money to herein respondent and to buy [sic] said property
under respondents name, with the understanding to turn over
said property to him, as soon as he and his family shall have
returned to the country;

x x x [S]ince herein respondent was not interested over the said
property as his own, he waited for his client from New York to
come home and to get his property but after 11 years, his client
decided not to come back anymore to the Philippines, and
directed herein respondent to register the Deed of Sale over the
property under his name and directed herein respondent to refund
his client.
[21]

The Court is not impressed. Complainants repurchased the
property from the Spouses Eustaquio. This is obvious. First,
complainants and the Spouses Eustaquio entered into an amicable
settlement stating that complainants would repurchase the
property from the Spouses Eustaquio:

1. x x x [T]he plaintiffs have offered to the
defendant[s] the sum of P30,000.00 as repurchase price
which the defendant[s accept];

2. x x x [U]pon the signing hereof, the plaintiffs shall pay the
defendant[s] the sum of P15,000.00 and for this purpose hereby
authorize the defendants to collect the same from the Clerk of
Court which amount had been deposited with this Honorable
Court; Likewise, upon signing hereof the Deed of Reconveyance
shall be immediately executed and delivered by the defendants to
plaintiff[s];

3. x x x [W]hile the balance of P15,000.00 has not been paid,
the defendant[s] shall continue to possess, and if necessary to
gather the produce of the property, however, upon receipt of the
defendant[s] of the balance of P15,000.00, said defendants
together with [their] agent and/or worker, Alfredo Rabadon shall


49
clear the area and turnover the same within fifteen (15) days from
receipt [of] said balance.
[22]
(Emphasis supplied)

Second, in his letter to the barrio captain, respondent stated that
complainants repurchased the property from the Spouses
Eustaquio:

This will inform you that the Heirs of Angalan Samal
have already redeemed their property through me from
Mr. Navarro Eustaquio since September, 1978. In my capacity
as counsel of the Heirs of Angalan Samal and owner of the money
in redeeming the property, I have authorized Mr. Macario Capol to
take over the possession of the property together with the
harvesting of the matured coconuts.
[23]
(Emphasis supplied)

These clearly show that complainants repurchased the property
from the Spouses Eustaquio.

Respondents story about the client from New York is
unbelievable. Respondent did not give any detail or proof to
substantiate his story the name of the alleged client, an
affidavit of the alleged client, the old passport of the alleged client
showing immigration stamps, or any form of correspondence
between him and the alleged client. The Court agrees with the
observation of Commissioner Hababag that respondents vain
attempt to salvage his malicious acts [is] too flimsy to gain belief
and acceptance.

In his position paper, respondent alleged that complainants
executed a motion to withdraw the complaint for disbarment and
an affidavit of desistance. This is immaterial. Section 5, Rule
139-B of the Rules of Court states that, No investigation shall
be interrupted or terminated by reason of the desistance,
settlement, compromise, restitution, withdrawal of
charges, or failure of the complainant to prosecute the
same.

Respondent violated Canons 16 and 17 of the Code of
Professional Responsibility. Canon 16 states that lawyers shall
hold in trust all properties of their clients that may come
into their possession. Respondent should have held in trust
TCT No. T-9926 and returned the property to complainants
upon demand.
[24]
Instead of holding in trust the property of
complainants, respondent (1) transferred the title of the property
to his name, (2) refused to return the property to complainants,
and (3) referred to complainants charges as malicious and
untruthful.

Canon 17 states that lawyers shall be mindful of the
trust and confidence reposed in them. Respondent should
have been mindful of the trust and confidence complainants
reposed in him. Complainants allege that they are illiterate and
that the Spouses Eustaquio took advantage of
them. Complainants engaged the services of respondent in the
hope that he would help them recover their property. Instead of
protecting the interests of complainants, respondent took


50
advantage of complainants and transferred the title of the
property to his name.

Considering the depravity of respondents offense, the
Court finds the recommended penalty too light. Violation of
Canons 16 and 17 constitutes gross misconduct.
[25]
Section 27,
Rule 138 of the Rules of Court states that a member of the bar
may be disbarred or suspended from his office as attorney by the
Court for gross misconduct. In Hernandez v. Go,
[26]
the Court
disbarred a lawyer for transferring the titles over the properties of
his client to his name without the knowledge of his
client. In Hernandez, the Court held that:

Considering the depravity of respondents offense, we find the
penalty recommended by the IBP too light. It bears reiterating
that a lawyer who takes advantage of his clients financial plight to
acquire the latters properties for his own benefit is destructive of
the confidence of the public in the fidelity, honesty, and integrity
of the legal profession. Thus, for violation of Canon 16 and Canon
17 of the Code of Professional Responsibility, which constitutes
gross misconduct, and consistent with the need to maintain the
high standards of the Bar and thus preserve the faith of the public
in the legal profession, respondent deserves the ultimate penalty,
that of expulsion from the esteemed brotherhood of lawyers.
[27]

A person who takes the 8.102-hectare property of his
illiterate clients and who is incapable of telling the truth is unfit to
be a lawyer.

WHEREFORE, the Court finds Atty. Leonido C.
Delante GUILTY of violating Canons 16 and 17 of the Code of
Professional Responsibility. Accordingly, the CourtDISBARS him
from the practice of law and ORDERS that his name be stricken
from the Roll of Attorneys.

Let copies of this Decision be furnished the Office of the
Bar Confidant, the Integrated Bar of the Philippines, and all courts
all over the country. Let a copy of this Decision likewise be
attached to the personal records of respondent.

SO ORDERED.

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