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THIRD DIVISION

[A.C. No. 6281. September 26, 2011.]

VALENTIN C. MIRANDA , complainant, vs . ATTY. MACARIO D. CARPIO ,


respondent.

DECISION

PERALTA , J : p

This is a disbarment case against Atty. Macario D. Carpio filed by Valentin C. Miranda. 1
The facts, as culled from the records, are as follows:
Complainant Valentin C. Miranda is one of the owners of a parcel of land
consisting of 1,890 square meters located at Barangay Lupang Uno, Las Pias, Metro
Manila. In 1994, complainant initiated Land Registration Commission (LRC) Case No.
M-226 for the registration of the aforesaid property. The case was led before the
Regional Trial Court of Las Pias City, Branch 275. During the course of the
proceedings, complainant engaged the services of respondent Atty. Carpio as counsel
in the said case when his original counsel, Atty. Samuel Marquez, gured in a vehicular
accident.
In complainant's Af davit, 2 complainant and respondent agreed that
complainant was to pay respondent Twenty Thousand Pesos (PhP20,000.00) as
acceptance fee and Two Thousand Pesos (PhP2,000.00) as appearance fee.
Complainant paid respondent the amounts due him, as evidenced by receipts duly
signed by the latter. During the last hearing of the case, respondent demanded the
additional amount of Ten Thousand Pesos (PhP10,000.00) for the preparation of a
memorandum, which he said would further strengthen complainant's position in the
case, plus twenty percent (20%) of the total area of the subject property as additional
fees for his services.
Complainant did not accede to respondent's demand for it was contrary to their
agreement. Moreover, complainant co-owned the subject property with his siblings, and
he could not have agreed to the amount being demanded by respondent without the
knowledge and approval of his co-heirs. As a result of complainant's refusal to satisfy
respondent's demands, the latter became furious and their relationship became sore.
ASEcHI

On January 12, 1998, a Decision was rendered in LRC Case No. M-226, granting
the petition for registration, which Decision was declared nal and executory in an
Order dated June 5, 1998. On March 24, 2000, the Land Registration Authority (LRA)
sent complainant a copy of the letter addressed to the Register of Deeds (RD) of Las
Pias City, which transmitted the decree of registration and the original and owner's
duplicate of the title of the property.
On April 3, 2000, complainant went to the RD to get the owner's duplicate of the
Original Certi cate of Title (OCT) bearing No. 0-94. He was surprised to discover that
the same had already been claimed by and released to respondent on March 29, 2000.
On May 4, 2000, complainant talked to respondent on the phone and asked him to turn
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over the owner's duplicate of the OCT, which he had claimed without complainant's
knowledge, consent and authority. Respondent insisted that complainant rst pay him
the PhP10,000.00 and the 20% share in the property equivalent to 378 square meters,
in exchange for which, respondent would deliver the owner's duplicate of the OCT. Once
again, complainant refused the demand, for not having been agreed upon.
In a letter 3 dated May 24, 2000, complainant reiterated his demand for the return
of the owner's duplicate of the OCT. On June 11, 2000, complainant made the same
demand on respondent over the telephone. Respondent reiterated his previous demand
and angrily told complainant to comply, and threatened to have the OCT cancelled if the
latter refused to pay him.
On June 26, 2000, complainant learned that on April 6, 2000, respondent
registered an adverse claim on the subject OCT wherein he claimed that the agreement
on the payment of his legal services was 20% of the property and/or actual market
value. To date, respondent has not returned the owner's duplicate of OCT No. 0-94 to
complainant and his co-heirs despite repeated demands to effect the same.
In seeking the disbarment or the imposition of the appropriate penalty upon
respondent, complainant invokes the following provisions of the Code of Professional
Responsibility:
Canon 20. A lawyer shall charge only fair and reasonable fees.

Canon 16. A lawyer shall hold in trust all moneys and properties of his client
that may come into his possession.
Canon 16.03. A lawyer shall deliver the funds and properties of his client
when due or upon demand. . . .

In defense of his actions, respondent relied on his alleged retaining lien over the
owner's duplicate of OCT No. 0-94. Respondent admitted that he did not turn over to
complainant the owner's duplicate of OCT No. 0-94 because of complainant's refusal,
notwithstanding repeated demands, to complete payment of his agreed professional
fee consisting of 20% of the total area of the property covered by the title, i.e., 378
square meters out of 1,890 square meters, or its equivalent market value at the rate of
PhP7,000.00 per square meter, thus, yielding a sum of PhP2,646,000.00 for the entire
378-square-meter portion and that he was ready and willing to turn over the owner's
duplicate of OCT No. 0-94, should complainant pay him completely the aforesaid
professional fee. aDCIHE

Respondent admitted the receipt of the amount of PhP32,000.00, however, he


alleged that the amount earlier paid to him will be deducted from the 20% of the current
value of the subject lot. He alleged that the agreement was not reduced into writing,
because the parties believed each other based on their mutual trust. He denied that he
demanded the payment of PhP10,000.00 for the preparation of a memorandum, since
he considered the same unnecessary.
In addition to the alleged agreement between him and complainant for the
payment of the 20% professional fees, respondent invoked the principle of "quantum
meruit" to justify the amount being demanded by him.
In its Report and Recommendation 4 dated June 9, 2005, the Integrated Bar of
the Philippines-Commission on Bar Discipline (IBP-CBD) recommended that
respondent be suspended from the practice of law for a period of six (6) months for
unjustly withholding from complainant the owner's duplicate of OCT No. 0-94 in the
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exercise of his so-called attorney's lien. In Resolution No. XVII-2005-173, 5 dated
December 17, 2005, the IBP Board of Governors adopted and approved the Report and
Recommendation of the IBP-CBD.
Respondent led a motion for reconsideration of the resolution of the IBP Board
of Governors adopting the report and recommendation of the IBP-CBD. Pending the
resolution of his motion for reconsideration, respondent led a petition for review 6
with this Court. The Court, in a Resolution 7 dated August 16, 2006, directed that the
case be remanded to the IBP for proper disposition, pursuant to this Court's resolution
in Noriel J. Ramientas v. Atty. Jocelyn P. Reyala. 8
In Notice of Resolution No. XVIII-2008-672, dated December 11, 2008, the IBP
Board of Governors af rmed Resolution No. XVII-2005-173, dated December 17, 2005,
with modi cation that respondent is ordered to return the complainant's owner's
duplicate of OCT No. 0-94 within fteen days from receipt of notice. Hence, the present
petition.
The Court sustains the resolution of the IBP Board of Governors, which af rmed
with modi cation the ndings and recommendations of the IBP-CBD. Respondent's
claim for his unpaid professional fees that would legally give him the right to retain the
property of his client until he receives what is allegedly due him has been paid has no
basis and, thus, is invalid.
Section 37, Rule 138 of the Rules of Court specifically provides:
Section 37. Attorney's liens. An attorney shall have a lien upon the funds,
documents and papers of his client, which have lawfully come into his
possession and may retain the same until his lawful fees and disbursements
have been paid, and may apply such funds to the satisfaction thereof. He shall
also have a lien to the same extent upon all judgments for the payment of money,
and executions issued in pursuance of such judgments, which he has secured in
a litigation of his client, from and after the time when he shall have caused a
statement of his claim of such lien to be entered upon the records of the court
rendering such judgment, or issuing such execution, and shall have caused
written notice thereof to be delivered to his client and to the adverse party; and he
shall have the same right and power over such judgments and executions as his
client would have to enforce his lien and secure the payment of his just fees and
disbursements. EcDTIH

An attorney's retaining lien is fully recognized if the presence of the following


elements concur: (1) lawyer-client relationship; (2) lawful possession of the client's
funds, documents and papers; and (3) unsatis ed claim for attorney's fees. 9 Further,
the attorney's retaining lien is a general lien for the balance of the account between the
attorney and his client, and applies to the documents and funds of the client which may
come into the attorney's possession in the course of his employment. 1 0
In the present case, complainant claims that there is no such agreement for the
payment of professional fee consisting of 20% of the total area of the subject property
and submits that their agreement was only for the payment of the acceptance fee and
the appearance fees.
As correctly found by the IBP-CBD, there was no proof of any agreement
between the complainant and the respondent that the latter is entitled to an additional
professional fee consisting of 20% of the total area covered by OCT No. 0-94. The
agreement between the parties only shows that respondent will be paid the acceptance
fee and the appearance fees, which the respondent has duly received. Clearly, there is
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n o unsatis ed claim for attorney's fees that would entitle respondent to retain his
client's property. Hence, respondent could not validly withhold the title of his client
absence a clear and justifiable claim.
Respondent's unjusti ed act of holding on to complainant's title with the obvious
aim of forcing complainant to agree to the amount of attorney's fees sought is an
alarming abuse by respondent of the exercise of an attorney's retaining lien, which by
no means is an absolute right, and cannot at all justify inordinate delay in the delivery of
money and property to his client when due or upon demand. 1 1
Atty. Carpio failed to live up to his duties as a lawyer by unlawfully withholding
and failing to deliver the title of the complainant, despite repeated demands, in the
guise of an alleged entitlement to additional professional fees. He has breached Rule
1.01 of Canon 1 and Rule 16.03 of Canon 16 of the Code of Professional Responsibility,
which read:
CANON 1 A LAWYER SHALL UPHOLD THE CONSTITUTION, OBEY THE LAWS
OF THE LAND AND PROMOTE RESPECT FOR LAW AND LEGAL PROCESS.

Rule 1.01 A lawyer shall not engage in unlawful, dishonest, immoral or deceitful
conduct.

CANON 16 A LAWYER SHALL HOLD IN TRUST ALL MONEYS AND


PROPERTIES OF HIS CLIENT THAT MAY COME INTO HIS POSSESSION.
Rule 16.03 A lawyer shall deliver the funds and property of his client when due
or upon demand. However, he shall have a lien over the funds and may apply so
much thereof as may be necessary to satisfy his lawful fees and disbursements,
giving notice promptly thereafter to his client. He shall also have a lien to the
same extent on all judgments and executions he has secured for his client as
provided for in the Rules of Court.
EcTDCI

Further, in collecting from complainant exorbitant fees, respondent violated


Canon 20 of the Code of Professional Responsibility, which mandates that "a lawyer
shall charge only fair and reasonable fees." It is highly improper for a lawyer to impose
additional professional fees upon his client which were never mentioned nor agreed
upon at the time of the engagement of his services. At the outset, respondent should
have informed the complainant of all the fees or possible fees that he would charge
before handling the case and not towards the near conclusion of the case. This is
essential in order for the complainant to determine if he has the nancial capacity to
pay respondent before engaging his services.
Respondent's further submission that he is entitled to the payment of additional
professional fees on the basis of the principle of quantum meruit has no merit.
"Quantum meruit, meaning 'as much as he deserved' is used as a basis for determining
the lawyer's professional fees in the absence of a contract but recoverable by him from
his client." 1 2 The principle of quantum meruit applies if a lawyer is employed without a
price agreed upon for his services. In such a case, he would be entitled to receive what
he merits for his services, as much as he has earned. 1 3 In the present case, the parties
had already entered into an agreement as to the attorney's fees of the respondent, and
thus, the principle of quantum meruit does not fully nd application because the
respondent is already compensated by such agreement.
The Court notes that respondent did not inform complainant that he will be the
one to secure the owner's duplicate of the OCT from the RD and failed to immediately
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inform complainant that the title was already in his possession. Complainant, on April 3,
2000, went to the RD of Las Pias City to get the owner's duplicate of OCT No. 0-94,
only to be surprised that the said title had already been claimed by, and released to,
respondent on March 29, 2000. A lawyer must conduct himself, especially in his
dealings with his clients, with integrity in a manner that is beyond reproach. His
relationship with his clients should be characterized by the highest degree of good faith
and fairness. 1 4 By keeping secret with the client his acquisition of the title, respondent
was not fair in his dealing with his client. Respondent could have easily informed the
complainant immediately of his receipt of the owner's duplicate of the OCT on March
29, 2000, in order to save his client the time and effort in going to the RD to get the title.
Respondent's inexcusable act of withholding the property belonging to his client
and imposing unwarranted fees in exchange for the release of said title deserve the
imposition of disciplinary sanction. Hence, the ruling of the IBP Board of Governors,
adopting and approving with modi cation the report and recommendation of the IBP-
CBD that respondent be suspended from the practice of law for a period of six (6)
months and that respondent be ordered to return the complainant's owner's duplicate
of OCT No. 0-94 is hereby af rmed. However, the fteen-day period from notice given
to respondent within which to return the title should be modi ed and, instead,
respondent should return the same immediately upon receipt of the Court's decision.
WHEREFORE , Atty. Macario D. Carpio is SUSPENDED from the practice of law
for a period of six (6) months, effective upon receipt of this Decision. He is ordered to
RETURN to the complainant the owner's duplicate of OCT No. 0-94 immediately upon
receipt of this decision. He is WARNED that a repetition of the same or similar act shall
be dealt with more severely.
Let a copy of this Decision be furnished to the Of ce of the Bar Con dant, to be
appended to the personal record of Atty. Macario D. Carpio as a member of the Bar; the
Integrated Bar of the Philippines; and the Of ce of the Court Administrator for
circulation to all courts in the country for their information and guidance. acEHCD

SO ORDERED.
Abad, Perez, * Mendoza and Perlas-Bernabe, JJ., concur.

Footnotes

* Designated additional member in lieu of Associate Justice Presbitero J. Velasco, Jr., per
Special Order No. 1102 dated September 21, 2011.
1. The case was initially referred by this Court to the Integrated Bar of the Philippines for
investigation, report and recommendation and docketed as ADM. Case No. 6281; rollo, p.
36.
2. Rollo, pp. 7-10.
3. Id. at 24.
4. Id. at 312-323.
5. Id. at 311.
6. Id. at 273-281.
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7. Id. at 325.
8. A.C. No. 7055, July 31, 2006, 497 SCRA 130, 137-138. In that case, the Court held that:
In concurrence with the above, now, therefore, BE IT RESOLVED, as it is hereby resolved,
that in accordance with our ruling in Halimao v. Villanueva, pertinent provisions of Rule
III of the Rules of Procedure of the Commission on Bar Discipline, as contained in the By-
Laws of the IBP, particularly 1 and 2, are hereby deemed amended. Accordingly, 1 of
said rules now reads as follows:
SECTION. 1. Pleadings. The only pleadings allowed are verified complaint, verified
answer, verified position papers and motion for reconsideration of a resolution.
(Emphasis supplied.)
And in 2, a motion for reconsideration is, thus, removed from the purview of the class of
prohibited pleadings.

Further, the following guidelines shall be observed by the IBP in respect of disciplinary
cases against lawyers:

1. The IBP must first afford a chance to either party to file a motion for
reconsideration of the IBP resolution containing its findings and recommendations
within fifteen (15) days from notice of receipt by the parties thereon;
2. If a motion for reconsideration has been timely filed by an aggrieved party, the IBP
must first resolve the same prior to elevating to this Court the subject resolution together
with the whole record of the case;
xxx xxx xxx
5. For records of cases already transmitted to this Court where there exist pending
motions for reconsideration filed in due time before the IBP, the latter is directed to
withdraw from this Court the subject resolutions, together with the whole records of the
cases, within 30 days from notice, and, thereafter, to act on said motions with
reasonable dispatch.
9. Ampil v. Hon. Agrava, 145 Phil. 297, 303 (1970). (Emphasis supplied)
10. Id. at 305-306.
11. Lemoine v. Atty. Balon, Jr., 460 Phil. 702, 714 (2003).
12. Rilloroza v. Eastern Telecommunications Phils., Inc., 369 Phil. 1, 11 (1999).
13. Lorenzo v. Court of Appeals, G.R. No. 85383, August 30, 1990, 189 SCRA 260, 264.
14. Schulz v. Atty. Flores, 462 Phil. 601, 613 (2003).

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