G.R. No.

L-28546, July 30, 1975

VENANCIO CASTANEDA, AND NICETAS HENSON, PETITIONERS, VS. PASTOR
D. AGO, LOURDES YU AGO AND THE COURT OF APPEALS, RESPONDENTS.

DECISION

CASTRO, J.:

The parties in this case, except Lourdes Yu Ago, have been commuting to this Court for
more than a decade.

In 1955 the petitioners Venancio Castaneda and Nicetas Henson filed a replevin suit
against Pastor Ago in the Court of First Instance of Manila to recover certain machineries
(civil case 27251). In 1957 judgment was rendered in favor of the plaintiffs, ordering Ago
to return the machineries or pay definite sums of money. Ago appealed, and on June 30,
1961 this Court, in Ago vs. Castaneda, L-14066, affirmed the judgment. After remand, the
trial court issued on August 25, 1961 a writ of execution for the sum of
P172,923.87. Ago moved for a stay of execution but his motion was denied, and levy was
made on Ago's house and lots located in Quezon City. The sheriff then advertised them
for auction sale on October 25, 1961. Ago moved to stop the auction sale, failing in
which he filed a petition for certiorari with the Court of Appeals. The appellate court
dismissed the petition and Ago appealed. On January 31, 1966 this Court, in Ago vs. Court
of Appeals, et al., L-19718, affirmed the dismissal. Ago thrice attempted to obtain a writ of
preliminary injunction to restrain the sheriff from enforcing the writ of execution "to save
his family house and lot;" his motions were denied, and the sheriff sold the house and lots
on March 9, 1963 to the highest bidders, the petitioners Castaneda and Henson. Ago
failed to redeem, and on April 17, 1964 the sheriff executed the final deed of sale in favor
of the vendees Castaneda and Henson. Upon their petition, the Court of First Instance
of Manila issued a writ of possession to the properties.

However, on May 2, 1964 Pastor Ago, now joined by his wife, Lourdes Yu Ago, as his co-
plaintiff, filed a complaint in the Court of First Instance of Quezon City (civil case Q-7986)
to annul the sheriff's sale on the ground that the obligation of Pastor Ago upon which
judgment was rendered against him in the replevin suit was his personal obligation, and
that Lourdes Yu Ago's one-half share in their conjugal residential house and lots which
were levied upon and sold by the sheriff could not legally be reached for the satisfaction
of the judgment. They alleged in their complaint that wife Lourdes was not a party in the
replevin suit, that the judgment was rendered and the writ of execution was issued only
against husband Pastor, and that wife Lourdes was not a party to her husband's venture in
the logging business which failed and resulted in the replevin suit and which did not
benefit the conjugal partnership.

The Court of First Instance of Quezon City issued an ex parte writ of preliminary
injunction restraining the petitioners, the Register of Deeds and the sheriff of Quezon
City, from registering the latter's final deed of sale, from cancelling the respondents'
certificates of title and issuing new ones to the petitioners and from carrying out any writ
of possession. A situation thus arose where what the Manila court had ordered to be
done, the Quezon City court countermanded. On November 1, 1965, however, the latter
court lifted the preliminary injunction it had previously issued, and the Register of Deeds
of Quezon City cancelled the respondents' certificates of title and issued new ones in
favor of the petitioners. But enforcement of the writ of possession was again thwarted as
the Quezon City court again issued a temporary restraining order which it later lifted but
then re-restored. On May 3, 1967 the court finally, and for the third time, lifted the
restraining order.

While the battle on the matter of the lifting and restoring of the restraining order was
being fought in the Quezon City court, the Agos filed a petition for certiorari and
prohibition with this Court under date of May 26, 1966, docketed as L-26116, praying for
a writ of preliminary injunction to enjoin the sheriff from enforcing the writ of
possession. This Court found no merit in the petition and dismissed it in a minute
resolution on June 3, 1966; reconsideration was denied on July 18, 1966. The
respondents then filed on August 2, 1966 a similar petition for certiorari and prohibition
with the Court of Appeals (CA-G.R. 37830-R), praying for the same preliminary
injunction. The Court of Appeals also dismissed the petition. The respondents then
appealed to this Court (L-27140). We dismissed the petition in a minute resolution on
February 8, 1967.

The Ago spouses repaired once more to the Court of Appeals where they filed another
petition for certiorari and prohibition with preliminary injunction (CA-G.R. 39438-R). The
said court gave due course to the petition and granted preliminary injunction. After
hearing, it rendered decision, the dispositive portion of which reads:

"WHEREFORE, writ of preliminary injunction from enforcement of the writ of

possession on and ejectment from the one-half share in the properties involved belonging
to Lourdes Yu Ago dated June 15, 1967 is made permanent pending decision on the
merits in Civil Case No. Q-7986 and ordering respondent Court to proceed with the trial
of Civil Case No. Q-7986 on the merits without unnecessary delay. No pronouncement
as to costs."

Failing to obtain reconsideration, the petitioners Castaneda and Henson filed the present
petition for review of the aforesaid decision.

1. We do not see how the doctrine that a court may not interfere with the orders of a co-
equal court can apply in the case at bar. The Court of First Instance of Manila, which
issued the writ of possession, ultimately was not interfered with by its co-equal court, the
Court of First Instance of Quezon City as the latter lifted the restraining order it had
previously issued against the enforcement of the Manila court's writ of possession; it is
the Court of Appeals that enjoined, in part, the enforcement of the writ.

2. Invoking Comilang vs. Buendia, et al.,[1] where the wife was a party in one case and the
husband was a party in another case and a levy on their conjugal properties was upheld,
the petitioners would have Lourdes Yu Ago similarly bound by the replevin judgment
against her husband for which their conjugal properties would be answerable. The case
invoked is not at par with the present case. In Comilang the actions were admittedly
instituted for the protection of the common interest of the spouses; in the present case,
the Agos deny that their conjugal partnership benefited from the husband's business
venture.

3. Relying upon Omnas vs. Rivera, 67 Phil. 419, the Court of Appeals held that a writ of
possession may not issue until the claim of a third person to half-interest in the property
is adversely determined, the said appellate court assuming that Lourdes Yu Ago was a
"stranger" or a "third-party" to her husband. The assumption is of course obviously
wrong, for, besides living with her husband Pastor, she does not claim ignorance of his
business that failed, of the relevant cases in which he got embroiled, and of the auction
sale made by the sheriff of their conjugal properties. Even then, the ruling in Omnas is
not that a writ of possession may not issue until the claim of a third person is adversely
determined, but that the writ of possession being a complement of the writ of execution,
a judge with jurisdiction to issue the latter also has jurisdiction to issue the former, unless
in the interval between the judicial sale and the issuance of the writ of possession, the
rights of third parties to the property sold have supervened. The ruling in Omnas is clearly
inapplicable in the present case, for, here, there has been no change in the ownership of
the properties or of any interest therein from the time the writ of execution was issued up
to the time the writ of possession was issued, and even up to the present.

4. We agree with the trial court (then presided by Judge Lourdes P. San Diego) that it is
much too late in the day for the respondents Agos to raise the question that part of the
property is unleviable because it belongs to Lourdes Yu Ago, considering that (1) a wife is
normally privy to her husband's activities; (2) the levy was made and the properties
advertised for auction sale in 1961; (3) she lives in the very properties in question; (4) her
husband had moved to stop the auction sale; (5) the properties were sold at auction in
1963; (6) her husband had thrice attempted to obtain a preliminary injunction to restrain
the sheriff from enforcing the writ of execution; (7) the sheriff executed the deed of final
sale on April 17, 1964 when Pastor failed to redeem; (8) Pastor had impliedly admitted
that the conjugal properties could be levied upon by his pleas "to save his family house
and lot" in his efforts to prevent execution; and (9) it was only on May 2, 1964 when he
and his wife filed the complaint for annulment of the sheriff's sale upon the issue that the
wife's share in the properties cannot be levied upon on the ground that she was not a
party to the logging business and not a party to the replevin suit. The spouses Ago had
every opportunity to raise the issue in the various proceedings hereinbefore discussed but
did not; laches now effectively bars them from raising it.

"Laches, in a general sense, is failure or neglect, for an unreasonable and unexplained

length of time, to do that which, by exercising due diligence, could or should have been
done earlier; it is negligence or omission to assert a right within a reasonable time,
warranting a presumption that the party entitled to assert it either has abandoned it or
declined to assert it."[2]

5. The decision of the appellate court under review suffers from two fatal infirmities.

(a) It enjoined the enforcement of the writ of possession to and ejectment from the one-
half share in the properties involved belonging to Lourdes Yu Ago. This half-share is not
in esse, but is merely an inchoate interest, a mere expectancy, constituting neither legal
nor equitable estate, and will ripen into title when only upon liquidation and settlement
there appears to be assets of the community.[3] The decision sets at naught the well-settled
rule that injunction does not issue to protect a right not in esse and which may never
arise.[4]

(b) The decision did not foresee the absurdity, or even the impossibility, of its
enforcement. The Ago spouses admittedly live together in the same house,[5] which is
conjugal property. By the Manila court's writ of possession Pastor could be ousted from
the house, but the decision under review would prevent the ejectment of Lourdes. Now,
which part of the house would be vacated by Pastor and which part would Lourdes
continue to stay in? The absurdity does not stop here; the decision would actually
separate husband and wife, prevent them from living together, and in effect divide their
conjugal properties during coverture and before the dissolution of the conjugal union.

6. Despite the pendency in the trial court of the complaint for the annulment of the
sheriffs sale (civil case Q-7986), elementary justice demands that the petitioners, long
denied the fruits of their victory in the replevin suit, must now enjoy them, for, the
respondents Agos, abetted by their lawyer Jose M. Luison, have misused legal remedies
and prostituted the judicial process to thwart the satisfaction of the judgment, to the
extended prejudice of the petitioners. The respondents, with the assistance of counsel,
maneuvered for fourteen (14) years to doggedly resist execution of the judgment thru
manifold tactics in and from one court to another (5 times in the Supreme Court).

We condemn the attitude of the respondents and their counsel who,

"far from viewing courts as sanctuaries for those who seek justice, have tried to use them
to subvert the very ends of justice."[6]

Forgetting his sacred mission as a sworn public servant and his exalted position as an
officer of the court, Atty. Luison has allowed himself to become an instigator of
controversy and a predator of conflict instead of a mediator for concord and a conciliator
for compromise, a virtuoso of technicality in the conduct of litigation instead of a true
exponent of the primacy of truth and moral justice.

"A counsel's assertiveness in espousing with candour and honesty his client's cause must
be encouraged and is to be commended; what we do not and cannot countenance is a
lawyer's insistence- despite the patent futility of his client's position, as in the case at bar.
"It is the duty of a counsel to advise his client, ordinarily a layman to the intricacies and
vagaries of the law, on the merit or lack of merit of his case. If he finds that his client's
cause is defenseless, then it is his bounden duty to advise the latter to acquiesce and
submit, rather than traverse the incontrovertible. A lawyer must resist the whims and
caprices of his client, and temper his client's propensity to litigate. A lawyer's oath to
uphold the cause of justice is superior to his duty to his client; its primacy is
indisputable."[7]

7. In view of the private respondents' propensity to use the courts for purposes other
than to seek justice, and in order to obviate further delay in the disposition of the case
below which might again come up to the appellate courts but only to fail in the end, we
have motu proprio examined the record of civil case Q-7986 (the mother case of the present
case). We find that

a. the complaint was filed on May 2, 1964 (more than 11 years ago) but
trial on the merits has not even started;

b. after the defendants Castanedas had filed their answer with a

counterclaim, the plaintiffs Agos filed a supplemental complaint where
they impleaded new parties-defendants;

c. after the admission of the supplemental complaint, the Agos filed a

motion to admit an amended supplemental complaint, which impleads
an additional new party-defendant (no action has yet been taken on
this motion);

d. the defendants have not filed an answer to the admitted supplemental

complaint; and

e. the last order of the Court of First Instance, dated April 20, 1974,
grants an extension to the suspension of time to
file answer. (Expediente, p. 815)

We also find that the alleged causes of action in the complaint, supplemental complaint
and amended supplemental complaint are all untenable, for the reasons hereunder stated.

The Complaint

Upon the first cause of action, it is alleged that the sheriff levied upon conjugal properties of
the spouses Ago despite the fact that the judgment to be satisfied was personal only to
Pastor Ago, and the business venture that he entered into, which resulted in the replevin
suit, did not redound to the benefit of the conjugal partnership. The issue here, which is
whether or not the wife's inchoate share in the conjugal property is leviable, is the same
issue that we have already resolved, as barred by laches, in striking down the decision of
the Court of Appeals granting preliminary injunction, the dispositive portion of which
was hereinbefore quoted. This ruling applies as well to the first cause of action of the
complaint.

Upon the second cause of action, the Agos allege that on January 5, 1959 the Castanedas and
the sheriff, pursuant to an alias writ of seizure, seized and took possession of certain
machineries, depriving the Agos of the use thereof, to their damage in the sum of
P256,000 up to May 5, 1964. This second cause of action fails to state a valid cause of
action for it fails to allege that the order of seizure is invalid or illegal.

It averred as a third cause of action that the sheriff's sale of the conjugal properties was
irregular, illegal and unlawful because the sheriff did not require the Castaneda spouses to
pay or liquidate the sum of P141,750 (the amount for which they bought the properties at
the auction sale) despite the fact that there was annotated at the back of the certificates of
title a mortgage of P75,000 in favor of the Philippine National Bank; moreover, the
sheriff sold the properties for P141,750 despite the pendency of L-19718 where Pastor
Ago contested the amount of P99,877.08 out of the judgment value of P172,923.37 in
civil case 27251; and because of said acts, the Agos suffered P174,877.08 in damages.

Anent this third cause of action, the sheriff was under no obligation to require payment of
the purchase price in the auction sale because "when the purchaser is the judgment
creditor, and no third-party claim has been filed, he need not pay the amount of the bid if
it does not exceed the amount of his judgment." (Sec. 23, Rule 39, Rules of Court)

The annotated mortgage in favor of the PNB is the concern of the vendees Castanedas
but did not affect the sheriff's sale; the cancellation of the annotation is of no moment to
the Agos.

Case L-19718 where Pastor Ago contested the sum of P99,877.08 out of the amount of
the judgment was dismissed by this Court on January 31, 1966.

This third cause of action, therefore, actually states no valid cause of action and is
moreover barred by prior judgment.

The fourth cause of action pertains to moral damages allegedly suffered by the Agos on
account of the acts complained of in the preceding causes of action. As the fourth cause
of action derives its life from the preceding causes of action, which, as shown, are
baseless, the said fourth cause of action must necessarily fail.

The Counterclaim

As a counterclaim against the Agos, the Castanedas aver that the action was unfounded
and as a consequence of its filing they were compelled to retain the services of counsel for
not less than P7,500; that because the Agos obtained a preliminary injunction enjoining
the transfer of titles and possession of the properties to the Castanedas, they were
unlawfully deprived of the use of the properties from April 17, 1964, the value of such
deprived use being 20% annually of their actual value; and that the filing of the
unfounded action besmirched their feelings, the pecuniary worth of which is for the court
to assess.

The Supplemental Complaint

Upon the first cause of action, it is alleged that after the filing of the complaint, the
defendants, taking advantage of the dissolution of the preliminary injunction, in
conspiracy and with gross bad faith and evident intent to cause damage to the plaintiffs,
caused the registration of the sheriff's final deed of sale; that, to cause more damage, the
defendants sold to their lawyer and his wife two of the parcels of land in question; that
the purchasers acquired the properties in bad faith; that the defendants mortgaged the
two other parcels to the Rizal Commercial Banking Corporation while the defendants'
lawyer and his wife also mortgaged the parcels bought by them to the Rizal Commercial
Bank; and that the bank also acted in bad faith.

The second cause of action consists of an allegation of additional damages caused by the
defendants' bad faith in entering into the aforesaid agreements and transactions.

The Amended Supplemental Complaint

The amendment made pertains to the first cause of action of the supplemental complaint,
which is, the inclusion of a paragraph averring that, still to cause damage and prejudice to
the plaintiffs, Atty. & Mrs. Juan Quijano, in bad faith sold the two parcels of land they
had previously bought to Eloy Ocampo who acquired them also in bad faith, while
Venancio Castaneda and Nicetas Henson in bad faith sold the two other parcels to Juan
Quijano (60%) and Eloy Ocampo (40%) who acquired them in bad faith and with
knowledge that the properties are the subject of a pending litigation.

Discussion on The Causes of Action

of The Supplemental Complaint And
The Amended Supplemental Complaint

Assuming hypothetically as true the allegations in the first cause of action of the
supplemental complaint and the amended supplemental complaint, the validity of the
cause of action would depend upon the validity of the first cause of action of the original
complaint, for, the Agos would suffer no transgression upon their rights of ownership
and possession of the properties by reason of the agreements subsequently entered into
by the Castanedas and their lawyer if the sheriff's levy and sale are valid. The reverse is
also true: if the sheriff's levy and sale are invalid on the ground that the conjugal
properties could not be levied upon, then the transactions would perhaps prejudice the
Agos, but, we have already indicated that the issue in the first cause of action of the
original complaint is barred by laches, and it must therefore follow that the first cause of
action of the supplemental complaint and the amended supplemental complaint is also
barred.

For the same reason, the same holding applies to the remaining cause of action in the
supplemental complaint and the amended supplemental complaint.

ACCORDINGLY, the decision of the Court of Appeals under review is set aside. Civil
case Q-7986 of the Court of First Instance of Rizal is ordered dismissed, without
prejudice to the re-filing of the petitioners' counterclaim in a new and independent
action. Treble costs are assessed against the spouses Pastor Ago and Lourdes Yu Ago,
which shall be paid by their lawyer, Atty. Jose M. Luison. Let a copy of this decision be
made a part of the personal file of Atty. Luison in the custody of the Clerk of Court.

Makasiar, Esguerra, Muoz Palma, and Martin, JJ., concur.

Teehankee, J., is on leave.

March 23, 1929

IN RE LUIS B. TAGORDA

DECISION

MALCOLM, J.:

The respondent, Luis B. Tagorda, a practising attorney and a member of the provincial
board of Isabela, admits that previous to the last general elections he made use of a card
written in Spanish and Ilocano, which, in translation, reads as follows:

"LUIS B. TAGORDA
"Attorney
"Notary Public

"CANDIDATE FOR THIRD MEMBER

"Province of Isabela

" (Note.As notary public, he can execute for you a deed of sale for the purchase of land
as required by the cadastral office; can renew lost documents of your animals; can make
your application and final requisites for your homestead; and can execute any kind of
affidavit. As a lawyer, he can help you collect your loans although long overdue, as well as
any complaint for or against you. Come or write to him in his town, Echague, Isabela. He
offers free consultation, and is willing to help and serve the poor.)"
The respondent further admits that he is the author of a letter addressed to a lieutenant of
barrio in his home municipality written in Ilocano, which letter, in translation, reads as
follows:

ECHAGUE, ISABELA, September 18, 1928

"MY DEAR LIEUTENANT : I would like to inform you of the approaching date for
our induction into office as member of the Provincial Board, that is on the 16th of next
month. Before my induction into office I should be very glad to hear your suggestions or
recommendations for the good of the province in general and for your barrio in
particular. You can come to my house at any time here in Echague, to submit to me any
kind of suggestion or recommendation as you may desire.

"I also inform you that despite my membership in the Board I will have my residence
here in Echague. I will attend the sessions of the Board in Ilagan, but will come back
home on the following day here in Echague to live and serve with you as a lawyer and
notary public. Despite my election as member of the Provincial Board, I will exercise my
legal profession as a lawyer and notary public. In case you cannot see me at home on any
week day, I assure you that you can always find me there on every Sunday. I also inform
you that I will receive any work regarding preparations of documents of contract of sales
and affidavits to be sworn to before me as notary public even on Sundays.

"I would like you all to be informed of this matter for the reason that some people are in
the belief that my residence as member of the Board will be in Ilagan and that I would
then be disqualified to exercise my profession as lawyer and as notary public. Such is not
the case and I would make it clear that I am free to exercise my profession as formerly
and that I will have my residence here in Echague.

"I would request your kind favor to transmit this information to your barrio people in any
of your meetings or social gatherings so that they may be informed of my desire to live
and to serve with you in my capacity as lawyer and notary public. If the people in your
locality have not as yet contracted the services of other lawyers in connection with the
registration of their land titles, I woul4 be willing to handle the work in court and would
charge only three pesos for every registration.

"Yours respectfully,
(Sgd.) "LUIS TAGORDA
"Attorney
"Notary Public"

The facts being conceded, it is next in order to write down the applicable legal provisions.
Section 21 of the Code of Civil Procedure as originally conceived related to disbarments
of members of the bar. In 1919 at the instigation of the Philippine Bar Association, said
codal section was amended by Act No. 2828 by adding at the end thereof the following:
"The practice of soliciting cases at law for the purpose of gain, either personally or
through paid agents or brokers, constitutes malpractice."
The statute as amended conforms in principle to the Canons of Professional Ethics
adopted by the American Bar Association in 1908 and by the Philippine Bar Association
in 1917. Canons 27 and 28 of the Code of Ethics provide:

"27. ADVERTISING, DIRECT OR INDIRECT.The most worthy and effective

advertisement possible, even for a young lawyer, and especially with his brother lawyers, is
the establishment of a well-merited reputation for professional capacity and fidelity to
trust. This cannot be forced, but must be the outcome of character and conduct. The
publication or circulation of ordinary simple business cards, being a matter of personal
taste or local custom, and sometimes of convenience, is not per se improper. But
solicitation of business by circulars or advertisements, or by personal communications or
interviews not warranted by personal relations, is unprofessional. It is equally
unprofessional to procure business by indirection through touters of any kind, whether
allied real estate firms or trust companies advertising to secure the drawing of deeds or
wills or offering retainers in exchange for executorships or trusteeships to be influenced
by the lawyer. Indirect advertisement for business by furnishing or inspiring newspaper
comments concerning the manner of their conduct, the magnitude of the interests
involved, the importance of the lawyer's position, and all other like self-laudation, defy the
traditions and lower the tone of our high calling, and are intolerable.

"28. STIRRING UP LITIGATION, DIRECTLY OR THROUGH AGENTS.It is

unprofessional for a lawyer to volunteer advice to bring a lawsuit, except in rare cases
where ties of blood, relationship or trust make it his duty to do so. Stirring up strife and
litigation is not only unprofessional, but it is indictable at common law. It is disreputable
to hunt up defects in titles or other causes of action and inform thereof in order to be
employed to bring suit, or to breed litigation by seeking out those with claims for personal
injuries or those having any other grounds of action in order to secure them as clients, or
to employ agents or runners for like purposes, or to pay or reward directly or indirectly,
those who bring or influence the bringing of such cases to his office, or to remunerate
policemen, court or prison officials, physicians, hospital attaches or others who may
succeed, under the guise of giving disinterested friendly advice, in influencing the
criminal, the sick and the injured, the ignorant or others, to seek his professional services.
A duty to the public and to the profession devolves upon every member of the bar having
knowledge of such practices upon the part of any practitioner immediately to inform
thereof to the end that the offender may be disbarred."

Common barratry consisting of frequently stirring up suits and quarrels between

individuals was a crime at the common law, and one of the penalties for this offense
when committed by an attorney was disbarment. Statutes intended to reach the same evil
have been provided in a number of jurisdictions usually at the instance of the bar itself,
and have been upheld as constitutional. The reason behind statutes of this type is not
difficult to discover. The law is a profession and not a business. The lawyer may not seek
or obtain employment by himself or through others for to do so would be unprofessional.
(State vs. Rossman [1909], 53 Wash., 1; 17 Ann. Cas., 625; People vs. Mac Cabe [1893], 19
L. R. A., 231; 2 R. C. L., 1097.)
It becomes our duty to condemn in no uncertain terms the ugly practice of solicitation of
cases by lawyers. It is destructive of the honor of a great profession. It lowers the
standards of that profession. It works against the confidence of the community in the
integrity of the members of the bar. It results in needless litigation and in incenting to
strife otherwise peacefully inclined citizens.

The solicitation of employment by an attorney is a ground for disbarment or suspension.

That should be distinctly understood. """Giving application of the law and the Canons of
Ethics to the admitted facts, the respondent stands convicted of having solicited cases in
defiance of the law and those canons. Accordingly, the only remaining duty of the court is
to fix upon the action which should here be taken. The provincial fiscal of Isabela, with
whom joined the representative of the Attorney-General in the oral presentation of the
case, suggests that the respondent be only reprimanded. We think that our action should
go further than this if only to reflect our attitude toward cases of this character of which
unfortunately the respondent's is only one. The commission of offenses of this nature
would amply justify permanent elimination from the bar. But as mitigating circumstances
working in favor of the respondent there are,'first, his intimation that he was unaware of
the impropriety of his acts, ( second, his youth and inexperience at the bar, and, third, his
promise not to commit a similar mistake in the future. A modest period of suspension
would seem to fit the case of the erring attorney. But it should be distinctly understood
that this result is reached in view of the considerations which have influenced the court to
be relatively lenient in this particular instance, and should, therefore, not be taken as
indicating that future convictions of practice of this kind will not be dealt with by
disbarment.

In view of all the circumstances of this case, the judgment of the court is that the
respondent Luis B. Tagorda be and is hereby suspended from the practice as an attorney-
at-law for the period of one month from April 1, 1929.

Street, Johns, Romualdez, and Villa-Real, JJ., concur.

Johnson, J., reserves his vote.

DISSENTING

OSTRAND, J.:

I dissent. Under the circumstances of the case a reprimand would have been sufficient
punishment.

July 12, 1979

PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME "SYCIP,
SALAZAR, FELICIANO, HERNANDEZ & CASTILLO", LUCIANO E. SALAZAR,
FLORENTINO P. FELICIANO, BENILDO G. HERNANDEZ, GREGORIO R.
CASTILLO, ALBERTO P. SAN JUAN, JUAN C. REYES, JR. ANDRES G. GATMAITAN,
JUSTINO H. CACANINDIN, NOEL A. LAMAN, ETHELWOLDO E. FERNANDEZ,
ANGELITO C. IMPERIO, EDUARDO R. CENIZA, TRISTAN A. CATINDIG,
ANCHETA K. TAN, AND ALICE V. PESIGAN, PETITIONERS, IN THE MATTER
OF THE PETITION FOR AUTHORITY TO CONTINUE USE OF THE FIRM NAME
"OZAETA, ROMULO, DE LEON, MABANTA & REYES", RICARDO J. ROMULO,
BENJAMIN M. DE LEON, ROMAN MABANTA, JR., JOSE MA. REYES, JESUS S. J.
SAYOC, EDUARDO DE LOS ANGELES, AND JOSE F. BUENAVENTURA,
PETITIONERS.

RESOLUTION

MELENCIO-HERRERA, J.:

Two separate Petitions were filed before this Court 1) by the surviving partners of Atty.
Alexander Sycip, who died on May 5, 1975, and 2) by the surviving partners of Atty.
Herminio Ozaeta, who died on February 14, 1976, praying that they be allowed to
continue using, in the names of their firms, the names of partners who had passed
away. In the Court's Resolution of September 2, 1976, both Petitions were ordered
consolidated.

Petitioners base their petitions on the following arguments:

1. Under the law, a partnership is not prohibited from continuing its business under a
firm name which includes the name of a deceased partner; in fact, Article 1840 of the
Civil Code explicitly sanctions the practice when it provides in the last paragraph that:

"The use by the person or partnership continuing the business of the partnership name,
or the name of a deceased partner as part thereof, shall not of itself make the individual
property of the deceased partner liable for any debts contracted by such person or
partnership."[1]

2. In regulating other professions, such as accountancy and engineering, the legislature has
authorized the adoption of firm names without any restriction as to the use, in such firm
name, of the name of a deceased partner; the legislative authorization given to those
[2]

engaged in the practice of accountancy - a profession requiring the same degree of trust
and confidence in respect of clients as that implicit in the relationship of attorney and
client - to acquire and use a trade name, strongly indicates that there is no fundamental
policy that is offended by the continued use by a firm of professionals of a firm name
which includes the name of a deceased partner, at least where such firm name has
acquired the characteristics of a "trade name." [3]

3. The Canons of Professional Ethics are not transgressed by the continued use of the
name of a deceased partner in the firm name of a law partnership because Canon 33 of
the Canons of Professional Ethics adopted by the American Bar Association declares
that:

"x x x The continued use of the name of a deceased or former partner when permissible
by local custom, is not unethical, but care should be taken that no imposition or
deception is practiced through this use. x x x [4]

4. There is no possibility of imposition or deception because the deaths of their respective

deceased partners were well-publicized in all newspapers of general circulation for several
days; the stationeries now being used by them carry new letterheads indicating the years
when their respective deceased partners were connected with the firm; petitioners will
notify all leading national and international law directories of the fact of their respective
deceased partners' deaths. [5]

5. No local custom prohibits the continued use of a deceased partner's name in a

professional firm's name; there is no custom or usage in the Philippines, or at least in the
[6]

Greater Manila Area, which recognizes that the name of a law firm necessarily identifies
the individual members of the firm. [7]

6. The continued use of a deceased partner's name in the firm name of law partnerships
has been consistently allowed by U.S. Courts and is an accepted practice in the legal
profession of most countries in the world. [8]

The question involved in these Petitions first came under consideration by this Court in
1953 when a law firm in Cebu (the Deen case) continued its practice of including in its
firm name that of a deceased partner, C.D. Johnston. The matter was resolved with this
Court advising the firm to desist from including in their firm designation the name of C.
D. Johnston, "who has long been dead."

The same issue was raised before this Court in 1958 as an incident in G.R. No. L-11964,
entitled Register of Deeds of Manila vs. China Banking Corporation. The law firm of
Perkins & Ponce Enrile moved to intervene as amicus curiae. Before acting thereon, the
Court, in a Resolution of April 15, 1957, stated that it "would like to be informed why the
name of Perkins is still being used although Atty. E. A. Perkins is already dead". In a
Manifestation dated May 21, 1957, the law firm of Perkins and Ponce Enrile, raising
substantially the same arguments as those now being raised by petitioners, prayed that the
continued use of the firm name "Perkins & Ponce Enrile" be held proper.

On June 16, 1958, this Court resolved:

"After carefully considering the reasons given by Attorneys Alfonso Ponce Enrile and
Associates for their continued use of the name of the deceased E. G. Perkins, the Court
found no reason to depart from the policy it adopted in June 1953 when it required
Attorneys Alfred P. Deen and Eddy A. Deen of Cebu City to desist from including in
their firm designation, the name of C. D. Johnston, deceased. The Court believes that, in
view of the personal and confidential nature of the relations between attorney and client,
and the high standards demanded in the canons of professional ethics, no practice should
be allowed which even in a remote degree could give rise to the possibility of
deception. Said attorneys are accordingly advised to drop the name "PERKINS" from
their firm name."

Petitioners herein now seek a re-examination of the policy thus far enunciated by the
Court.

The Court finds no sufficient reason to depart from the rulings thus laid down.

A. Inasmuch as "Sycip, Salazar, Feliciano, Hernandez and Castillo" and "Ozaeta, Romulo,
De Leon, Mabanta and Reyes" are partnerships, the use in their partnership names of the
names of deceased partners will run counter to Article 1815 of the Civil Code which
provides:

"Art. 1815. Every partnership shall operate under a firm name, which may or may not
include the name of one or more of the partners.
"Those who, not being members of the partnership, include their names in the firm
name, shall be subject to the liability of a partner."

It is clearly tacit in the above provision that names in a firm name of a partnership must
either be those of living partners and, in the case of non-partners, should be living
persons who can be subjected to liability. In fact, Article 1825 of the Civil Code prohibits
a third person from including his name in the firm name under pain of assuming the
liability of a partner. The heirs of a deceased partner in a law firm cannot be held liable as
the old members to the creditors of a firm particularly where they are non-lawyers. Thus,
Canon 34 of the Canons of Professional Ethics "prohibits an agreement for the payment
to the widow and heirs of a deceased lawyer of a percentage, either gross or net, of the
fees received from the future business of the deceased lawyer's clients, both because the
recipients of such division are not lawyers and because such payments will not represent
service or responsibility on the part of the recipient." Accordingly, neither the widow nor
the heirs can be held liable for transactions entered into after the death of their lawyer-
predecessor. There being no benefits accruing, there can be no corresponding liability.

Prescinding the law, there could be practical objections to allowing the use by law firms of
the names of deceased partners. The public relations value of the use of an old firm
name can tend to create undue advantages and disadvantages in the practice of the
profession. An able lawyer without connections will have to make a name for himself
starting from scratch. Another able lawyer, who can join an old firm, can initially ride on
that old firm's reputation established by deceased partners.

B. In regards to the last paragraph of Article 1840 of the Civil Code cited by petitioners,
supra, the first factor to consider is that it is within Chapter 3 of Title IX of the Code
entitled "Dissolution and Winding Up." The Article primarily deals with the exemption
from liability in cases of a dissolved partnership, of the individual property of the
deceased partner for debts contracted by the person or partnership which continues the
business using the partnership name or the name of the deceased partner as part
thereof. What the law contemplates therein is a hold-over situation preparatory to formal
reorganization.

Secondly, Article 1840 treats more of a commercial partnership with a good will to
protect rather than of a professional partnership, with no saleable good will but whose
reputation depends on the personal qualifications of its individual members. Thus, it has
been held that a saleable goodwill can exist only in a commercial partnership and cannot
arise in a professional partnership consisting of lawyers.[9]

"As a general rule, upon the dissolution of a commercial partnership the succeeding
partners or parties have the right to carry on the business under the old name, in the
absence of a stipulation forbidding it, (s)ince the name of a commercial partnership is a
partnership asset inseparable from the good will of the firm x x x x ." (60 Am Jur 2d,s
204, p. 115) (Emphasis supplied)

On the other hand,

"x x x a professional partnership the reputation of which depends on the individual skill
of the members, such as partnerships of attorneys or physicians, has no good will to be
distributed as a firm asset on its dissolution, however intrinsically valuable such skill and
reputation may be, especially where there is no provision in the partnership agreement
relating to good will as an asset. x x x" (ibid, s 203, p. 115) (Emphasis supplied)

C. A partnership for the practice of law cannot be likened to partnerships formed by

other professionals or for business. For one thing, the law on accountancy specifically
allows the use of a trade name in connection with the practice of accountancy. [10]

"A partnership for the practice of law is not a legal entity. It is a mere relationship or
association for a particular purpose. x x x It is not a partnership formed for the purpose
of carrying on a trade or business or of holding property." Thus, it has been stated that
[11]

"the use of a nom de plume, assumed or trade name in law practice is improper." [12]

"The usual reason given for different standards of conduct being applicable to the
practice of law from those pertaining to business is that the law is a 'profession.' x x x
"Dean Pound, in his recently published contribution to the Survey of the Legal
Profession, (The Lawyer from Antiquity to Modern Times, p. 5) defines a profession as 'a
group of men pursuing a learned art as a common calling in the spirit of public service, --
no less a public service because it may incidentally be a means of livelihood.'
xxx xxx xxx
"Primary characteristics which distinguish the legal profession from business are:
1. A duty of public service, of which the emolument is a byproduct, and in which one
may attain the highest eminence without making much money.
2. A relation as an 'officer of court' to the administration of justice involving thorough
sincerity, integrity, and reliability.
3. A relation to clients in the highest degree fiduciary.
4. A relation to colleagues at the bar characterized by candor, fairness, and unwillingness
to resort to current business methods of advertising and encroachment on their practice,
or dealing directly with their clients."
[13]

"The right to practice law is not a natural or constitutional right but is in the nature of a
privilege or franchise. It is limited to persons of good moral character with special
[14]

qualifications duly ascertained and certified. The right does not only presuppose in its
[15]

possessor integrity, legal standing and attainment, but also the exercise of a special
privilege, highly personal and partaking of the nature of a public trust." [16]

D. Petitioners cited Canon 33 of the Canons of Professional Ethics of the American Bar
Association in support of their petitions.
[17]

It is true that Canon 33 does not consider as unethical the continued use of the name of a
deceased or former partner in the firm name of a law partnership when such a practice is
permissible by local custom but the Canon warns that care should be taken that no
imposition or deception is practiced through this use.

It must be conceded that in the Philippines, no local custom permits or allows the
continued use of a deceased or former partner's name in the firm names of law
partnerships. Firm names, under our custom, identify the more active and/or more
senior members or partners of the law firm. A glimpse at the history of the firms of
petitioners and of other law firms in this country would show how their firm names have
evolved and changed from time to time as the composition of the partnership changed.

"The continued use of a firm name after the death of one or more of the partners
designated by it is proper only where sustained by local custom and not where by custom
this purports to identify the active members. x x x
"There would seem to be a question, under the working of the Canon, as to the propriety
of adding the name of a new partner and at the same time retaining that of a deceased
partner who was never a partner with the new one." (H.S. Drinker, op. cit., supra, at pp.
207-208) (Emphasis supplied)

The possibility of deception upon the public, real or consequential, where the name of a
deceased partner continues to be used cannot be ruled out. A person in search of legal
counsel might be guided by the familiar ring of a distinguished name appearing in a firm
title.

E. Petitioners argue that U.S. Courts have consistently allowed the continued use of a
deceased partner's name in the firm name of law partnerships. But that is so because it is
sanctioned by custom.

In the case of Mendelsohn v. Equitable Life Assurance Society (33 N.Y.S. 2d 733) which
petitioners Salazar, et al. quoted in their memorandum, the New York Supreme Court
sustained the use of the firm name Alexander & Green even if none of the present ten
partners of the firm bears either name because the practice was sanctioned by custom and
did not offend any statutory provision or legislative policy and was adopted by agreement
of the parties. The Court stated therein:

"The practice sought to be proscribed has the sanction of custom and offends no
statutory provision or legislative policy. Canon 33 of the Canons of Professional Ethics
of both the American Bar Association and the New York State Bar Association provides
in part as follows: 'The continued use of the name of a deceased or former partner, when
permissible by local custom is not unethical, but care should be taken that no imposition
or deception is practiced through this use.' There is no question as to local custom. Many
firms in the city use the names of deceased members with the approval of other attorneys,
bar associations and the courts. The Appellate Division of the First Department has
considered the matter and reached the conclusion that such practice should not be
prohibited. (Emphasis supplied)
xxx xxx xxx
"Neither the Partnership Law nor the Penal Law prohibits the practice in question. The
use of the firm name herein is also sustainable by reason of agreement between the
partners." [18]

Not so in this jurisdiction where there is no local custom that sanctions the
practice. Custom has been defined as a rule of conduct formed by repetition of acts,
uniformly observed (practiced) as a social rule, legally binding and obligatory. Courts
[19]

take no judicial notice of custom. A custom must be proved as a fact, according to the
rules of evidence. A local custom as a source of right cannot be considered by a court of
[20]

justice unless such custom is properly established by competent evidence like any other
fact. We find such proof of the existence of a local custom, and of the elements requisite
[21]

to constitute the same, wanting herein. Merely because something is done as a matter of
practice does not mean that Courts can rely on the same for purposes of adjudication as a
juridical custom. Juridical custom must be differentiated from social custom. The former
can supplement statutory law or be applied in the absence of such statute. Not so with
the latter.

Moreover, judicial decisions applying or interpreting the laws form part of the legal
system. When the Supreme Court in the Deen and Perkins cases issued its Resolutions
[22]

directing lawyers to desist from including the names of deceased partners in their firm
designation, it laid down a legal rule against which no custom or practice to the contrary,
even if proven, can prevail. This is not to speak of our civil law which clearly ordains that
a partnership is dissolved by the death of any partner. Customs which are contrary to
[23]

law, public order or public policy shall not be countenanced. [24]

The practice of law is intimately and peculiarly related to the administration of justice and
should not be considered like an ordinary "money-making trade."

"x x x It is of the essence of a profession that it is practiced in a spirit of public

service. 'A trade' x x x 'aims primarily at personal gain; a profession at the exercise of
powers beneficial to mankind.' If, as in the era of wide free opportunity, we think of free
competitive self assertion as the highest good, lawyer and grocer and farmer may seem to
be freely competing with their fellows in their calling in order each to acquire as much of
the world's good as he may within the limits allowed him by law. But the member of a
profession does not regard himself as in competition with his professional brethren. He
is not bartering his services as is the artisan nor exchanging the products of his skill and
learning as the farmer sells wheat or corn. There should be no such thing as a lawyers' or
physicians' strike. The best service of the professional man is often rendered for no
equivalent or for a trifling equivalent and it is his pride to do what he does in a way
worthy of his profession even if done with no expectation of reward. This spirit of public
service in which the profession of law is and ought to be exercised is a prerequisite of
sound administration of justice according to law. The other two elements of a profession,
namely, organization and pursuit of a learned art have their justification in that they
secure and maintain that spirit." [25]

In fine, petitioners' desire to preserve the identity of their firms in the eyes of the public
must bow to legal and ethical impediments.

ACCORDINGLY, the petitions filed herein are denied and petitioners advised to drop
the names "SYCIP" and "OZAETA" from their respective firm names. Those names
may, however, be included in the listing of individuals who have been partners in their
firms indicating the years during which they served as such.

SO ORDERED.

Teehankee, Concepcion, Jr., Santos, Fernandez, Guerrero, and De Castro, JJ., concur.
Fernando, C.J., and Abad Santos, JJ., no part.
Barredo, Makasiar, and Antonio, JJ., joins J., Aquino in his dissent.

A.C. No. 2131, May 10, 1985

ADRIANO E. DACANAY, COMPLAINANT, VS. BAKER & MCKENZIE AND JUAN G.
COLLAS, JR., LUIS MA. GUERRERO, VICENTE A. TORRES, RAFAEL E.
EVANGELISTA, JR., ROMEO L. SALONGA, JOSE R. SANDEJAS, LUCAS M. NUNAG,
J. CLARO TESORO, NATIVIDAD B. KWAN AND JOSE A. CURAMMENG, JR.,
RESPONDENTS.

DECISION

Lawyer Adriano E. Dacanay, admitted to the bar in 1954. in his 1980 verified complaint,
sought to enjoin Juan G. Collas. Jr. and nine other lawyers from practising law under the
name of Baker & McKenzie. a law firm organized in Illinois.

In a letter dated November 16, 1979 respondent Vicente A. Torres, using the letterhead
of Baker & McKenzie, which contains the names of the ten lawyers, asked Rosie Clurman
for the release of 87 shares of Cathay Products International. Inc. to H. E. Gabriel, a
client.

Attorney Dacanay, in his reply dated December 7, 1979, denied any liability of Clurman to
Gabriel. He requested that he be informed whether the lawyer of Gabriel is Baker &
McKenzie "and if not, what is your purpose in using the letterhead of another law office."
Not having received any reply, he filed the instant complaint.

We hold that Baker & McKenzie, being an alien law firm, cannot practice law in the
Philippines (Sec. 1, Rule 138, Rules of Court). As admitted by the respondents in their
memorandum, Baker & McKenzie is a professional partnership organized in 1949 in
Chicago, Illinois with members and associates in 30 cities around the world. Respondents,
aside from being members of the Philippine bar, practising under the firm name of
Guerrero & Torres, are members or associates of Baker & Mckenzie.

As pointed out by the Solicitor General, respondents' use of the firm name Baker &
McKenzie constitutes a representation that being associated with the firm they could
"render legal services of the highest quality to multinational business enterprises and
others engaged in foreign trade and investment" (p. 3, respondents' memo). This is
unethical because Baker & McKenzie is not authorized to practice law here. (See Ruben
E. Agpalo, Legal Ethics, 1983 Ed., p. 115.)

WHEREFORE, the respondents are enjoined from practising law under the firm name
Baker & McKenzie.

SO ORDERED

Teehankee (Acting C.J.), Makasiar, Abad Santos, Melencio-Herrera, Escolin, Relova, Gutierrez, Jr.,
De la Fuente, Cuevas, and Alampay, JJ., concur.
Plana, J., took no part.
Fernando, C.J. and Concepcion, Jr., J., on leave.