Professional Documents
Culture Documents
www.abarol.org/
Foreword
The late Chief Justice of the Philippine Supreme Court, Manuel V. Moran, defined the
term “legal ethics” as the “embodiment of all principles of morality and refinement that
should govern the conduct of every member of the bar.” Accordingly, the legal
profession, perhaps more than any other, requires a strong adherence to ethical standards
which guide the profession and its members. These core ethical standards, embodied in
the Code of Professional Responsibility (CPR) and the Canons of Professional Ethics
(CPE), are an integral part of the education of every law student.
The ABA-Asia Law Initiative is a passionate advocate in the promotion of high ethical
standards and the rule of law worldwide. It is in that spirit that ABA-Asia partnered with
the University of the Philippines Law School to develop a specialized ethics course. The
process involved initial training on interactive teaching techniques by Professor Eleanor
Myers of Temple University, followed by the development and implementation of the
ethics course during the second semester of the 2005-06 school year, and finally the
compilation of these course materials. The interactive nature of this course, which allows
students to be actively involved in the classroom experience, is unique in the Philippines
and is one that we hope will be a revolution in law school teaching methodology. The
course materials are provided in this module for future use by law professors throughout
the Philippines. ABA-Asia and the University of the Philippines Law School hope that
this module will become a standard for the teaching of legal ethics.
ABA-Asia wishes to acknowledge and thank the professors who worked so tirelessly to
develop and teach the course and to compile this module. Those professors include:
Professor Pacifico A. Agabin; Professor Vicente B. Amador; Professor Rogelio A.
Vinluan; Professor Elizabeth A. Pangalangan; and Professor Rafael A. Morales. Dean
Raul C. Pangalangan and his successor Dean Salvador T. Carlota enthusiastically and
fully supported the preparation of this Manual. Professors Domingo P. Disini, Jr. and
Concepcion L. Jardeleza performed administrative duties and assisted the writers, both in
research and editing. We would also like to extend our thanks to Professor Eleanor Myers
for her support of this project. ABA-Asia also wishes to acknowledge the financial
support of the U.S. Agency for International Development (USAID).
Teresa L. Cannady
Resident Legal Advisor
ABA-Asia Law Initiative
Manila, Philippines
This publication was made possible through support provided by the U.S. Agency for International Development
Philippines Mission, under the terms of the Cooperative Agreement No. 492-A-00-03-00018-00. The opinions expressed
herein are those of the author(s) and do not necessarily reflect the view of the U.S. Agency for International Development.
A
TABLE OF CONTENTS
Page
1
How To Use this Module
The Problem
2
The module examines the issues confronting Louis, a young
lawyer, in giving advise to his high school friend and his wife on various
occasions. The central theme is the capacity in which Louis acts, whether
he gives advice as a lawyer or as a friend, considering that many times, his
“legal” advice is sought in informal and unstructured situations. Another
lawyer, Evie Escaler has to make certain choices as regards her duty to
her client and her responsibility to the greater public as an advocate of a
certain issue.
The Client File has all the documents necessary for the students
to see the weight of the document as evidence and create a theory of the
particular case. To guide the students, the File include precise provisions
of the Code of personal responsibility and cases decided by the Supreme
Courts on a similar or same legal question.
Class Activities
3
Manuel and Wendy were married 1992. They are both
professionals, with stable jobs. In the five years that they were married,
they were trying to conceive, but have not been successful. Manuel
wanted to have a baby for so long that on the day Wendy received news
that she was pregnant, Manuel was ecstatic.
As Wendy’s pregnancy progressed, she started having difficulty
breathing and was easily fatigued. One day, she was rushed to the
hospital because she couldn’t breathe. The doctors diagnosed her as
having mitral valve stenosis, a congestion of the heart due to a valve defect.
As explained by the doctors, her heart has to work double time to be able
to circulate blood in her system. Her condition was one of functional
class III, and women with functional class III to IV heart conditions are
strongly advised against pregnancy because of high maternal mortality
rate. (See Appendix A, Medical Certificate) The doctors say that the
chances of Wendy carrying the babying to term are slim because her
heart would not be able to take it. She was then 10 weeks pregnant.
Wendy was scared; she does not want to die. She contemplates
the possibility of abortion, and seeks advice from Louis, a high school
buddy of Manuel’s, who was a lawyer.
4
iv. Civil Code, Art. 41 - 42
5
II. Dilemma 2 & 3: Contract for Support and Custody, and
Simulated Birth Certificate
The following month, Manuel received word from Cora that she
was pregnant with his baby and that she wanted support for herself and
the child. Manuel asked Atty. Paulina Paz, his tax lawyer to draft a
6
contract where Cora promised to drop all claims against Manuel if he
took full responsibility for Cora’s financial needs until a year after her
delivery and the baby’s until he/she finished College. Cora agreed to this
and the provison that should Manuel exercise the option of supporting
the child in his home, she will give up all her parental rights over the
baby since this was clearly “in the best interest of the child.”
7
For Class Discussion – Faculty Guide
a. Should Atty. Paulina Paz have prepared the support and custody
contract between Cora and Manuel?
I. See Appendix B, Contract
II. Consider the following:
i. Code of Professional Responsibility, Canons 1,
1.01, 1.02, 1.04, 9, 15
8
with competence and diligence, and champion the
latter's cause with whole-hearted fidelity, care, and
devotion...."
9
and assistance of the attorney is sought and
received, in matters pertinent to his profession. An
acceptance of the relation is implied on the part of
the attorney from his acting in behalf of his client in
pursuance of a request by the latter." (7 C. J. S.,
848-849; see Hirach Bros. & Co. vs. R. E.
Kennington Co., 99 A. L. R., 1.)
10
speaking, no attorney-client [relationship] existing
between them. Rather, right from the start,
everything was sort of personal.]
MENDOZA, J.:
A lawyer shall not borrow money from his
client unless the client's interests are fully protected
by the nature of the case or by independent advice
(Rule 16.04, Code of Professional Responsibility).
This rule is intended to prevent the lawyer from
taking advantage of his influence over the client.
This rule is especially significant in the instant case
where the respondent enjoys an immense
ascendancy over the complainant who, "as well as
two of his sisters, had served respondent's family as
household helpers for many years." Having gained
dominance over the complainant by virtue of such
long relation of master and servant, the respondent
took advantage of his influence by not returning the
money entrusted to him. Instead, he imposed his
will on the complainant and borrowed her funds
without giving adequate security therefor and
mindless of the interest of the complainant. In the
light of the foregoing, . . . respondent has
committed an act which falls short of the standard
of the norm of conduct required of every attorney.
If an ordinary borrower of money is required by the
law to repay the loan failing which he may be
subjected to court action, it is more so in the case of
a lawyer whose conduct serves as an example….
Respondent's liability is thus not for
misappropriation or embezzlement, but for
violation of Rule 16.04 of the Code of Professional
Responsibility, which forbids lawyers from
borrowing money from their clients, unless the
latter's interests are protected by the nature of the
case or by independent advice.
11
David, “To constitute professional employment it is
not essential that the client should have employed
the attorney professionally on any previous
occasion . . . It is not necessary that any retainer should
have been paid. promised, or charged for; neither is it
material that the attorney consulted did not
afterward undertake the case about which the
consultation was had. If a person, in respect to his
business affairs or troubles of any kind, consults with his
attorney in his professional capacity with the view to
obtaining professional advice or assistance, and the attorney
voluntarily permits or acquiesces in such consultation, then
the professional employment must be regarded as
established….”
12
“Section 26 (e), Rule 123 of the Rules of
Court provides that "an attorney cannot, without
the consent of his client, be examined as to any
communication made by the client to him, or his
advice given thereon in the course of professional
employment;" and section 19 (e) of Rule 127
imposes upon an attorney the duty "to maintain
inviolate the confidence, and at every peril to
himself, to preserve the secrets of his client." There
is no law or provision in the Rules of Court
prohibiting attorneys in express terms from acting
on behalf of both parties to a controversy whose
interests are opposed to each other, but such
prohibition is necessarily implied in the injunctions
above quoted. (In re De la Rosa, 27 Phil., 258.) In
fact the prohibition derives validity from sources
higher than written laws and rules. As has been
aptly said in In re Merron, 22 N. M., 252, L.R.A.,
1917B, 378, "information so received is sacred to
the employment to which it pertains," and "to
permit it to be used in the interest of another, or,
worse still, in the interest of the adverse party, is to
strike at the element of confidence which lies at the
basis of, and affords the essential security in, the
relation of attorney and client."
“That only copies of pleadings already filed
in court were furnished to Attorney Agrava and
that, this being so, no secret communication was
transmitted to him by the plaintiff, would not vary
the situation even if we should discard Mrs.
Hilado's statement that other papers, personal and
private in character, were turned in by her.
Precedents are at hand to support the doctrine that
the mere relation of attorney and client ought to
preclude the attorney from accepting the opposite
party's retainer in the same litigation regardless of
what information was received by him from his first
client.
"The principle which forbids an attorney
who has been engaged to represent a client from
thereafter appearing on behalf of the client's
opponent applies equally even though during the
continuance of the employment nothing of a
confidential nature was revealed to the attorney by
13
the client." (Christian vs. Waialua Agricultural Co.,
30 Hawaii, 533, Footnote 7, C. J. S., 828.)
"Where it appeared that an attorney,
representing one party in litigation, had formerly
represented the adverse party with respect to the
same matter involved in the litigation, the court -
need not inquire as to how much knowledge the
attorney acquired from his former client during that
relationship, before refusing to permit the attorney
to represent the adverse party." (Brown vs. Miller,
52 App. D. C. 330; 286, F. 994.)
"In order that a court may prevent an
attorney from appearing against a former client, it is
unnecessary that the court ascertain in detail the
extent to which the former client's affairs might
have a bearing on the matters involved in the
subsequent litigation on the attorney's knowledge
thereof." (Boyd vs. Second Judicial Dist. Court, 274
P., 7; 51 Nev., 264.)
"This rule has been so strictly enforced that
it has been held that an attorney, on terminating his
employment, cannot thereafter act as counsel
against his client in the same general matter, even
though, while acting for his former client, he
acquired no knowledge which could operate to his
client's disadvantage in the subsequent adverse
employment." (Pierce vs. Palmer [1910], 31 R. L,
432; 77 Atl., 201, Ann. Cas., 1912S, 181.)
“Communications between attorney and
client are, in a great number of litigations, a
complicated affair, consisting of entangled relevant
and irrelevant, secret and well known facts. In the
complexity of what is said in the course of the
dealings between an attorney and a client, inquiry of
the nature suggested would lead to the revelation, in
advance of the trial, of other matters that might
only further prejudice the complainant's cause. And
the theory would be productive of other unsalutary
results. To make the passing of confidential
communication a condition precedent; i.e., to make
the employment conditioned on the scope and
character of the knowledge acquired by an attorney
in determining his right to change sides, would not
enhance the freedom of litigants, which is to be
sedulously fostered, to consult with lawyers upon
14
what they believe are their rights in litigation. The
condition would of necessity call for an
investigation of what information the attorney has
received and in what way it is or it is not in conflict
with his new position. Litigants would in
consequence be wary in going to an attorney, lest by
an unfortunate turn of the proceeding, if an
investigation be held, the court should accept the
attorney's inaccurate version of the facts that came
to him. "Now the abstinence from seeking legal
advice in a good cause is by hypothesis an evil
which is fatal to the administration of justice."
(John H. Wigmore's Evidence, 1923, Sections 2285,
2290, 2291.)
Hence the necessity of setting down the
existence of the bare relationship of attorney and
client as the yardstick for testing incompatibility of
interests. This stern rule is designed not alone to
prevent the dishonest practitioner from fraudulent
conduct, but as well to protect the honest lawyer
from unfounded suspicion of unprofessional
practice. (Strong vs. Int. Bldg., etc.; Ass'n, 183 III.,
97; 47 L.R.A., 792.) It is founded on principles of
public policy, on good taste. As has been said in
another case, the question is not necessarily one of
the rights of the parties, but as to whether the
attorney has adhered to proper professional
standard. With these thoughts in mind, it behooves
attorneys, like Caesar's wife, not only to keep
inviolate the client's confidence, but also to avoid
the appearance of treachery and double-dealing.
Only thus can litigants be encouraged to entrust
their secrets to their attorneys which is of
paramount importance in the administration of
justice.
So without impugning respondent's good
faith, we nevertheless can not sanction his taking up
the cause of the adversary of the party who had
sought and obtained legal advice from his firm; this,
not necessarily to prevent any injustice to the
plaintiff but to keep above reproach the honor and
integrity of the courts and of the bar. Without
condemning the respondent's conduct as dishonest,
corrupt, or fraudulent, we do believe that upon the
admitted facts it is highly inexpedient. It had the
15
tendency to bring the profession, of which he is a
distinguished member, "into public disrepute and
suspicion and undermine the integrity of justice."
16
III. Dilemma 4: Declaration of Presumptive Death for Purposes of
Remarriage
About a year and a half passed since the plane crash, Wendy met
another man, Omar. They fell in love, and decided to marry on June
2003. But in the months of January and February 2003, Wendy received
information from three different sources (see Appendixes E, F, G)
indicating that Manuel may be alive, and is living in Hong Kong. Despite
efforts to verify, there was no confirmation from the Hong Kong
authorities.
Wendy informs Louis that she has broken off her engagement to
Omar and asks Louis to help her locate Manuel. Louis feels guilty about
Wendy being so concerned about Manuel, whom he considered
undeserving of her love. Not wanting to see Wendy more depressed and
anguished, he finally tells Wendy that Ben is the child of Manuel with
Cora. Wendy was shocked and furious at both Manuel and Louis. To
gain back Wendy’s trust, Louis suggests that she should disregard any
information about Manuel since these were all hearsay. Thus, he says,
having received no news that Manuel may be alive, she can secure a
declaration of presumptive death in a summary proceeding before her
June wedding. He adds that he would do this without compensation as
proof of his friendship and remorse. He tells her of his uncle who is a
family court judge and assures her that their case will be “raffled” to his
court.
17
For Class Discussion – Faculty Guide
a. Did Louis violate his lawyer-client confidentiality when he
told Wendy that Ben was Manuel’s child?
I. Consider the discussion in Part II (c), (e) [whether
there exists a lawyer-client relationship or not]
II. Consider the following:
i. Code of Professional Responsibility,
Canons 21, 21.01, 21.02
ii. Rules of Court, Rules 138, section 20 (e)
iii. Revised Penal Code, Article 209
18
“Belief is a state of the mind or
condition prompting the doing of an overt
act. It may be proved by direct evidence or
circumstantial evidence which may tend, even
in a slight degree, to elucidate the inquiry or
assist to a determination probably founded in
truth. Any fact or circumstance relating to the
character, habits, conditions, attachments,
prosperity and objects of life which usually
control the conduct of men, and are the
motives of their actions, was, so far as it tends
to explain or characterize their disappearance
or throw light on their intentions, competence
evidence on the ultimate question of his
death.
“The belief of the present spouse
must be the result of proper and honest to
goodness inquiries and efforts to ascertain the
whereabouts of the absent spouse and
whether the absent spouse is still alive or is
already dead. Whether or not the spouse
present acted on a well-founded belief of
death of the absent spouse depends upon the
inquiries to be drawn from a great many
circumstances occurring before and after the
disappearance of the absent spouse and the
nature and extent of the inquiries made by
present spouse.”
19
whereabouts of his wife, he fails to
state of whom he made such inquiries.
He did not even write to the parents
of his first wife, who lived in the
Province of Pampanga, for the
purpose of securing information
concerning her whereabouts. He
admits that he had a suspicion only
that his first wife was dead. He admits
that the only basis of his suspicion
was the fact that she had been absent.
. . .’
“In the case at bar, the Court consider
that the investigation allegedly conducted by
respondent in his attempt to ascertain Janet
Monica Parker's whereabouts is too sketchy to
form the basis of a reasonable or well-founded
belief that she was already dead. When he arrived
in San Jose, Antique after learning of Janet
Monica's departure, instead of seeking the help of
local authorities or of the British Embassy, he
secured another seaman's contract and went to
London, a vast city of many millions of
inhabitants, to look for her there.”
20
21
IV. Dilemma 5: Last Will and Testament and Succesional Rights
b. Louie reminds Wendy that in all their years of friendship, she and
Manuel have gone to him for their legal problems but not once
did he charge them a fee. Due to the time involved in litigating
this case (as to not giving Cora the P500, 000), he accepts the
case but demands from Wendy payment of P150, 000, his
standard fee. Wendy refuses. Can Louis withdraw from the case?
I. Consider the following:
a. Code of Professional Responsibility,
Canons 22, 22.01, 20.04, 14.04
b. Santiago vs. Fojas, 248 SCRA 68
22
"It is axiomatic that no lawyer is
obliged to act either as adviser or advocate for
every person who may wish to become his
client. he has the right to decline employment,
subject, however, to Canon14 of the CPR.
Once he agrees to take up the cause of a
client, the lawyer owes fidelity to such cause
and must always be mindful of the trust and
confidence repose in him. he must serve his
client with competence and diligence, and
champion the latter's cause with whole-
hearted fidelity, care, and devotion...."
23
II. On the other hand, a contingent fee is defined in
the case of Taganas vs NLRC as “an agreement
laid down in an express contract between a lawyer
and a client in which the lawyer's professional fee,
usually a fixed percentage of what may be
recovered in the action is made to depend upon
the success of the litigation.” Thus, in contingent
fees, the lawyer gets paid the agreed amount if the
case is successful, otherwise, he does not get paid,
or gets paid a lower agreed amount. This does
not mean though that the lawyer necessarily pays
the costs and fees of the suit. The clients may still
be paying for the costs of the suit, but the lawyer
gets paid his agreed fee if they win.
24
c) the nature and importance of the
litigation;
d) the amount of money or the value of
the property affected by the controversy;
e) the novelty and difficulty of questions
involved;
f) the responsibility imposed on counsel;
g) the skill and experience called for in the
performance of the service;
h) the professional character and social
standing of the lawyer;
i) the customary charges of the bar for
similar services;
j) the character of employment, whether
casual or for establishment client;
k) whether the fee is absolute or
contingent (it being the rule that an
attorney may properly charge a higher fee
when it is contingent than when it is
absolute); and
l) the results secured.”
f. Presume that Louis does not take the case and Wendy seeks the
services of a media-savvy female lawyer, Atty. Evie Escaler. She
believes that there is little chance that the case will prosper
considering that Wendy wanted the bequest to Cora to be
voided on moral grounds but did not want any proof to be
presented that could identify Cora as Ben’s biological mother.
Nevertheless, she keeps these thoughts to herself and accepts the
case considering that it presented a real challenge and was a good
25
test case in addition to having the makings of a high profile case
of “show-biz” proportions. Discuss the legal and moral issues
involved.
I. Consider the following:
i. Code of Professional Responsibility,
Canons 15, 15.05, 15.07, 17
APPENDIX “A”
ST. LUKE’S MEDICAL CENTER
279 E. Rodriguez Sr. Blvd., Quezon City, Philippines
1102
(632) 7230301 / 7230101 / 7230199
info@stluke.com.ph
MEDICAL CERTIFICATE
SYMPTOMS:
• Difficulty of breathing
• Pounding of heart
• Easily tired without doing anything
PHYSICAL EXAMINATION:
• Intrauterine pregnancy 9 4/7 weeks age of gestation by last
menstrual period,
o 10 3/7 by first ultrasound
o currently not in labor G1P0
• BP 130/90
• cardiac rate 110 ( normal 60-100)
• respiratory rate 30 (normal 16-20)
26
• head & neck:
o (+) neck vein engorgement,
o jugular venous pressure 10 cm H20
• chest & lungs:
o crackles all lung fields
o enlargement of the left atrium
o (+) grade 3/6 murmur of the heart, best heard at the left
5th intercostal space, parasternal border and at the apex,
with radiation to anterior axillary line, systolic.
• extremities: edema, grade 3, pitting
MEDICAL HISTORY:
• rheumatic fever at age 15, poor follow up.
• paroxysmal nocturnal dyspnea (difficulty of breathing before
going to sleep)
• easy fatigability, relieved by 3-4 pillows
• bipedal edema (swelling of feet)
FINAL DIAGNOSIS:
Mitral Valve Stenotic: Congestive Heart Failure functional class
III, secondary to Acquired valvular heart disease, secondary to
Rheumatic Heart Disease.
(signed)
DR. BETTINA COLORO, MD.
Attending Physician
License Number: 0987-35593
27
APPENDIX “B”
CONTRACT
and
III. That by the third week of every month said amount shall
be deposited to Donee’s account at Equitable PCI Bank, Candoni Branch
with Savings Account Number 266-192837, without necessity of further
demand;
28
V. That the child’s support shall be for the amount of
P15,000 (Fifteen thousand pesos) per month subject to modification,
considering the needs of the child and the financial capacity of Donor.
VII. That in exchange for the preceding, Donee shall drop any
case and desist from filing any and all future claims against Donor.
_____(signed)__________ _______(signed)___________
______(signed)__________ _______(signed)___________
JOINT ACKNOWLEDGMENT
29
Manuel V. Soriano, with CTC No. 234975 issued at Quezon City on
February 3, 1996;
This Contract consists of two pages, including the page on which this
acknowledgment is written, and has been signed on the left margin of
each and every page thereof by the testator and his witnesses, and sealed
with my notarial seal.
(signed)
ATTY. RICARDO Q. ROMANO
Notary Public
My commission expires December 30, 1996
30
APPENDIX “C”
Municipal Form No. 102 (Revised December 1, 1958) TO BE ACCOMPLISHED IN DUPLICATE
REPUBLIC OF THE PHILIPPINES
CERTIFICATE OF LIVE BIRTH
(FILL OUT COMPLETELY, ACCURATELY, LEGIBLY IN INK OR TYPEWRITER)
-------------------------
Register Number:
Province: ____National Capital Region________________ (a) Civil Registrar-General No. ______________________
City or Municipality: ____Makati City____________________________ (b) Local Civil Registrar No. ________________________
1. Place of Birth 2. Usual Residence of Mother (where does mother live?)
a. Province National Capital Region a. Province National Capital Region
b. City or Municipality b. City or Municipality
Makati City Quezon City
c. Name of Hospital or Institution (If not in hospital, give street address) c. Number and Street
St. Luke’s Medical Center #14 Maginhawa Street, Teachers Village, Diliman
d. Is place of Birth inside City Limits? d. Is residence inside city limits? e. Is residence on a farm?
12. Maiden Name First Middle Last Religion 13. Nationality 13a. Race
Wendy Chua Gomez Roman Catholic Filipino
14. Age (at time of this birth) 15. Birthplace 16. Previous deliveries to mother (do not include this birth)
31 Quezon City 0
17a. Informant’s Signature: a. How many children are b. How many other children c. How many fetal deaths
b. Name in Print: now living? were born alive but are now (fetuses born dead any time
c. Address 0 dead? after conception)?
0 0
18. Mother’s Mailing Address: (number, street, city, or municipality, province)
#14 Maginhawa Street, Teachers Village, Diliman, Quezon City
19. ATTENDANT AT BIRTH
I hereby certify that I attended the birth of this child who was born alive at _2:20 o’clock _p_m. on the d. Date signed by Attendant at Birth:
date above indicated. ___________________________
a. Signature: e. Title of Attendant at Birth
b. Name in Print: O M. D. O Midwife
c. Address: O Nurse O Others (specify)
20. Received in the Office of the Local Civil Registrar by 21a. Given name added from supplemental report:
a. Signature:
b. Name in Print:
c. Title or Position b. Date when given name was supplied:
d. Date:
22a. Length of Pregnancy 22b. Weight at Birth 23. Legitimate
_______36____ Complete weeks ____7__Lbs. ___2______Oz. YES O NO O
24. Date and Place of Marriage of Parents (for legitimate birth) 25. This Certificate is prepared by:
__May 2, 1992_____________ Signature:
Month Day Year Name in Print:
Title or Position:
City or Municipality __Quezon City__ Province _National Capital Region Date:
31
APPENDIX “D”
Dear Louis,
As you know, Wendy and I plan to take in as ours the baby that Cora is
carrying. I know you question why we plan to do it this way. But I
actually have a deeper reason for it, one that Wendy does not know.
Cora’s baby is mine. I made a mistake, and I don’t want Wendy to know
about it. At the same time, I want that baby to grow up with me, because
after all, I’m the father. The only way this can happen is if we simulate
the birth of the baby. Otherwise, the social worker handling the
adoption case will be asking too many intrusive questions, and Wendy
might find out I’m the father.
I don’t know where to start. I need your support and advice on this
Louis, as my friend.
I trust that you will keep this between the two of us.
Yours truly,
Manuel
__________________________________________________
Do You Yahoo!?
Tired of spam? Yahoo! Mail has the best spam protection around
http://mail.yahoo.com
32
APPENDIX “E”
Hong Kong Office and HSBC Premier Centre and Financial Management Centre
1 Queen’s Road Central, Central District, Hong Kong Island
Tel: [852] 2748 3322 Fax: [852] 2899 8810
February 9, 2003
I often see Mr. Soriano here at the Hong Kong Office, and I assume that
you planned to extend your investments to Hong Kong. I would like to
offer the services of HSBC to you. I have some very good proposals that
may interest you. Attached are some brochures and investment plans.
Should you have any inquiries, you may contact me through the numbers
at the letterhead.
Sincerely,
(signed)
Mr. ANTON K. ONG
Senior Manager for Investments
33
APPENDIX “F”
MEMORANDUM
Please be informed that that following people are the authorized agents
of our distributors in Asia beginning year 2003:
Bangkok, Thailand Ms. Yanisa Chanakarn
Beijing, China Ms. Chen Shui Ben
Chinese Taipei Mr. Francis Chang
Hong Kong, China Mr. Manuel B.Soriano
Jakarta, Indonesia Mr. Guntur Setiawan
Kuala Lumpur, Malaysia Ms. Christine Yeoh
Seoul, South Korea Mr. Peter Jung Soon
Singapore Mr. Michael Huang
Tokyo, Japan Mr. Takashi Imegu
Please be reminded to transact our business only with the authorized
agents of our distributors, as furnished herein.
Thank you.
Noted:
(signed)
JULIANA C. RAMOS
Human Resource Director
34
APPENDIX “G”
Dear Wendy,
It’s been a long time my dear friend. The last time we talked was just
before my family and I left for Malaysia. That was three years ago! I
hope you are doing well, and that baby Ben is in good health. My kids
are doing well too. I must admit, rearing children is not an easy task.
I don’t know how else I’m supposed to tell you this. The reason why I
wrote is because I saw Manuel in Hong Kong when our family went on a
vacation to Disneyland a couple of weeks ago. He had with him a one
year old toddler. At first I thought I was hallucinating, but it was really
him! I walked over to make sure, and sure enough, he recognized me.
He said he’s been in Hong Kong all these years. An old lady took him in
when he survived the crash, and now he’s married to the old lady’s
daughter. He says he can’t go back to the Philippines anymore, because
he can’t leave his new family behind. It came as a bit of a shock, and
before I knew it, he was saying goodbye. He said his wife was waiting for
him.
I just thought you deserve to know this.
You and Ben should come visit us here in Malaysia when you get the
chance. It would be nice to see my inaanak again.
Love,
Cristina
__________________________________________________
Do You Yahoo!?
Tired of spam? Yahoo! Mail has the best spam protection around
http://mail.yahoo.com
35
APPENDIX “H”
1
LAST WILL AND TESTAMENT
of
MANUEL V. SORIANO
II. I give P500, 000 to Cora Z. David, for the happiness and
help that she brought to me and my wife.
36
V. I hereby direct that the executor named herein or his
lawful substitute should serve without bond;
VI. I hereby revoke any and all my other wills, codicils, or
testamentary dispositions heretofore executed, signed, or
published, or alleged to have been executed, signed or
published, by me.
(signed)
MANUEL V. SORIANO
ATTESTATION CLAUSE
37
JOINT ACKNOWLEDGMENT
All known to me to be the same persons who signed the foregoing Will,
the first as testator and the last three as instrumental witnesses, and they
respectively acknowledged to me that they signed the same as their own
free act and deed.
(signed)
ALESANDRO Y. ROMA
38
Notary Public
My commission expires April17, 2002
39
APPENDIX “I”
References:
Constitution
Code of Professional Responsibility
Canon 1, 2, 6, 14 – 21
Rules of Court
Rule 130, 138
Revised Penal Code
Art . 208-209, Art. .256-259, Art 11, Art .347-348,
Art. 350-352
Family Code
Art. 41-43, Art.176, Art. 194- 208, Art 213-216
RA 8552 (Domestic Adoption Law)
Civil Code
Provisions on Wills and Succession
Art. 41-42
40
a. Should Atty. Paz have prepared the contract between
Cora and Manuel?
Cases:
1) Hilado v.David, 84 Phil 569
2) Junio v. Grupo,, Administrative Case No 5020 (Dec
18,2001)
41
legal problems but not once did he charge them a fee. Due
to the time involved in litigating this case, he accepts the case
but only if Wendy will pay him P150,000, which he claims is
his standard fee. Wendy refuses. Can Louis withdraw from
the case?
42
B
TABLE OF CONTENTS
Page
Suggested Readings………………………………………… 14
V. COURT-ANNEXED MEDIATION
Study Guide ……………………………………………….. 22
Suggested Readings ………………………………………. 22
1
VI. ETHICAL PROBLEMS IN MEDIATION
Study Guide ………………………………………….…… 24
Hypothetical Role Play: “The Father In Law” ……….. 25
Suggested Readings ……………………………………… 30
2
HOW TO USE THIS MANUAL
3
mediation he is relegated from front and center stage to the background,
may also have an interest in the publicity that accompanies a sensational
case, or even an interest to practice his trial skills, against his client’s
interest in settlement. When the lawyer finally agrees to go to the
mediation table, they will have to grapple with the meaning of
“advocacy” in the context of mediation: Does passionate advocacy mean
continuing with the adversarial attitude, or does it mean shifting to a
cooperative mode to achieve effective settlement?
4
I. INTRODUCTIONS: ADR - WHAT DOES IT MEAN?
Study Guide
Assume that you have been engaged to handle a big estate case by
a wealthy client. Under your contract, you are to receive a down payment
of P 25,000 acceptance fee, and a per appearance fee of P 5,000, aside
from transportation and representation expenses. You figure that, since
this is a big estate proceeding, it will drag on for about five years, and that
you would have an assured retainer every month since a case is
calendared at least every month. Further, your client has also intimated
that he would like you to be appointed administrator of the estate if you
win the case.
The complaint is filed, and the case is set for pre-trial. As the case
is called for pre-trial, the judge orders the parties to go to the Philippine
Mediation Center for mediation. In the mediation proceedings, the
mediator has proposed a compromise which will satisfy the wishes of
your client.
5
Role Play: Chekhov, The Proposal (On the Nature of Conflict)
6
entertained a profound respect for your father and your late mother. The
family of the Lomovs and the family of the Choobukovs have always
been on the friendliest and, one might almost say, on intimate terms.
Besides, as you are aware, my land is in close proximity to yours. Perhaps
you will recollect that my Volovyi meadows lie alongside your birch
wood.
NATALYIA: Excuse me, but I must interrupt you there. You say ‘my’
Volovyi meadows…But are they really yours?
LOMOV: Yes, mine
NATALYIA: Well, what next! The Volovyi meadows are ours, not
yours!
LOMOV: No, they’re mine, dear Natalyia Stepanovna.
NATALYIA: That’s news to me. How do they come to be yours?
LOMOV: What do you mean, how? I’m speaking of the Volovyi
meadows that lie like a wedge between your birch wood and the Burnt
Swamp.
NATALYIA: But yes, of course They’re ours.
LOMOV: No, you’re mistaken, my dear Natalyia Stepanovna, they
are mine.
NATALYIA: Do come to your senses, Ivan Vassilievich! How long
have they been yours?
LOMOV: What do you mean by ‘how long’? As long as I can remember
– they’ve always been ours.
NATALYIA: Well, there you must excuse me for disagreeing.
LOMOV: You can see it in the documents, my dear Natalyia Stepanovna.
It’s true that the Volovyi meadows were a matter of dispute at one time,
but now everyone knows that they’re mine. There’s really no need to
argue about it. If I may explain - my aunt’s grandmother handed over
those meadows to your great grandfather’s peasants for their use, rent
free, for an indefinite period, in return for their firing her bricks. Your
7
great grandfather’s peasants used the meadows rent free for forty years or
so and got accustomed to looking upon them as their own... and then
when the settlement was made after the emancipation...
NATALYIA: But it wasn’t at all as you say! Both my grandfather and
my great grandfather considered that their land reached to the Burnt
Swamp - so the Volovyi meadows must have been ours. So why argue
about it? I can’t understand you. It’s really rather annoying!
LOMOV: I’ll show you the documents, Natalyia Stepanovna!
NATALYIA: No, you must be just joking, or trying to tease me.... What
a surprise indeed! We’ve owned the land for something like three
hundred years, and now suddenly someone declares that the land isn’t
ours! Forgive me, Ivan Vassiliovich, but I just can’t believe my own
ears.... I set no value on those meadows. They’re not more than fifteen
acres, and they’re only worth about three hundred roubles, but it’s the
injustice of it that disgusts me! You can say what you like, but I can’t
tolerate injustice.
LOMOV: Do hear me out, I implore you! Your father’s
grandfather’s peasants, as I’ve already had the honour of telling you, fired
bricks for my aunt’s grandmother. My aunt’s grandmother, wishing to do
something for them...
NATALYIA: Grandfather, grandmother, aunt... I don’t understand
anything about it! The meadows are ours, that’s all!
LOMOV: They’re mine!
NATALYIA: They’re ours! You can go on trying to prove it for two
days, you can put on fifteen dress suits if you like, but they’re still ours,
ours, ours! ... I don't want what’s yours, but I have no desire to lose
what’s mine…. You can please yourself!
LOMOV: I don’t want the meadows, Natalyia Stepanovna, but it’s a
matter of principle. If you wish, I’ll give them to you as a present.
8
NATALYIA: But I’m the one who could make a present of them to
you – because they’re mine I ... All this is very strange, Ivan Vassilievich,
to say the least of it! Till now we’ve always regarded you as a good
neighbour, a friend of ours. Last year we lent you our threshing machine,
and because of that we had to finish threshing our own corn in
November. And now you’re treating us as if we were gypsies! You’re
making me a present of my own land! Forgive me, but this isn’t
neighbourly conduct! To my mind it’s almost impertinent, if you want to
know…
LOMOV: You mean to say then that I’m a usurper? I've never
stolen other people’s land, Madam, and I won’t allow anyone to accuse
me of it [Goes rapidly to the decanter and drinks water.) The Volovyi meadows
are mine!
NATALYIA: That’s not true, they’re ours!
LOMOV: They’re mine!
NATALYIA: It isn’t true! I’ll prove it to you! I’ll send my men to mow
those meadows today.
LOMOV: What's that?
NATALYIA: My men will be working there today!
LOMOV: I’ll kick them out!
NATALYIA: You daren’t do that!
LOMOV: [clutches at his heart] The Volovyi meadows are mine! Don't
you understand that? Mine!
NATALYIA: Don’t shout, please! You can shout and choke with rage
when you’re at home, but please don’t overstep the mark here!
LOMOV: If it weren’t for these dreadful agonizing palpitations,
Madam - if it weren’t for the throbbing in my temples, I should speak to
you very differently! [Shouts] The Volovyi meadows are mine!
NATALYIA: Ours!
LOMOV: Mine!
9
NATALYIA: Ours!
LOMOV: Mine!
[Enter CHOOBUKOV]
CHOOBUKOV: What’s all this? What are you shouting about?
NATALYIA: Papa, please explain to this gentleman: to whom
do the Volovyi meadows belong - to him or to us?
CHOOBUKOV: [to LOMOV] The meadows are ours, dear chap.
LOMOV: But forgive me, Stepan Stepanych, how do they come to
be yours? At least you might be reasonable! My aunt’s grandmother gave
over the meadows to your grandfather’s peasants for temporary use
without payment. The peasants had the use of the land for forty years
and got accustomed to regarding it as their own. But when the settlement
was made...
CHOOBUKOV: Pardon me, my dear friend…You forget that it
was just because there was a dispute and so on about these meadows that
the peasants didn’t pay rent to your grandmother, and all the rest of
it…And now every dog knows that they’re ours - yes, really! You can’t
have seen the plans!
LOMOV: But I’ll prove to you that they’re mine!
CHOOBUKOV: You won’t prove it, my dear man.
LOMOV: Yes, I will!
CHOOBUKOV: But why shout, my dear boy? You won’t prove
anything by shouting! I don’t want what is yours, but I’ve no intention of
letting go of what’s mine. Why should I! If it comes to that, my dear
friend - if you’re thinking of starting a dispute about the meadows and all
the rest of it, I’d sooner make a present of them to the peasants than to
you. So that’s that!
LOMOV: I don't understand this. What right have you to give away
someone else’s property?
10
CHOOBUKOV: Permit me to decide whether I have the right or
not! And really, young man, I’m not used to being spoken to in that tone,
and so forth…I’m twice your age, young man, and I beg you to speak to
me without getting excited, and all that…
LOMOV: No, you’re simply taking me for a fool and laughing at
me! You call my land yours, and then you expect me to say cool and talk
to you in the ordinary way. Good neighbors don’t behave in this way,
Stepan Stepanych. You’re not a neighbor, you’re a usurper.
CHOOBUKOV: What’s that? What did you say?
NATALYIA: Papa, send the men to mow the meadows at once!
CHOOBUKOV: [to LOMOV] What was it you said, sir?
NATALYIA: The Volovyi meadows are ours, and I won’t give them
up! I won’t, I won’t!
LOMOV: We shall see about that! I’ll prove to you in court that
they’re mine.
CHOOBUKOV: In court? You take it to court, sir, and all the rest
of it! You do it! I know you – you’ve really just been waiting for a chance
to go to law, and all that. It comes natural to you - this petty niggling.
Your family always had a weakness for litigation. All of them!
LOMOV: Please don’t insult my family! The Lomovs have all been
honest men, and not one of them has ever been on trial for embezzling
money like your uncle!
CHOOBUKOV: Every member of the Lomov family has been
mad!
NATALYIA: Every one of them - every one!
CHOOBUKOV: Your grandfather was a dipsomaniac and your youngest
aunt, Nastasyia Milvailovna - yes, it’s a fact - ran away with an architect,
and all the rest of it...
11
LOMOV: And your mother was deformed. [Clutches at his heart]. This
shooting pain in my side!... The blood is gone to my head… Holy
Fathers! Water!
CHOOBUKOV: Your father was a gambler and a glutton!
NATALYIA: Your aunt was a scandal-monger - and a rare one at that!
LOMOV: My left leg’s paralyzed... And you’re an intriguer. ...Oh,
my heart!... And it’s an open secret that before the elections you....There
are flashes in front of my eyes... Where’s my hat?..
NATALYIA: It’s mean! It’s dishonest! It’s perfectly vile!
CHOOBUKOV: And you’re just a malicious, double-faced, mean
fellow! Yes, you are!
LOMOV: Here it is, my hat. ...My heart. ... Which way do I go?
Where’s the door? Oh! I believe I’m dying…I’ve lost the use of my leg
[Walks to the door].
CHOOBUKOV: [calling after him] I forbid you to set foot in my
house again!
NATALYIA: Take it to court! We shall see!
[LOMOV goes out staggering]
CHOOBUKOV: The devil take him! [Walks about in agitation.]
NATALYIA: Have you ever seen such a cad? Trust good neighbors
after that!
CHOOBUKOV: The ridiculous scarecrow! The scoundrel!
NATALYIA: The monster! Grabs other people’s land, then dares to
abuse them into the bargain!
CHOOBUKOV: And this ridiculous freak, this eyesore - yes, he has
the impertinence to come and make a proposal and all the rest of it!
Would you believe it? A proposal!
NATALYIA: What proposal?
COOBUKOV: Yes, just fancy! He came to propose to you.
12
NATALYIA: : To propose? To me? But why didn’t you tell me
that before?
CHOOBUKOV: That’s why he got himself up in his tail-coat. The
sausage! The shrimp!
NATALYIA: To me? A proposal? Oh! [Drops into a chair and moans.]
Bring him back! Bring him back! Oh, bring him back!
CHOOBUKOV: Bring whom back?
NATALYIA: Be quick, be quick! I feel faint! Bring him back! [Shrieks
hysterically.]
CHOOBUKOV: What is it? What do you want? [Clutches at his head.]
What misery! I’ll shoot myself! I’ll hang myself! They’ve worn me out!
NATALYIA: I’m dying. Bring him back!
CHOOBUKOV: Phew! Directly. Don’t howl. [Runs out]
NATALYIA: [alone, moans] What have we done! Bring him back! Bring
him back!
13
Suggested Readings
14
II. PARADIGM SHIFT FOR THE LAWYER
Study Guide
You are a veteran labor lawyer as well as a labor leader of a big national
labor federation. One day a multinational company approaches you and
tells you that you have been chosen to act as a private impartial mediator
in a sensational labor dispute between the company and another
federation, which happens to be a rival of your own union.
Suggested Readings
15
III. THE ROLE OF A LAWYER IN NEGOTIATIONS
Study Guide
Suggested Readings
Study Guide
16
You are a negotiator for your client, a plaintiff in a bodily injury civil case
arising from a bad accident where your client’s head was fractured. Your
client suffered damages amounting to P 1,000,000. You are meeting with
your counterpart negotiator and he has asked you to lay your cards on
the table, and to give him your bottom line negotiating figure. You know
very well that whatever amount you tell him will not be readily accepted
and that your counterpart will probably try to cut it, possibly into half.
Will you tell him the correct amount of damages, or will you inflate it to
make allowance for a compromise?
Lisa De Jesus has worked for the Hart & Andersen call center for the
past year. She works from 10 AM to 7PM everyday except Saturday,
handling inquiries from Hart & Andersen clients in the United Kingdom
and Australia. Lisa is young, and quite pretty. In fact, in her province, she
is something of a local celebrity: she is a product endorser for her town’s
signature culinary delicacy.
17
Simon Castro is the CEO for Hart & Andersen in the Philippines. One
morning, after returning from a business trip to Melbourne, Simon
receives a letter addressed to him from Lisa, saying she had contacted her
lawyers and was contemplating the filing of charges against him for
sexual harassment.
You have just passed the bar, and given your mediocre performance in
law school, was fortunate to have as your godfather a senior partner of a
top Makati law firm.
In her initial conversation with you, Lisa tells you of several separate
incidents on which she is basing her charge. The incidents consisted
mainly of one-on-one encounters with Castro where he placed his hands
on her back or her shoulders and uttered statements in a tone that
suggested sexual overtures (in Lisa’s words, “tsansing”).
Lisa is asking for nothing less than Php 150,000 by way of settlement,
and she is adamant about remaining with Hart & Andersen. She has no
qualms about going to court as she confides that all of your services are
being “covered”. She is nevertheless interested in exploring an out-of-
court settlement, as she believes this will enable her to quickly get the
money she feels is due her.
18
Upon consulting with your godfather about the case, he tells you that a
senior partner of the law firm had promised, in return for Lisa’s services
as an escort, to help Lisa in her undertaking. Afraid that this might be
revealed should the case go to court, the senior partner is willing to give
you the Php 150,000 that Lisa is requesting, or the balance from what
Castro is willing to pay. However, should he be required to pay, then the
settlement terms with Castro must include a stipulation that Lisa is to
return home. He makes it clear that he does not want to spend more on
Lisa than is necessary to “keep things quiet”.
Lisa is unaware of this exchange. She knows that the senior partner is
already helping her by allowing her to be represented by his firm. The
senior partner does not want Lisa to know that he is doing anything
more.
Simon does not want this case to go to court, as the consequences on his
career would be devastating. He confides to you that though there were
19
instances where he did touch De Jesus and joke with her, he claims that
he did so only because he thought that De Jesus was comfortable with it.
He says that at no time did De Jesus show any signs of being offended by
his conduct.
He does however admit that he finds her pretty, and has more than once
contemplated on asking her out. He tells you that it is not impossible that
these thoughts may have found their way into his actions.
In light of all this, Simon is willing to settle for no more than Php
200,000 but Lisa must tender her resignation and agree to bring no
subsequent civil, criminal, or administrative action against him in
connection with any cause arising from this settlement, including her
termination.
Later, you go to the gym, an exclusive one in the Makati area frequented
by hotshot lawyers like yourself. While in the locker room, you happen to
overhear a conversation between two young lawyers of a woman who
provided the senior partner of a law firm with escort services, and who is
now asking one of the newer lawyers of that firm to represent her in a
case she is planning to file for sexual harassment against her boss. All the
details seem to mirror the ones in Simon’s case, although no names are
mentioned.
Suggested Readings
20
21
V. COURT-ANNEXED MEDIATION
Study Guide
You are the judge in a civil case for legal separation, with plea for support
pendente lite. At the pre-trial, you are enjoined under rules prescribed by
the Court Administrator, to try your best to reconcile or at least to find a
compromise between the parties. You do that, inquiring into the family
life of the parties, examining the source of their disagreement, and
probing into their hidden fears and interests. From your inquiry, you get
to know that it is probably the husband who is at fault, and that the wife
needs immediate support, otherwise she and her four children will starve.
Despite your best efforts, your attempts to settle fail, and the case goes to
trial.
Will you go on and try the case yourself, or will you inhibit yourself and
pass on the case to another judge?
Suggested Readings
1. Regulatory Framework
22
- Standard and Procedure for Accreditation Mediators
for Court-Referred/Mediation Cases
23
VI. ETHICAL PROBLEMS IN MEDIATION
Study Guide
24
of power between the wealthy and articulate husband and the destitute
and inarticulate wife. The proceedings have become an opportunity for
the husband to browbeat the wife and put her under intense
psychological pressure. The wife cannot even afford to hire the services
of counsel. As assisting counsel for the husband, what will you do, if you
do anything at all? Why?
Harry and Kathleen were engaged. Harry is the guitarist in a rock band
that plays on weekends in bars around the city, while Kathleen is the
beautiful daughter of a rich plastic surgeon whose clients include society’s
bigwigs, actors, and wives of politicians. In fact, he has several billboards
along major thoroughfares, a tv commercial, and a segment on a weekly
talkshow.
In preparation for their wedding, Harry, who is a bit overweight and has
a tendency to sweat a lot, has decided to undergo surgery in the hands of
Kathleen’s father. However, something goes horribly wrong during the
liposuction procedure. Harry spends four months in the care of a team of
specialists in one of the best hospitals in the country. Although he
survives, he is left scarred in areas around his waist, and has been told
that he has lost all reproductive abilities.
Given the high profiles of Kathleen and her father, and the nature of
Harry’s injuries, the parties have acquiesced to mediation as their
preferred form of dispute resolution. They have further agreed that
because of the intense emotions involved, it would be best to allow their
25
respective counsels to represent them in the mediation, rather than risk a
volatile confrontation.
26
treated Harry had overlooked a crucial indicator that the doctor warned
might become the basis for an unduly favorable prognosis.
You have just returned from three months of secret negotiations with the
leaders of a covert international group whose extremist views against
capitalism are basis for their highly sophisticated commercial sabotage of
key North American financial institutions. Your part in the process, as a
representative of the United Nations, is confidential: no one must know
that the UN is even aware of the group’s existence.
27
Which is why, to throw off suspicion, you have been asked to spend a
few weeks in your home country before returning to Geneva.
You haven’t become a top international diplomat for nothing: your sense
of professionalism, integrity, and fairness have been important factors in
your success. You do not intend to treat this case any differently, even in
spite of the long friendship you share with Harry’s family. In fact,
because of this relationship, which you are well aware will spawn
suspicion in counsel for Kahtleen’s father, you are going to exert extra
effort simply to ensure that the process will be as just as possible, and
that your conduct will be neutral and above reproach.
According to a report from the doctor who attended to Harry during his
recovery, there is a 60% chance that Harry will recover normal
reproductive functions within the next three years, but there is an 80%
chance that, because of the damage to certain areas, dexterity in his limbs
-- including the fingers -- will decrease significantly in the same period.
The doctor however added that there is a 35% chance that with proper
physical therapy, the risk of loss of dexterity could be reduced by as
much as 50%.
28
Harry is still very much in love with Kathleen, despite what has
happened, and wants a settlement with Kathleen’s father that won't
endanger Harry’s chances of marrying. This is precisely why, although he
does not have very much money, he does not want to go through a
protracted legal process and is willing to give up all claims to the medical
expenses incurred if Kathleen’s father will agree to pay for the physical
therapy needed to keep the dexterity loss to a minimum.
The hospital bills show that Harry’s medical expenses totalled more than
Php 1.3 million. A conservative estimate for the physical therapy is Php
850,000.
You are confident -- after hearing Harry’s explanation that Atty. Mariano
was a regular guest of his family’s for Sunday lunches and out-of-town
trips while Atty. Mariano was still in law school-- the mediation will yield
favorable results.
Suggested Readings
29
VII. CASE STUDY IN MEDIATION
30
C
TABLE OF CONTENTS
Page
Preface
1
Part II – Within the Legal Framework ………………………….. 21
Notarial Practice ……………………………………….. 22
Suggested exercise ………………………………. 25
Suggested reading …………………………….…. 25
Paper Minutes ………………………………………… 26
Suggested exercise ………………………………. 30
Suggested reading ……………………………….. 30
Rules Penal in Character ……………………………….. 31
Suggested exercise ………………………………. 33
Suggested reading ……………………………….. 33
Opinion Committee …………………………………….. 33
Suggested exercise …………………………………. 34
Suggested reading ………………………………….. 34
Code of Corporate Governance ………………………… 34
Suggested exercise ………………………………… 35
Suggested reading ………………………………. 35
Zealous Legal Representation …………………………… 35
Suggested exercise ………………………………… 36
Suggested reading …………………………………. 36
Appendix A – Form of Retainer Agreement …………………….. 37
Appendix B – Form of Paper Minutes …………………………… 43
Appendix C – Form of Secretary’s Certificate …………………… 44
(Re Board Action Recorded in Paper Minutes)
2
HOW TO USE THIS MANUAL
This manual is divided into two parts. Part I begins with a brief
discussion of the ethical infrastructure that can be established within a
law firm to address conflicts of interest, in line with Canon 15 of the
Code of Professional Responsibility. The discussion shifts to “conflict
avoidance/ resolution” measures in a retainer agreement and outside of
it, before turning to certain built-in statutory or regulatory mechanism for
resolving conflicts of interest.
3
of the ethical infrastructure of a law firm). Finally, Part II deals with the
Code of Corporate Governance or Manual on Corporate Governance (as
a set of rules of conduct to be observed by directors and certain
corporate officers who may well be lawyers), before turning to the ethical
demand on lawyers to keep abreast of legal and related developments
consistent with the zeal required by Canon 19 of the Code of
Professional Responsibility.
4
It goes without saying that a good companion to this manual
(apart from the suggested readings) is an authoritative textbook on legal
ethics, which provides commentaries on the Code of Professional
Responsibility.
5
PART I
6
the issuer in a public offering of securities, when it already agreed to act
as counsel to the underwriters of the issue. As will be shown shortly,
however, it is possible for that law firm to act as common or transaction
counsel to all parties to the transaction with their consent.
7
15 of the Code of Professional Responsibility (particularly Rule 15.01
thereof).
8
our accepting an engagement from you in regard to a specific matter
to be adverse to its general interests, and thus object to our
performing work for you in that regard. In situations like this, we
would suggest that we address the feasibility of engagement on a case-
by-case basis.
9
Another conflict-avoidance clause in a retainer agreement is a
stipulation whereby the client grants its consent in advance to the law
firm’s acting for another client. The following paragraph in the sample
retainer agreement deals with the possibility of the law firm’s acting for
the Philippine government:
10
(a) Non-exclusivity: Chinese Wall
11
i. the flow of information between the different parts
of its organization which perform each function; and
See also Kesselhaut v. United States, 555 F. 2d 791 (1977), the landmark
ruling that validated the use of the Chinese Wall as a means of avoiding
conflict of interest in law practice.
A client may have retainer agreements with many law firms but
refers work to only some (but not all) of them. Since no work referrals
are actually given to the other law firms, one can deduce that the retainer
is a defensive posture on the part of the client, as it hopes that, by the
retainer, those other law firms will be conflicted in representing other
companies that may have interests adverse to the retainer client. The
issue that arises is whether a law firm under this situation could terminate
the “defensive” retainer and represent another client rather than the
12
erstwhile retainer client. For instance, the law firm may terminate a
defensive retainer of a borrowing client to represent the bank lending to
such client.
13
Built-in Statutory or Regulatory Conflict-Resolution Measures
14
Here we have a situation where the Corporation Code itself
supplements the Code of Professional Responsibility, as it prescribes a
solution to an ethical problem.
15
A securities lawyer, who is an “associated person of a broker or
dealer” (hence, a compliance officer), will simply be guided by the said
SRC Rule in respect of the proprietary trading activities of his or her
broker/dealer employer.
One should also note the following provisions of SRC Rule 30.2:
. . .
16
would be expected to affect the price of such securities and violate
Section 27 of the Code (insider trading prohibition);
17
Stockholdings exceeding twenty percent (20%) of the
outstanding capital stock shall be considered substantial for purposes
of interlocking directors.
18
Suggested reading: Legal commentaries on the pertinent
ethical provisions, including those quoted above.
19
PART II
20
Lawyers may be commissioned as notaries public and, in fact,
associates in a law firm are encouraged to apply for a notarial
commission. Accordingly, they should be familiar with the 2004 Rules
on Notarial Practice promulgated by the Supreme Court, particularly
Rule IV thereof, which contains certain ethical rules of conduct for
notaries. In particular, Sections 4, 5 and 6 of Rule IV provide:
(a) the notary knows or has good reason to believe that the
notarial act or transaction is unlawful or immoral;
21
Moreover, notaries public should be aware of the following
prohibitions and disqualifications under Sections 2 and 3 of Rule IV.
(2) public function areas in hotels and similar places for the
signing of instruments or documents requiring notarization;
(b) A person shall not perform a notarial act if the person involved
as signatory to the instrument or document -
22
In this connection, notaries public will be faced with situations
that do not exactly fit into the foregoing rules. Consider, for instance, a
notary public for Makati City, who resides in Quezon City. If someone,
say his parish priest in Quezon City, appears before him and execute an
affidavit in his presence in Quezon City, must he still require his parish
priest to go with him to his Makati office to notarize the affidavit? If he
notarizes the affidavit in Makati City in the absence of the parish priest, is
he in violation of Section 2(b)(1) of Rule IV? Consider further a case
where a Makati notary is asked by a client corporation to notarize the last
will and testament of its sick president in the latter’s residence in Forbes
Park, Makati City. If the notary holds office in Paseo de Roxas in Makati
City, will he be in violation of the notarial rules if he agrees to notarize
the last will and testament in Forbes Park, which is not in Paseo de
Roxas?
Suggested exercise: The students should be asked to group
themselves into two, one group taking an affirmative position in respect
of the questions raised above, while the other espousing the contrary
stance. In this exercise, the students should take into account Section 2
of Rule I of the 2004 Rules on Notarial Practice, which provides that:
“These Rules shall be applied and construed to advance the following
purposes: (a) to promote, serve, and protect public interest; (b) to
simplify, clarify, and modernize the rules governing notaries public; and
(c) to foster ethical conduct among notaries public.”
23
Paper Minutes
24
4. All the directors have express or implied
knowledge of the action in question and none of them makes prompt
objection thereto in writing.
The Supreme Court, in its decision (at 1002), took notice of the peculiar
nature of copra trading, the business of the corporation. Thus:
25
turnover. Copra contracts then had to be executed on
short notice – at times within twenty-four hours. To
be appreciated then is the difficulty of calling a
formal meeting of the board.
Be that as it may, there are at least four cases where the use of
paper minutes is probably improper and impermissible, namely:
26
(2) in electing officers -- since, in paragraph 1 of the Amended
Rules Requiring the Filing of Information Sheet by Domestic
Corporations, the Securities and Exchange Commission requires that the
minutes of the board meeting show “the names of the directors who
were present and have voted;”
27
Suggested exercise: The students should comment on the
foregoing solution to the ethical issue of non-holding of a board meeting
by the use of paper minutes.
28
to enable a guilty person to escape punishment through a technicality
but to provide a precise definition of forbidden acts.
29
Be that as it may, one cannot simply disregard the following
concluding remarks of Justice J.B.L. Reyes to the graduating class of the
College of Law of the University of the Philippines in 1972:
I shall conclude by pleading with the new graduates that they indelibly engrave
in their hearts a maxim we have inherited from the great lawyers of antiquity –
“Non omne quod licet honestum est.” Not everything that is permitted is
honorable. Do not equate law, which is but the tool, with justice, that is the ultimate
goal. Ever abide in the ways of honor and may the Almighty be with you.
Opinion Committee
30
recipients. Further, where the lawyer concerned is confronted with a
novel issue that may involve a departure from the existing legal stance of
the firm, he or she should refer the issue to the committee for guidance
and disposition. The objective here is to avoid, if not minimize, the
potential liability and embarrassment to the firm arising from incorrect,
inconsistent, or conflicting opinions.
31
the framework of governance of the corporation concerned, once
adopted by it.
32
by keeping abreast with legal and related developments consistent with
the zeal required by Canon 19 of the Code of Professional Responsibility.
33
APPENDIX A
January 1, 2006
Gentlemen:
Retainer Agreement
Further to our conversation with you, we are pleased to submit
our proposal for a retainer arrangement between Fair and Square
Philippines, Inc. (the “Company”)) and our law firm upon the following
terms:
34
(a) Verbal opinion and advice on general
matters of Philippine law affecting the Company and its
operations in the Philippines;
We normally send special billings for the matters and cases listed
above on the basis of our prevailing charges for our lawyers’ time,
depending on the level of seniority and experience of the lawyer
35
concerned. In these cases, we cannot usually determine in advance the
amount of work and time that will be required.
36
Our experience has been that sometimes, even in situations
where we ourselves are not conflicted, a valued client might regard our
accepting an engagement from you in regard to a specific matter to be
adverse to its general interests, and thus object to our performing work
for you in that regard. In situations like this, we would suggest that we
address the feasibility of engagement on a case-by-case basis.
37
7. Account Partner. The partner in charge of your account
is Raymond N.M. Morales. You should address all your communications
to him. However, if he is not available, you can contact the undersigned.
By:
Ralph Morseley
38
President
39
APPENDIX B
2. Action Taken
ATTEST:
__________________________ _________________________
Chairman of the Board Corporate Secretary
APPROVED:
__________________________ _________________________
Director Director
__________________________ _________________________
Director Director
APPENDIX C
40
SECRETARY’S CERTIFICATE
___________________________
Corporate Secretary
REPUBLIC OF THE PHILIPPINES )
CITY OF MANILA ) S.S.
41
SUBSCRIBED AND SWORN to before me this 10th day of
January, 2006, affiant exhibiting to me his Community Tax Certificate
No. 1236789, issued at Manila on January 6, 2006.
NOTARY PUBLIC
Appointment No. ______ until Dec. 31, 2006
Roll of Attorney No. ________
PTR No. _________; 01/06/2006; Manila
IBP No. __________; 01/06/2006; Manila Chapter
Address: ________________________________
42
D
TABLE OF CONTENTS
Page
Preface
Assignment I ………………………………………….……….… 5
Assignment II ………………………………………………….. 7
1
Assignment III ……………………………………………….…. 9
2
HOW TO USE THIS MANUAL
The facts of an actual case (the names of the parties have been
changed) are utilized to illustrate the ethical problems confronting
lawyers in an adversary system. A short description of the facts of the
case is attached as Appendix A.
This manual is divided into four parts, the first one of which is
the “Statement of Factual Situation”, and the other three are
denominated as “Assignments”. The “Statement of Factual Situation”
delineates the problem involved when a weak case is referred to a law
firm under an existing retainer relationship with a client and it also gives a
short summary of the factual and legal issues involved in the case.
3
Assignment I deals with the concerns and issues confronting law
firms in the acceptances of cases, especially those with existing retainer
agreements where clients pay monthly retainers for day-to-day counseling
and “availability”. It addresses the problem of a case filed against the
client which in the evaluation of the lawyers handling the case is
meritorious but which the law firm is constrained to accept because of its
retainer agreement with the client.
4
accept a case which on the basis of his honest evaluation has no chance
of winning and one that a client should amicably settle, a lawyer or a law
firm under a retainer agreement with a client is under a strong
compulsion to accept it. This is a situation peculiar in the Philippine
setting – i.e., a client paying an outside counsel a fixed monthly fee for
day-to-day counseling and in most cases for availability. Although the
standard retainer agreement (See Appendix “A”) usually contains a clause
that the lawyer or law firm reserves “the right to make our own
assessment of cases and/or matters referred to us for purposes of
determining the proper disposition of the referral”, the lawyer is usually
hard put to reject a case referral despite an unfavorable assessment of the
merits of the case.
The principal issue is whether the cause of the fire was the
spontaneous combustion of nitrocellulose which VTC claims was stored
in the premises of MGC at the time of the fire. MGC was then engaged
in the manufacture of leather dressings and leather varnishes which
require the use of nitrocellulose. MGC, however, denied the presence of
nitrocellulose at the time of the fire and contended that the cause was of
“undetermined origin”, probably due to an electrical short circuit.
5
ASSIGNMENT I
3. Reading Materials
6
a. Statutes – Article 2176, Civil Code of the Philippines
ASSIGNMENT II
7
reglementary period. If Mr. Santos admits that the cause of the fire was
the explosion of the drum containing nitrocellulose but settlement of the
case is out of the question, what should you do? If your law firm rejects
the case, your law firm stands to lose a montly retainer fee of P20,000
plus, of course, the additional billable hours to be generated from the
handling of the case.
If your law firm decides to accept the case, you need to prepare
the answer of MGC and file it within the reglementary period. How will
you draft the answer in light of what you know is the truth?
2. Think About How You Will Handle the Trial. - In
handling the trial, will you present witnesses whom you know will not be
telling the truth? And will you cross-examine the witnesses of VTC to
destroy their credibility despite your knowledge that they are telling the
truth?
3. Reading Materials
8
(3) Wise, Raymond L., Legal Ethics (1979
Supplement), pp. 326-353.
9
ASSIGNMENT III
10
b. Other Reading Materials
11
9. Curtis, Charles P. The Ethics of Advocacy, 4
Stan., L. Rev. 3. (1951)
6 February 2006
______________________
______________________
______________________
______________________
Attention: _______________
_______________
12
Gentlemen:
Services Covered by the Retainer Fee: The retainer fee will cover
the legal services required in the ordinary course of the Corporation’s
business, such as consultations, advice and preparation of simple contracts
and opinions, but shall not cover legal services (including the drafting
and/or review of contracts and/or the rendering of opinions) which will
require extensive studies or time involvement by our lawyers, or assistance
at negotiations with, or representation before, any governmental
instrumentality. In the event our periodic review of the engagement
1
The effectivity of this agreement shall be subject to our receipt of (a)
your written conformity to this retainer agreement, and (b) the initial
retainer fee within fifteen (10) days from date hereof. (You may
immediately fax to us an advance copy of the duly conformed to
retainer agreement and send the original thereof to us by courier.)
2
Subject to an additional amount corresponding to the applicable
VAT in accordance with Republic Act No. 9337 and its implementing
regulations.
13
indicates that the services rendered under this paragraph substantially
exceed the amount of retainer fees paid, we reserve the right to send you
additional retainer fee billing(s).
14
outside the Metro Manila area, and other special out-of-pocket expenses
you may authorize us to incur (which shall always be cleared with you in
advance), shall be for your account. In this connection, we would request
you to deposit with us the amount of =P__________ to cover such out-of-
pocket expenses. Our Accounting Department will regularly render a
report on these expenses and, if necessary, request a replenishment of the
deposit.
___________________________________
By:
C O N F O R M E:
15
____________________
By:
____________________
APPENDIX “B”
DESCRIPTION
16
On January 1, 2006, VTC filed a complaint for damages
against MGC with the Regional Trial Court of Quezon City
alleging that the fire was “caused by the fault or negligence of
defendant and/or its employees in not taking the necessary precautions
to avoid damage to others and in failing to comply with the
requirements of the authorities relative to the use and storage of highly
inflammable goods and materials like nitrocellulose which is needed in
the manufacture of its products.” The complaint seeks from MGC the
payment of compensatory damages in the amount of P25 million, with
legal interest from the filing of the complaint, plus exemplary
damages, counsel fees, expenses of litigation and the costs of suit.
17
practice of the firm, prepared an analysis of the facts and the law. The
team expressed serious doubts on the merits of the case, especially on
the issue of the presence of nitrocellulose in MGC’s premises and
whether it was the cause of the fire. It is MGC’s position that the
cause of the fire was of “undetermined origin” or “accidental in origin
of undetermined source”, probably due to an electrical short circuit.
The members of the legal team felt that the client’s prospective
witnesses were not fully disclosing the truth and that VTC’s complaint
is meritorious.
Assume that at the trial VTC will present the following two
principal witnesses:
18
(c) When his employment was terminated by MGC
sometime in June 2005, there were still two (2)
drums of unused nitrocellulose stored in the
premises of MGC.
19
When the team handling the case interviewed Mr. Oscar
Cervantes – who had resigned from MGC after the fire – he refused to
testify for MGC for the purpose of contradicting the story of Mr.
Reynaldo Reyes about the incident.
On the part of MGC, the team handling the case was asked to
present witnesses who would testify that the probable cause of the fire
was an electrical short circuit.
20
connected to an electrical wire becomes overloaded and
the motor is damaged, short circuit may occur inside the
motor causing the same to draw a larger amount of
electric current causing the electrical wires to carry
current beyond their rated capacity and the insulation
thereof will burn and this starts the fire.
APPENDIX “C”
21
COMPLAINT
22
equipment in use and other equipment belonging to plaintiff were
totally lost or destroyed.
23
Less: Salvage Value of Building 6,000.00
399,696.49
OTHERS:
PVC Materials & Products Stock P173,000.00
Cement Materials & Products Stock 313,000.00
Shop & IRS Matrials & Products Stock 130,000.00
Unused Office Supplies, Stamps &
Medical Supplies 15,032.06
631,032.06
Total Estimate Fire Loss
2,538,231.79
Deduct: Insurance Proceeds
395,632.29
Net : Fire Loss
2,142,599.50
vvvvvvvvvvvv
24
WHEREFORE, it is most respectfully prayed that judgment be
rendered ordering the defendant to pay the plaintiff the following
amounts:
Plaintiff also prays for such other reliefs just and equitable in
the premises.
25
E
TABLE OF CONTENTS
Page
Preface
How To Use This Materials ……….......................................... 1
Labor Lawyers’ Obligations as Contract Drafters ………………. 3
Non-Lawyers as Union Representatives and Voluntary
Arbitrators ………………………………………………….. 5
Labor Lawyers’ Obligations as Negotiators ………………………. 10
Labor Lawyers’ Duty to Encourage Fair Settlement …….……. 16
Labor Lawyers’ Duty to Preserve Privileged
Communication ………………………………………………… 21
Prohibitions Against Commission of Prohibited Activities ..... 22
Labor Lawyers’ Obligations to their Clients ……………………… 32
Suggested Ethical Scenarios ……………………………………… 34
Ethics Scenarios
Scenario 1 - Employment Dismissal ……………………………. 38
Scenario 2 - Union formation ………………………………….. 41
Scenario 3 - Collective Bargaining ………………………………..43
Scenario 4 - Concerted Union Activity ………………………… 46
Appendix A – Probationary Employment Agreement ……...... 48
Appendix B – Regular Employment Agreement ………………… 54
Appendix C – Project Employment Contract ……………………. 58
Appendix D – Independent Contractor Agreement …….......... 64
Appendix E – Deed of Release and Quitclaim ……………………. 73
Appendix F – Sample CBA Provisions ……………………………... 76
1
HOW TO USE THIS MANUAL
2
3
LABOR LAWYERS’ OBLIGATIONS AS CONTRACT
DRAFTERS
In this part of the course the students are required to draft basic
agreements in labor and employment relations. These agreements include
(i) Probationary Employment Agreement (ii) Regular Employment
Agreement and (iii) Project Employment Agreement.
4
for law and legal process 1 that they shall not engage in unlawful,
dishonest or deceitful conduct, 2 and that lawyers who accept the cause of
a person unable to pay his professional fees shall observe the same
standard of conduct governing this relations with paying clients. 3
1
Canon 1
2
Canon 2
3
Rule 14.04
4
Rule 19.01
5
themselves facing non-lawyers or laymen as voluntary arbitrators in labor
and employment disputes who are not subject to the ethics rules under
the Code. This is on account of Article 222 of the Labor Code, which
provides:
6
The problems that may arise from this situation is best-
exemplified by the Supreme Court decision in Trade Union Congress of the
Philippines and Allied Services World Federation of Trade Unions vs. Hon.
Bienvenido Laguesma and NAFLU. 5 In this case, the rank and file
employees of PDIC represented by TUPAS entered into a collective
bargaining agreement with said company. This CBA expired on April 30,
1991.
5
GR No. 102350, June 30, 1994
7
Said Code of Ethics was adopted and signed by four base
organizations, namely: Kilusang Mayo Uno (KMU), to which private
respondent NAFLU is affiliated; Federation of Free Workers (FFW);
Lakas ng Manggagawa Labor Center (LMLC); and Philippine World
Federation of Trade Unions (WFTU) Affiliates, which includes petitioner
TUPAS. 2 Petitioner urged the DOLE to "give its imprimatur and
uphold the binding effect of the Code among the LACC members."
8
verified; and (3) that the petition is supported by the written consent of
at least twenty-five (25%) per cent of all employees in the bargaining unit.
It is undisputed that all these requirements were met by private
respondent NAFLU in its petition before the DOLE Regional Office
No. 3, in San Fernando, Pampanga. Thus, Med-Arbiter Cortez, acting in
accordance with Article 256 of the Labor Code, as amended, had no
recourse but to automatically order the holding of a certification election
at PDIC. It bears stressing that no obstacle must be placed to the
holding of certification elections, for it is a statutory policy that should
not be circumvented.
9
agreement between or among the parties. Moreover, labor disputes
involve public interest, and hence any private agreement on their
settlement cannot prevail over what is provided for by our laws.”
10
Their petition is based primarily on Pampanga Sugar
Development Co., Inc. v. Court of Industrial Relations, where it was
held:
The Court had deliberated on the issues and the arguments of the
parties and finds that the petition must fail. The exception and not the
rule shall be applied in this case.
11
It is also noteworthy that the quitclaims were voluntarily and
knowingly made by both petitioners even if they may now deny this. In
the case of Veloso, the quitclaim he had signed carried the notation that
the sum stated therein had been paid to him in the presence of Atty.
Gaga Mauna, his counsel, and the document was attested by Atty.
Ferdinand Magabilin, Chief of the Industrial Relations Division of the
National Capitol Region of the DOLE. In the case of Liguaton, his
quitclaim was made with the assistance of his counsel, Atty. Leopoldo
Balguma, who also notarized it and later confirmed it with the filing of
the motion to dismiss Liguaton's complaint.
12
original award was exorbitant and they were apprehensive that it would
be adjusted and reduced. In any event, no deception has been established
on the part of the private respondent that would justify the annulment of
the petitioners' quitclaims.
Not all waivers and quitclaims are invalid as against public policy.
If the agreement was voluntarily entered into and represents a reasonable
settlement, it is binding on the parties and may not later be disowned
simply because of a change of mind. It is only where there is clear proof
that the waiver was wangled from an unsuspecting or gullible person, or
13
the terms of settlement are unconscionable on its face, that the law will
step in to annul the questionable transaction. But where it is shown that
the person making the waiver did so voluntarily, with full understanding
of what he was doing, and the consideration for the quitclaim is credible
and reasonable, the transaction must be recognized as a valid and binding
undertaking. As in this case.
14
LABOR LAWYERS’ DUTY TO ENCOURAGE FAIR
SETTLEMENT
6
. G.R. No. 10570, February 23, 1995
15
was reiterated in Dionela v. Court of Industrial Relations, 8 SCRA 832
(1963) and Chua v. National Labor Relations Commission, 190 SCRA
558 (1990).
16
"2. The union Board Members and Shop Stewards
may be dismissed by respondent-appellee subject to the
payment of separation pay equivalent to one-half month
for every year of service; and
17
court, the members themselves become the real parties in interest and it
is for them, rather than for the union, to accept or reject individually the
fruits of litigation" (Esso Philippines, Inc. v. Malayang Manggagawa sa
Esso (MME), 75 SCRA 73 [1977]).
18
LABOR LAWYERS’ DUTY TO PRESERVE PRIVILEGED
COMMUNICATION
7
Canon 21
19
and Quitclaim, and provisions of collective bargaining agreements
establishing the grievance procedure for the settlement of labor disputes.
This is essential to the students’ appreciation of the mechanics of
compromise agreements in labor and employment disputes, consistent
with the Code of Professional Responsibility that a lawyer shall
encourage his clients to avoid, end or settle a controversy if it will admit
of a fair settlement.
8
Canon 1
9
Rule 1.02.
10
Rule 1.01
11
Canon 2
20
with the laws and principles of fairness. The prohibited acts of
employers under the Labor Code are equally applicable to the employers’
lawyer apart from being grounds for disciplinary action against the lawyer
under the Code of Professional Responsibility.
21
separated, or to actually dismiss, discharge, discriminate or otherwise
prejudice a woman employee merely by reason of her marriage.”
22
other forms of damages, attorney’s fees and other affirmative relief, shall
be under the jurisdiction of the Labor Arbiters. The Labor Arbiters shall
give utmost priority to the hearing and resolution of all cases involving
unfair labor practices. They shall resolve such cases within thirty (30)
calendar days from the time they are submitted for decision.
23
(c) To contract out services or functions being performed by
union members when such will interfere with, restrain or coerce
employees in the exercise of their rights to self-organization;
24
shall be held criminally liable. (As amended by Batas Pambansa Bilang
130, August 21, 1981).”
25
(d) To cause or attempt to cause an employer to pay or
deliver or agree to pay or deliver any money or other things of value,
in the nature of an exaction, for services which are not performed or
not to be performed, including the demand for fee for union
negotiations;
26
picketing by employees during any labor controversy or in the
exercise of the right to self-organization or collective bargaining, or
shall aid or abet such obstruction or interference.
27
not less than three months nor more than three (3) years, or both
such fine and imprisonment, at the discretion of the court.
Prosecution under this provision shall preclude prosecution for the
same act under the Revised Penal Code, and vice versa.
12
Canon 15
13
Rule 15.02
28
client, shall ascertain as soon as practicable whether the matter would
involve a conflict with another client or his own interest, and if so, shall
forthwith inform the prospective client. 14 A lawyer shall not represent
conflicting interests except by written consent of all concerned given
after a full disclosure of the facts. 15
A lawyer when advising his client shall give a candid and honest
opinion on the merits and probable results of the client's case, neither
overstating nor understating the prospects of the case. 16 A lawyer may,
with the written consent of all concerned, act as mediator, conciliator or
arbitrator in settling disputes. 17
14
Rule 15.01
15
Rule 15.03
16
Rule 15.05
17
Rule 15.04
18
Rule 19.03
19
Canon 21
29
acquitting him from the charges of violating the Code of Professional
Responsibility. The four ethics scenarios in the appendices are suggested
for this purpose but the professor may alter the facts or create his own
scenarios for his class.
30
of another International School that follows the same employment
practices as IS Cebu.
31
2 (b) Reading Materials
(Code of Professional Responsibility Canon 1 to Canon 6.03;
Articles 211 to 212; Articles 217 to 222; Articles 224 to 240; Articles
241 to 246 Labor Code of the Philippines
32
3 (c ) Analysis and Discussion: Non-Lawyers as Union Representatives
and Voluntary Arbitrators; Labor Lawyers’ Ethical Obligations as
Negotiators; Drafting Sample Provisions of Collective Bargaining
Agreements; Labor Lawyers’ Duty to Encourage Fair Settlement; Labor
Lawyers’ Duty to Preserve Privileged Communication; Application to
Lawyers and Union Representatives and Voluntary Arbitrators – As
practical exercises, the students may be asked, as a matter of substantive
labor law, to study the benefits and disadvantages of the mechanisms
established under the Labor Code for the resolution of labor disputes
and to examine how these mechanisms can be effectively utilized in a
manner consistent with the Code of Professional Responsibility.
33
ETHICS SCENARIOS
Scenario 1
Employment Dismissal
She started discussing these issue with Victor who was pleased to
answer her questions and provide her legal guidance. Under other
circumstances, Victor, who is a Senior Associate of the law firm of XYZ
would have required a client's signature on an engagement letter. Since
Jaclyn was his girlfriend, he considered it unnecessary to make her sign
an engagement letter.
34
As it happened, Jaclyn raised the following question and Victor
answered them to the best that he can:
35
Victor takes the position that he has not rendered any service for
IS Cebu which has consulted exclusively with Partner D of XYZ the law-
firm hence has no access to any confidential information of IS Cebu that
he could unfairly use against it in the threatened disciplinary proceeding
against Jaclyn.
The partners of the XZZ law firm also had to grapple with the
question whether (i) it is in a conflict of interest situation considering that
Victor, a Senior Associate of the firm, had advised Jacklyn on legal issues
concerning IS Cebu’s employment practices and (ii) asking Victor to
resign from the firm or dismissing him if he refused will avoid any
conflict of interest situation.
Scenario 2
Union formation
36
The Alliance of Concerned Teachers (ACT) learned off the equal
work, but unequal pay practices of IS Cebu and started recruitment
activities among its locally hired teachers. ACT also attempted similar
recruitment activities among the locally hired teachers of IS Manila,
which was following the same employment practices as IS Cebu.
However, the teachers at IS Manila appeared to be divided on the issue
of union formation.
37
independent union ACT would expose ACT to an unfair labor practice
charge under the Labor Code by the majority of the employees who
prefer to be represented by an independent union under Title IV,
Chapter III, Article 249 et seq. of the Labor Code.
Scenario 3
Collective Bargaining
38
However, 60 days before the expiration of the CBA on April 30,
2006, and FCY Company received a notice from the local union
president informing it that the employees have disaffiliated from a
Federation XYZ and asking FCY Company to refrain from negotiating a
collective bargaining agreement with it.
The local union president told FCY Company that the employees
would be negotiating with the Activists Union as their new collective
bargaining representative.
39
narrowly won the election with a margin of only 10 votes over the
Activist Union.
The employees who voted for Activist Union also voted against
the ratification of the collective bargaining agreement by an account of
the influence exerted by the supervisors --acting with the discrete
guidance of FCY’s company's counsel--the CBA was ratified by is slightly
more than half of the employees within the collective bargaining unit.
The clerks of the Supreme Court justice to whom the case was
assigned were directed to research and write a member on whether the
administrative complaints against the two lawyers have merit and justify
the imposition of disciplinary actions upon them.
40
Scenario 4
Concerted Union Activity
Activist Union argued that based the data FCY Company has a
very profitable rate of return compared to other companies, where a 50%
rate of return is considered a significant profit achievement. Activist
41
Union therefore proposed a wage increase for the workers of 30% their
present over their current wages effective on the date of execution of the
collective bargaining agreement and on the second and third years of the
agreement. Activist Union also proposed the adoption by FCY
Company of medical and hospitalization insurance for the employees on
top of those required of employers under current laws.
42
After 10 negotiation meetings, Activist Union maintained its 30%
wage increase demand and FCY Company said it would not go higher
than a 10% wage increase for each year of the three-year duration of the
collective bargaining agreement. All other economic benefits would be
granted based on the labor standards provision of the Labor Code.
APPENDIX A
43
PROBATIONARY EMPLOYMENT AGREEMENT
(Date)
Dear M :
We are pleased to advise you that you have successfully passed our
employment requirements and, subject to your submission of the required
clearances, we are employing you on a probationary status, with the
designation of , under the following terms and conditions:
44
period of probationary employment, you will be entitled to collect only
your salaries up to the end of working hours of the last day of actual
service.
45
6. You agree that all records and documents of the
Company and its clients and all information pertaining to their affairs are
confidential, and that no unauthorized disclosure or reproduction of the
same will be made by you at any time during or after your employment
with us.
46
affecting this agreement and that no alterations or variations of the terms
hereof shall be binding upon either party to this agreement unless the same
are reduced in writing and signed by you and the Company.
____
______
Signature
______
Date
47
APPENDIX B
(Date)
Dear M :
Your present classification and grade are and you shall receive
compensation of ___________ PESOS (P___________),
payable on the 15th and the last day of the calendar month. Your salary
already includes compensation for unworked legal holidays and any
mandatory allowance under existing laws.
48
and within one year after the termination of your employment, from
engaging in any activity which is prejudicial to the interests of the
Company or which will interfere with the performance of your job,
whether within or outside Company hours, without the prior written
consent of the Company. You agree to give immediate notice to the
Company of any possible conflict of interest which you may have.
49
shortage, to the Company immediately upon your discovery thereof or
when demanded by the Company.
50
Very truly yours,
____
_______
Signature
_______
Date
51
APPENDIX C
- and –
W I T N E S S E T H:
52
1. The Company is hiring the PROJECT
EMPLOYEE as ________________, for Project to undertake
the following work/services:
a.
b.
53
5. It is hereby understood that as a
__________________, on a project hire basis, PROJECT
EMPLOYEE is not considered a regular employee of the
Company and, therefore, is not entitled to the benefits extended
by the Company to its regular employees;
54
participated in by PROJECT EMPLOYEE with consent of the
Company;
By:
55
________ ___________
(Duly authorized for the purpose) (Project Employee)
______________________ _____________________
56
ACKNOWLEDGMENT
Community Tax
Name Certificate No. Date/Place Issued
Doc. No.
Page No.
Book No.
Series of 2006.
APPENDIX D
57
INDEPENDENT CONTRACTOR A G R E E M E N T
, a corporation duly
organized and existing under the laws of the Philippines, with business
address at ,
represented herein by its , Mr./Ms. ___________
and hereinafter referred to as the “COMPANY”
- and –
W I T N E S S E T H:
58
provide the services and undertake all the works specified in Section 1 of
this Agreement or those that may be required from time to time by its
operations;
I. SCOPE OF SERVICES –
59
A. The CONTRACTOR shall secure all necessary
government permits, licenses and clearances necessary for the
performance of the services stated and specified in Section 1 of this
Agreement and hereby assumes full responsibility for complying with all
the laws, ordinances and regulations applicable to the said contracted
work. The CONTRACTOR agrees to be solely responsible for renewing
all such permits, licenses, and clearances and for securing additional
permits, licenses and clearances which may hereinafter be required by
law, rule or regulation.
IV. LABOR –
60
B. The CONTRACTOR shall have the sole right to
discipline, suspend or dismiss and of its employees but the COMPANY
may report to it any untoward act or omission committed by any of
them. The CONTRACTOR further agrees to pay the wages of its
employees it being expressly understood that they are its employees and
not those of the COMPANY. For this purpose, the CONTRACTOR
agrees to post a bond equal to the cost of labor to answer for any and all
wages which may be due to its employees should it fail to pay the same.
61
while inside the COMPANY’s premises and shall issue appropriate rules
and regulations not inconsistent with pertinent COMPANY rules and
regulations.
The risk of loss and/or damage to any of the works and any and
all parts of materials for the same, as well as for other related work shall
be borne by the CONTRACTOR.
VI. FEES –
62
pertain exclusively to the CONTRACTOR. Neither may the
CONTRACTOR request the COMPANY to pay directly to any of the
CONTRACTOR’s employee any amount owing them by the
CONTRACTOR as salaries, wages or for any cause or matter
whatsoever.
63
B. The COMPANY shall allow the CONTRACTOR the use
of existing electrical, water, and necessary facilities of the COMPANY,
conformably with the requirements of the COMPANY’s operations.
X. TERMINATION OF AGREEMENT
INC.
By: By:
________________________
64
SIGNED IN THE PRESENCE OF:
_____________________ ____________________
ACKNOWLEDGMENT
Community Tax
Name Certificate No. Date/Place Issued
Doc. No. ;
Page No. ;
65
Book No. ;
Series of 2006.
APPENDIX E
66
acknowledge that I am physically fit for work and, therefore, am not
suffering from any disability.
4. I will not at any time, in any manner whatsoever, directly
or indirectly engage in any activity prejudicial to the interest of the
Company and its manager, or employees and will not disclose any
information concerning the business of the Company, its manner of
operation, its plans, processes or data of any kind.
67
SUBSCRIBED AND SWORN to before me this ___ day of
_______________, 200__ at Makati City, Philippines, affiant having
exhibited to me his/her Community Tax Certificate No.
____________________ issued on __________________, 200__ at
__________________.
Doc No.__________;
Page No.__________;
Book No._________;
Series of 2006.
68
APPENDIX F
ARTICLE XV
LABOR MANAGEMENT RELATIONS COMMITTEE
69
ARTICLE XVI
GRIEVANCE AND ARBITRATION PROCEDURE
70
and/or settle amicably the issue and render a decision thereon.
Grievances not resolved by the supervisor and shop stewards among
themselves may be brought to the next step provided herein within five
days after submission of the grievance.
The Department Head shall have five (5) working days from his
receipt of the grievance to investigate the matter, call the Chief Steward,
employee concerned, witnesses if any, to try and work out an amicable
solution. If this fails, the Department Head shall render his decision.
If the decision is not satisfactory, the Chief Steward shall have
five (5) working days within which to appeal to the next step. Decision
not appealed within this period shall be deemed settled on the basis of
the Department Head’s decision.
From Management:
71
(c) Supervisor, if any
From Labor:
72
the party violating the terms in this Article shall be denied benefits of this
Agreement.
ARTICLE XVII
RESPONSIBILITIES OF THE PARTIES AND INDUSTRIAL
PEACE
73
Section 3. No Strike, No Lock Out -. Each of the parties hereto
acknowledges the rights and responsibilities of the other party and agrees
to discharge its responsibilities under this Agreement.
The UNION, its officers and representatives of all levels, and all
employees are bound to observe the provisions of this Agreement. In
addition to the responsibilities that may be provided for elsewhere in this
Agreement, the following shall be observed:
(a) The UNION, its officers, and members agree that for the
duration of this Agreement there shall be no strikes, walk-outs, sit-
downs, slow-downs, stoppages-of-work, boycotts, secondary boycotts,
sympathetic or general strikes, picketing or any acts of similar nature,
however peaceful, which would interfere with the normal operations and
work schedules of the COMPANY, and that it will not otherwise permit,
countenance or suffer the existence or continuance of any kind of these
acts, but shall strictly settle all issues between the parties through the
grievance procedures set forth in Article XVI. Failure or refusal on the
part of any employee to fully observe and obey the provisions hereof
shall be sufficient cause for dismissal with cause.
74
(ii) Any suspension of operations by the HOSPTIAL
when it is beset with financial problems.
(c) The UNION agrees that neither it nor any of its officers or
members will engage in any union activities while such employees are on
COMPANY time and premises.
(e) The UNION and its members recognize the need for running
the COMPANY efficiently and continuously and agree to work with the
COMPANY to promote such efficient and continuous operation and the
welfare of the business.
75
Section 4. Additional Responsibilities - The UNION agrees that
it will not officially publish or circulate any false, prejudicial, or
misleading remarks about the COMPANY, its operations, its officers or
other management personnel.
76
The parties shall continue to be bound by their full and complete
settlement of the issue concerning R.A. No. 5901, the terms of which as
embodied in the parties' earlier collective bargaining agreements shall be
deemed reproduced and incorporated herein. -
ARTICLE XX SEPARABILITY
77
the Agreement either implicitly or explicitly, unless it so specifically
provides.
ARTICLE XXI
DURATION AND RENEWAL OF AGREEMENT
78
receipt of the notice in which to notify the other party by registered mail
of the termination of any provision of this Agreement which has not
been terminated by the party which sent the first notice.
ARTICLE XXII
NATURE AND EFFECT OF AGREEMENT
79
was the result of full bargaining, and therefore, shall not give rise to any
further liability against the COMPANY.
80