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6317, August 31, 2006

FACTS: Sometime in January 2001, Luzviminda C. Lijauco engaged the services of Atty. Rogelio P. Terrado for P 70,000 to assist in recovering her deposit with Planters Development Bank in the amount of P180,000 and the release of her foreclosed house and lot located in Calamba, Laguna. The said foreclosed house and lot is the subject of a petition for the issuance of writ of possession then pending before the RTC of Binan Laguna docketed as LRC Case No. B-2610.

Ms. Lijauco alleged that Atty. Terrado failed to appear in the hearing for the issuance of Writ of Possession and did not protect her interest in allowing her to participate in a Compromise Agreement in order to end the LRC Case No. B-2610. She filed an administrative complaint against Atty. Terrado for gross misconduct, malpractice and conduct unbecoming of an officer of the court. In his defense, Atty. Terrado claims that the P 70,000 legal fees he received is purely and solely for the recovery of the P 180,000 savings account. The complaint was then referred to the Integrated Bar of the Philippines (IBP) for investigation, report and recommendation. The Investigating Commissioner submitted his report finding Atty. Terrado guilty of violating Rule 1.01 and 9.02 of the Code of Professional Responsibility (CPR) and recommended that he be suspended from the practice of law for six (6) months. The IBP Board of Governors adopted the recommendation of the investigating commissioner.

ISSUE: Whether or not the ruling of the IBP Board of Governors is proper?

HELD: Yes. The Supreme Court agreed with the findings of the IBP. The records show that Atty. Terrado acted as complainants counsel in the drafting of the compromise agreement between Ms. Lijauco and the bank regarding LRC Case No. B-2610. He lured Ms. Lijauco to participate in a compromise agreement with a false and misleading assurance that the latter can still recover her foreclosed property even after three years from foreclosure. Atty. Terrado violated Rule 1.01 Canon 1 of the CPR which says that a lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct. Furthermore, the Investigating Commissioner observed that the fee of P 70,000 for legal assistance in the recovery of the deposit amounting to P 180,000 is unreasonable and is violative of Canon 20 of the CPR. Atty. Terrada was also found guilty of violating Rule 9.02 of the CPR by openly admitting that he divided the legal fees with two other people as a referral fee.